In my opinion, the practice of delayed gratification may very well be the “Viking King” of building wealth. And research has shown this to be a strong characteristic of self made millionaires. The famous Millionaire Next Door books illuminate this key characteristic of success with money.
Who wants a cookie now?
Do you want one cookie now or two cookies in an hour?
Do you want to two cookies in an hour or 4 tomorrow?
Do you want $5 now or $10 next week when your asset or investment has grown in value?
Do you want that luxury car now or to have another $100k in your 401k in 7 years?
Do you want that fancy car now so you can feel rich today or do you want to invest in assets so you can actually be rich in the future?
You get the idea. If we can find a way to balance our current “burning desires” with our long term success, we may be much better off for it down the road. But how do we do this?
Make it stronger
The good news is that although we may be born with some base point of the ability to delay gratification, it also appears we can strengthen this practice like a muscle. That puts more of the control in our hands over time with small adjustments and effort.
What are some practical ways we can improve our practice of delayed gratification in order to build wealth? We have pulled some ways from experts and research on the subject. I think we have all had our own struggles with delayed gratification. Therefore, we are pretty much hard wired for present moment bias and delayed gratification is not in that picture.
Having delayed gratification issues is not a character flaw. Actually, from the research conducted on the topic it is more situational and has a lot to do with how our brains are wired and how we are responding to our environment. And it is also highly habitual. See our earlier posts about habits, instant gratification becomes a habit and gravitational force that becomes very hard to escape. In other words, we can make either instant gratification a habit or delayed gratification a habit with practice. Monkeys with Money explores other psychological factors that impact our money habits.
The good news is that we can adopt practices and build environments that make it easier to create healthy habits of delayed gratification. For example, continual toxic stress does major damage to our brain wiring and basically makes delayed gratification very hard. I know when I am stressed at work I will definitely be more inclined to go to my favorite fast food joint for a high caloric meal. I am not thinking about the health consequences tomorrow, I am thinking about feeling pleasure and lowering stress now.
The mind craves a sense of comfort and I probably on some level feel under attack. A Psychology Today article written by Dr. Gordon said this:
“poor self control. It is not that simplistic. Biology wires our brains by observing our early-life experiences to determine how our world should be so that our brains are prepared to respond to life accordingly.” Bill Gordon, PH.D.
The good news is that experts say self control is a skill that can be sharpened. It is also not necessarily an inborn trait that you either have or do not have. Here are a few ways to strengthen the self-control muscle for building wealth:
1. Manage Stress
There will always be some level of stress in life, it is the nature of life and survival. And some stress makes us stronger and more resilient. But there is a toxic and continual kind of stress that messes with our brain wiring and makes delayed gratification and self control harder. According to Dr. Gordon, “stress negatively affects brain function, especially the neural components of the reward system.” Without getting into a bunch of complicated biological information, basically when we are stressed the dopamine (feel good chemical in the brain) becomes more “valuable” to us. So the bottom line is do what you can to reduce toxic stress. Walks, nature, yoga, healthy foods, time with nurturing friends and family, a new job, etc.
2. Distract yourself with activities that do not cost money
What things can you fill your time with that do not involve spending money impulsively? Working around the house, spending time with people that share your values, games, puzzles, low cost hobbies, working out and exercise.
3. Let your mind wander sometimes
Research suggests that people who let their mind wander reconnect with long term goals. Especially after concentrating for a long time, let your mind rest and wander a bit. Use your imagination and fantasize.
4. Be grateful for what you have
Focus focus focus on gratitude. To me gratitude is a hallmark of what we call “True Wealth.” Chance are if you are reading this article you are actually pretty well off in the grand scheme of humanity and human history. You probably have access to food and clean water, a job, housing, some educational resources, entertainment, clothes, etc. Many of these things we have we tend to take for granted, but they are wealth.
The point is to really look at and appreciate all the stuff and people you already have in your life. Count your blessings. This act instantly makes me feel better immediately, no delayed gratification required.
When looking at your stuff, remember at one time it was all shiny and new. Clean it up, organize it and you may be less inclined to go buy the new shiny thing. Or ask if you really need it anymore and practice some Konmari to declutter space and mind. Research also suggests that having gratitude leads people to value future options even more.
5. Articulate your priorities and values
One thing we are trying to teach our children is about priorities. For example chores and work come before fun and entertainment. The healthy foods come before a small desert. If you prioritize building wealth over having a fancy car, new clothes and expensive meals, then you will move closer to the direction of building wealth.
Ask yourself what your priorities are? If it is to impress other people, then I think it will be harder to build wealth. If it is to live a life of love, experiences, creativity, etc., it may be more aligned with delaying gratification and building wealth.
6. Find a way to release some of the desire to instantly satisfy
Is there some other way of satisfying the urge. Perhaps you do have a desire to shop, then go to the thrift store. You will release the urge without blowing the budget. Jerry’s favorite ice cream is halo top, and they make their entire marketing campaign around eating the entire pint of ice cream, and only spending a few hundred calories. So this minor indulgence plays an important role in managing feelings of stress and delayed gratification for the bigger and more important things.
These may seem like small things when faced with buying that shiny sports car, eating an extra piece of chocolate cake or buying that extra pair of shoes. But remember the temptation is all in your head and with practice you may build a strong habit of delayed gratification. And when you do satisfy whatever urge you may have had, it might seem even more special and pleasurable.
* This is not personal psychological advice for anyone, please consult a professional if you have specific questions.