How to Teach Your Kids to Delay Gratification and Why It Matters

How to Teach Your Kids to Delay Gratification and Why It Matters

Delayed gratification is ‘the ability to resist the urge for an immediate, smaller reward in pursuit of a greater reward at a later time,’ explains Joyce Marter, licensed psychotherapist and author of ‘The Financial Mindset Fix: A Mental Fitness Program for an Abundant Life.’ 


Marter says that kids as young as toddlers and preschoolers can begin to learn delayed gratification. And, there's research to back this up. One of the seminal studies on delayed gratification is known as the Stanford Marshmallow Experiment. In this experiment, preschool-age children were presented with a marshmallow and given two options: 


  1. They could eat the marshmallow immediately, or
  2. They could wait for 15 minutes and get an additional marshmallow 


The children who were able to wait 15 minutes effectively demonstrated the skill of delayed gratification. 


In follow-up studies conducted decades later, researchers found that the children who delayed gratification ended up having higher SAT scores, lower levels of obesity, better social skills, and better emotional coping skills.


A similar study found that children with good self-control grew into adults with higher socioeconomic status and were more likely to be homeowners and have retirement plans.


These follow-up studies highlight the importance of delayed gratification as a key ingredient for success in many areas of life.


Related: Financial literacy for kids




How to teach delayed gratification to kids

  1. Start small and start talking early
  2. Teach children to prioritize the most important things
  3. Give allowance and encourage your children to earn money with chores and jobs
  4. Set savings goals with your children 
  5. Help them to learn from making their own mistakes
  6. Encourage them to celebrate successes
  7. Explain the dangers of Buy Now, Pay Later (BNPL)
  8. Teach them ‘the Pause’
  9. Start thinking long-term, early


Learning how to delay gratification is an important part of money management. It not only helps kids to understand bigger money messages, such as financial choices, interest rates, and debt, but it’s also the basis of financial planning. 


This helps your child to understand that saying no to something they want today means more time to save – and, therefore, more money for them in the long term.


Of course, it's not easy to teach this when faced with a child who is 100% sure they need a toy right now, or a teen who wants a new pair of trainers this instant. It's important to know that kids and young people don't have the same impulse control as adults, which means they have trouble waiting. So, to teach delayed gratification, you need to help kids see the benefits of choosing a long-term reward over a short-term one – and how this can transform their financial future.

1. Start small and start talking early

With small children getting them to understand delaying gratification can start early with simple requests such as waiting to speak when someone else is talking, taking turns in games, and being patient when they ask for something. All these very simple acts start them on the road to understanding that often they have to delay gratification.


Louise Hill, COO of GoHenry agrees, "You should start talking to your children as early as possible about the difference between need and want. Research from Cambridge University shows that children form their attitudes and habits towards money by age seven, so it's never too early to start having these conversations. Remind them that you steal from yourself if you buy what you don't need."


Another good way to get them used to this idea is to explain the differences between need and want when you are out shopping, says Louise. "We need the rice and the chicken, but we don't need — we just want — the chocolate cake, for example. There are many simple ways to do that and bring that to life for children so that it's meaningful, without having to go into complicated details or worry them."

2. Teach children to prioritize the most important things

It's crucial to start with small goals when teaching financial skills that prioritize delaying gratification. With small children, allow them to make mistakes around gratification. Rather than tell them off, use these mistakes as a way of explaining that sometimes they need to wait.


For example, tell them they can have one treat at the end of the day or after dinner – and if they take one before that, they won’t get another one. The following day, challenge them to wait for longer – and explain that the longer they can last, the more exciting the treat will be.


Related: Budgeting for kids


3. Give allowance and encourage your children to earn money with chores and jobs

One of the best ways to teach your kids to delay gratification is with an allowance. If your child asks for sweets or toys whenever you’re in a shop, or requests money to go see a film or have lunch with friends, giving an allowance means that your child has their own source of money to manage. And managing their money means making the money last by learning to delay gratification. 


If your child does run out of money, encourage them to supplement their allowance by earning more from chores and jobs. If you want to reward your children for doing chores with an allowance, GoHenry allows you to set paid tasks. Once your child has finished a paid task, you can tick it off, and the GoHenry app will automatically pay this out on their weekly allowance day. 


Our latest Youth Economy report reveals that a third of kids (34%) felt they weren't earning enough. But, rather than expecting their parents to hand over extra cash, seven out of ten kids (78%) say that it's important to make their own money. In 2021, GoHenry kids earned a total of $3.1 billion from completing tasks that had been set in their GoHenry app. 

4. Set savings goals with your children

Children of all ages can also create a savings goal on the GoHenry app. This will help them see how quickly savings grow, and how delaying gratification increases their financial choices. When your child has a savings goal, they will be much more likely to think about whether they need or want something before buying it. It will keep them focused on their long-term goals, rather than just spending money on what they want in the moment. Having a savings goal also gives children a sense of financial responsibility and ownership over their money.


Related: What is saving and why is it important for kids



5. Help them to learn from making their own mistakes

One of the best ways to teach a kid how to make smart decisions is to let them learn by doing. This means encouraging your kid to manage their allowance on their GoHenry card and regularly check the app to see what they are spending and saving.


This also means no bank of mum and dad bailouts. A hands-off approach to letting kids manage their own money means letting your kids figure things out on their own. If they know they are due to go out at the weekend with friends but spend all their money online during the week, you can feel bad for them, but bailing them out won't teach them to learn from their mistakes – or delay gratification.

6. Encourage them to celebrate successes

It’s also important to celebrate successes. Let your kids know that you're aware of how tough it can be to resist everything to get that one thing they want, and how proud you are when they reach their saving goal or can resist instant gratification.


"It's so important to celebrate these achievements," says Louise Hill. "Always celebrate when a goal is met, and help your kids achieve this by setting up savings goals with your children on their GoHenry account."

7. Explain the dangers of buy now, pay later (BNPL)

The BNPL market is exploding for teenagers, with a range of companies offering kids the chance to buy even when they don't have the money. This makes it easy to bypass delaying gratification in favor of instant gratification as BNPL allows consumers to pay for purchases in installments or in 30 days (make sure to read the small print). Users pay no fees or interest unless they default. 


Related: Teaching your child about credit


Make it clear to your kids that borrowing isn't inherently wrong – but it is vital to delay gratification, read the small print, understand APR, and make sure they can meet repayments before they buy anything. 

8. Teach them ‘the Pause’

The pause is a simple but effective way of helping kids to overcome the urge to spend. It involves pausing before they make any purchase – whether it's in person or online – and taking 60 seconds to consider whether they really need or want what they're about to buy. This will help them get into the habit of thinking about their long-term financial goals, rather than just spending money on something they want in the moment.


The pause can be a difficult concept for kids to grasp at first, but with practice, it will become second nature. And once they've mastered it, they'll have a valuable skill that will serve them well throughout their lives. It's one that will help them to overcome the urge to spend and make smart financial decisions.

9. Start Thinking long-term, early

One of the best things you can do for your kids is to help them start thinking about their long-term financial goals. This could involve setting up a savings goal on the GoHenry app or simply talking to them about what they want to save for. It's never too early to start thinking about the future, and the sooner your kids start, the better.


Long-term thinking is a valuable skill that will serve your kids well throughout their lives. It will help them to make smart financial decisions, and to resist the urge to spend money on things they don't need. So encourage your kids to start thinking about the future today, and they'll be on the right track for a bright financial future.

Why delayed gratification is essential for financial success and wellbeing

According to Marter, teaching delayed gratification early on in your children's lives helps them to prepare for future financial success in the following ways:

  • Financial responsibility: Delayed gratification helps children learn to live within their means and strike a healthy balance between spending and saving. Having the ability to say no to that toy, shirt, or video game now means your child can save up and buy something even better or more meaningful in the future.
  • Financial planning: Being able to think ahead, save, and prepare for the future helps to provide financial stability and resilience. These skills can increase your child's ability to endure hardships such as unemployment or a dip in the economy.
  • Financial consciousness: Being financially conscious means your child will be more aware of their financial reality and not be in financial denial. They will be more likely to take action and deal with their finances instead of ignoring any issues.

Help teach your kids delayed gratification through using GoHenry

With the GoHenry prepaid kids debit card and app your children can learn to earn, save and spend their money wisely.

“Great for teaching children the value of money - helps them to get into the spend what’s left after saving mentality and steers them away from an instant gratification life.” (Trustpilot)

Your kids can setup saving goals within the app to help save towards a purchase.  They can also be paid their allowance through the app and GoHenry allows you to set paid tasks to help your kids earn more from chores and jobs.



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Financial literacy resources for children 

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Written by Anita Naik Published Jan 6, 2022 ● 2 min. read