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Rainy day savings are incredibly important, because from time to time, bad things happen. And if you're not prepared for that, it's going to be really terrible.
Dan Ariely
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Dan Ariely
Age: 57
Born: 1967
Born: April 29
Economist
Pedagogue
Professor
Psychologist
University Teacher
Writer
New York City
New York
Important
Rainy
Going
Savings
Really
Incredibly
Things
Saving
Time
Prepared
Terrible
Happen
Happens
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The most difficult thing is to recognize that sometimes we too are blinded by our own incentives. Because we don’t see how our conflicts of interest work on us.
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When you're in pain, tomorrow doesn't exist - just the pain - and the only thing that you want in the world is for it to go away.
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When we think about labor, we usually think about motivation and payment as the same thing, but the reality is that we should probably add all kinds of things to it - meaning, creation, challenges, ownership, identity, pride, etc.
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When you get a checking account, you should have a savings account, and the number for the savings account should be one off of your checking account.
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The things that motivate us are to help other people, to feel that we're useful, to feel that we're getting better, to feel that we are kind of living to our potential, to get a sense of meaning. All of those things are positive.
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People are irrational - and predictably so.
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What kind of people would be able to rationalize better than other people? Better storytellers, right? Creative people, right? Because if you're creative, you find more ways to cheat and still yourself a story about why this is okay.
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It is helpful to think of people as having two fundamental motivations: the desire to see ourselves as honest, good people, and the desire to gain the benefits that come from cheating - on our taxes or on the football field.
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When people are in severe pain, there's an expression, you're a pain person, and what that means is that nothing else matters.
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Once you break the social norm and create a new social norm, all of a sudden it can stay with us for a long time.
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When it comes to the mental world, when we design things like health care and retirement and stock markets, we somehow forget the idea that we are limited. I think that if we understood our cognitive limitations in the same way that we understand our physical limitations … we could design a better world.
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The problem is that people basically dangle debt in front of us. And the cost for the poor of course is much higher than for the wealthy.
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Not all debt is bad. From time to time we should get into debt when there's a good reason for that.
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The experiments show quite clearly that, as you resist more and more temptation, you're actually more and more likely to fail.
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You can think about life as a battle between you and a doughnut shop. The doughnut shop wants you to eat another doughnut and pay the money, and you want to do it in the short term, but in the long term it's not good for you either financially or from a health perspective.
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It is very difficult to make really big, important, life-changing decisions because we are all susceptible to a formidable array of decision biases. There are more of them than we realize, and they come to visit us more often than we like to admit.
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But because human being tend to focus on short-term benefits and our own immediate needs, such tragedies of the commons occur frequently .
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I don't think we should go around life and being miserable all the time and feel the pain of paying. It's a question of what categories we want to spend more on and what categories we want feel that we are spending too much on and we want to cut down.
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Honesty is a complex and tricky thing, and we don't want to be honest all the time.
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In life we encounter many people who, in some way or another, try to tattoo our faces.
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