We all have a struggle going on in our brains for energy, resources and time. We have our current self needs (like fun, food, and shelter) and we have the future self needs (such as fulfillment, big dreams and eventually retirement).
It can be difficult to strike a healthy balance between the needs of your current self and your future self. The reason this is a struggle is because you’re human and you’re hard-wired for self-preservation, which means that you are inherently focused on the here and now.
Your brain lights up when focusing on immediate needs, concerns, and threats in order to protect you.
While this is great for ensuring survival and maintaining situational awareness, it does little for the needs of your future self. As a result of focusing on the here and now, people are inclined to view their future selves as unreal, or too abstract to fully comprehend.
This is exactly why procrastination is such a common issue.
Needless to say, this thought process can (and will) get you into trouble if you’re not careful. For example, you can’t borrow for retirement. If you choose not to focus on it now, it will be harder to make up saving for it in the future.
Not saving now (procrastination), actually creates more pain and anxiety in the future.
However, not saving now can feel worth it because it also alleviates a bit of pain and stress in the present. Of course, this is just an illusion. You are only delaying (and worsening) the inevitable.
You can try to reason with your current self, but it’s not going to be easy. Your future self often feels like an obligation, so reworking the way you view your future self can actually help out a lot.
Visualization and Automation
For example, you might try thinking of your future self as a really important person that you want to impress, thus encouraging your present self to work harder. No matter how you choose to go about it, you will almost certainly need to trick yourself into compliance.
When you’re dealing with finances and financial planning, automation is one of the best ways to get your current self and future self on the same page.
Do you want to save some cash to make the down payment on a new car? Set up an automatic transfer directly from your paycheck.
What about retirement? This is the ever-present future need that, despite its importance, is frequently put off for far too long.
Most financial plans aim to have a year’s salary saved by the time you are 30, and two year’s saved by the time you are 40.
Are you behind? Don’t stress!
Start automatically increasing your contribution by 2% every year. Or better yet, make a rule that you have to share half of your raise with your future self. When you automate, you set the rules and then forget about it. Saving for the future is much less painful this way.
What about other future goals? Say you want to leave your current job and start a business of your own. You will need to save at least one (possibly two) year’s salary. So the key is to start saving now. You have to make a measurable plan to get there.
Set up an automated savings transfer that pulls money to your savings every time your paycheck deposits into your checking account. Obviously, whatever is not dedicated to savings is yours to spend.
No matter what you are saving for, the savings rate is the most important factor when developing a winning strategy. Remember: save first, and spend the rest.
Imagine What Life Could Be
If you don’t want to trick your current self into compliance through automation, you can also try to coax it gently. At North Financial Advisors, we practice goal setting exercises to help clients identify with their future selves. This way, clients are more able to see the importance of their future needs.
Here are some examples of the questions we ask:
- What would you do if you knew you couldn’t fail?
- How do you want to be remembered?
- If you could wave a magic wand and all your financial needs were taken care of, how would you spend your time?
- In three years, what would need to happen for you to feel happy about your progress?
All of these questions can help make your future self feel more “real.” When you see your future self in this way, it makes it easier for your current and future selves to agree and succeed.
Deadlines, Sharing and Celebrations
Deadlines work well, too. You can make your current self believe that a goal is more urgent by thinking in days, rather than years. For example, “I am buying a house in 730 days (2 years),” or “I am retiring in 9,125 days (25 years).”
Another effective method is sharing your goals with other people. Sometimes the sense of accountability provided by a friend or advisor is enough motivation to make it real for your current self.
Finally, celebrating your successes helps, too.
Often times, once you have achieved something, you look back and think, “Really? That’s all it took?” It’s easy to forget this feeling, so you should make a point to celebrate. Pairing a celebration or reward with a difficult task can also help keep you motivated.
Here are just a few ideas that we’ve heard:
- “I hate doing it, so I schedule time to do my business accounting when I go to spa world.”
- “I treat myself to a fancy coffee when I have my monthly money date with myself.”
- “I do my annual goal setting exercise while sitting on the beach.”
- “When I meet my targets, I reward myself with a quarterly facial.”
This is one more reason that having a financial advisor can be so important. It’s not enough to know what to do. At North Financial Advisors, we continuously remind you of your future self needs and helping you find balance (or come up with those plans or rewards) even when your money situation or priorities change.
Which methods do you use to get in touch with your future self? Tell us your thoughts!