3323: Don't Eat the Doughnut by Craig Stephens of Retire Before Dad on Delayed Gratification

Summary

---

Podcast Summary: Optimal Finance Daily, Episode 3323

Title: Don’t Eat the Donut by Craig Stephens (Retire Before Dad) – Delayed Gratification
Host: Diania Merriam
Date: October 19, 2025

---

Episode Overview

This episode centers on the role of delayed gratification in achieving financial independence and personal well-being. Using Craig Stephens’ “Don’t Eat the Donut,” host Diania Merriam explores why practicing financial restraint—opting for smart spending and long-term investing over instant rewards—not only paves the way towards wealth, but also mirrors the challenges of maintaining a healthy lifestyle. The episode provides actionable advice on mindful spending, the emotional dynamics of money decisions, and balancing frugality with occasional indulgence.

---

Key Discussion Points & Insights

1. The Simple, Not-Easy Formula for Wealth

• Triforce of Wealth:

  • Make more money
  • Spend less than you make
  • Invest the surplus
    (03:00) “Achieving success in personal finance is simple but not easy.”—Craig Stephens

• Habits, persistence, and steady income are the pillars of lasting financial progress.

2. The Psychology of Spending & Saving

• Temptations to Overspend:

  • People struggle with strong urges to spend entire paychecks, even in strong economies.
  • Emotions heavily influence money decisions, often leading to poor choices.

• Material Objects & Instant Gratification:

  • “Saving money is boring. Why save for tomorrow when you can live for today?” (03:57)
  • Spending on non-essentials provides short-term pleasure, but erodes long-term wealth.

3. The True Cost of Purchases

• Calculating Real Life Costs:

  • Every non-essential purchase should be weighed by how much working time it costs to afford it.
  • Example: A $100 item at $20/hour wage equates to 5+ hours of labor, considering hidden costs like taxes and commuting.
  • Each $100 saved brings you several hours closer to retirement. (05:06)

• Family Life Application:

  • Stephens often reminds his kids of the effort behind every purchase, connecting their wastefulness (like food thrown away) to his work hours.
  • “I work for nothing. The same goes for leaving the lights on or spilling milk.” (06:03)

4. Delayed Gratification Analogy: Don’t Eat the Donut

• Personal Finance as Weight Loss:

  • Both are conceptually simple (spend less, save more / eat less, exercise more) but hard in practice.
  • Both require willpower, emotional resilience, and persistence.

• The Donut Dilemma:

  • Even after a sufficient breakfast, the temptation of a free donut is strong, despite clear goals.
  • Burning off a 400-calorie donut requires significant exercise or caloric compromise.
  • “It’s far easier not to eat the donut than it is to burn off the calories.” (07:55)

5. Finding Balance: Frugality Without Deprivation

• Fringe Spending Should Be Scrutinized:

  • Non-essential purchases should only be made if they bring value or lasting happiness.
  • “Go ahead and eat the donut, but skip the third slice of pizza at dinner.” (08:32)

• Budgeting for Treats:

  • Enjoying occasional indulgences is important; denying yourself every pleasure can lead to misery.
  • “That’s why we budget. Build non-essential spending into your budget. Just make sure that your purchase is useful or fun and not a waste.” (08:23)

---

Notable Quotes & Memorable Moments

• On Financial Strategy:
  “That’s the formula to become wealthy over time. The Nintendo fanboy in me calls this the triforce of wealth.” —Craig Stephens, 03:05

• On the Cost of Living:
  “If you don’t spend the hundred dollars, you are theoretically six or seven hours closer to the date you can retire. I’m not making this stuff up.” —Craig Stephens, 05:22

• On Kids & Money Lessons:
  “My kids are always sad to see me leave for work… I’ll say something like, hey, dad worked hard to buy that slice of pizza and you took a nibble and threw it away. So I work for nothing.” —Craig Stephens, 06:03

• On Donut Temptation:
  “Do I eat it and enjoy the delicious taste and short-term happiness, or do I stay strong and walk away?” —Craig Stephens, 07:35

• On Frugality and Balance:
  “Go ahead and eat the donut, but skip the third slice of pizza at dinner.” —Craig Stephens, 08:32

---

Host Commentary & Personal Reflection (10:19–12:00)

Diania Merriam’s Perspective on Frugality and Mindfulness

• Living frugally has been her number-one personal finance improvement.
• Pushing back against consumerism requires intentionality and questioning what is truly necessary.
• Mindful Habits:
  • Pausing before purchases, considering alternatives such as repurposing or borrowing, then buying used or with research if needed.
• Hedonic Adaptation:
  • “If I buy the new shiny thing, it’s going to feel good for a little bit, and then it just becomes a part of my new normal. And that has diminishing returns on my happiness.” (11:09)
• Frugal living not only increases savings for financial independence, but also means your target retirement fund is smaller.

---

Important Timestamps

• 03:00 – The “Triforce of Wealth” overview and the challenge of consistent financial habits
• 05:06 – Calculating the true cost of discretionary spending
• 06:03 – Teaching kids about value and effort behind money
• 07:20 – The donut analogy: why it’s easier to abstain than make up for poor choices
• 08:23 – Balancing frugality with occasional indulgence
• 10:19 – Diania’s personal reflection on frugality, gratitude, and mindful spending

---

Final Takeaway

Financial independence demands deliberate, sometimes difficult, choices—not unlike resisting a tempting donut. The episode encourages listeners to make mindful spending decisions, recognize the real cost of their purchases, and strike a healthy balance between enjoying life and reaching their long-term goals. Delayed gratification isn’t about constant self-denial—it’s about budgeting thoughtfully so you can savor the occasional treat without undermining your progress.

---

Transcript

[Dell/Intel Advertiser]

Introducing your new Dell PC. Powered by the Intel Core Ultra processor, it helps you handle a lot, even when your holiday to do list gets to be a lot because it's built.

[Podcast Host]

With all day battery plus powerful AI.

[Dell/Intel Advertiser]

Features that help you do it all with ease. From editing images to drafting emails to summarizing large documents to multitasking. So you can organize your holiday shopping and make custom holiday decor and search for great holiday deals and respond to holiday requests and customer questions and customers requesting custom things. And plan the perfect holiday dinner for vegans, vegetarians, pescatarians and Uncle Mike's carnivore diet.

[Podcast Host]

Luckily, you can get a PC that.

[Dell/Intel Advertiser]

Helps you do it all faster so.

[Podcast Host]

You can get it all done.

[Dell/Intel Advertiser]

That's the power of a Dell PC with Intel inside backed by Dell's price match guarantee. Get yours [e-mail] holiday terms and conditions apply. See dell.com for details.

[Carvana Advertiser]

All right, remember, the machine knows if you're lying. First statement Carvana will give you a real offer on your car. All online.

[Dell/Intel Advertiser]

False.

[Podcast Host]

True.

[Carvana Advertiser]

Actually, you can sell your car in minutes.

[Podcast Host]

False.

[Carvana Advertiser 2]

That's gotta be true again.

[Carvana Advertiser]

Carvana will pick up your car from your door or you can drop it off at one of their car vending machines.

[Carvana Advertiser 2]

Sounds too good to be true. So true.

[Carvana Advertiser]

Finally caught on. Nice job. Honesty isn't just their policy, it's their entire model. Sell your car today too, Carvana. Pickup fees may apply.

[Podcast Host]

This is optimal Finance Daily don't eat the donut By Craig Stevens ofretire before dad.com achieving success and personal finance is simple but not easy. Make more money, spend less than you make. Invest the surplus. That's the formula to become wealthy over time. The Nintendo fanboy in me calls this the triforce of wealth. But doing those things requires habit, persistence, and a steady income. If personal finance were easy, everyone would be financially secure. Most people are not. Even as the US Economy is at its strongest levels in more than a decade, an uncomfortable percentage of people are still living paycheck to paycheck. The temptation to spend an entire paycheck is powerful. Other factors challenge us too. Making money requires work, sometimes hard work. Not everyone is willing to do hard work. Work may be difficult to find even as the macroeconomy is strong and opportunities to earn are widespread. Online. Lack of skills is often a hurdle, and smaller towns aren't experiencing the same low unemployment rates as the big cities. On top of all that, money makes us emotional, and our emotions can affect our decisions, often for the worse. Is it worth your time? Material objects entice us Saving money is boring why save for tomorrow when you can live for today? Overcoming this mindset may be the most prominent challenge people face in their financial lives. When you invest your cash into income producing assets, the principle remains yours and it earns you more money. Like dividends, rental income, etc. When you spend your money on an item or experience, the money is gone. To acquire more wealth, you have to earn it again. Earning more requires your time, muscles and brain power. We all must spend money to eat, live in a home and be entertained. But the fringe spending that which doesn't add value to our lives should be more heavily scrutinized. When considering non essential purchases, it's helpful to determine its usefulness or entertainment value by estimating the amount of time you need to work to pay for it. For example, if an item costs $100 and you earn $20 per hour at a job, you'd need to work five hours to pay for it. That's a simplistic view. To be more accurate, the hidden costs such as taxes, commuting, wardrobe costs, daycare, etc. Need to be factored in. Buying the item may actually cost six or seven hours instead of five. If you don't spend the hundred dollars, you are theoretically six or seven hours closer to the date you can retire. I'm not making this stuff up. This way of thinking is a core principle in the book youk Money or your Life by Vicki Robin and Joe Dominguez, a favorite in the early retirement blogging community. I use this train of thought around my family sometimes. My kids are always sad to see me leave for work when they are wasteful with food. I'll say something like hey, dad worked hard to buy that slice of pizza and you took a nibble and threw it away. So I work for nothing. The same goes for leaving the lights on or spilling milk. This kind of thinking makes perfect sense in my head, but they don't get it yet. Speaking to my kids this way won't win me any parenting awards, that's for sure. But someday, maybe it will sink in. They can apply it to their own lives. I like to use a weight loss analogy to illustrate this financial concept more simplistically. Don't eat the donut. Like personal finance, weight loss is simple but not easy. Eat less food. Eat healthier foods. Exercise more. That's the formula for maintaining a healthy weight. Doing those things also requires habit and persistence. Eating and attempting to lose weight are also highly emotional activities. Unhealthy, sugary foods taste great and make us feel good in the short term, but not so good when we gain weight successfully. Losing weight requires willpower, mental courage and the ability to cope with setbacks. Emotional support is paramount. I usually eat a banana or a packet of oatmeal for breakfast early each morning in the office. Some mornings I'll walk by the kitchen around 9:30 and there is a box with leftover donuts from an executive meeting. Since I already ate enough calories for breakfast, I don't need any more food. But I see free donuts and I want one. A typical donut contains about 400 calories. If I eat a donut after my regular breakfast, I'll fall behind on my summer weight loss goal. Do I eat it and enjoy the delicious taste and short term happiness or do I stay strong and walk away once eaten? The only options to compensate for the donut besides barfing are to eat fewer calories at a future meal or to exercise it off. Humans are pretty smart about this stuff, so we can calculate how much exercise it takes to burn off the donut. To burn about 400 calories, I'd need walk four miles, run for 30 minutes at a moderate pace, swim for 45 minutes, play an hour of competitive badminton, play four hours of croquet, jump on a trampoline for two hours, play two hours of volleyball, or skip rope for 35 minutes. You get the picture. It's far easier not to eat the donut than it is to burn off the calories with exercise. Not to mention, the time you save not exercising can be spent doing something more enjoyable. Conclusion Low annual spending is a critical factor in determining whether or not you can retire early. The lower your living expenses, the less money you'll need to save to cover them in retirement. As you save more money, your retirement date inches closer. But every non essential expenditure means you'll need to work longer. This concept should be taken with a grain of salt. Extreme early retirees think this way. Most normal people don't. There's a balance between spending and saving. If you don't spend any money on good food, cool gadgets and memorable experiences, you might become miserable. Where's the joy in saying no to donuts every time? Treat yourself every once in a while. Even if the calories are on top of the usual breakfast, donuts are delicious and they make us happy. That's why we budget. Build non essential spending into your budget. Just make sure that your purchase is useful or fun and not a waste. Go ahead and eat the donut, but skip the third slice of pizza at dinner. You just listened to the post titled Don't Eat the Donut by Craig Stevens of retire before dad.com nobody wants to pay rent, but if you have to.

[Dell/Intel Advertiser]

Bill it makes it worth it. BILT is revolutionizing how millions think about paying rent by rewarding their members with points and exclusive benefits around their neighborhood every single month. By paying rent through bilt, you earn flexible points that can be redeemed towards hundreds of hotels and airlines, a future rent payment, your next Lyft ride, and more. But it doesn't stop there. BILT is about making your entire neighborhood more rewarding. You can dine out at your favorite local restaurants and earn additional points, get VIP treatment at certain fitness studios, and enjoy exclusive experiences just for BILT members every month. BILT is turning a monthly expense into an opportunity to earn rewards and discover the best that your neighborhood has to offer. Your rent is finally working for you. Earn points on rent and around your neighborhood, wherever you call home by going to joinbuilt.comofd that's J O I N.

[Podcast Host]

B I L T.

[Dell/Intel Advertiser]

Make sure to use our URL so they know we sent you.

[Home Depot Advertiser]

The holidays have arrived at the Home Depot and we're here to help bring the excitement with decor for every part of your home. Check out our wide assortment of easy to assemble pre lit trees so you can spend less time setting up and more time celebrating. And bring your holiday spirit outdoors with unique decorations like one of our Santa inflatables. Whatever your style, find the right pieces at the right prices this holiday season at the Home Depot.

[Podcast Host]

If you've been listening for a while, you know that I'm a big fan of frugality. Learning to live frugally and actually enjoy it is probably the number one way I've improved my finances. And this is a topic that bears repeating because we've been conditioned since birth to be consumers, so it takes a lot of intentionality to push back against that. From a financial perspective, reduced expenses can create a double whammy scenario where you'll have more to save towards financial independence and retirement. But also since your lifestyle is cheaper to fund, you'll have to save less and therefore you'll reach financial independence sooner. I first built my frugal muscles by slowing down and being really mindful about the money I was spending. When I paused long enough to question my assumptions around what was a necessity, I was often surprised by the answer and delighted by my own creativity in getting my needs met. My thought process went something like do I actually need this thing or is it more of a want? Then I would question if I already had something that could be repurposed or or if I could borrow this thing from a friend. If not, I would look into buying it used or do the necessary research to find the best price. Another way I've pushed back against my consumerist conditioning is by understanding the concept of hedonic adaptation, which states that people tend to return to a sort of set point of happiness after positive or negative events. So if I buy the new shiny thing, it's going to feel good for a little bit, and then it just becomes a part of my new normal. And that has diminishing returns on my happiness. And that will do it for another edition of Optimal Finance Daily. I'll be back tomorrow as usual, where your optimal life awaits.