Central to all our lives - and a key issue in financial planning and portfolio construction - is making decisions involving trade-offs between costs and benefits occurring at different times - what economists call “intertemporal choice”.

The concept of time preferences refers to how a person’s valuations of costs and benefits differ across different time horizons. Earlier costs and benefits are frequently weighted more heavily (or discounted less) than those in the future, but research continues to reveal exceptions and individual differ...