Delayed gratification might be the secret weapon to growing your wealth.
The classic Marshmallow Test was a simple experiment with a profound message. Stanford researchers offered children a marshmallow, promising them a second treat if they could resist eating the first one for a few minutes. The kids who managed to hold out for that second marshmallow didn’t just show willpower—they demonstrated a skill that, decades later, linked to higher academic achievement, better health, and yes, even greater financial success.
When it comes to building wealth, the same principle applies. Those who can delay gratification—who can save now to enjoy more later—often find themselves in a stronger financial position. The marshmallow may be a metaphor for any immediate temptation: spending on impulse buys, indulging in lifestyle inflation, or making risky investments for quick gains.
The real key to financial freedom often lies in saying “not yet” and allowing your money to grow.
Saving today can lead to big rewards tomorrow.
At its core, the Marshmallow Test is all about patience, and saving money is one of the best real-world applications of this concept. When you set aside money now—whether it’s in a savings account, retirement fund, or investments—you’re essentially choosing the second marshmallow. Instead of spending on something small today, you’re giving yourself the chance to enjoy much bigger rewards down the line, according to Angel Navidad of Simply Psychology.
The magic of compound interest amplifies this idea. Even modest savings can grow significantly if you start early and allow them to compound over time. The hardest part is often getting started, but once you see your savings begin to grow, the motivation to continue only increases. Much like the kids who waited for their treat, the satisfaction of seeing your wealth build can outweigh the temporary thrill of instant gratification.
Investing is like choosing the second marshmallow—if you play it smart.
Investing can feel risky, but the principles of the Marshmallow Test apply here too. The key to successful investing isn’t chasing quick returns or getting caught up in the latest market trend—it’s about patience and consistency. Just like those kids who sat on their hands to avoid eating the marshmallow, smart investors know that keeping their money in the market long-term often leads to the best results, as reported by author James Clear.
The stock market will always have its ups and downs, but history shows that those who hold steady typically see growth over time. Instead of trying to time the market or react to every fluctuation, think of your investments as seeds. They need time and patience to flourish. The reward for this discipline can be a financial cushion that makes future opportunities (your metaphorical second marshmallow) much sweeter.
Avoiding debt is like resisting the temptation of the first marshmallow.
Credit cards, payday loans, and buy-now-pay-later offers are like that first marshmallow—they promise something good right away, but often come with a price. While taking on debt can sometimes be necessary, learning to manage it wisely is crucial for building wealth. The goal is to avoid high-interest debts that eat away at your financial stability.
Learning to wait, save up, and pay with cash or a debit card can prevent the financial hangover that comes with debt. It’s about training yourself to enjoy what you can afford rather than getting caught in the cycle of paying off past choices, based on the findings of Moneywise Global. Much like the kids who waited for the second marshmallow, avoiding unnecessary debt requires discipline but can lead to a much more satisfying financial future.
Budgeting is the adult version of delaying gratification.
Creating and sticking to a budget is one of the most practical ways to practice financial discipline. It might not feel exciting, but setting spending limits and tracking expenses is like setting the marshmallow just out of reach—you know it’s there, but you’re choosing not to grab it impulsively.
Budgeting helps you make intentional decisions with your money. By planning how much to allocate to savings, bills, and discretionary spending, you create a financial framework that supports your long-term goals. It also provides clarity, showing you exactly how small sacrifices today can lead to bigger rewards down the road. Over time, budgeting shifts from feeling restrictive to feeling empowering, as you gain control over your finances.
Setting financial goals is like focusing on that second marshmallow.
The kids who succeeded in the Marshmallow Test often distracted themselves—singing songs, covering their eyes, or imagining something else. Adults can do something similar by setting clear financial goals. Whether it’s saving for a house, building an emergency fund, or preparing for retirement, goals give you a tangible reason to resist spending temptations.
Visualizing what you’re working towards can make it easier to say no to smaller, immediate pleasures. It’s not about depriving yourself but about creating a future where those bigger goals are within reach. Keeping your “second marshmallow” in mind helps transform financial discipline from a chore into a powerful motivator.
Emergency funds are the safety net for when life eats your first marshmallow.
Life doesn’t always play fair. Sometimes, the metaphorical marshmallow gets snatched away—a sudden expense, a job loss, or an unexpected bill. That’s why having an emergency fund is so important. It acts as a safety net, allowing you to handle financial surprises without derailing your long-term plans.
Building an emergency fund takes time and discipline, but it provides peace of mind. When you know you have a financial cushion, you can avoid rash decisions or taking on debt when challenges arise. It’s like having a hidden stash of marshmallows—one that ensures you’re prepared for whatever life throws your way.
Living below your means keeps more marshmallows on your plate.
One of the best ways to build wealth is by consistently spending less than you earn. This concept is simple but not always easy, especially when lifestyle inflation tempts you to upgrade your home, car, or wardrobe as your income grows. Living below your means is the financial equivalent of choosing not to eat the first marshmallow.
This strategy doesn’t mean you have to live a life of deprivation. Instead, it’s about making thoughtful choices and prioritizing what truly matters to you. The savings generated by living modestly can then be invested or saved, creating a strong foundation for long-term financial stability. It’s about enjoying life’s pleasures without jeopardizing your future security.
Practicing patience in financial decisions pays off.
Whether it’s waiting for a sale instead of buying on impulse or holding off on a major purchase until you’ve saved up, financial patience can lead to better choices. Much like the Marshmallow Test, where kids showed remarkable creativity to avoid temptation, adults can develop strategies to manage spending urges.
Financial patience is not about denying yourself forever but about creating thoughtful pauses in decision-making. This approach can help you avoid buyer’s remorse, find better deals, and make investments that truly align with your goals. Over time, practicing patience helps build a mindset that prioritizes value and long-term gain over immediate satisfaction.
Teaching kids about money is like giving them their own marshmallow test.
If the Marshmallow Test taught us anything, it’s that the ability to delay gratification can be nurtured early. Teaching kids about saving, budgeting, and making smart financial choices can set them up for success. Lessons like saving allowance money or earning rewards for chores introduce the idea that good things come to those who wait.
By modeling healthy financial habits and providing opportunities for kids to practice money management, parents can pass on valuable skills. The earlier these habits are formed, the easier it will be for the next generation to handle financial challenges with confidence and wisdom. It’s like giving them the tools to choose the second marshmallow—only this time, the reward is a lifetime of financial security.
Developing a long-term mindset helps turn marshmallows into a feast.
The Marshmallow Test wasn’t just about resisting temptation; it was about thinking beyond the immediate moment. When it comes to building wealth, having a long-term mindset can transform modest beginnings into substantial gains. Those who look beyond instant gratification are more likely to make decisions that contribute to financial security—like investing in retirement accounts, setting aside money for education, or building passive income streams.
A long-term approach encourages consistent saving and smart investing, even when the results aren’t immediately visible. It’s the difference between eating one marshmallow now and building a marshmallow factory later. By prioritizing future gains over present indulgences, you set yourself up for sustainable financial growth and a more comfortable life.
Surrounding yourself with disciplined people makes it easier to wait for the second marshmallow.
The children who succeeded in the Marshmallow Test often used clever tactics to resist temptation. As adults, our tactics can include surrounding ourselves with like-minded individuals who prioritize financial stability. When your circle values saving, investing, and budgeting, it becomes easier to adopt those habits yourself.
Peer influence is powerful. If your friends are consistently splurging on expensive dinners, vacations, or impulse purchases, it can be challenging to stick to your financial goals. On the flip side, being around disciplined people can reinforce your own resolve to delay gratification. It’s like sitting next to another kid who’s also determined to get that second marshmallow—you keep each other accountable and motivated.
Building good financial habits creates a strong foundation for wealth.
In the Marshmallow Test, the kids who waited often had strategies—they sang songs, closed their eyes, or distracted themselves. When it comes to wealth-building, good financial habits serve the same purpose. Consistently budgeting, tracking expenses, and setting financial goals help create a stable foundation that makes wealth accumulation more achievable.
Habits are powerful because they turn disciplined actions into automatic behaviors. When saving, investing, or avoiding debt becomes second nature, you reduce the mental strain of making tough financial choices. Over time, these habits compound, much like interest, contributing significantly to long-term wealth.
Learning to say ‘no’ to smaller pleasures opens the door to bigger opportunities.
The essence of the Marshmallow Test is learning to say no when it matters most. This skill is just as valuable in managing finances. Whether it’s passing on a daily latte, avoiding unnecessary subscriptions, or skipping the latest gadget, saying ‘no’ to smaller expenses can free up resources for larger financial goals.
This discipline isn’t about denying yourself joy but about prioritizing what truly matters. Instead of a short-lived dopamine hit, you’re setting yourself up for lasting financial security. The money saved by resisting everyday temptations can accumulate, opening doors to opportunities like investing, travel, education, or early retirement.
Using visualization techniques can strengthen financial discipline.
Some of the kids in the Marshmallow Test used visualization to resist temptation—they imagined the marshmallow as something else or thought about the future reward. Applying this strategy to wealth-building can be incredibly effective. Visualizing financial goals—like a paid-off mortgage, a dream vacation, or a robust retirement fund—can reinforce the motivation to save and invest.
Creating a vision board or setting up visual reminders of your goals can make the concept of delayed gratification more tangible. When faced with a spending temptation, these cues can help shift your focus back to the bigger picture. Visualization isn’t just daydreaming—it’s a powerful tool to keep your financial actions aligned with your long-term ambitions.
Automating finances removes temptation altogether.
One of the best ways to avoid eating the first marshmallow is to take it out of sight. In financial terms, this means automating your savings and investments. Setting up automatic transfers to a savings account or investment portfolio ensures that money is saved before you even have the chance to spend it.
Automation helps eliminate the friction of making financial decisions repeatedly. Instead of having to choose between spending and saving every payday, the decision is made for you. It’s a hands-off approach that builds wealth consistently and prevents the temptation of impulse spending.
Practicing gratitude can reduce the urge for instant gratification.
The Marshmallow Test highlighted the challenge of resisting temptation, but practicing gratitude can make that resistance easier. When you focus on what you already have, the urge to acquire more diminishes. This shift in perspective can reduce impulse spending and reinforce saving habits.
Gratitude helps break the cycle of always wanting more. Instead of seeking happiness through purchases, you find contentment in experiences, relationships, and non-material joys. This mindset not only supports financial goals but also enhances overall well-being. It’s like realizing you don’t need the first marshmallow because you’re already satisfied—and still getting rewarded with the second one.