Present bias as of · 209
In a household notebook, Present bias is judged from . The line is “Behaviour is a rate” and the figure in the sum is 1. A blinking gain on a screen is not the reason. Money without a date is storytelling. Compounding and discounting both need a clock.
Why tomorrow’s compounder loses to today’s treat — and how defaults and commitment devices fight the skew. Present bias is the overweighting of immediate rewards that starves future contributions — a behavioural tax on every compounding plan. Present bias sits in the behavior family of this atlas: mechanisms first, products second, hype never.
Use the calculator for scenarios, then return to the section pages when you want the vocabulary behind the curve. What is present bias in one sentence? No. Tool-Lifes pages are educational atlases. Decisions need your goals, constraints and, when appropriate, a licensed adviser. Do I need a high return for compounding to matter?
Higher net rates help, but time and contributions often dominate — especially early. Costs and behaviour can erase a “good” rate. Treat outputs as scenario sketches. Vary contribution, rate, fees and inflation to see which lever moves your goal date. Always ask whether a figure is nominal or real. A high nominal path can still lose purchasing power.
For Present bias in , the figure that stays is 1, named “Behaviour is a rate.” Sparkle is not a figure.1
Figures to keep
- Year of the rule
- 1
- Figure in the sum
- 1
- Item
- Present bias
- Reason kept
- Behaviour is a rate