But sometimes you have to wait for it, save for it, and plan for it, so that you can still win financially.
We all have things that shape how we handle money. We are made up of our nature, nurture, and self-choice. The only one we really have complete influence over is our self-choice. We can control our actions and behaviors; therefore, we can choose to delay gratification. Parents can still use their nurture influence on children to teach them good habits and self-control as in a video that has gone viral, where parents are teaching children to practice the art of delayed gratification, following in the footsteps of the Stanford, Marshmallow experiment. The Stanford marshmallow experiment was a study on delayed gratification in 1972 led by psychologist Walter Mischel, a professor at Stanford University. In this study, a child was offered a choice between one small but immediate reward, or two small rewards if they waited for an unknown period of time. The children waited in the room for 15 minutes until the researchers opened the door and allowed those who waited to have the second marshmallow. The researchers followed each child for more than 40 years and the group who waited patiently for the second marshmallow succeed in whatever capacity they were measuring. In other words, this series of experiments proved that the ability to delay gratification was critical for success in life.
You can have whatever you like, but as stated earlier sometimes you need to wait for it, or delay when you get to enjoy it.
Tim Goodwin commented, “I am starting to believe one cannot out-earn their wants (maybe if you’re a billionaire, but since I’m not and don’t know one, I’ll just assume it’s the same). Therefore, since we cannot out-earn our wants, there must be delayed gratification. And it’s easier to delay that gratification if you have a plan to obtain the want over time.”
Tim continued with his realization, “Maybe that want becomes less important over time. Maybe that want is met through another want being satisfied. Maybe we are gifted that want from God or someone else. That’s why a budget is so important, to give us enough satisfaction that if we don’t purchase that want now, but instead delay gratification, we can still obtain it without going into debt. But it’s hard—very hard. I would argue it’s never been as hard as it is nowadays to delay gratification. With money being so electronic, it makes it feel fake and infinite. I mean, think of how finite a $20 bill feels. It’s real, you don’t want to break it, and as soon as you do, you can very easily see it slip through your fingers. And we have so many options to overspend with credit cards and easy and cheap financing options.” To read more, check out our blog on debt, “This is your brain on credit cards.”
Adulting is hard. Choose today to win with money. Choose a great budgeting tool, like YNAB. Make sure you have an accountability partner. If you’re married, your spouse, if not a close and trusted friend is a must! Besides creating a budget there are some other ways you can get the things you want.
Govern your wants:
Create three different categories from small, medium, and large wants. For example, the small wants could be purchases of $40 or less, or whatever amount you deem ok to spend a couple of times a month that won’t interfere with your budget. The medium wants are purchases that require a bit of saving, think more like $100-$200 range. You can create an account to save money for these wants that are outside of your budget. You and your spouse can each have your own account for this, where you set money aside to buy these items. You can even use other streams of income for these accounts, like an income producing hobby, and that money gets automatically put into a savings account for these items. Then, for the larger items, like a home, an RV, boat, or lake house, you can make a list and go over it with your spouse, or an accountability partner. Prioritize the list in order of when you would like to purchase the item. Spend some time really making sure it is what you want and then once you are 100% sure, you can make a plan to buy it. Create an automated sinking fund that allows you to save for the larger item.
Do you want to win with money? Prove it by changing your behavior! This is what separates the wealthy from the broke. And as in the marshmallow experiment, those that are successful in every area of their life have mastered this ability.
In the end, it’s not about making more money, it’s about telling your money where to go in advance, through a plan, and having an accountability partner to keep you on the right path!