What have you been front-loading ?
Benefits or Costs?
“People are impatient—they like to experience rewards soon and delay costs until later” - From the ‘Doing it now or Later’ paper written by Ted O'Donoghue and Matthew Rabin
Do remember this quote as I will elaborate on this very soon. But, let’s take this piece forward with a survey I have in mind -
What’s your favorite dessert - __________
What’s your favorite TV channel / OTT platform - ________
What's your favorite past time or leisure activity - ________
What activity do you dread going through - ________
What assignment or activity bores you the most - ________
Anything that you have been procrastinating for days or weeks - ________
Do think about these before you proceed. Take a few seconds more seconds.
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If you have written these down or thought them through, then let’s do a thought exercise on your answers -
How do you explain your tendency to pounce on an activity eg. watching your favorite show on an OTT platform while the same you struggles with procrastinating _________ for weeks or months? (could be any of the last 3 answers in the survey above)
This means that you procrastinate only when the activity is associated with a cost or a price to pay i.e. effort, discomfort, or boredom. But, if the activity is associated with benefits like pleasure, relaxation, or joy - then you would pounce on it right away.
Does this make you a procrastinator since you delay things sometimes? Or does this make you proactive since you seem to act immediately sometimes? It’s a trick question actually. It’s got nothing to do with the specific activity. It rather comes down to your ability to understand the tradeoffs involved and your judgment in making good choices.
Frank Partnoy describes it as follows in his book WAIT - “Preproperation is the term for acting when we should wait. Procrastination is the term for waiting when we should act. When scientists test preproperation and procrastination together, they find that both are associated with the same variable: high discount rates.”
Discount rates here refer to an individual’s tendency to perceive a desired result in the future as less valuable than one in the present. Hence you would notice yourself binge-watching your favorite shows because you perceive the consumption of it in the present as way more valuable compared to its consumption in the future. And discounting is the same reason that makes you procrastinate your workouts or reading habit because you perceive that you would do these later instead of now.
In mathematical terms, your discount rate is very high for activities that have benefits like pleasure or joy. Hence you value them more now, right now. Whereas your discount rate is really low for activities that involve discomfort or effort. Hence you postpone, thinking that the costs are merely nominal for doing so.
Or, you may be ok with postponing activities due to the overconfidence bias all humans tend to exhibit - try explaining billions of dollars won by casinos every year through games of chances like roulette or slot machines. Another extreme example of overconfidence bias was millions of people moving around without a mask in many countries during the COVID epidemic from 2020 - 2021.
This is a problem actually because it makes you wait while you should act on the important stuff, stuff that matters and moves the needle in your life. And it's the same tendency that seduces you into doing things now that could have waited. This tendency derails you from accomplishing goals and even interrupts you from giving 100% to the current moment.
Robert Sternberg has a profound statement in this regard “Intelligence would seem to be knowing when to think and act quickly and knowing when to think and act slowly”.
And the irony of life is that marketers are aware of most of the tendencies that make you act irrationally. Let me share a few examples -
A paid newsletter provides you with a trial period of 7-30 days and you are tempted to subscribe to it thinking that you will make a final decision in this trial period. If the decision is to discontinue the subscription, then you would go online and cancel the same.
It’s a good thought process and practical sounding too. But have you been successful at canceling all your subscriptions on time?
How many times did you realize that your card has been debited with the amount and you rationalized it by saying, “It’s ok. Let me try it for some time.” ?
An invitation to make a quick buck through a tip or inside information is very tempting, especially if you have a perception that the source is very credible and knows what he is doing. In an extreme case, maybe the source is a hero to you and you want to emulate him, so you go ahead and make the purchase.
Again it sounds reasonable that you made the investment, but does it pan out in your favor always?
Have you lost money by borrowing someone else’s conviction? Have you paid the price too - either by monetary loss or reputational damage?
I have suffered from both and have realized that my tendencies are purely part of being human and I may get sucked into making wrong calls again. And hence I cannot depend solely on my gut instincts or System 1 Thinking i.e. intuitions/memory/default response.
If you can speak your native language fluently, then it comes from System 1 Thinking. Whereas System 2 Thinking requires a mindful approach with deep thought given to it e.g. speaking in a language that you have started learning recently. It can be time-consuming and hence is put to use only for the most crucial decisions, or rarely at all for many people.
Since I cannot expect myself to put deep thought to all my choices at all times, I have chosen to devise ways and protocols that build guardrails around me acting too soon when I should wait, or waiting too long when I should act. Let me share with you a few examples -
Gyming - I have hired a personal coach and I have paid him 3 months’ training fee in advance. That’s a decent outflow and I am not gonna make it go to waste. I also don’t want to disappoint him by going late or postponing my sessions week after week. There is something at stake (money) and I don’t want to lose it. In this case, I am making loss aversion work wonders for me.
Investing - I have systematic investment set up in many mutual funds i.e. these are monthly auto-debits that happen around my salary credits. This becomes forced savings for me as money gets allocated for the future even before I withdraw anything for lifestyle or personal expenses. It could be a small amount, to begin with, but my future gets taken care of through these regular infusions on a monthly basis.
Nutrition - I have deployed commitment bias in a way that my environment supports me against my own tendencies to give into my sweet cravings. The simple things that I have done are -
No sugar / sugar-laced foods are available in the kitchen. Even if my lizard brain takes over and wants to feast on goodies, there is nothing available at that very moment. The lack of these foods around me, itself gives me enough time to think through my choices.
Enough nuts/protein bars/coffee are available in the office and at home at all times. At no point in time am I left hungry and this helps me to be balanced in my thinking, instead of getting hangry and losing the plot. I even carry a protein bar with me at all times, in case if needed.
I often share with people about my desire to live a healthy and long life. I must have repeated so often that by now my friends always have a healthier option for me during parties/ my birthdays. I often get to eat sugar-free, gluten-free, and dairy-free treats. I love it ;)
Lifestyle Expenses - I have a pact with my wife that every time I am tempted to buy something, I should just call her and inform her. She won’t stop me but she will question me a thing or two about the item of purchase. It’s just these few moments that delay my temptation to spend some money and the decision is postponed or cancelled completely.
Eg. I recently got tempted to change my car and went for trial runs for few cars, and I did love a few of them, especially the VW Touareg R Line. Just before booking the same, I called her to discuss about my noble intentions ;) It just took 2-3 minutes of a fruitful discussion and I dropped the idea completely.
I am a human being and it would be really stupid of me to think that I will act rationally at all times. I won’t. I will discount my future differently and will be trapped into making wrong choices in the present moment i.e. do what is exciting and delay what takes effort. This isn’t going to get me anywhere.
Even this very blog post was a hurdle for me in the last few days. I wasn’t keeping well and so was my wife. We spent more than 3 hours yesterday running between hospitals and clinics. But my Twitter profile reads as follows 👇
I had to submit the piece because I have declared it to the world. It was you, the community, that made this possible. You didn’t ask for it, you may not have even noticed. But I have made it public that I will post every Saturday, and hence here I am writing this out. I am a day late in publishing, but it’s way better than missing out completely. So thank you to all !!
I invite you to think about the answers to the survey again. There is work to be done here so that you don’t land up making choices that harm you in the long term while making your present filled with joy and excitement.
Every action has an equal and opposite reaction. So be mindful of your own quirks/habits and create systems or protocols that guide you to choose well. Living well is the least of the responsibilities that you and I should be executing well. And we can !!!
Wishing you all a fantastic weekend and a smashing week ahead.
Sending you loads of love and luck 🧿
Manish
Nice one!