Time Inconsistency

When we think about the future we want to make choices that lead to long-term benefits (“Yes, I'll save more!”), but when we think about today, we want to make choices that lead to short-term. immediate benefits (“I'll spend it right now.”). ...

We all like to feel good about ourselves in the moment, even if it interferes with our long-term goals.

But instead of letting our present self make the decision, we need to bring our future self into the decision-making process to help us think about the future consequences.

• Projection bias can occur because we don’t realize how much exogenous factors — things that happen outside of our control — can influence our decision-making.
• Overestimating impact. When we are faced with significant life events, lik...