I started this blog post well over a month ago, I wanted to go into detail about delayed gratification and why I thought it was such a wonderful thing. But about the same time as I was going to make this post, I started reading a book that changed my perspective on this subject a little.
I pushed off posting this for so long and even debated on just trashing it. But after thinking over it far too much and for far too long I have come to the conclusion that I will break this into a two-part post.
So here is the original post, then I will write part two and tell you how my thoughts have changed on this. Hope you like it.
A while ago there was a study done with kids where the kids were given 1 marshmallow and told that if they waited until the adult came back in the room they could have 2 marshmallows. They had to wait a whole 15 minutes. Very few kids waited, they wanted the marshmallow now and had a hard time with the concept of delayed gratification.
Was it the fear of missing out, I mean is the adult really coming back? Or was it just that they didn't see any reason to wait when they could have want they wanted now? Delayed gratification is a truly hard concept to grasp.
We live in an instant-gratification world. A world where we take a photo and can see it immediately. You can download music and listen to it right away, and even pick and choose what songs you listen to. You can call someone and they can answer from anywhere. Instant gratification can make delayed gratification an even harder concept for both kids and adults.
What is delayed gratification and how does it affect me and my finances?
According to the Oxford Dictionary of Marketing delayed gratification, or deferred gratification is: "The psychological condition which enables the individual to wait patiently for future benefits instead of demanding something that they desire instantly and acting accordingly."
WHAT?? I have to wait patiently???
To be quite honest I have never been very good at delayed gratification in my life. I was forced into a form of delayed gratification as a kid, by being taught to save my money for items I wanted. I had to do chores for money and then save that money until I had enough to buy that item. But usually, I ended up settling for a less expensive item that I could have now and never really saved up for the bigger items I wanted.
Not being patient as a kid carried over to my adult financial life and grew into a large credit card debt. I would see something I wanted and I would just buy it, usually on credit. Why wait when I could have it now? There were all sorts of "marshmallows" in my world.
Delayed gratification has been an area of improvement for me for some time now, but I am making great headway in this area. I have learned that it is important to implement delayed gratification in our instant gratification world.
I learned over the years, 3 steps to achieve delayed gratification.
Let's go over each one with respect to sending money and purchasing. Here is how my husband and I have used delayed gratification in our financial world.
Evaluate: The 1st step is to really think over the purchase. To help us with this we have implemented a 72-hour rule to fully evaluate all purchases over $50. This is done by looking at the item or trip and saying to ourselves, "Do we need the best and the greatest of this item? Do we need to take a 2-week all-inclusive trip at the high-end hotel? Is there a way to get what we need and want that is less expensive and easier to save for?" We think over our purchases for 72 hours then make the decision if we want to purchase the item, and if it fits into our budget. Over the years we have learned we do not have to keep up with the Joneses, and staying in high-end hotels is fun and all, but maybe not what is needed. Can we get the same satisfaction with a less expensive item or trip? Sometimes after 72 hours, we decide that we don't even want what we previously, in the moment, thought we could not live without.
Modify: The next step is to make modifications to both our thinking about the item and to what item we ultimately decide on. I did this as a kid, I would look at the money I saved and see if there was an item that I wanted for the amount. Could I buy the single record rather than the full album? Could I buy the roller skates with the key rather than the boot skates? Now we think things like, will a Country Inn hotel be just as good as a Ritz Carlton, after all, we just are sleeping in a bed at night so we can go and enjoy the days on vacation.
Save. The 3rd step is to save and budget for the item. This is just like when we were kids and worked on chores to earn money. We would then take the money that we earned and place it in a piggy bank until we had enough for the record we wanted or the roller skates we just had to have ( I know I'm old, hahaha). This concept carries over to adulthood and we see something that we want or a trip we want to take. We then budget for that item/experience by placing a set amount of money each month into savings and when we have enough we get the item or go on the trip.
So the next time you just have to have something, step back and exercise delayed gratification rather than just throwing down that card. Wait patiently for the future benefit of having the money for it and the satisfaction that you made the right decisions.