How to Spend Your Time and Money Better (with Nobel Prize Winner Richard Thaler)
New episode of The Happiness Lab: “How to Spend Your Time and Money Better (with Nobel Prize Winner Richard Thaler)”
As humans, we do a lot of things that don’t make much sense. We eat foods we know aren’t good for us. We put off simple habits like exercising or flossing, even though we know they’ll help us in the long run.
And yet, we also do some extraordinary things. We give blood, donate organs, and show kindness to strangers we may never meet again. To a perfectly rational outsider — say, a Vulcan from Star Trek — our mix of irrational mistakes and unexpected generosity would be baffling.
Happiness itself would be especially hard to explain. The things that make us feel good are often complex, counterintuitive, and not at all what a purely logical being would predict.
I can’t sit down with a Vulcan to talk this through, but in this week’s episode, I get to do the next best thing: chat with Nobel Prize–winning economist Richard Thaler about a fresh, updated edition of The Winner’s Curse—a tour of the lovable (and fixable) ways humans are not Vulcans.
Happiness scientists often wonder about cases of “hyperopia,” where you up saving these good things for the future that you never end up enjoying. — Dr. Laurie Santos
How to Outsmart Your Quirks
Stop waiting for the perfect moment.
We tend to hold onto our best things — the nice wine in the pantry, the saved miles in our frequent flyer accounts, the perfect tomato in the fridge — waiting for a “special occasion” that never comes. Psychologists call it hyperopia—being so focused on the future that we neglect our happiness in the present. Don’t fall into the “hyperopia trap.” Balance long-term planning with savoring the small pleasures available right now.
Don’t confuse “winning” with being better off.
In auctions, we often bid high to “win.” But the very fact that we won usually means we overpaid, leaving us worse off than if we’d lost.Use windfalls wisely.
When money feels like “extra,” we often waste it — like spending gas savings on premium fuel our cars don’t need. Instead, channel those unexpected dollars into things that really boost happiness, like experiences (travel or meals with friends), acts of kindness (spending money on others), or time affluence (using money to buy back time).Don’t let inertia decide for you.
Our tendency to cling to what we already have can keep us stuck with mugs, gym subscriptions, and habits we don’t need. Make inertia work for you by setting up automatic systems — like saving for retirement, meal planning, or weekly catch-ups with friends — that run in your favor.
Take Action This Week: Flip the status quo toward happiness. Use your inertia for good: set a recurring calendar reminder to call a loved one, or auto-schedule a weekly dinner with a friend. Let your defaults work in your favor.
Share your holiday woes with us!
Share Your Worst Holiday Moments
I know the holidays might feel far away right now, but I’m already working on a Happiness Lab episode about how tough (and funny!) they can be. From family feuds to travel nightmares to gift-giving gone wrong—I want to hear your worst holiday stories and biggest holiday challenges.
Email happiness@yale.edu and share your story in a short selfie video, audio clip, or written message—you might just hear it featured on the show with a surprise celebrity guest.
Bonus points if you can guess who our surprise co-star is for the episode!
Remember: once we know our quirks, we can design around them and make choices that leave us a little bit happier.
Remember: once we know our quirks, we can design around them and make choices that leave us a little bit happier.
Looking for more?
You can find all our companion guides from this season of The Happiness Lab on DrLaurieSantos.com/Newsletter.
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