9 in 10 uni graduates are employed full time.1

Uni grads earn 15-20% more than those without a degree.2

Deakin postgraduates earn 36% more than undergraduates.3

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$5K now or $10K in three years? What your choice says about you

Would you prefer $5000 now or $10,000 in three years?

It turns out the choice you make may depend on your gender, work status, decision-making style or even your mood. We asked you, our audience, this very question in our recent Cash Conundrum competition – and the results of our survey reveal some intriguing insights. As Dr Melissa Weinberg from Deakin’s School of Psychology confirms, many of the trends we found among our 10,226 responses align with existing research.

Are you a ‘right here, right now’ kind of person, or do you subscribe to the philosophy that ‘good things come to those who wait’? And how do you compare to others?

The survey results

Long-term planning dominated the survey results, with 63% of respondents choosing the $10,000 in three years (6490 people). Just 37% (3736 people) opted to take the $5000 now.

It would seem that waiting three years to nab the larger figure is indeed the sensible option. As Dr Campbell Heggen from Deakin’s Faculty of Business and Law advises, it’s pretty difficult to double your money in three years if you try to invest $5000. But sensible, long-term planning doesn’t suit everyone, right?

In addition to asking whether you’d prefer $5000 now or $10,000 in three years, we also asked a few extra questions about:

  • your mood (happy, excited, sad or stressed)
  • your decision-making style (rational, conservative, impulsive or reckless)
  • your work status (full-time, part-time or not working)
  • your gender (male, female, gender diverse or prefer not to say).

Below, our psychology expert, Dr Weinberg discusses how your answers to these additional questions may align with your chosen side of the Cash Conundrum fence.

Insight 1: Gender

Males were nearly 20% more likely than females to choose the $5000 now.

‘Research suggests that males engage in impulsive and risky behaviours more frequently than females, while females are more likely to exhibit effortful control and inhibit an automatic or impulsive response to “hold out” for longer term benefit.

‘But this conundrum is more aligned with studies on temporal discounting, on which no sex differences have reliably been observed. If the choice triggered an automatic impulse in respondents, the finding that more males opted for the $5000 now could be said to be consistent with the research.’

Insight 2: Decision-making style

‘Reckless’ and ‘impulsive’ decision-makers were about 25% more likely than ‘rational’ or ‘conservative’ decision-makers to choose $5000 now.

‘While impulsivity typically involves some sort of risk, there wasn’t really a risk in the conundrum we posed here – either way the participant would win, it was just a matter of how much and when. The impulsive and emotional response is to say “I want it now”, but the rational response is to delay for a greater reward (unless someone is currently in debt or needs the money for something in particular that’s happening sooner).

‘Also, if we asked people to make the choice first, and then answer this question, their answer could easily be influenced by the choice they just made. A person who just chose to take their $5000 now would be more likely to confirm that they are more reckless or impulsive to show a consistent front.’

Insight 3: Work status

Those not working were 15% more likely than those working full-time to take the $5000 now, while those working part-time were 5% more likely to do so.

‘The value of the reward is not just based on dollar value – clearly $10,000 is more valuable than $5000 –  but the value to an individual also depends on their current status, and how much they need the money now compared to how much they need it in a few years’ time.

‘Obviously, if you can afford to, receiving the $10,000 in a few years is a better option, but for those currently out of work or earning a low income, the value of $5000 may subjectively be greater than the value of $10,000 in a few years.’

Insight 4: Mood

Those feeling stressed at the time of the survey were 5% more likely to take the $5000 now as opposed to those in a more positive emotional state. Those feeling happy at the time of the survey were 4% more likely to choose the $10,000 in three years.

‘Mood is an interesting one, and we can look at it from two angles. One is that people who feel stressed or sad are highly motivated to get out of that situation, and a $5000 reward might be a great quick fix if the money can be used to alleviate those emotions. Need a holiday? $5000 should do the trick.

‘On the other hand, when people are induced into a sad mood they are likely to behave more cautiously and conservatively because they want to prevent that mood from getting any worse.’

victoria s cash conundrum winner

Our delighted winner: Victoria S

It was just another Monday at school for Year 12 student Victoria S until she got the phone call telling her she’d won $10,000 in Deakin’s Cash Conundrum competition. ‘I started freaking out and doing a little dance. All my friends were like, ‘What’s going on? Is she okay?’ the 17-year-old from Craigieburn laughs.

When the competition came up in her Facebook feed, Victoria found it pretty easy to make the ‘rational’ choice of $10,000 in three years rather than $5000 now, she says. ‘Growing up, my parents always said to me, “Work hard and good things come to those who wait”. I was kind of thinking realistically; because I’m only 17, I don’t really need five grand now. But in three years’ time I’ll be 20.’

By then, Victoria hopes to have finished a university degree in marketing communications and have gained industry experience towards starting a business in fashion. ‘I want to create something that helps me make people feel good in what they wear,’ she explains. ‘I think empowering women is something that’s really important. So hopefully through my business I can do that.’

Ever since she turned 14-and-nine-months and could get a job, Victoria’s been working hard in hospitality towards the ambitious goal of buying a house by age 18. That goal is looking closer than ever, and she now hopes to own another house at age 20. ‘Otherwise, my family does deserve a holiday, so I might use the money for that and invest the other half,’ she says.

Congratulations, Victoria!

Curious about the psychology of choice? Read about why your choices aren’t always yours to make.

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Dr Melissa Weinberg
Dr Melissa Weinberg

School of Psychology, Deakin University

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