The Marshmallow Test for Retirement

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Walter Mischel, who used marshmallows to test children’s ability to delay gratification, died recently, but his lesson never grows old.

For those who aren’t familiar with his famous test, a young girl or boy sits at a table with a single marshmallow on a plate. The tester tells the child that he or she can eat the marshmallow right away, but waiting to eat it until the tester comes back into the room will bring a big payoff: a second sweet, puffy morsel.

Watching the children in this video squirm as they wrestle with their decisions brings to mind the adult equivalent. A desire for immediate self-gratification can come at the detriment of any number of personal financial decisions.

Like the marshmallow test, consuming now means having less money in the bank later.  The test also applies to deciding when to retire. Retiring becomes extremely tempting for baby boomers who want to escape from work after decades in the labor force.  But those who wait patiently for a few more years will have a sweeter retirement: a much larger Social Security check and more 401(k) savings distributed over fewer total years in retirement.

Children, when faced with the marshmallow test, struggle mightily to exercise self-control. They pick up the marshmallow to examine it, play with it, nibble it, and move it out of reach – but impulse gets the better of them, and they pop it into their mouths.

The lesson here is the same for children and adults: resist temptation and be rewarded.

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Ken Pidcock

I don’t see it. The reward would appear to be fewer years unburdened by work before you die. If you’ve accumulated a solid source of income, perhaps you should ask if it’s fair to continue working. My guess is that a lot of the visitors here have jobs for which someone else is waiting.

Cynthia Crawford

“The idea behind the new paper was to see if research from the late 1980s and early ’90s showing that a simple delay of gratification (eating a marshmallow) at ages 4 through 6 could predict future achievement in school and life could be replicated.

What the researchers found: Delaying gratification at age 5 doesn’t say much about your future. Rather, there are more important — and frustratingly stubborn — forces at work that push or pull us from our greatest potential.

The marshmallow test story is important. The original studies inspired a surge in research into how character traits could influence educational outcomes (think grit and growth mindset). They also influenced schools to teach delaying gratification as part of “character education” programs.

It’s also a story about psychology’s “replication crisis,” in which classic findings are being reevaluated (and often failing) under more rigorous methodology.”

Stephen Rose

Taking Social Security benefits early or late should be driven by your health status. If you live the average number of years after 66, it does not make a difference. If you are bad health, take it now. Finally, if you think you will outlive the average, delaying is financially better.

    Ken Pidcock

    With exceptions, prudence counsels insuring against longevity by delaying. If the bet doesn’t pay off, you will not, by definition, regret it. (This assumes that you have the resources to place the bet.)

Wendy Weiss

I understand that the Marshmallow Test was born out. Longitudinal studies showed that children who could delay gratification for a simple marshmallow exhibited impulse control throughout their lives. They were academically more competent and, according to author Daniel Goleman, were more emotionally intelligent, as well.

Delaying gratification (or impulse control) is key to financial security as well. It is essential for “living within your means,” plus saving a significant portion of your income.

I propose a follow up study of those same 4 year olds. I would like to compare the amount of money in their retirement accounts at age 65, the amount of credit card debt they still hold, and the debt to income.

My 15 years of experience as a professional financial planner has shown me that there is a high correlation between impulse control and no (orlow) credit card debt. These same individuals often have larger retirement accounts (maybe maxing out!) and may have investment accounts of considerable size as well.

While statisticians would argue this is anecdotal evidence, I hypothesize that –to take today’s spending patterns as examples– folks who couldn’t wait to renovate their houses, may not have not saved enough for their children’s college tuition and their own retirement. Indeed, Elizabeth Warren and her daughter conducted research that shows that a large number of families buy homes that are too expensive. (They do this so their children can attend good schools.) These same families may default on their mortgages if they are faced with a large medical bill, or other bill. And lots of other research shows that most Americans could not come up with $2,000 to pay for a car repair bill or medical setback.

Granted, many middle class Americans have not enjoyed a significant raise in the last 30 years. So it is harder for them to save. Those in the top two deciles may have more discretionary income. But, they too rarely can pay for their kids’ college tuition. (hence the rise in student loan debt). And they often have retirement accounts that can not begin to cover the costs of their spending after they leave work.

Controlling spending so that traditional North Americans can save 10%-20% of your income is unfortunately less common than is expeditious. Longevity risk is a real problem.

To think that it turns on an ability to wait to enjoy…a marshmallow.


I retired at 58. Earned a pension. At 62 took Social Security. Decided to take the gamble. I live in an area with a lot of retirees and the conclusion I reached is this: one size does not fit all. I am ok as far as being able to afford to retire. Some people in their 70’s work at Walmart here. Most tell me because they outlived their resources and need to work. Many tell me their spouse died and did not really provide for them. I had a plan and my spouse will be fine if I go first. Feel very blessed.


I find too many adults don’t get to eat all their marshmallows…delaying gratification in excess. my father died in his 50’s having never tasted 1 of his treats.

Not me, now 60 – I am making retirement work with the nest egg I got…I want to live the life I dreamed of, not extravagantly, in good health.

Denise Hartman

Planning for retirement is hard. My husband retires at 67 next June. We have always been big savers but never paid much attention to asset allocation in our early to mid accumulation years nor how much we needed to save. The wealth of knowledge available on the internet in the last five years has been extremely helpful. Our plan is more solid now than ever. We continued to save for retirement even when our kids were in college. Now we are struggling with trying to determine what we can spend on badly needed home upgrades why we wait for SS to kick in at 70. Sequence risk at the end of this long bull market feels like concrete shoes to us. The “spending fear” by retiring baby boomers will have an enormous impact on the economy. This fear is compounded by my 93 year old parents. Reasonably healthy in assisted living but requiring financial support from their retired or near retired children. My husbands father also lived to 93.

I never new that there were so many risks in your on your own retirement years. Trying to manage or anticipate them vs living the moment is a daunting psychological task.

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