If you were to meet your future self, would you recognise him or her?
Would you care about them? Would you even like them?
If you can relate to your future self, you’re more likely to make plans for the future and save; if you can’t, it’s expected that you will still understand that you ought to save, but it’s less likely that you will do anything about it.
There are three critical elements in understanding your future self:
• Vividness. How clearly can you imagine your future self, taking account of physical changes and changes in your circumstances?
• Positivity. How important is it for your future self to be happy and prosperous?
• Relatability. How does your perception of your “current self” compare to your vision of your future self, concerning goals, values, and priorities?
If you can imagine your future self, want them to be happy and understand what will make them tick, it stands to reason that you will try to help them.
Psychological research into this area uses the term “Future Self-Continuity”.
There isn’t just one future self we need to imagine – there are several versions of ourselves in the future, and the more distant the future self, the more difficult it is to imagine them.
A 2009 study showed that people, at a neurological level, tend to think of their future selves similarly to how we might think about some other person – the results of the study showed that thinking of the future self and thinking of an arbitrary celebrity activated the same sections of the brain.
A study from 2014 concluded that “…for those estranged from their future selves, saving is like a choice between spending money today or giving it to a stranger years from now”. This may be one of the reasons why many people don’t take an interest in their pension.
The US financial planning community has developed some questions which help us to relate better to the person we will become, and which help us to gain an understanding of who we will be when we have retired:
• What is one trait that you value about who you are today, that you want to be sure is a part of who you are in retirement?
• What is an activity that you enjoy doing today, that you would like to ensure you can do more of in the future when you retire?
• What relationships do you value currently, that you want to be sure your future self continues to cultivate?
These questions can be adapted to the three phases of retirement (“Go-Go”, “Slow Go” and “No Go”), and indeed to the transition between any life stage.
The good news is that technology can help us.
‘Future Phil’ is one way to help imagine our future selves.
Remember the recent craze for ageing filters on websites like Snapchat and ageing apps like AgingBooth? Research shows that this technology can help us to relate to our future selves and that seeing our future selves makes us more likely to relate to and like them.
A powerful method of helping us relate to our future selves is to write a letter to our future self, setting out what the current self is trying to achieve and the actions that they are taking.
In early retirement, we might want to set out what memories our future self might have of those early years.
US research has shown that those who have a financial plan are much more likely to have a clear picture of who they will be in the future, to want good things for their future self, and to understand better what they will want in future.
A good planner will help you with all of this as part of the financial planning process, and the simple fact that you are making a plan for your future increases the likelihood that you will follow through on that plan.
