Understanding Commitment Devices and Future Self

The video discusses the story of Odysseus and the Sirens as an example of a commitment device, a strategy to resist temptation by binding oneself to a decision made with a cool head. It explores the psychological battle between the present and future selves, emphasizing the difficulty of resisting immediate gratification. The speaker shares personal experiences with commitment devices and their limitations, and introduces tools like the distribution builder and virtual reality to help people visualize their future financial selves and improve saving behavior.

What was Odysseus' strategy to resist the Sirens' song?

• He sang a louder song.

• He tied himself to the mast.

• He chose an alternate route.

• He covered his ears with wax.

What is a commitment device?

• A tool to enhance memory.

• A decision made to avoid future regret.

• A method to improve physical strength.

• A strategy to increase wealth.

Why is resisting temptation difficult according to the speaker?

• The future self has legal representation.

• Temptations are physically impossible to resist.

• The future self is more powerful.

• The present self is in control.

What is one drawback of commitment devices mentioned by the speaker?

• They are too expensive to implement.

• They can undermine self-discipline.

• They are only effective for financial goals.

• They require legal approval.

What was the speaker's personal commitment device during his post-doc?

• Writing five pages a day or losing five dollars.

• Reading a book or paying a fine.

• Exercising daily or donating to charity.

• Saving money or giving it to a friend.

What is the 'two selves' problem in the context of saving?

• Both selves want to spend.

• The present self wants to save, the future self wants to spend.

• The present self wants to spend, the future self wants to save.

• Both selves want to save.

What tool helps people visualize their future financial outcomes?

• The distribution builder.

• The retirement planner.

• The savings calculator.

• The investment simulator.

How does the distribution builder work?

• It calculates current expenses.

• It displays 100 equally probable future outcomes.

• It predicts exact future wealth.

• It shows a single outcome for the future.

What is the purpose of the virtual reality tool created by the speaker?

• To show users their future appearance and influence savings behavior.

• To entertain users with future scenarios.

• To calculate future expenses.

• To predict future market trends.

What is the main goal of the behavioral time machine?

• To predict future economic conditions.

• To calculate retirement age.

• To connect people with their future selves.

• To make people look younger.