The marshmallow test is a famous experiment designed to measure a child’s patience and willpower. Place a marshmallow in front of a child and tell him he can have a second treat if he can go 15 minutes without eating the first one. The research, which was conducted in the 1960s, suggested that those who pass the delayed gratification test tend to do better in school and go on to have successful careers.

But a new study published last week found that the ability to hold out for a second marshmallow was less about delayed gratification and more about the child’s social and economic background. It was this background that determined a child’s chance at future success, not their capacity to hold out for a second treat.

The researchers, NYU’s Tyler Watts and UC Irvine’s Greg Duncan and Hoanan Quan, restaged the classic marshmallow test with a much larger sample size (900 subjects versus 90) that was more representative of the general population in terms of race, ethnicity, and parents’ education.

Among kids whose mothers did not have college degrees, those who waited did no better than those who gave in to temptation. For those kids, self-control alone couldn’t overcome economic and social disadvantages.

Kids from poorer households might have less motivation to wait for that second marshmallow. There’s a scarcity mindset that values short-term outcomes over long-term rewards. Meanwhile, in well-off households, it might be easier for children to delay gratification when the pantry is always fully stocked and treats are aplenty.

The other thought is that less affluent parents might get a boost of joy out of indulging their kids with a treat once in a while, whereas richer parents might prefer their kids to wait for bigger rewards.

The bottom line: Consider the results from the original marshmallow test debunked.

This Week’s Recap

On this post-race recovery week I recapped my half-marathon over on the Echo Runner blog.

I’ve had more to say recently on Rewards Cards Canada where I asked a behavioural economist about WestJet’s clever marketing trick.

I’m ramping up my travel rewards collecting and revealed how to unlock $850 in Aventura points from this CIBC rewards card three-pack.

And finally, one for the Air Miles collectors – I review the BMO Air Miles World Elite MasterCard, which has a terrific promotion on right now that pays a welcome bonus of up to 3,000 Air Miles.

Next week I’ll look at the best place to park your short-term cash, plus a better way to redeem unused rewards points.

Weekend Reading:

Neighbours of lottery winners are more likely to go bankrupt. Why? Because seeing someone else get rich puts people into spending mode.

The brilliant Morgan Housel shares nearly 8,000 words on the psychology of money, describing 20 flaws, biases, and causes of bad behaviour that pop-up often when people deal with money.

The Irrelevant Investor Michael Batnick answers this reader question: “My dad has $1.8 million dollars worth of GE. What should he do?”

On the Debt Free in 30 podcast: How one man survived a layoff after 20 years at Canada’s biggest company.

The Lemonade blog, a Dan Ariely inspired project, explains why you can’t stop looking at your phone.

“When you perform a specific behaviour over and over again that triggers a certain reward, the pattern becomes etched into your neural pathways. Soon enough, your brain begins to crave that reward regularly.”

Preet Banerjee is back with another investing video that looks at top level asset classes such as cash, real estate, commodities, and alternative investments:

The team at Spring Plans shares an important resource about how to get your RESP money out now that tuition, textbook, and accommodation invoices have started to roll in.

Will we have enough for our children’s University tuition? Million Dollar Journey blogger Frugal Trader explains where he’s at with his kids’ RESPs.

The Stocktrades blog shares 55 ways to invest $1,000 (and make a killing).

A number of Canada’s big banks are under investigation by the Financial Consumer Agency of Canada for possible violations of the consumer rules in the Bank Act.

Tens of thousands of banking customers at BMO and Simplii Financial may have had their accounts compromised after “fraudsters” gained access to personal and financial information.

Here’s Rob Carrick on how to protect yourself when your bank’s online security fails.

My Own Advisor Mark Seed explains the benefits of variable percentage withdrawals in retirement.

For retirees: Don’t slam on the brakes – keep active and ease into retirement.

A new book argues that many of us are working in meaningless “bullshit jobs”. Let automation continue and liberate people through universal basic income.

Finally, here’s how blogger Bridget Casey budgeted her way through a surprise pregnancy.

Two years ago I decided to get serious about my physical health and so I took up running. My wife was already a fitness junkie and avid runner. It was time for me to get moving. I downloaded one of those ‘Couch to 5K’ running apps for my phone and started running three days a week. Since then I’ve entered a couple of 10K races, and this year I decided to step it up and enter my first half-marathon race.

I’ve trained for the past 16-weeks, logging nearly 570 kilometres along the way. I know all the hard work has already paid off with improved fitness and health. I’ve also finally ‘caught-up’ with my wife so we’ll get to run the same distance for the first time at a race. Our goal is to finish the race in 1:50:00 so we’ll be pushing each other to get our personal best times.

We’ll find out this Sunday at the Calgary Marathon where we’ll be competing in the Centaur Subaru 21.1KM at 7:00 a.m. Wish us luck!

Echo Runner

You know I’m taking this new hobby seriously because I’ve started a new blog – Echo Runner – to share everything about my running addiction and, like with this blog, to hold myself accountable to achieve my running and fitness goals. I even managed to sneak in a money-related post on how much running costs (because of course I did!).

I’d love it if you’d follow along, whether you’re into running and fitness or just want to check out another side of your favourite personal finance blogger. I’m also on Twitter @EchoRunnerBlog.

This Week’s Recap:

On Monday I shared my financial freedom update and was pleased to see that I’m still on target for freedom 45.

On Wednesday Marie listed five ways to prepare your executor before you die.

And on Friday I shared how I manage to find the time to work 9-5 and run a successful side business.

Over on Rewards Cards Canada I explained why you don’t want to leave home without first getting travel medical coverage.

Weekend Reading:

Karen Wallace at Morningstar explains exactly how a 25-year-old with no savings and making $40,000 per year can end up with $80,000 by age 35. It can be done, folks.

I also liked how Des Odjick broke this down at Half Banked. She smartly says you can’t just save your way to retirement. You need to invest your way to retirement.

Investing trump savings thanks to the power of compound interest. Million Dollar Journey explains how compounding returns make you rich. I noticed this in my own portfolio as market returns beat my savings contributions for the first time.

Real estate investing is a subject we don’t often tackle on this blog, mainly for lack of first-hand experience. Here’s how blogger Paula Pant has built an eight-home rental property empire.

How are millennials countering a precarious job market and the dreaded office cubicle? The latest trend has them buying franchise businesses.

Larry Swedroe applies these poker playing lessons to investing:

“When it comes to investing, there are no clear crystal balls. Just as in poker, the best we can do is put the odds in our favor and invest (bet) accordingly.”

Here are some intelligent examples on when to look at the big picture and let retirement planning take a backseat to more urgent financial issues.

The whole concept of a financial market exists on the basis that taking risk can result in financial gain. Here’s PWL Capital’s Ben Felix on how much risk you should take with your investments:

Michael Batnick shares some great examples as to why you should never begin with the end in mind when it comes to investing:

“When we buy a stock, a few biases instantly kick in. We value it more than we did before we owned it (endowment affect), we look for reasons to support our purchase (confirmation bias) and perhaps most pernicious, we anchor to the purchase price.”

Here’s CFP Jason Heath on what today’s savers can learn from today’s seniors about retirement planning.

Jonathan Chevreau just turned 65 and shares how he plans to make the transition into retirement.

Michael James says you could be making a fundamental mistake with your asset allocation by not thinking of your RRSP as partially belonging to the government.

Ben Carlson from A Wealth of Common Sense answers a popular reader question: Do long-term investors need bonds?

No one can explain how cryptocurrencies work, but that aura of mystery seems to attract new money and investors. Robert Shiller explains why none of this is new, and, as with past monetary innovations, a seemingly compelling story may not be enough.

Rob Carrick says we need to stop blaming the mortgage stress test for killing the housing market.

The ‘holy grail of shipwrecks’ has finally been discovered: a Spanish ship that sank with $17B in gold.

Finally, grab a coffee and dive into this collection of terrific investing pieces by Jason Zweig.

Have a great weekend, everyone!