From the Compendium on Social Doctrine of the Catholic Church:
547. The lay faithful should act according to the dictates of prudence, the virtue that makes it possible to discern the true good in every circumstance and to choose the right means for achieving it. Thanks to this virtue, moral principles are applied correctly to particular cases. We can identify three distinct moments as prudence is exercised to clarify and evaluate situations, to inspire decisions and to prompt action. The first moment is seen in the reflection and consultation by which the question is studied and the necessary opinions sought. The second moment is that of evaluation, as the reality is analyzed and judged in the light of God's plan. The third moment, that of decision, is based on the preceding steps and makes it possible to choose between the different actions that may be taken.
548. Prudence makes it possible to make decisions that are consistent, and to make them with realism and a sense of responsibility for the consequences of one's action. The rather widespread opinion that equates prudence with shrewdness, with utilitarian calculations, with diffidence or with timidity or indecision, is far from the correct understanding of this virtue. It is a characteristic of practical reason and offers assistance in deciding with wisdom and courage the course of action that should be followed, becoming the measure of the other virtues. Prudence affirms the good as a duty and shows in what manner the person should accomplish it. In the final analysis, it is a virtue that requires the mature exercise of thought and responsibility in an objective understanding of a specific situation and in making decisions according to a correct will.