Why You Keep Making Bad Decisions (And How 'Nudge' Can Fix That)

Have you ever promised yourself to save more money, eat healthier, or exercise regularly, only to find yourself falling back into old habits? The frustration is universal, but the reasons are deeply rooted in how our minds work.

According to Nudge, our minds harbor two selves: the Planner, who envisions long-term goals and makes rational decisions, and the Doer, who craves immediate gratification and acts impulsively. This internal conflict explains why resolutions often fail once temptation strikes.

One key insight is the 'hot-cold empathy gap.' When calm, we underestimate how strong our desires will be in moments of temptation. For example, a person deciding to quit smoking may fail to anticipate how cravings will overwhelm their resolve later.

Furthermore, cognitive biases like anchoring cause us to rely heavily on initial information, even if irrelevant. Availability bias makes vivid or recent events disproportionately influence our judgments, such as fearing plane crashes more than car accidents despite statistics.

These mental shortcuts, while efficient, often mislead us. But the good news is that understanding these biases allows us to design interventions that help us succeed.

Take automatic enrollment in retirement savings plans. By making saving the default, participation rates skyrocket because the Doer tends to accept the status quo. The Save More Tomorrow program cleverly lets employees commit in advance to increasing their savings with future pay raises, easing the pain of immediate sacrifice.

Other commitment devices, like social contracts or alarms that run away, help the Planner keep the Doer in check. These tools reduce the burden of self-control and make good choices easier.

By recognizing these hidden mental forces and leveraging nudges, you can finally break free from the cycle of bad decisions and build habits that align with your true goals.

Stay tuned for our next blog where we'll explore how social influence shapes your choices and how to harness it for positive change.

Sources: Medium - The Art of Influencing Choices, Rare.org - On Nudging, EmbracePossibility.com - Nudge by Richard Thaler and Cass Sunstein 1 2 3