The impact of present bias on our lives may be something we don’t even realize is happening, but ultimately you could be sabotaging yourself. If you haven’t heard of it, the concept of present bias means, as humans, we’re often inclined to settle for a smaller reward if it’s in the present rather than waiting for something larger in the future.
It’s like an inability to deal with delayed gratification.
For example, when given a choice, many people might prefer to pay $100 today rather than wait a month to get $100.
If you chose the smaller amount of money today, that’s present bias in action.
A lot of why present bias exists may stem from our brains. Researchers believe that the concept of an award in the present activates our brain reward centre, so that’s what makes the decision instead of parts of the brain that could actually be better equipped for decision-making.
While present bias is something that affects everyone at some point or another, you can be mindful of it, and you can take steps to overcome it.
Be Aware
As mentioned, simply being aware of something like present bias is one of the best ways to overcome it.
Some people are probably more susceptible to the concept than others, and those are the very people that need to be especially aware.
Know that it’s normal to feel this way, but you can practice mindfulness about what’s driving your decision-making to hopefully make the one that’s better for the long term.
Automate Behaviors
One of the areas where present bias can be most harmful is when it comes to our finances. We might know that we should save money, but present bias puts us in a mindset where we think more about what we want to do now and less about things like retirement.
One way to overcome the effects of present bias on your finances, in particular, is to automate the behaviors you desire.
If you have a goal to set aside a certain amount of money that you’ll contribute to your retirement account every week or month, automate that. Put it on autopilot, so you don’t even have to think about it. It’s just happening, and it would take action on your part to undo that, so you’re less likely to take that action when you have to take time and think about it.
You can do this with other things too. For example, if your goal is to eat more healthy foods, maybe you get a delivery service so your meals arrive ready to go. If you want to save on your utilities, maybe you use a programmable thermostat.
There are a lot of ways to overcome a lack of willpower or the need to feel instant gratification.
Create a Habit Cue
Habit cues are something that will trigger you to engage in the desired behavior. Maybe, for example, you put your medication next to your coffeemaker so you remember to take it every morning.
You can do this with other things. If you have a goal you’re saving for, put a picture of it in your wallet so that every time you reach for your money or credit cards, you see that goal.
If your goal is paying off a chunk of debt, create a progress chart and put it somewhere that you’re constantly seeing it and thinking about your progress or lack thereof.
Give Yourself an Instant Reward
Yes, present bias leads you to take the path of instant gratification, but there are ways you can instantly reward yourself when you take steps toward a long-term goal.
Think about some small ways that you can reward yourself when you make a choice to engage in behaviors that will be beneficial for you over the long term. For example, treat yourself to a coffee when you put money aside for retirement. Yes, you’re still spending money on coffee, but that’s a small amount compared to the benefits of saving for retirement actively. You can delay gratification but simultaneously get something beneficial instantly.
Have Someone Keep You Accountable
Finally, you can tell someone what your goals are. If you have a goal to save up for something, tell someone and make them your accountability partner. If you don’t do what you agreed to, then you have to tell your accountability partner you’ve failed. For a lot of people, the thought of having to do this is enough of a push in the right direction.
