Tuesday 10 September 2013

Are You Sabotaging Your Best Intentions?


“Self-Control is not a problem in the future, it is only a problem now.”
- Shlomo Benartzi
According to eminent psychologist Daniel Kahneman, we each have two selves. There's the Experiencing Self, which lives life continuously and is aware of what is happening about 3 seconds at a time. And then there's the Remembering Self, which thinks it remembers most of what happens, but which actually remembers very little.

Kahneman believes the Remembering Self can (and often does) sabotage our best intentions. Kahneman's insights carry a lot of weight. He's a former Nobel Memorial Prize winner, one of Foreign Policy magazine's "top global thinkers", and the author of the best-seller Thinking, Fast and Slow.

Let's see how his theory works in practice. What do you remember about July and August? You experienced a lot in those two months: more than 1.6 million three-second intervals. But, if asked what you remember about the summer, what would you say? How long could you talk about your summer? Twenty or thirty minutes perhaps? That is not much compared with the 80,000 minutes you actually lived during July and August.

Although your mind only remembers a fraction of what you think about moment by moment, your Remembering Self makes almost all of your decisions. Here's where the sabotage comes in. When we make decisions, we don’t choose between experiences - we choose between our memories (or our stories) of those experiences.

How many times has your Remembering Self promised you that you will:

  • Save more for your retirement
  • Exercise more regularly
  • Pay down your credit cards
  • Eat healthier foods
  • Stop procrastinating

And yet, when you actually experience the moments when you could put those promises into practice (your Experiencing Self), your Remembering Self sabotages the opportunity by remembering  a good reason why you can’t do it this minute.

But there's help at hand. Authors Richard Thaler and Cass Sunstein suggest we can overcome the 'can't do it now' message if we give ourselves a gentle nudge, rather than a giant task.

Nudge Yourself and Improve Your Life

According to their new book, Nudge, Improving Decisions About Health, Wealth, and Happiness, you can achieve your goals more easily, and live more happily, if you get into the habit of giving yourself... a nudge. For example, if you would like to increase your retirement fund, arrange with your bank to transfer $25, $50,or $100 per week into an RRSP fund. Once the arrangement is made, you will hardly notice the deduction, but you will enjoy seeing your fund steadily increase.

Want to eat more healthily? Here's how the nudge strategy works. Instead of declaring you are going to lose 10 pounds (a giant task), give yourself a nudge: remove all sugary, fatty, and salty snacks from your environment and replace them with your favorite fruits and veggies. You can also explore stickk.com to choose other nudges which will help you achieve your goals.

So, when that self-sabotaging Remembering Self tells you can't pay your debts, or improve your diet, or get fitter - give yourself a nudge.

Scarcity: Why Having so Much Means so Little

How is it that we can be so smart in many ways, and yet some of us can't manage our time? How come others are smart in different ways, but still find themselves maxed out on their credit cards? A new book helps us understand why the poor stay poor, and the busy stay busy.

In their book, Scarcity, Harvard economist Sendhil Mullainathan and Princeton psychologist Eldar Shafir paint an alarming picture of how completely scarcity - whether money or time or some other asset - colonizes our minds and destabilizes our decision-making.

Mullainathan and Shafir show that scarcity creates a similar psychology for everyone struggling to manage with less than they need. Busy people fail to manage their time efficiently for the same reasons the poor and those maxed out on credit cards fail to manage their money. The dynamics of scarcity reveal why dieters find it hard to resist temptation, and why students and busy executives mismanage their time.

Once we start thinking in terms of scarcity and the strategies it imposes, the problems of modern life come into sharper focus. Chronically busy people, suffering from a scarcity of time, demonstrate impaired abilities and make self-defeating choices, such as unproductive multi-tasking or neglecting family for work. Lonely people, suffering from a scarcity of social contact, become hyper-focused on their loneliness, prompting behaviours that render it worse.

Mullainathan and Shafir have written a book that provides a new way of understanding why the poor stay poor and the busy stay busy. And it reveals not only how scarcity leads us astray but also how individuals and organizations can better manage scarcity for greater satisfaction and success.

Richard Thaler and UCLA Economist Shlomo Benartzi have worked together for years on finding the crucial steps to help people save for the future. You might enjoy Benartze’s TED talk “Saving for Tomorrow, Tomorrow.”