What Was I Thinking?

Why we often have trouble acting in our best financial interests

Illustration by Leif Parsons for TIME

Biz; Investment Horizon: What Was I Thinking

Imagine you're buying a mobile phone that retails for $100. At the store, you learn the same phone sells for $75 two blocks away. Do you walk to the other store? Now imagine you're buying a ski jacket that sells for $800. At the shop, you learn the same coat goes for $775 at a branch two blocks away. Do you walk to that branch?

If you're like most people, you answered yes to the first question but no to the second, even though both essentially ask if you would walk two blocks to save $25. Such differing responses are examples...

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