Adjust Text Size

The Power of Delayed Gratification

Written by Guest Contributor - 5 Comments

The Power of Delayed GratificationThis is a guest post from Daniel of Sweating the Big Stuff. If you like what you see here, please consider subscribing to his RSS feed.

People often like to act without thinking about the consequences. While that feeling is definitely liberating, it may not be so wise. That’s why I advocate a system of saving for purchases and then waiting for a period of time (say 30 days) before making any significant purchases.

Resist your impulses

First let’s take a look at why we should save for purchases instead of going with our first impulses. There are two clear dangers of buying now and paying later: The risk of building up credit card debt, and the risk of becoming disconnected from our money and making purchases that we might not otherwise have made.

With respect to the former, it’s true that the personal savings rate in this country is higher than it used to be, but there are still plenty of people playing fast and loose with their credit cards and piling up debt. And no, the fact that you’ll (hopefully) be making more money in the future isn’t a valid reason to over-extend yourself.

With respect to the latter, it’s been suggested that people who use cash spend less than those who use credit. In other words, by reaching for plastic, you might end up spending significantly more than you would have with cash.

No matter how you look at it, it’s clear that rash decisions can hurt us financially and drive us to not only spend more than we expect, but more than we can afford. Beyond the immediate financial benefits of saving before spending, this practice also creates a built-in delay in our spending habits which can have beneficial effects.

Buy yourself some extra time

When setting goals and saving for purchases, we force ourselves to prioritize and think about what we really want to spend our money on. For example, I recently saved up for a nice new pair of headphones. While waiting for the money to build up, I realized just how much I valued them and how much use I’d get out of them (on the subway, at work, exercising, and so on). I ended up working harder to save for them, and now that I have them, I couldn’t be happier.

Similarly, by saving up for and holding off on major purchases, we have time to reconsider our decisions. Instead of making impulsive decisions about buying the latest gadget, the time spent saving, plus whatever waiting period you may have instituted, is often enough to realize that you really can live without it.

For example, I’ve had an old clunky TV for years, and there have been several times when I thought that getting a new LCD was the most important thing in the world. When I’ve had such an impulse, I’ve simply told myself that if I waited 30 days and still thought it was necessary, I’d pull the trigger. Each time, I’ve realized within days that not only does my old TV work fine, but there are a lot of other things on which I’d rather spend that money.

Published on July 2nd, 2010 - 5 Comments
Filed under: Frugality

About the author: This article was written by a . Please don't hesitate to share your thoughts in the comments, below. If you're interested in writing for us, please contact us for details.

Related articles...

» The two-word secret to personal finance success
» Why is it so Hard to Save?
» What Effect Will a Federal Government Shutdown Have on Tax Refunds?
» Credit Cards: Can’t Get No Satisfaction?
» The Salary Theorem
» Six Ways to Teach Your Kids To Be Money Savvy
» Google Stock Quotes
» Should You Pay Your Children for Good Grades?

Was this article useful? Please sign up to receive our content via e-mail:

You will receive only the daily updates, and can unsubscribe at anytime.

5 Responses to “The Power of Delayed Gratification”

  1. 1
    John Says:

    I created a shiny list. My shiny list is all of the “shiny”things that I want and have not yet purchased. This allows me to prioritize. If I decide that I would like to have a tool or gadget, I add it to the shiny list so that I can see it next to all the other things I would like.

  2. 2
    Kev Says:

    I used to struggle with this. It was especially hard after I paid off all my non-mortgage debt and was working on building up my savings b/c the money was there. Things like new televisions, video games, treadmills, and computers were constantly calling my name and it took every ounce of will-power I had to avoid the temptation. I felt like I was constantly giving up the things I wanted and there was never any reward for working and staying free from debt. It was around this time that I realized I wasn’t giving up my wants at all – I was just prioritizing them. An awesome flat screen television would be nice, but it will never be as nice as a fully funded EF or a paid off mortgage.

    So whenever something new and shiny catches my attention now, I quickly remember what it is that I want most. I want the mortgage paid off yesterday and buying stuff that I don’t really need will just set me back. Once my house is paid off then I can renew my love affair with Best Buy.

  3. 3
    Matt Says:

    I did the same thing with an XBox 360 as you did for the LCD TV… almost. I bought one on implulse (paid cash, though), and realized w/in the 30 day return window that I just didn’t use it enough to justify the cost, so I returned it.

    I ended up doing it again a few months later… Purchase, play a lot for a few days, then realize I won’t play enough to pay that kind of money… return.

    When did I get too old for video games? :(

  4. 4
    Rosa Rugosa Says:

    I keep a list of wants too – it does help to priorize and put the brakes on impulses, but it’s also useful when my mother or sister ask why I want for xmas or my birthday. Some things that I really want can wait (like a new birdbath heater; ours died, but it’s July).
    And it’s definitely true that some things get crossed off the list and never purchased. Sometimes I find another way to fill that need, which is definitely the best! It’s not about deprivation; it’s about slowing the process down and being a little more mindful about parting with that cash.

  5. 5
    Jo/Gaelicwench Says:

    I work at Cracker Barrel on the gift store side. The temptations there are overpowering for me. As I walk around during my shift, helping guests and doing a little tasking during a lull, I look at the items I am tempted to buy.

    I refuse to pay retail for anything, except the food. I am hard put to buy something for 25% off. It needs to be the last item available before I will entertain any sort of thought to buying it. Otherwise, I prefer to wait until it goes down to 40% or more. I throw in my discount and that brings it to nearly 60% off. Not too bad of a purchase.

    I’ve incorporated steps, however, before making the final decision to buy. I carry with me in my apron pocket a small spiral bound note pad where I’ve written, “Do I Really Want It?” And with that I wrote down five rules:

    1)Write down item and cost.
    2)Wait a week.
    3)Save for it, if serious about the item.
    4)If item is gone before I buy or while waiting, put money saved aside into my savings account.
    5)Then, I can save for what I TRULY want!

    Lastly….PAT MYSELF ON THE BACK!

    This works, and I have no sad feelings if an opportunity has come and gone. As it is, I’ve written down many items and waited a week, or at least until it goes on sale. I can’t tell you how many times I’ve changed my mind about buying it after all. It’s a really good feeling.

Leave a Reply

Disclaimer...
Because rates and offers from advertisers shown on this website change frequently, please visit referenced sites for current information. This website may be compensated by companies mentioned through advertising, affiliate programs or otherwise.

FiveCentNickel User Survey