Tag Archives: Brian Knutson

Change Future Time Perspective to Reduce Procrastination

Neil Lewis

Neil Lewis

Future events seemed more “proximal” or occurring sooner when volunteers considered in days rather than months or years.

This shift in perspective made the Future Self and the future event seem more tangible and connected to the Present Self, enabling participants to begin progress toward distant goals, according to University of Michigan’s Neil Lewis and Daphna Oyserman of the University of Southern California.

Daphna Oyserman

Daphna Oyserman

Many people know the dilemma between purchasing expensive clothes now instead of putting the money into retirement savings or between enjoying dessert now when “swimsuit season” is just weeks away.
This pull between current rewards and costs vs future events and required efforts was labeled temporal discounting by Stanford’s Kacey Ballard and Brian Knutson.

Kacey Ballard

Kacey Ballard

People may not act when considering future events like retirement because they focus more on whether to take action in the present.
In contrast, people tend to concentrate how to act when faced with imminent situations requiring attention, according to temporal construal theory, described by NYU’s Yaacov Trope and Nira Liberman.

Yaacov Trope

Yaacov Trope

Further, people may not act when an anticipated Future Self seems incongruous or disconnected with the Present Self, found Williams College’s Kris Kirby with Nancy Petry of University of Vermont and Virginia Tech’s Warren Bickel.

Nancy Petry

Nancy Petry

When volunteers have begun preparing for the future, such as a work presentation, saving for a home, retirement, or children’s education, they saw metrics implying when a future event will occur.

More than 160 volunteers considered six scenarios — three with time metrics and three without.
For the time-metric situations, participants imagined that they were shopping, studying, or carrying out other tasks in preparation for future events — a birthday party, presentation, wedding, exam — and were asked to report how long it would be until those events occurred.

Warren Bickel

Warren Bickel

When participants considered time in the smaller of two possible units, the event seemed closer – an average of 29.7 days sooner when considered in days instead of months and an average of 8.7 months sooner when considered in months instead of years.

In other Lewis and Oyserman studies, more than 1100 participants in the U.S. indicated when they should start saving for a future scenario such as a child’s college education, measured either as 18 years or 6,570 days.

Nira Liberman

Nira Liberman

People who realized that this event would arrive within days planned to start saving four times sooner than those who thought that educational expenditures were years away, even when controlling for income, age, and self-control.

In contrast, when participants hadn’t begun preparing for an expected future event, they considered metrics as implying when they should start preparing.

This difference in time perspective can affect whether people achieve future goals that require consistent, long-term investments of time, effort, and money.
In fact, Oyserman argues that changing time perspective is  “… a new way to think about reaching goals that does not require willpower and is not about having character or caring.

Brian Knutson

Brian Knutson

Since the majority of people do not save save sufficient financial resources for required future expenditures, changing time metrics to more granular measures can make both future goals and one’s Future Self more aligned with the Present Self.

-*How do you align Future Self with Present Self when working toward future goals?

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Genes and Neurotransmitters Influence Investment Risk-Taking: Implications for Taking Career Risks?

Camelia Kuhnen

Camelia Kuhnen

Brian Knutson

Brian Knutson

Camelia Kuhnen, then of Stanford with her Stanford colleague Brian Knutson and Vanderbilt’s Gregory Samanez-Larkin posit a small but meaningful genetic basis to risk-averse financial investing, providing a biological basis for findings that women hedge fund managers outperformed male counterparts.

Volunteers with two short serotonin transporter genes (5-HTTLPR) reported that they tend to worry, and this pattern was associated with chosing less risky investment choices.

Gregory Samanez-Larkin

Gregory Samanez-Larkin

“Short allele carriers” also showed higher levels of the personality trait “neuroticism,” but no significant difference in cognitive skills, education, or financial status.
Kuhnen estimates that less than 30 percent of variance in risk-taking is attributable to short 5-HTTLPR, and the remaining difference is derived from experience, culture, education, and social environment.

Kuhnen and Knutson reported the neural basis of financial risk taking using event-related fMRI.
They observed that the nucleus accumbens was activated before volunteers made risky choices and made risk-seeking mistakes.
In contrast, they found that the anterior insula was activated before risk-free choices and risk-aversion mistakes.

They proposed that different neural circuits are associated with differing emotions as volunteers anticipate gain or loss associated with financial choices.
This emotional activation “signature” can lead to specific investment choices, favoring or avoiding risk, and may lead to investing mistakes.

In unpublished research, Kuhnen found that short-allele carriers showed increased anxiety before making a decision in a trial-and-error risk discovery task, but reacted no differently than long-allele carriers when they observed a negative outcome.

She noted that volunteers differ in how they anticipate and react to a potential decision before they make it rather that in their reactions to actual outcomes of investment decisions.

Joan Chiao

Joan Chiao

Kuhnen, now at Northwestern collaborated with Northwestern colleague Joan Chiao to investigate the impact of both the 5-HTTLPR gene and the DRD4, gene, which regulates dopamine transmission.
These genes and their related neurotransmitters have been linked to emotional behavior, anxiety and addiction.

Their research replicated Kuhnen’s earlier finding that individuals with two short 5-HTTLPR alleles take 28% less risk than people with other combinations, and they demonstrated that the double DRD4 7 allele carriers took 25% more risk than people with other combinations.
They conclude that serotonin is associated with risk-averse investment choices, whereas dopamine is associated with riskier choices.

Kuhnen and Chiao argue that risky investment behavior shares commonalities with other risky behaviors like drug use, gambling, unsafe sex, dangerous physical and social pursuits, and more.

-*How do you determine the right amount of risk to undertake in career development and financial investing?

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