Marshmallows and 401(k) Plans

When I was a right-brain undergraduate and long before my left-brain discovered ERISA, I took a number of psychology courses.

In one of those courses, we discussed the famous marshmallow experiment conducted by social psychologist Walter Mishchel at Stanford in the 1960s.

It went something like this. Mishcel put marshmallows in front of a room full of 4-year olds, and told them that they could have one marshmallow now, but if they could wait several minutes, they could have two. The experiment, of course, had to do with delayed gratification.

The children who waited longer went on to get higher SAT scores. They got into college and had, on average, better adult outcomes. These individual differences in the ability-to-wait were attributed to self-control.

A recent study jogged my memory about this experiment, and got me thinking about the link between marshmallows and 401(k) plans. The study, Rational snacking: Young children’s decision-making on the marshmallow task is moderated by beliefs about environmental reliability, was an update of the original experiment.

The researchers, Celeste Kidd, Holly Palmeri, and Richard N. Aslin at the University of Rochester,  were concerned that the results in the early experiments were attributable to more than self-control. In fact, they found that the results also reflected the child’s belief about the practicality of waiting.

So now how does this relate to 401(k) education programs?

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