You’ve noticed I’m sure how time can play tricks on us.
Like if you are bored, stuck in a meeting or a class, the minutes pass so slowly, but if you are having a ball on the weekend or vacation, the days fly by.
Here’s another trick time plays that is less obvious but more critical to our wellbeing.
We devalue the future.
In fact, the value we assign to things drops rapidly as we think about them in the months, weeks, or even days ahead, whether we’re considering a piece of cake or money or our future health.
We do this even though, assuredly, tomorrow is coming, a year from now is coming, twenty years from now is coming.
It’s all inevitable. Time passes. The future becomes now.
Behavioral economists call the tendency to overly discount the future, hyperbolic discounting, and we do it to such an irrational degree that it can negatively affect the decisions we make today about our future selves.
Here is what a hyperbolic discounting value curve looks like.
Traders might note that this looks like a backwardation curve, and they can think about it that way too.
It’s like a futures contract for our personal futures.
The Groundhog Day Bias
A big problem arises as a result of our tendency to devalue the future.
I call this the Groundhog Day Bias after the movie starring Bill Murray and Andi MacDowell.
As you might recall, Murray's character (Phil Conners) gets stuck in a loop in which the same day repeats itself over and over again.
In real life, the same calendar day does not repeat itself over and over again, obviously.
However, tomorrow does always become today.
Today is happening now. In 24 hours, tomorrow will be today, and in 48 hours, the day after tomorrow will be today.
Everyday out in the future eventually becomes today.
So if we are making decisions today that discount the value of the future, there is a fair chance that we are going to make the same decisions tomorrow and the day after that etcetera, forever, ad infinitum.
Here’s a definition:
The Groundhog Day Bias is the human tendency to make decisions in the present which discount the importance of the future and to repeat these decisions again and again as time passes, day after day.
So let’s say we are making decisions today that maximize our pleasure in the present but devalue our future health.
Maybe we decide to eat a big piece of our favorite cake today rather than prioritize the effects that cake might have on our health in 10, 20, or 30 years.
(I wrote more about the Price of Cake here.)
According to the Groundhog Day Bias, we’re going to choose to eat that piece of cake again tomorrow, and the next day and the next…
Why Do We Discount the Future?
Below, I’m going to walk through a remedy for Groundhog Day Bias, one that makes it easier for us to stop discounting and instead to fairly value our future selves, but first I’m going to discuss a possible cause.
Why do we devalue the future so much that we do things today like eat poorly or overspend?
We do it because we are not thinking vividly or feeling deeply about our future selves, the way we are thinking vividly and feeling deeply about our present selves.
In fact, we’re hardly thinking about or feeling for our future selves at all.
The Thousand Mile Journey Begins with Google Maps.
When we are going somewhere we’ve never been and we don’t know how to get there, we use Google Maps. It’s ubiquitous at this point.
We plug the address in, Google drops a pin in our destinations, and provides turn by turn directions.
It’s fantastic, especially for those of us with a poor sense of direction.
But in life, we don’t usually imagine where we are headed in the future. We don’t drop a pin in a life path destination or define things like traffic, turns, distance, and time.
A lot of times, we don’t even know where we’re headed.
We’ve never given it deep thought. We’ve never used our imaginations to picture in vivid detail what we want that future to look like.
We’ve never taken the time to imagine it or write out in detail our aspired destinations, that pin drop in the future, to review it on occasion, or to revise it as our aspirations change.
We never think through the path we can take to arrive at that future place, the things we might need to learn, the people we might need to consult with, and the stuff we must do.
And certainly, we never imagine our future selves at our aspired destinations in the future with such energy that we even feel on a deep emotional level.
We lack the thoughts and the feelings, so, of course we are going to discount it!
Today, we are thinking mostly about the stuff we are doing now and all the feelings we are having now. It’s all immediate and we are all up in it.
We are present-biased.
Maybe, we are anxious about a big presentation we have this afternoon or we are comfortably pleased, anticipating the carrot cake we just ordered for dessert after a wonderful meal.
The Remedy for Groundhog Day Bias
We can visualize in our mind where we want to be 5 or 10 or 25 years in the future.
We can take our time and picture vividly, using our imaginations to map details, like what we will look like, how we will feel, what we’ll be doing, what we’ll be wearing, how we’ll be able to move, and more.
Maybe there are big events like our children’s weddings or the birth of grandchildren or a bucket list trip somewhere we’ve always longed to go.
Whatever our aspirations.
We can write this stuff down and add more details over time or revise it as our plans for the future change.
We can visualize it in our minds again and again with new details and feel it with greater salience.
See Your Future, Make It Happen
This act, this dropping a pin in our time map, allows us to think about and to feel our future selves.
We can plan the steps necessary to reach this destination - the distance, the traffic, the turns.
Here is a visualization summary I wrote down a few years ago that has a profound influence on my thinking and feeling about events that are still many years in the future.
I see this in my mind often. It puts a premium on my future self and influences the actions I take today.
I love the visualization. Can't wait to walk with you at altitude!!