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Hot states are dangerous for our budgets

Our cold, higher thinking is slow thinking, and hot thinking is fast thinking.

As humans, we struggle to balance the two thinking processes. In a hot state, we have an enormous desire to want. We want to buy impulsively with no concern for our future selves. As countries reopen, the hot states will strike intensely and be very dangerous for our budgets.

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The hot state decision making

One factor that will determine how we behave is where we fall on the cold or hot state of the spectrum.

A hot state is when our emotions like fear or exhaustion take over. We are so eager for something that we will grab it the moment it becomes possible. Over the last year, an enormous amo...

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Our minds are more than spreadsheets

Our minds are more than spreadsheets

After a year of holding back on festivals, plays, or going out without concern about a deadly virus, many of us will spend beyond our limits if we don't prepare for the powerful emotions that will sweep through us.

Our minds are not just based on mathematical equations but...

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How to plan for the hot state

Pay attention to the moral licensing words, "I deserve it because..." The permission-giving has some truth to it, but then there's future you that also deserves the good.

  • In order to satisfy both worlds, set aside some cash now that is safe to spend without putting y...

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Awareness of our biases

  • If you think you won't fall for a hot state, you might rely on your restraint bias - the bias that makes you overestimate your ability to resist impulsive behaviour.
  • If you think because you've been so good by limiting yourself, you deserve a little bit of indulgence, that's moral ...

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CURATED FROM

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lolaf

"You have to go broke three times to learn how to make a living." ~ Casey Stengel

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