”Hyperbolic discounting is the tendency for people to increasingly choose a smaller-sooner reward over a larger-later reward. Hyperbolic discounting has been applied to a wide range of phenomena. These include lapses in willpower, health outcomes, consumption choices over time, and personal finance decisions.” – Joseph Redden
We all want the immediate gratification of the present. What can be had today frequently seems better than what can be had in the future. Yet these series of small decisions that we face every day – do I have the salad or the fries? Do I spend money or save money? Do I go to the gym or sleep in? These and other small decisions that we make every day are how we define our future. Just avoiding the trap of hyperbolic discounting in one part of our lives will have an impact on our long term prospects.