If the concept and subject of money interests you (which I believe it does), then you should be aware of the concept of "Time Preference" and its impact on your decision-making.
Time Preference
We are mortal, and hence anything offered us today means more value than in the future unless the future holds more value of the same thing to compensate for the wait.
If you weigh present consumption more than in the future, you have a higher time preference.
If offered enough remuneration to wait, a person will wait for the increased amount of the same product in the future rather than consuming it now. That is a lower time preference, i.e., we are ready to wait for future consumption. And, when we are ready to defer, we are ready to invest.
Our time preferences have shifted from high to low through time, allowing us to prepare for long-term needs.
Advancements in technology, medicine, food, etc., are a prime contributor to this shift.
Instant and Delayed Gratification
Instant gratification — Consume for instant happiness.
Delayed gratification — Postpone consumption for future happiness or gains.
Now, connect high time preference with instant gratification and low with delayed gratification.
Notice how you prefer to delay gratification only when the investment raises the productivity or the quality of your life over time.
Delayed gratification builds you for a better future.
Let's take a hypothetical example of two fishers who start fishing with their bare hands (Source: The Bitcoin Standard by Saifedean Ammous)
- X spends his entire time catching fish with his bare hands and, in the process, invests eight hours each day. Y, too, starts with the same process, and both end the day with enough fish to consume.
- X is a person with a high-time preference, i.e., instant gratification, while Y is ready to delay gratification for future returns.
- The next day, Y spends a couple of hours building a fishing rod. Y loses time and the number of fishes during this process, while X takes away the same quantity of fish each day.
- The next week, Y appears with the fishing rod and catches an equal amount of fish as X does in just five hours.
- Y then cuts down some more time and invests it in building a small fishing boat. X continues with his bare hand fishing to catch almost the same number of fishes in Week 1.
- Y, in comparison, keeps saving time and energy to generate more fish than X.
- Through delayed gratification, Y has learned to invest and improve his future productivity and output. Once he can go deeper inside the sea to pick bigger and better fish than X, his investment in the boat starts yielding returns bigger than expected.
The entire process of delayed gratification, investment of time, efficient production leads to a better quality of life for Y.
The example may sound simple, yet it delivers a powerful connection.
So is delaying gratification a personality trait?
The famous Marshmallow Experiment (once more…..)
Psychologist Walter Mischel in the 1960s, conducted this experiment which is commonly known as the "Marshmallow Experiment."
Walter would leave children in a room with a piece of marshmallow and tell the kids they were free to have it if they wanted, but that he will come back in 15 minutes, and if the children had not eaten the candy, he would offer them a second piece as a reward. Therefore, giving the children a choice between instant gratification and delayed gratification.
In other words, the Psychologists test the children's time preferences.
Mischel followed up with the children later and found a significant correlation between having a low time preference or delayed gratification as measured with the marshmallow test and good academic achievement, high SAT score, low body mass index, and lack of addictions.
Twist
Since human behavior is a lot more complex and not necessarily linked to a simple experiment, the same experiment was challenged by a few researchers from the University of Rochester.
The researchers carried out the same experiment with a twist. They divided the group into two. The researchers promised a reward for delayed gratification to the first group but never gave them the rewards. While the second group got all the rewards as promised.
This time the researchers noticed a vast difference in the results. The first group saw delayed gratification as negative, while the other group saw it as hugely positive.
In other words, the child's ability to delay gratification and display self-control was not a predetermined trait but rather was impacted by the experiences and environment that surrounded them.
This also means that delayed gratification is not simply linked to your personality traits, and hence you can learn it with practice or by tweaking your environment.
The Connection.
- You skip a sugary snack to ensure better health tomorrow.
- You go for a morning run to ensure a day full of energy and focus.
- 90-minutes of HIIT to ensure a healthy tomorrow.
- 15-minutes meditation for a calm mind.
- Skipping social media for self-care.
Delaying gratification certainly has advantages linked to it. It helps you spare time and money for investments and improves your skills and abilities for future consumption.
Even if you don't feel like you're good at delaying gratification now, you can train yourself to become better simply by making a few small improvements.
I see Journaling as a strong tool that has helped me over time to cultivate this attitude. It's a powerful tool in my self-development journey.
Every day, I pull out the blank pages and express my mind over them. I feel a pause. Everything around me pauses for those moments and allows me to move away from instant gratifications.
I believe people who spend writing their thoughts are akin to that fisherman who is ready to cut down on present consumption and invest in the future.
While writing down our raw thoughts and allowing our minds to connect with paper, we consciously opt to settle down, slow down. Our thoughts get a channel to express themselves. During everyday rush, our minds do not get this opportunity.
Journaling is Mindfulness. Mindfulness is the opposite of Mindlessness.
Invest in a Journaling Habit — It's a sabbatical.
Journal writing is not a way to pass your free time. It's a serious investment for a better future—an investment with guaranteed results and unlimited compounding of benefits.
Woooohooooo! Such a big promise!!!!
Yes!
Because I experience this daily, I see a blank page, my mind smiles, starts expressing, share ideas, allows me time away from all the tools of instant gratification, and leaves me in a beautiful pause.
An attitude of low-time preference is an asset. That doesn't mean not investing in your present. It only means to tilt your balance more towards low-time preference or delayed gratification.
Journaling is my 30-minutes sabbatical.
- A sabbatical that helps me invest in a better "self."
- A sabbatical from which when you come back, you see life differently.
- Instant gratification turns to delayed gratification.
- And, high time preference turns to low.
Final words
You might think writing down your thoughts is not your skill. But believe me, if you can speak, you can write.
Spoken words float around this Universe like a wildfire, but written words are concrete.
- Journaling converts your thoughts into physical shape.
- Journaling alters your time preference.
- Journaling alters your attitude towards gratification.
Journaling is an evergreen habit. For your tough times, to your good times.
The more you express yourself on the paper, the clearer your head will become. Time will pause. Gratification will take a detour.
Nishith is an author and creator of a unique self-development platform — "Be Better Bit-By-Bit."
Grab your copy of his debut book — Be Better Bit-By-Bit and listen to his podcasts Be Better Bit-By-Bit and 10 Bullets — 100 Words Book Summary.