The Pitfalls of Low Time Preference

In psychology, you can be classified as low or high time preference. High time preference people are focused on living for the moment rather than the future. This cascades throughout their life in disastrous ways. They don't invest or plan. They end up impoverished, they don't save money, their homes and yards fall into disrepair. They place a large importance on things happening now, in the moment. They're more likely to do what feels good right now, like eat junk food, stay up late watching TV, play video games, and spend money rather than saving it. They don't want to wait. Time (right now) is everything.

Low time preference people don't care as much about the present moment. They plan for the future and invest. They contribute to their 401ks and keep up with their doctor and dentist visits. Their time horizon is expansive and far. They care less about things happening in the moment and are willing to delay gratification for long-term gain.

The implication throughout the psychological literature is that it is better to be low time preference than high time preference. They have better life outcomes, more educational attainment, higher incomes, and generally report being more satisfied with life. I would definitely agree that, as a whole, it's better to be low time preference.

But there are potential downsides and pitfalls to being low time preference. I'm surrounded by these people, and have been one all my life, and it's not a get-out-of-jail-free card.

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