You are here: mental models for 2026

In a recent post I entitled Your mental models are out of date, I argued that we give young people advice designed for an economy that no longer exists.

Responses I received both publicly and privately to that post split into three camps: agreement but despair, disagreement that anything fundamental has changed, and a smaller group asking what mental models would work better.

This follow-up post is for that third group.

Debates usually focus on tactics: university choices, getting on the housing ladder, or starting a pension. But I'm more interested in more holistic ways of responding to the rolling polycrisis we're in where “multiple crises interact in such a way that the overall impact exceeds the sum of each part.” We need updated mental models that can handle the complexity.

Most people do not have them. Not because they're stupid, but because the old mental models were fit for purpose in a different setting.

First-order thinking: linear causality

Most of us were taught to think about problems like this:

• Identify the problem
• Analyse the cause
• Implement a solution
• Problem solved ✅

This is linear, first-order thinking. A leads to B. So if you fix A, then B improves. This works for simple, contained problems. For example, if your car has a flat tyre, you replace the tyre. Problem solved.

The trouble is, 2026’s challenges do not work like this. They are neither simple nor contained. They are systemic. When you pull one lever, three other things move. And when you solve one problem, you often create two more elsewhere in the system.

Take the example from my original post: young people are told to obtain a degree as the solution to economic insecurity. That advice made sense when fees were low, jobs plentiful, and degrees genuinely opened doors. But when you scale that advice up and apply it across a whole generation, you get:

• Massive student debt (£53,000+ average in England)
• Credential inflation (now even entry-level jobs require degrees and experience)
• Universities as debt factories rather than public goods
• Young people who followed the “right” advice still unable to afford housing or secure stable work

The first-order effect was that education improved outcomes. But the second-order effects? Degrees became a mandatory gateway, costs exploded, returns diminished, and the overall debt burden reshaped life choices. Linear thinking cannot and did not see that coming.

Second-order thinking: asking “and then what?”

Second-order thinking is the practice of looking beyond immediate consequences to the next layers of effects. It's focused on indirect, delayed, and cascading cause-and-effect. We're thinking in systems.

To get started, for any decision or change, ask these three questions:

1. What is the immediate, first-order consequence?
2. And then what? What happens as a result of that consequence?
3. And then what? What happens next?

Applying this to housing:

• First-order: House prices rise faster than wages, making it harder to buy
• Second-order: People rent longer, landlords buy more property as investment, demand increases, prices rise further
• Third-order: Young people live with parents longer, delay forming households, consumer spending shifts, economic patterns change, political frustration grows

Each consequence becomes a cause of the next consequence. Linear thinking stops at the Daily Mail approach of “house prices are too high, so we need to build more houses.” Second-order thinking shows you why that alone will not solve the problem: building incentivises more investment buying, which in turn drives prices up again unless you address financialisation, landlord incentives, planning rules, and mortgage structures at the same time.

Going beyond first-order thinking does not mean doing nothing. Rather, it means seeing the whole game board before starting to move your pieces.

Problems can get worse when you “solve” them

Second-order thinking naturally leads to recognising feedback loops. Systems thinker Donella Meadows described these as the fundamental building blocks of any system. There are two types of feedback loops:

• Reinforcing loops (amplifying): where a change feeds back to create more of the same change – e.g. AI eliminates entry-level jobs, graduates cannot gain experience, employers demand experienced candidates, more automation to fill gaps, fewer entry-level jobs.
• Balancing loops (stabilising): where a change triggers a response that counteracts it – e.g. house prices rise, fewer buyers, prices stabilise or fall. Except, of course, if investors step in to buy, then the balancing loop breaks and a reinforcing loop takes over.

“Common sense” solutions often fail by ignoring feedback loops. In my original post I mentioned that 42% of Gen Z now hold two jobs, described as “a structural adaptation to a less forgiving labour market.” It's a response to precarity, but also subject to a feedback loop:

• Precarity increases, people take multiple jobs, employers see labour supply as elastic, offer worse terms, and precarity increases further.

The individual rational response (get a second job) reinforces the system-level problem (normalisation of precarity). Unless you see the loop, you will keep blaming individuals for “not working hard enough” whilst the structure tightens around them.

Cause and effect are often separated

One of the hardest aspects of systems thinking is that cause and effect are often separated in time. You do something today, and the real consequences show up months or years later. By then, you have forgotten the original action, or the context has changed, or you blame something else entirely.

Student debt is a good example. The decision to introduce and then raise tuition fees in England was taken in 1998, 2004, and 2012. The consequences appear now, in 2026, as:

• Graduates with debts of £53,000–£60,000
• Teachers deliberately avoiding career progression to stay below repayment thresholds
• One in five young people likely to have a mental health condition – with financial stress a significant factor
• Trust in institutions collapsing to 14%, as people see the system punish those who followed its advice

The people who made those original decisions are largely gone or retired, and the people suffering the consequences were children at the time. This time delay makes accountability nearly impossible and allows the same failed mental models to persist, because the people still making decisions don't experience the feedback.

Without grasping time delays, we keep solving yesterday's problem whilst creating tomorrow's crisis.

Beliefs that shape the system

Systems do not just consist of physical structures, policies, and behaviours. They are made up of the mental models people hold about how the system works.

The charity sector organisation FSG defines mental models as “deeply held beliefs and assumptions and taken-for-granted ways of operating that influence how we think, what we do, and how we talk.” They remain largely invisible, which makes them powerful. You do not question them because you just assume that is how the world is.

Examples of mental models embedded in UK society:

• Hard work leads to prosperity (assumes a functioning meritocracy)
• Property ownership is wealth building (assumes accessibility to the housing ladder)
• Individual responsibility solves problems (assumes structural fairness)

These were more accurate 30–40 years ago but they have become progressively less true as structures changed. Wages are now decoupled from productivity, the housing market is financialised, university fees have exploded, and social mobility has stalled. But the mental models persist.

The reason I think my original post struck a nerve is that it named this gap. Young people are living this reality on a daily basis, while older generations still carry mental models formed in a different economy. When those older generations give advice, they are handing over a map of a country that no longer exists. Then they have the temerity to blame young people for getting lost!

FSG's research suggests that “shifting mental models is a prerequisite to achieve systems change.” You cannot redesign a system if the people with influence still think the old system is working fine, or that problems are individual rather than structural.

Three mental models for 2026

So what are the alternatives? Based on systems thinking principles, here are three mental models better suited to an era of polycrisis.

1. Portfolio thinking

Old model: There is one correct path (degree, career, house, pension). Optimise your choices along that path.

New model: There are multiple contingent paths through an unstable system. Build a portfolio of skills, income streams, relationships, and forms of security, not all of which are financial.

When entry-level jobs have dropped 32%, when any job can vanish, when a single degree no longer guarantees anything, then betting everything on one path is high-risk. Portfolios spread risk.

In practice, this might mean: some paid work, some learning, some community contribution, some building of skills or networks, some low-stakes experiments. Not all at once, but rotating over time. I believe in higher education, but I don't believe in being in £50,000+ worth of debt to prove skills you could have shown by earning a series of microcredentials.

2. Structural diagnosis

Old model: If someone is struggling, they made bad choices in life. The solution is therefore learning how to make better personal decisions.

New model: There are widespread structural problems. Individual adaptations matter, but they cannot substitute for systemic change.

When we have so many young people who are worried about money, have mental health issues, and who don't trust the government, this is not a collection of individual failures. That is a system producing those outcomes reliably.

Structural diagnosis does not remove individual agency but instead identifies where the levers are. Some levers are personal (skills, networks, location). Others are collective (policy, regulation, institutional design). Pretending all levers are personal just protects the structural levers from proper scrutiny.

3. Adaptive learning

Old model: Make a plan based on current conditions. Execute the plan. Adjust only if forced.

New model: Make a plan based on current conditions. Execute whilst watching for feedback. Adjust continuously as you learn what actually happens.

This is how feedback loops improve decision quality. You treat each action as a hypothesis, observe the results (first-order and second-order), learn from them, then adjust. Research suggests that organisations using active decision feedback loops will outperform peers by 30% in decision accuracy.

For individuals this might mean: try something, see what happens, learn, and pivot. Do not stake everything on one big bet such as an expensive degree, a single career path, or living in one location. You will feel trapped if and when it does not pay off. Build in flexibility and increase your serendipity surface.

You are here: 2026

In my original post I asked people to admit that the mental models they inherited no longer match current conditions. This follow-up goes a step further by suggesting a few mental models that might help.

These are not magical incantations: reading them out loud will not pay your rent or clear your student debt. But they will do is help you see the world more clearly, make better decisions within constraints you cannot control – and understand where collective action might actually change those constraints.

We are not going back to the world where the old mental models worked. That world required conditions such as cheap housing, rising wages, stable work, and state-funded education that no longer exist and show no signs of returning.

The choice, then, is whether to keep using maps of that vanished country and feeling lost, or learn to read the territory we actually inhabit.

You are here. In 2026. Systems are tangled, feedback loops are everywhere, time delays mask cause and effect, and linear thinking fails constantly. The mental models that help you see that clearly are your compass to navigating the polycrisis.