Thank you to Silverbells2012, whose comment on my post 305 Days ’til 40…. was part of what inspired me to write this blog entry.
We live in a world of instant gratification. In fact, if you live in New York you can have warm cookies delivered to your home even late at night. If you have a desire, it can be fulfilled immediately, and that is what you want…… or is it?
Many studies have been done with children and instant versus delayed gratification. One of the most famous experiments involved giving children a treat (perhaps it was a marshmallow) and telling them they could eat it now, or wait. They were told if they waited until the researcher returned they could have two, if they ate it immediately they would only have one. Many of the children could not control their need for instant gratification, and ate it immediately. The children were followed over many years and it was found that the children who were able to delay gratification often did better in life.
I have one daughter who easily delays gratification (she can work her way through a bag of candy over months) and another one who wants everything instantaneously (she can work her way through a bag of candy in less than an hour!) I often look at the two of them and wonder which one will find it easier to navigate our world.
I then think about our world today. For the most part, the huge amounts of debt we are in as a society are a result of so many people not learning how to control their needs for instant gratification. This is surely the case with my family members and friends who have serious amounts of debt. In every case they spent money they did not have on things they wanted, but probably really did not need – and ended up creating a mountain of financial issues as a result. I wonder what would have happened if these individuals had participated in that experiment as children. I am guessing they would have eaten the marshmallow. Then I wonder, “what if they did?” And, what if afterwards we worked to train and condition them to NOT eat the marshmallow so that they could learn the value and satisfaction of DELAYED gratification.
As I may have mentioned before, our family does not purchase anything that we cannot pay off at the end of the month. This means that sometimes we must save for things we would like (things we think we need, but really do not need). An example of this would be air conditioning. Where we live there are some summer days (in fact, MANY summer days) that get as hot as 100 degrees Fahrenheit. We have lived in our home for three years now and are just considering using some of our savings to purchase air conditioners for the bedrooms. We spent three years with fans running and complaining that our sleep was not what it could be if we were cooler, we desperately wanted air conditioning, but we lived without it because at the time our finances just could not support the purchase. It was a good lesson for us and for our daughters. We are now talking with our girls about the possible purchase and they understand that we had to wait until we were in a place to invest without placing our finances in any compromising position.
I wish more people would learn this lesson.
As far as I am concerned, there are very few reasons to justify going into debt….. here are some that seem to be justified to me, maybe my readers have a few more they will add in the comments section.
1. Mortgage. This is a necessary evil that eventually allows you to own your home. STAY AWAY From balloon mortgages, if you cannot afford it today, you will not be able to afford the expanding payments a year or five years from now.
2. Medical Debt. Crappy things in life happen and people get sick. In fact, medical debt is one of the largest reasons for bankruptcy and homelessness in the USA – so very sad. I will not turn this post into a rant about insurance companies gone out of control, but I will say that debt to save the life of a loved one is never frivolous debt.
3. Student Loans. This is the only way many people can finance their education, and I am personally still paying off my loans. I probably have 10 years left to go, and it is a substantial monthly payment. Yet, my college education was critical to my current job (I would not have my current job if I had not received my degrees). Therefore, when student loans result in employment, they seem to me to be an appropriate debt.
4. Automobile…… sometimes. If you live in New York, this is harder to justify – but if you live in a rural neighborhood with little to no public transportation and you need to get to work every day, then debt for an automobile may be necessary for your survival.
If you are planning to make a purchase that you do not need, that you cannot afford, I strongly caution you to delay the gratification until you are in a better financial position.
Today, 303 days ’til 40, I commit to plan my purchases wisely. It is my goal to teach and model delayed gratification to my daughters in hopes that they will learn the self-control necessary to make wise financial decisions for themselves. It is my hope that more individuals in our world will acquire this skills as well.