You go shopping for office clothes \u2013 and end up with three casual shirts and two pairs of jeans you just knew you wanted. You decide to go for a salad and soup meal and end up in an expensive restaurant with an impressive menu and end up ordering much more than you can eat. None of these incidents is unusual, but as time passes, your choices amount to a mounting and consistent trade off: You\u2019re choosing pleasure now in exchange for some possible financial discomfort in the future.<\/p>\n\n\n\n
Future cost or consequence doesn\u2019t seem like a big deal in the moment you make your choice, but combined together, these choices can add up to a pattern for which behavioral economists have a name: temporal discounting<\/strong>. This is a prime culprit for the poor decisions we make about money, life and what will really make us happy in the long run \u2013 by incorrectly feeling today\u2019s indulgence is worth more than an abstract future reward.<\/p>\n\n\n\n “Humans are not good at thinking about the future<\/em>,” said Moran Cerf, a business and neuroscience and professor at Northwestern\u2019s Kellogg School of Management. “We are the best animal out there in doing that, but still not good<\/em>.”<\/p>\n\n\n\n Study after study has shown that we humans tend to make myopic choices, because they feel like a good idea at the time \u2013 even when they really aren\u2019t. These include using high-interest credit, big spending on vacations but saving only a little for retirement; and focusing energy on immediate urges, like a craving for dessert, despite long term health and savings goals.<\/p>\n\n\n\n The good news is that our brains are equipped to think deliberately about future-looking abstract concepts \u2013 if we make the effort. What this might mean for you is that simply becoming more aware of poor choices could help you resist them. Whether you\u2019re trying to build your business or just stop being impulsive in general, long-term thinking is your friend.<\/p>\n\n\n\n Take it from Jeff Bezos, who titled his first shareholder letter, in 1997, “It\u2019s all about the long term<\/em>.” As he later told Harvard Business Review, “Long-term orientation is essential for invention because you\u2019re going to have a lot of failures along the way<\/em>.” Turns out, Bezos is onto something. Publicly traded companies with a long-term focus tend to perform better on everything from profits to market capitalization, according to a 2017 report from McKinsey, which analyzed 615 large-cap and mid-cap firms from 2001 to 2015.<\/p>\n\n\n\n So how do you hack your brain to get what you really want in life? The first trick is to understand your biases, be aware of your tendencies and keep perspective through having time for reflection, or consulting with a friend or coworker before making a decision to take on something new.<\/p>\n\n\n\n So how does one suppress these self-defeating impulses? Here are some steps you can take:<\/p>\n\n\n\n 1-\u00a0Prioritize your “needs” over your “wants.<\/strong>“<\/p>\n\n\n\n When you go out to eat, do you find yourself staring at the menu and wanting to order every single thing, from appetizer to dessert, because it all looks delicious? One way to make a quick decision that won\u2019t leave you with way more than you can eat \u2013 or afford \u2013 is to ask yourself the questions: Do you really need it<\/em>?<\/p>\n\n\n\n 2- Gain perspective on when less now means more later.<\/strong><\/p>\n\n\n\n In one classic study, participants were asked to choose what food to eat in a week, with the options of a piece of fruit or chocolate. Seventy-four percent went for the healthier option of fruit. But when they were asked what they wanted right now, 70% chose the chocolate.<\/p>\n\n\n\n A variation on this idea, known as hyperbolic discounting<\/em>, shows that the further you delay rewards, the more likely you are to make the smarter choice. For example, given the choice between one piece of chocolate now and two in a week, more people are likely to choose one now, Cerf said. But if you were given the option of one piece in a year or two pieces in a year and a week, most people would hold out the extra week.<\/p>\n\n\n\n 3- Make it difficult to choose poorly<\/strong><\/p>\n\n\n\n Sometimes it is hard to make the right choice when there are choices. One strategy is to take away the choices so for example do not keep chocolates within easy reach in the house.<\/p>\n\n\n\n 4- Create accountability<\/strong><\/p>\n\n\n\n Say you want to commit to going to the gym three times a week. If you decide to pay in advance for personal training sessions, for example, you are much more likely to follow through on your goal than you would be otherwise. Having a trainer makes you go when you are tired as the trainer adds a component of accountability.<\/p>\n","protected":false},"excerpt":{"rendered":" You go shopping for office clothes \u2013 and end up with three casual shirts and two pairs of jeans you just knew you wanted. You decide to go for a salad and soup meal and end up in an expensive restaurant with an impressive menu and end up ordering much more than you can eat.…<\/p>\n","protected":false},"author":5,"featured_media":3713,"comment_status":"closed","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[1],"tags":[],"class_list":["post-1883","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-uncategorized"],"yoast_head":"\n