“Patience is a virtue” my father would always say to me. If you think about it, patience truly is a virtue. Oftentimes, we want things now. That is not the way the world works. Those that want instant gratification often end up on the wrong side of the stick. It is time to think about delaying gratification for the win. Let’s delay our gratification and make tomorrow a better day.
The Marshmallow experiment.
In the 1960s, Scientist Walter Mischel was doing experiments at Stanford University to test how instant gratification affects children. He came up with an experiment called the Marshmallow Experiment.
This is no ordinary experiment. He sits a kid in front of a plate with one marshmallow. The kid is told that if he can wait 15 minutes without eating it, the kid will get 2 marshmallows.
However, if the kid did eat the marshmallow before the researcher came back in then the kid will not get a second marshmallow.
The choice was simple, either one marshmallow now or two later. All they had to do was wait 15 minutes.
As you can imagine the film of these kids was quite entertaining. I have seen other parents to do this experiment with their kids as well, and that too is entertaining to watch.
Some kids ate the marshmallow right after the researcher closed the doors. While others squirmed and withheld their desire, until finally collapsing to temptation after a few minutes.
There were a few that held out til the end, they were rewarded the second marshmallow.
This study was printed in 1972 and named the Marshmallow Experiment.
What is Instant Gratification?
Let’s first take a look at the results of instant gratification. Instant gratification is the desire to experience pleasure and fulfillment without delay. This is all about pleasure.
When can I get this now? It is like the girl from Willy Wonken who wanted everything now. It ended up she was sent out by Willy Wonken.
Oftentimes, we are inspired by what people have and what we do not have. The Joneses next door have the new PS5, and therefore I need to have it now.
The work colleagues all bought 4K projectors or a TV so I need to get that as soon as possible to be in the IT crowd.
The problem with this thinking is that we make rash decisions. They are not thought out, looked up, or even made without the 2 cents of seeing what it will cost in the future. These people often make a poor decision that will gratify you for the first few seconds of life with this object of obsession.
We see this with saving. Often people do not think about saving their money at the beginning of the month. They get their paycheck and go on spending. It is that excitement of getting paid, and being able to buy things that drives this instant gratification high.
The problem with this thinking is that it prevents people from making proper sound decisions and therefore they may not have saved enough money for their future retirement or even future expenses.
Emergency Funds is a great example of something you need for your financial future. If you are unable to save for it, and an emergency happens your financial future may be in flux.
Let’s Talk about Delayed Gratification:
In the Marshmallow experiment, the researchers followed up with the students later in life. Some of their findings were quite surprising.
The children that delayed the gratification had higher SAT scores, lower substance abuse, dealt with stress better, and had better social skills.
After 40 years, they have found that the ones that delayed their gratification were succeeding in life in every capacity.
It is all about discipline. People that can be disciplined in their life or more likely to succeed. They can prioritize the important things instead of putting them off for the fulfillment of gratification.
Delaying Gratification with Investing:
People are always chasing the highs in life. With finances, people chase the hot stock or commodity. Right now, Bitcoin is a big thing to many people. As more people feel FOMO they want to get in and get rich right away driving the prices up and up.
That feeling of getting rich quick is almost like those that feel the lottery is also a great way to make money. It is that instant gratification.
Charlie Munger said “Great investing requires a lot of Delayed Gratification”
As I have worked with investing, my strategy is a more slower and simpler way. I buy and hold index funds. The market may go down, but I do not panic and sell. I plan to increase this wealth vehicle every year.
In 10, 20, 40 years, the wealth vehicle will have increased enough with compound interest for me and my family to live life comfortably.
Saving is delaying gratification. It is the part about not spending all of your money as quickly as you get it.
Having goals to help make these things a reality.
Try to save, try to delay your gratification, and it will increase your income, improve your savings, and increase your enjoyment in life.
“Great investing requires a lot of Delayed Gratification.”
Here are some Steps to help.
It is time to stop chasing after the hottest stock. Make a plan and goals to accomplish for your finances.
Stop procrastinating on work and investing. Procrastination leads to being less productive. TV watching will not help you out, let's make a plan to accomplish some goals.
Time to take a few minutes to make sure you make the right decisions.
What are you waiting for? The time is now. Take a step, stop watching tv, and make your time worth it.
” Spend less than you make, stay out of debt, and invest the rest”