Delayed Gratification for Financial Security
We all crave it; We all want it. The happiness that comes from unboxing that new pair of shoes or taking that last-minute holiday is an addictive feeling that does more harm than the perceived good. The essence of delayed gratification is the ability to resist this instant pleasure in the hope of getting a reward in the future with better stable returns.
Lack of financial security results in constant stress, fear, and anxiety, leading to the need for instant gratification and instant happiness – a quick fix. This results in sinking deeper into the hole of financial insecurity, stress, and a repeat of this cycle until the bubble bursts.
Attaining financial security is a process, not a destination. It takes time and sacrifices to get there. Sacrifices from delays where you postpone your desires for a future reward; the sooner you begin, the better.
The process and the journey to financial security may sound gloomy, but it can be easy, efficient, and enjoyable. Taking advantage of some of human being’s most ingrained weaknesses will make it easy to build better financial habits, with the goal of Financial Security
- Practice smart decision making
The decisions we make shape our lives, every day, we’re faced with situations where we have to choose between an ideal and a less ideal position. But, in most cases, the ideal choice favors our immediate needs while the less ideal option benefits us in the long run.
Repeat an action long enough, and you will have formed a habit that may be difficult to shake. If you lean towards the ideal enough times, it will become your second nature. For example, it could be having fast food for lunch instead of a balanced, low, calorie meal or watching YouTube videos late into the night when you should be getting enough sleep. Think about your daily habits; you did not pick them up yesterday or last week; they have been rehearsed over time.
Such habits translate into your financial mindset and affect the decisions you make. Therefore, nurturing a pattern of delayed gratification results in making tougher but smarter decisions. For example, a mind that can effortlessly choose healthy foods over junk and good sleep instead of night entertainment will find it easy to make smarter financial decisions because it has internalized delayed gratification.
- Have your priorities right
One of the fastest ways to go down a poor financial decisions rabbit hole is by placing importance on the wrong priorities. The difference between a need and a want can sometimes seem difficult to pinpoint, but it is always there.
Whenever you want to buy something, whether it’s a service or a product, practice taking a step back and thinking through it to determine its importance. Do you need it? Or do you want it? Is it the only answer to a problem you may be facing? Or can you think of a better, cost-effective way of solving the problem? Finally, give yourself time to think about it.
If it costs you an arm and a leg, it takes 24 hours to allow yourself enough time to crystallize your thoughts so you’re sure the decision you make is the correct one on the larger scale of things.
Ultimately, you need to develop a list, mental or physical, of your financial priorities, which can act as your reference point when making decisions. It will keep you in check and provide a great sounding board.
- Build a system to divert extra money
To lack infinite willpower is to be human. You cannot depend on your motivation to achieve your financial goals. Instead, our mind is designed to avoid hard or painful events, and delaying the desired feeling is recorded as hard.
So, you need to develop a system that instills positive financial actions without depending on your willpower. For instance, set up standing orders from your current account to your savings account or a mutual fund.
Or you can open a locked savings account where instant withdrawals are impossible. Anytime you want to withdraw cash, you have to wait for a set time, maybe three days to 1 week, before you can access the money.
With such systems in place, you’ll have to automatically nurture a habit of delayed gratification because they will prevent you from instant satisfaction.
- Have an accountability partner
While systems can work effectively in controlling your financial transactions, they cannot help you instill a habit of smart financial planning. That’s where an accountability partner comes in.
An accountability partner is someone who makes sure you stay true to your promises. As humans, we have a deep desire to make the people around us happy so we can feel accepted. You can tap into this innate feeling to ensure you practice delayed gratification.
Your accountability partner will decide on a punishment for every financial mishap you make. For instance, if you choose to deposit Ksh.10,000 in your savings account by the 10th of each month, your accountability partner can decide to charge Ksh.1000 daily for being late.
It is necessary to make the punishment dire to instill discipline in you and make it virtually impossible to escape the punishment, e.g., by asking your employer to deduct the fines from your salary.
- Reward yourself
Let’s change gears a little bit. One of the best ways to make a habit stick is to reward yourself. James Clear, the author of Atomic Habits, poses that immediate rewards build a strong enough association on encouraging a behavior again. Coupling an achievement with a good reward makes your mind associate the preceding action with the resultant reward, encouraging you to repeat the same.
When nurturing habits of delayed gratification, you should pair every achievement with a reward that excites you. Using the earlier example, you can reward yourself with an adventurous activity every time you deposit the savings before the deadline.
This way, your mind associates the reward with saving, and you’ll find yourself looking forward to the next time you’ll be saving. Delayed gratification doesn’t have to be complicated; you can learn to enjoy the process to make it stick.
Delaying gratification when handling money is a surefire way to build wealth and achieve financial security. By practicing smart decision-making and having your priorities right, you develop a great mindset to start your journey towards Financial Security.
We have numerous solutions that you can take advantage of to begin your journey to financial freedom. So why not get started today?