"People who overweight the first-order consequences and ignore the effects that the second- and subsequent-order consequences will have on their goals, rarely reach their goals.”

- Ray Dalio. Founder of Bridgewater Associates.⁣

⁣We are wired to prefer short-term over long-term gains. Known as “hyperbolic discounting,” long-term ramifications of our decisions are not something that we intuitively consider when we make financial, health, and relationship decisions. In other words, we discount the value of future rewards as we are “present-biased.”⁣

⁣Suzy Welch, a business writer for publications such as Bloomberg Businessweek, wrote about the 10/10/10 rule in a book of a similar name. The rule has been used by Warren Buffet to avoid the immediate gratification effect of quick decisions in the business world. The strategy forces us to think ahead, and evaluate the decision by how we think about it after 10 minutes, 10 months, and 10 years.⁣

1. What are the consequences of my decision in 10 minutes?

For example, how would I feel 10 min after putting 10% of my revenue into a retirement account? I won't probably feel ecstatic. I think about all the things I could have done with this revenue.⁣

⁣2. What are the consequences of my decision in 10 months?⁣

10 months down the line, I will start to see accruing dividends on my investment. This will make me think that I have taken an "ok" decision. I’d still think about the things I could have bought with that 10% revenue money but I’d feel more comfortable that the money is growing.⁣

⁣3. What are the consequences of my decision in 10 years?

Appreciating the wealth growth over 10 years, I will look back and feel that putting this money into a retirement plan was perhaps the best decision!⁣

⁣*Suzy Welch, 10/10/10 rule⁣