08/13/2019: Finding Financial Gratification

Delayed gratification has been touted by grandparents, kindergarten teachers, accountants, and even Aristotle as the path to happiness and wellbeing. Holding off on immediate temptation for future rewards is the key to reaching our goals, avoiding major mishaps, and finding long-term satisfaction. And when it comes to money — things are no different. In fact, research has shown that a person’s ability to resist instant gratification is a key determinant of financial success.

Understanding Delayed Gratification

Controlling our impulses is one of the best life skills we can develop. Delayed gratification ultimately comes down to weighing instant pleasure versus long-term rewards, then acting on what’s most beneficial for us overall. You might have heard of the Marshmallow Experiment, in which Stanford psychology professors offered hundreds of children a marshmallow with one caveat; the kids could eat one marshmallow now, or they could wait a few minutes and have two marshmallows later. Long story short, most kids who waited for the second treat went on to have higher SAT scores, better social skills, lower levels of substance abuse, and more success in life.

What do Marshmallows have to do with Money?

A lot. Those kids who waited for a second marshmallow — most of them went on to earn more money. But most importantly, applying delayed gratification to your money will help you reach your financial goals. Many people find themselves spending mindlessly. When they see something they want, they buy it. Even if they can’t afford it. This sort of impulse spending can bring short bursts of pleasure, but it also leads to stress, debt, and disappointment.

Without learning delayed gratification, it’s nearly impossible to reach your financial goals.

It’s that simple. It’s also that important. Learning to control your spending is crucial whether you’re saving for a vacation, working to pay off debts, putting together an emergency fund, or just want to stop living paycheck to paycheck. The seemingly small decisions you make now have big impacts on your bank accounts. Financial delayed gratification means waiting to buy something when you can actually afford it. It means investing money today to have money when you retire. It means being in control of your finances. While learning delayed gratification isn’t always easy, it’s always worthwhile.

Applying Delayed Gratification to Finance

Delayed gratification can feel difficult to learn and even more difficult to apply. When you’re used to operating on a want-it-buy-it basis, you might feel uncomfortable changing your habits. Be sure to practice patience with yourself and your money, and you’ll find yourself mindlessly saving instead of mindlessly spending. The following tips will help you learn the practice.

Set Goals and Remind Yourself of Them

If you set realistic, attainable financial goals, you’ll be surprised at how often you achieve them. Even better, you’ll often exceed them. Set short-term and long-term financial goals to motivate yourself to manage your money and avoid impulse spending.

Short-term goals should include — but not be limited to — savings and investing goals. Set them monthly and annually and analyze them periodically. Be sure to include rewards for yourself as well. A few examples of short-term financial goals:


Put $250 in your 401K
Save for and buy Cardinals’ tickets
Put $100 towards vacation


Add $3,000 to your 401K
Save for and buy a new laptop
Take a vacation to Cancun

Long-term financial goals don’t need to be complicated. Just realistic and attainable. Set them annually when you budget and stay relentless in tracking them. A few examples of long-term financial goals:

Pay off mortgage by the age of fifty
Pay for a car in full in the next five years
Retire by the age of sixty

Setting goals is a great motivator for delayed financial gratification. Be sure to remind yourself of your goals on a regular basis; something as simple as a picture of your dream vacation spot on your desk can make a big difference. With regular review and realistic, attainable goals, you’ll find yourself developing better financial habits.                                

Practice the Power of Delay

A lot of our bad spending habits, and life habits, result from letting our mind run on autopilot. The remedy — delay. Whenever you have the urge to buy something, stop,  take a breath, and practice the power of delay. Delay your insta-spending, and instead practice more these more positive habits:

Ask yourself: “Is this a want or a need?”

When you’re about to spend, determine if it’s something you need. If it’s just something you want, hold off. Instead, use the 10-second or 30-day rule.

Use the 10-second rule

If the item you want is cheap, take a quick break. Hold the item in your hand for 10 seconds, then honestly ask yourself if it’s worth spending money on. Think of if there is a better alternative, consider your financial goals, and question if the item will really bring you value. You’ll often find after the short break that the purchase isn’t going to bring fulfillment. If it passes the test, you can buy it.                       

Use the 30-day rule

Before you buy anything expensive, and you can judge what’s “expensive,” stop for a moment to understand your motive. Now, wait one month and see if you still want to spend the money. This gives you time for research, and you can see if you actually want the product before spending your hard-earned money.

Saving for the Future and Enjoy the Present

Delayed gratification does take discipline. It doesn’t decrease your quality of life. In fact, developing healthy spending habits can help you enjoy life even more. It’s not just the fact that you’ll enjoy financial wellbeing. It’s that you can free up time for more important things and find what really brings you joy. This can mean finding inexpensive hobbies, connecting with family and friends, finding time for yourself, and slowing down to enjoy life. Smarter spending gives you the freedom to enjoy what you have and to commit to your goals. The key is to live life to the fullest without destroying your future.

With the right approach, practicing delayed financial gratification can become a habit. The knowledgeable team at Peoples Bank will help you solve your budgeting and personal finance problems. To learn more about our financial services, visit any of our locations in Cuba, Steelville, Sullivan, or Bourbon, or visit www.peoplesbk.com to learn more.

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