|Pathways Advisory Group, Inc.|
Thursday, September 14, 2017
By now, you’ve likely heard about the data breach at Equifax. From May through July, Equifax - one of the three major credit bureaus - experienced a breach in data affecting at least 143 million people. For information on this breach, please visit the Federal Trade Commission’s website here. You can also check for updates directly from Equifax here, including whether you were potentially impacted.
Equifax is offering a free 1-Year subscription to TrustedID. You can see the details of the program here.
We’ve written about credit and identity protection in the past. Jeff’s blog post, Credit Protection, highlights freezing your credit among a other key ways to protect your information. Leslie’s post, 10 Steps to Protect Your Identity, outlines other valuable options available to you.
While many credit card companies and banks notify their customers of suspicious activity, proactively taking a few of the steps above can make a huge difference in keeping your identity secure.
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Friday, September 1, 2017
Back in the 1960’s, Walter Mischel, a psychologist, studied preschool children to assess the level of self-control they possessed. Using marshmallows, he placed one on a plate in front of each child. He then left, but before doing so, gave each child the same two choices: either eat the marshmallow, or wait 15 minutes until he returned. If the child was able to wait, he would receive two marshmallows (Delaying Gratification, n.d.).
Only about a third of the children could wait the full 15 minutes. Why? Willpower and impulsiveness are the two competing cognitive processes that come into play. Willpower is based on a person’s strategic planning, while impulsiveness comes more from a person’s emotions (Delayed Gratification, n.d.). If a person employs willpower in a situation, it decreases the chances of submitting to impulsiveness in the next situation. In other words, a person must practice willpower to have willpower.
We see our clients practice willpower every day in order to save for a comfortable retirement. Younger clients are typically in the midst of buying a house, having children, and achieving career goals. It’s sometimes harder for this generation to save towards their retirement goals. But, if possible, it does have a significant effect on portfolio size at retirement. How much? See the following spreadsheet from our website's Young Investors page…
Ben’s willpower to save those first ten years made a huge difference! In addition, isn’t it a little crazy how compounding interest can substantially increase our savings over time? The point: Today’s choices completely affect our future.
So, what happened to those preschoolers? Mischel tracked down nearly 60 of those original subjects more than thirty years later. The children who had exhibited high self-control remained that way throughout life, and vice versa. The higher self-control group led healthier lifestyles, received higher SAT scores, and had higher income (Konnikova, 2014).
Later in life, Mischel addressed some worried parents. He explained that children who fail The Marshmallow Test need to practice. Start out small, a few minutes maybe, and increase the time slowly (Konnikova, 2014). After all, 15 minutes is a long time for a little kid.
Remember: Practicing willpower builds willpower. Whether it is marshmallows or regular savings, willpower pays off.
Also, if you would like to see children take The Marshmallow Test, check it out here on YouTube. It’s quite entertaining.
-Written by Katie Nelson from our March 2016 Client Newsletter Article.
Delaying gratification (n.d.). American Psychological Association. Retrieved from https://www.apa.org/helpcenter/willpower-gratification.pdf
Konnikova, M. (2014). The struggles of a psychologist studying self-control. The New Yorker. www.newyorker.com.
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