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BY MICHAELA CAVALLARO
ILLUSTRATIONS BY JUSTIN GABBARD
We’re not idiots. We know we’re
supposed to manage our money better. So why don’t we?
The biggest reason may be our
money instincts: They aren’t particularly good. The fact is, people tend to
choose immediate gratification over
larger long-term payoffs (like, say, a
comfortable retirement), and we rationalize our behavior by telling ourselves we’ll do better tomorrow. In a
recent University of Michigan study
of the Chilean retirement system,
which has relied on 401(k)–like plans
since the early 1980s, researchers
found that investors’ impatience is a
