To change our behaviour and get a long-term perspective in life we need to know why our focus tend to be short term. Science tells us that one reason is that our brains are wired to prioritize short-term gains over long-term ones. This is known as temporal discounting, and it means that we
tend to place a higher value on rewards that are closer in time, even if they are smaller than rewards that are farther away.
The are several strategies you can use to avoid temporal discounting:
1. Set specific, achievable goals: By setting specific, achievable goals,
you can establish a clear vision of what you want to achieve in the long
term. Do you have an exit strategy for your investment? When are you going to take profits? This can help you stay motivated and committed to your long-term investment plan.
2. Create a plan and stick to it: Develop a clear investment plan with
specific steps and milestones to reach your long-term goals. If a certain crypto investment drops by 90% what will you do? What will you do if a coin remains dormant for a very long time? Sticking to a plan can help you avoid impulsive decisions and stay focused on your
long-term vision.
3. Find an accountability partner: Partner with a trusted friend, family
member, or financial advisor who can help keep you accountable and on track with your investment goals. Regular check-ins and discussions can help you stay motivated and committed to your long-term plan.
4. Focus on the big picture: Try to keep the big picture in mind and
remind yourself of your long-term goals whenever you are tempted to make an impulsive decision. Remember that short-term gains may be tempting, but the long-term rewards of a disciplined investment strategy can be much greater.
5. Use tools and resources: There are many resources available to help
you avoid temporal discounting, such as budgeting apps, investment
calculators, and educational materials on personal finance and investment
strategies. Utilize these tools to help you stay on track with your
long-term investment plan.
By using these strategies, you can avoid temporal discounting and stay
focused on your long-term investment goals. Remember, achieving long-term financial success requires patience, discipline, and a commitment to your goals.