Instant Gratification Bias

When We Take Ozempic and Put Bandages On a Gun Wound

The world moves fast. One moment we are on the beach, complaining about the weather and humidity, and the next moment the air’s so chilly you can see your breath in the morning. One moment you cannot wait to turn 21 so that you could have independence from your parents, and the next you’re 30 and counting seconds to go home for Christmas when mom cooks and takes care of you, and you get to be a child for a couple of days. In this fast-paced world, where not that many people keep a gratitude journal, it’s easy to forget to be thankful for what we have, are, and do at the moment and always look for that extra bit of pleasure whenever we can get at that very moment. “Instant gratification” lurks around every corner of our lives silently and mischievously.

We are constantly faced with decisions that require us to choose between “now” and “later.” Do we want something quick and easy now, or do we want something better but delayed? We constantly tend to prioritize the now over the later, whether it’s that extra cookie, the next episode of our favorite show, or that extra 10K that was offered to us by the headhunter. Now matters more: it’s human, it’s natural, and it’s very costly.

At the risk of being redundant, as I have compared the concept of financial and emotional investments far too many times, think of romantic relationships, for example. How often do people walk away from their partner because, in their own words, “they have to prioritize themselves and put their needs first and love themselves more,” whereas it's just that they are not getting what they want immediately? They literally “crave” validation and affection now, not realizing that the real phase of a relationship starts once the honeymoon phase is over, that enduring some dry spells might lead to something that they’ve been after their whole adult life, that it might just be worth it all, and they just need to see it through.

Or consider shopping behavior: we walk into a store in a perfectly fine-looking and relatively new pair of shoes just to buy the newer, trend-for-the-season pair just because we are having a bad day and we need that instant pleasure. We often spend beyond our means because the satisfaction of owning something right now outweighs the wisdom of waiting for a wiser and more favorable time, like during the Christmas sale or when we actually have the excess money to avoid credit card interest traps.

And then there’s the workplace, of course: we’re stuck in that dead-end job, we feel underappreciated and underpaid. Actually, let me rephrase: we know we are underappreciated, and we see ourselves as entitled to a raise. Our approach? The classic “why bother” attitude. Clock in, clock out. We do the bare minimum; we do exactly what's asked of us, no more, no less, unless we receive a raise or a promotion. We need to see change and rewards now, and since those don’t seem to be happening anytime soon, we see no reason to go that extra mile. We simply do not have the fuel to push more on the gas pedal. We do drive the car, though, and we do reach the destination, but right on the clock, just before the deadline.

What we fail to realize is that sometimes the investment of a bit more time and effort, especially when nobody’s asking, gets noticed. Most times, promotions and raises happen because of those extra miles, not because of hitting targets. But, as with so many things, the enticement of the right now blinds us to the long-term potential. Now, this is a touchy subject and a tricky example. Let’s put a pin in this and circle back at the end of this chapter.

These examples help to illustrate the core of instant gratification: it’s the desire for immediate rewards at the expense of future gain. This concept has its roots deep in human psychology and also human nature. Humans struggle with patience once they can conceptualize the rapid return.

Another noteworthy angle to the instant gratification bias is a macroeconomics concept called “time preference”. It basically captures our tendency to prioritize the current over the future. Most people choose to spend now rather than save for later. This concept, as simple as it sounds, affects countries’ national saving rates and investments; basically, one of the main pillars of a nation. This preference does not stop there and goes hand in hand with another bias called “the present bias”. Present bias is a behavioral tendency of individuals overvaluing immediate rewards and undervaluing future benefits, which often leads to impulsive spending and financial decisions. This bias has a significant and profound effect on long-term economic behavior, such as credit card spending and retirement planning.

To make the above a bit more tangible, let’s walk through a simple and already-proven example:

When given a choice between receiving €100 now or €500 a year from now, most people would choose €100 now. I work in asset management, and I have never come across an investment strategy that could (legally) get an investor 400% in a year, ever.

Our brains are programmed to prioritize the present. Back in ancient times, our ancestors had to flee from predators, hunt for food, build their own shelters, and could not afford to think long term. For them, gratification was about making it through the day. Nowadays, and especially in the first world, modern problems are barely ever about survival, but our brains remain the same and still respond similarly. When faced with something that promises an instant reward, our brain lights up and urges us to seize the opportunity. The future and its vague, uncertain promises seem far less appealing. The activation of the hypothalamus, which is a hormonal reaction, compels us to act on the spot. It is not just about feeling good instantly; it's about safety, security, and yes, a bit of entitlement and greed. Biologically, we are predisposed to favor the right now over later. Ironically enough, we often don’t realize the long-term consequences of our actions as we are unaware of why we feel such a strong pull towards instant gratification.

The trails of instant gratification do not stop at investments. With the election fever that we've been having lately, let’s think about politics for a moment. Most political campaigns are built on the promise of quick fixes: immediate tax cuts, rapid social reforms, instant jobs, immediate actions. These promises overlook two important factors: first of all, the taxes didn’t soar overnight, society’s been out of “form” for years, and unemployment is no kid 'round the block on the list of issues in a country. These problems weren’t caused within a day for the politicians to fix in a day. Secondly, quick solutions always have long-term consequences. They do not take into account the long-term effects and cater to a populace's hunger for immediate gains at the expense of later sustainable stability. Rapid diets and Ozempic shots don’t last long. The weight will come back hand in hand with severe health issues.

The bias towards immediate rewards can shape our decisions in unpredictable ways, and yet for many, the vicious circle continues. The present is just so tantalizingly close. Why wait and invest if we could have something tangible right now? But history has taught us one thing: patience is often the fine invisible line between success and failure. Speaking of history:

Now, as always, let's take a stroll down memory lane, shall we?

Throughout human history, the need for instant gratification has repeatedly led people down dark paths. Take the infamous Mississippi Company scheme in France, for example: in the early 1700s and after the war, France placed all its bets on the speculative potential of the American colonies, eager to solve its mounting debt. The Mississippi Company, founded and managed by John Law, is a classic example of how the temptation of instant gratification and quick fixes can shake an entire nation to its core. The company was established to fund the Banque Royale and fuel rapid economic growth through speculative investments in colonial trade. Law, a Scottish-French economist, was the mastermind behind the “Mississippi Bubble.” This chaotic collapse in the French economy started with John Law consolidating the trading companies of Louisiana into a single monopoly (the Mississippi Company), which eventually led to the devaluing of the Mississippi Company’s shares and the fall of the Banque Générale. France, left with wounds and financial devastation, not only was unable to pay its debt but also had to face the national discontent that ultimately helped spark the French Revolution.

Flash forward two centuries, Bernie Madoff’s Ponzi scheme has earned its spot in this chapter. Madoff basically broke all the basic economic rules and promised investors high returns with little risk. Tempted by the instant and substantial gains, nearly 5,000 clients invested significant sums without questioning the alpha source, the sustainability of the returns, or even conducting proper due diligence. It was only a matter of time before the Ponzi collapsed and it became impossible to recruit new investors to pay returns to the earlier ones. Everybody involved faced massive financial losses. The Bernie Madoff example illustrates the danger of sacrificing long-term security at the expense of short-term gratification. The pursuit of quick returns overshadowed any sort of rationale behind investment strategies.

The cryptocurrency boom of 2017–2018 is another example of instant gratification thirst and quick cash frenzy. Many novice traders, driven by pillow-talk stories of how they could become millionaires overnight, entered the market, bought Bitcoin and Ethereum, helped the price of the cryptocurrencies skyrocket, only to watch their life savings fade in the air not long after. The bias towards instant gratification manipulated them into believing that the upward trend would continue endlessly, not knowing that the high volatility of anything means that the prices would swing dramatically within short periods. Also, day trading cost money! Investors had to pay a significant amount of money on transaction costs, exchange fees, high spreads, and in some cases, network fees. Eventually, the market corrected, prices plummeted, and many lost.

Instant gratification has left its muddy footprints in our lives in many other ways and not just financially.

Back in 2011, people across the Middle East and North Africa just had it: they rose up and raised their voices against corruption, authoritarian rule, and economic hardship. The Egyptian Revolution was a defining moment in the broader wave of the “Arab Spring.” Moved and inspired by Tunisia’s rapid regime change, the Egyptians dreamed a dream and sought similar immediate relief: they believed that the surgical removal of President Hosni Mubarak, who ruled the nation for almost 30 years, would put out the flames of decades of inequality and repression. The life after Hosni was the end of an era, end of a dark, disgusting tunnel. The light at the end of the tunnel was so bright that it made the nation blind to all the hidden complexities, as Egypt’s embedded social and political structures required more than the removal of one single leader to transform. It had taken decades to leave the country in ruins. How could it shine overnight? How could destruction magically also revitalize and reconstruct?

Again, the weight lost with Ozempic isn’t sustainable and it always bounces back.

Egypt held its first free elections after Hosni’s fall; amid high hopes and desire for swift change and drastic improvements, the Egyptians voted for Mohamed Morsi of the Muslim Brotherhood. Morsi was a symbol. For some, he symbolized a shortcut to democracy; for others, he was simply a choice, the classic scenario of having to choose between worse and the worst. It wasn’t long after the election when the Egyptians had their reality check and realized that a short-term solution without fully considering the long-term impacts does not exist, no matter who the president was. Morsi’s presidency, marked by political tension and economic cancer, highlighted the impossibility of a rapid transformation for the better.

By 2013, the very people that had pushed for instant change and Morsi, pulled the rug out from under him and pushed back against his government. Nationwide protests because of unmet “expectations” left the military with no choice but to intervene. The president of the time was once again surgically removed. Morsi was replaced with General Abdel Fattah el-Sisi, and the military was once again ruling over the entire country. What had begun as hopes for a better life and beams of democracy, ended up turning Egypt backwards and reinforcing Egypt’s existing corrupted power structure, highlighting, once again, that the weight lost with Ozempic always bounces back.

I am positive that when reading this part, many of you thought of many other revolutions and coup d’états down history lane. It baffles me how we as human beings fail to remember history lessons and keep falling back into the exact same traps. The Egyptian Revolution, set against the broader aspiration of the Arab Spring, is an awakening reminder that there is no quick solution without thinking about the long-term consequences and undergoing the hardship of fixing the “underlying issues” first. We unintentionally trade one set of challenges for another when we pursue instant gratification and say “yes” to rapid and radical changes. No underlying change for the better happens without adequate time, investment, patience, resilience, and most importantly, understanding the roots of the issue.

Don’t get me wrong; by no means am I saying the Egyptians should’ve tolerated the corrupted regime! What I am trying to say is that had they adjusted their “expectations” of the consequential outcomes of the president’s fall in the short run, everything would’ve turned out different.

The moral of these stories, you ask?

Remember the employee’s example at the beginning of this article and how I mentioned that it was a touchy subject?

It is because employees’ age, length of employment, and other factors such as their social, geographical, and psychological backgrounds play a very crucial role here. I would like to remind you of the fifth chapter of Beyond the Numbers: Loss Aversion. If you’re an employee who’s dedicated five years of their life to a job, given their all, been patient, and motivated purely by their own internal monster of a booster: “I am learning a lot, I am building up my resume and network, this is all worth it,” and somehow your employer takes you for granted, confuses your grace and self-motivated gratification for being a loser whom they will never have to worry about losing to some other organization that recognizes your worth and talent, you are more than entitled to a “serious talk” and a gear-shifting change. I would give you the shove to jump myself! Some people are sewn down to their dusty desks just because they are afraid of change, afraid to take a risk so they can finally step up, afraid to lose. And some are simply graceful and grateful. They give their employers unearned credit and undeserved patience. They give their jobs everything, blinded by empty promises and hopes of a change for the better. Little do they know, they’re nothing but a resource, being exhausted.

Having said that, in this chapter, we are talking about the other side of the coin: those who want it all now, without having gone through the pain of earning it. Those who make a rapid change, demand it all without having done the proper due diligence on what the alternative would actually be like. Those who have not exhausted all of their resources at their current job and just want something better, bigger, different—now. Those who take Ozempic because they had a bad couple of weeks at work and wish to lose the frustration immediately, or replace the bandage by switching employers, not knowing that their life wounds aren’t all related to their jobs.

Those who overlook the value of investing in something, not being sure of the result. By no means am I suggesting we should work longer than we have to for machine-like corporations that pay us down to the cent on the clock for the good of our heart. All I’m saying is that everyone should find their path, and if they don’t know which path, just pick a path and passion, stay invested in it, and know that your dawn and day will come too. The “why bother” attitude only punishes us. It wastes our valuable time—not the organization we work for. They get their job done, but we don’t get our youth back.

When I was a student and in my 20s, I worked at a company that was way outside the city. I needed to wake up at 5:30 in the morning to be at my desk by 7. Pay was as little as it could’ve been, and I didn’t even have a key! Sometimes I had to wait outside in the snow for as long as someone would hear my tapping on their window and would let me in. Back then there was no home office. Most of us didn’t even have a corporate laptop and were working on a PC, on site. You might not believe it, but I am smiling as I am writing about this. I never complained about anything, never “expected” anything; I remember I didn’t even know that I, as a working student, had a right to take vacation days!

I invested so much time and energy in that job. And you might think that I am going to end this story by saying now I am an executive director at that very company. No, the happily ever after didn’t happen. I did not make a fortune and did not get promoted. Do I regret it? Not even for a second.

Why would I regret a job that taught me first and foremost a profession, and second of all, discipline, corporate manners, hard work, morals, and most importantly: humility! Something for which I am beyond grateful as my parents always protected me in this shell of safety and I never learned or experienced humility. Something I believe was the most valuable thing I took from that job. The ending of that job was the beginning of chapters so incredible that I never “expected” to happen. And that’s the point I’m trying to get at: I invested, not knowing what the outcome would be. Nothing was sure but one thing: I knew I had nothing to lose at that age but only to learn. What else did I have to do that young and full of energy? Sleep 3 hours longer? Take care of the kids or the family I did not have? I knew I would learn. Not knowing what the outcome was, I stayed focused and invested, as long as I was learning. And believe me, what I do now, almost 8 years later, is worlds apart.

I love history. I read into it a lot! As you might’ve noticed, there’s always a “memory lane section” in every chapter of Beyond the Numbers. I love the romance that it tells. It is romantic to me how history writers manifested success. How they simply kept doing what was meant to be done at that point, repeatedly, tirelessly, religiously, and with conviction. They just kept going, not even thinking about how and when they would ever succeed. And that is the point! With enough time, hardship, dedication, consideration, and conviction, success is inevitable!

Whoever I look up to in my life, that are full of joy, peace, love and success, all of my real-life heroes and sheroes, they all have stories about them having worked at a restaurant or at a farm selling vegetables while they were students, how they sold asparagus on Sundays on top of their other 3 jobs, or stayed invested in their marriages and a jobs regardless of the financial and emotional hardships and dry spells, and how they simply kept pushing forward, woke up early, morning routines, and kept going. Money, power, or success or love weren’t their motivating drive. The path itself was rewarding. They never expected instant results and trusted the journey. And that is exactly why they got all the big four. None of them have an overnight bitcoin or lottery related success story.

I have come across people who were fitter than a swimsuit model as I first met them, later to find out that they were not only overweight but had-to-buy-two-plane-tickets obese. None were on Ozempic. None told me about their 90-day diet plan. None told me of their Keto diet. It was all about years of eating healthy and balanced, working out properly and regularly, no alcohol or cigarettes, and one unshakable, iron-fisted belief that they would make it.

Hitler ruled for 12 years, and it took Germany 44 years until the fall of the Berlin Wall in 1989 for the country to fully reunify and achieve a sense of normality and complete democracy. Not to mention that Germany made its final payments on World War I reparations on October 3rd, 2010, nearly 92 years after the Treaty of Versailles was signed.

Whether it’s politics, finance, or life in general, the thirst for instant gratification has given us nothing but short-term solutions and long-term problems. Remember the 2012 Pepsi slogan? “Live for Now”? Has it ever occurred to you how many people have fought addiction to sugar, food, gambling, sex, alcohol, or drugs just because they took that advice a bit too seriously? Nations bankrupt themselves chasing military victories, investors ruin their lives by betting speculatively on made-up bubbles, and the young leave their jobs for a flashier set of gadgets, a housing package plus 10% raise.

Whether it’s a leader who gets high on recent victories and acts in the heat of the moment or the day trader who sees nothing but the instant return, the pitfalls of instant gratification are as old as time itself.

Note of the Month: When the pursuit of immediate rewards and quick fixes outweighs patience and planning, disaster is inevitable. People, communities, nations, societies, all have fallen victim to the same old psychological bias. Satan whispering into their ears, pushing them to seize the moment without considering the consequences.

Beyond The Numbers is a monthly newsletter that aims to delve into the human side of finance, exploring emotions, psychology, and biases that influence our financial decisions. My name is Sadaf Poursheikhani, and I am a behavioral economist, passionate about dissecting investor psychology. Join me as we uncover the hidden secrets of the financial world.

Disclaimer: I would like to remind readers that this newsletter is based on scientific studies, my own research, and personal opinions. It does not reflect the views of any organization, and I am not providing financial advice. Rather, the aim is to shed light on the emotional side of the market and provide insights into how emotions can impact financial decision-making.