Prof. Johanna Peetz: Personal Spending, Time Perception, and Close Relationships (EP.153)

Today we speak to Professor Johanna Peetz about how the errors people make about predicting their futures affect financial planning and relationships. Professor Peetz is an Associate Professor of Psychology at Carleton University and her three main research interests are time perception, personal spending, and close relationships. We kick the conversation off on the topic of biased spending estimates, the idea that people are bad at budgeting, and Professor Peetz gets into the main causes and implications of this issue. Our guest gives pointers for how to make less biased predictions for spending and makes a great point about how people with more aggressive saving goals often don’t spend less. We move onto the subject of long-term financial planning and motivation, and Professor Peetz weighs in on a few methods to get better at breaking down big goals into steps as a way of keeping motivation up. Another big discussion from today is how this idea of behaviour predictions fits into the context of healthy relationships. We talk about the connection between partner-satisfying decisions and happiness, and how partners should view each other's ability to keep promises. So for all this and more on how to get better at knowing your personality traits and the effects this can have on finances and relationships, tune in today.

Key Points From This Episode:

• Introducing Professor Johanna Peetz and her research on predictive errors. [0:00:48.2]
• If people are good at predicting how much money they're going to spend in the future. [0:03:05.2]
• The causes and implications of these biased spending estimates. [0:04:33.5]
• What people can do keep their spending in line with their goals. [0:06:53.5]
• The financial literacy gap between men and women. [0:13:37.5]
• Increasing motivation to reach long-term financial goals based on a future self. [0:17:05.7]
• Setting goals using intrinsic over extrinsic reasons. [0:21:40.5]
• How financial planners can help their clients find and reach their goals. [0:23:56.5]
• The relationship between pro-social behaviour and happiness. [0:24:51.5]
• How good people are at predicting relationship-enhancing behaviour. [0:28:27.0]
• Dealing with money-related relationship conflict amongst being bad at predicting behaviour and spending. [0:32:39.0]
• How unpacking expenses can help people make less biased spending predictions. [0:34:26.0]
• Different ways of responding to boredom in a relationship. [0:39:34.0]
• Taking the perspective of the other person to improve the forecast of relationship-enhancing behaviours. [0:43:10.0]
• What Professor Peetz is working on now that makes her most excited. [0:46:05.0]
• How knowing your personality traits can help you make better financial decisions. [0:48:20.0]
• Our guest’s definition of success. [0:49:09.0]