Editor’s Note: In our march back through the YNAB podcast episodes, we’re skipping episode 80 because we published it last year. Enjoy the transcript of episode 79.
Hello YNABers. My name is Jesse Mecham and this is podcast number 79 for You Need A Budget, where we teach you four rules to help you stop living pay check to pay check, get out of debt and save more money.
It’s now planting season – at least it is here in Utah – and I have planted some things. The trick is being patient. And since I put in the cold stuff a few weeks ago – radishes, spinach, some Italian seed mix that will throw up 11 different types of lettuce – I find myself going out daily and checking on the seeds, seeing if they’ve sprouted. And it is a test in patience. I was telling Julie after three days, “I’m worried about the spinach. I’m not seeing anything from it,” and then, “I’m worried about the lettuce,” then I saw some lettuce. Oh, I put in beets too, and I haven’t seen any of the beets. And I found myself wanting to do things to try and hurry it along. But there’s not really anything you can do – you just have to be patient. If you think that adding more water is going to help, if they’re sufficiently watered already that won’t and you wouldn’t want to drown them. If you’ve got a lot of cold weather, a lot of cloud, that will slow it down a little bit. And so I find myself being patient.
I planted 14 raspberry plants. They were bare root, and bare root plants are really strange because you stick them in the ground and it’s just like putting sticks in the ground. I worry that my kids are going to yank them out and start using them as Harry Potter wands or something like that, so I had to warn them. But you sit there and you’re just looking at these sticks in the ground. They look completely dead. The instructions even told me to snip off about six inches of the stick, so not only have I just stuck a stick in the ground, but I also snipped half of it off and I’m supposed to be patient. The raspberries will take a full year to… and they might produce a few berries but nothing of note until next year, so I have to be patient.
Two years ago I planted two pear trees, five peach trees and four apple trees. And I did get a little bit of fruit last year – like one peach and two apples. I didn’t have the heart to pull them off the tree and have the tree devote its energies to establishing itself, which is what I should have done. I just couldn’t bring myself to do it. So I ate the apples and the peach. But the trees won’t produce fruit for another two years or so – nothing of note, at least. So I have to be patient. So I fertilize, I look at the trees a lot, I make sure they’re budding. But there’s not much I can do. You have to wait for things to do their thing.
There was a study done a while ago… I don’t remember what the source of the study was, but I heard it from a reputable source. And it had to do with little kids that were put in front of a marshmallow – a big, pasty marshmallow – and they were told, “There’s the marshmallow, you can have it now. But if you wait a while, we’ll give you two marshmallows.” And they would videotape the kids and track what the kid decided. Some of the kids, they just went to town on that marshmallow immediately; and other kids waited and waited and then cracked under the temptation of that big, white, fluffy marshmallow, and they popped it in their mouth. Some of the kids actually could hold out, and if they did then they got two marshmallows and they were rewarded.
They tracked these kids for a while, and they found a correlation between the kids’ ability to hang on, to kind of hold off and not have immediate gratification; they tracked that willpower back and saw a correlation with their success – with their grades in school and with how they performed based on standard measures of success that we have for kids, mainly grades and test scores and things like that. So the kids’ ability to be patient and wait for the greater reward is what allowed them… well, not what allowed them, but was at least correlated with greater success later on in life. And we know that with the harvest as well. If you harvest too early – if you eat the seed corn, so to speak – then you don’t get the ultimate reward.
And of course, you guys often see the parallels with budgeting, with avoiding debt – avoiding the instant gratification temptation and being able to say, “You know what? I don’t need that now. I might want it now, but I don’t need it now. I can hold off. I can wait. And I can determine if that’s what I really want and if it’s something I should work toward.” The same happens with retirement, saving up for vacations, saving for Christmas – all those things. Well, Christmas you kind of have to wait for no matter what, but… Being able to put off instant gratification for a greater reward down the road is a mark for a patient and likely, later on in life, a wealthy person.
I’ve been thinking a lot about the investing course that we launched, and I’m having great feedback from people on it. The ability to set money aside and acknowledge the fact that you will have expenses in the future, for which you will need money, and those expenses are far, far, far in the future – it’s like the ultimate rainy day category. The ability to set some money aside and say, “I don’t want to use that now. I’m going to exercise some discipline and use that later” – that is the mark of a patient and wealthy person.
Until next time, follow YNAB’s four rules and you will win financially. You have not budgeted like this.