Your Money: Your future is counting on you

Bruce Helmer and Peg Webb Have you ever taken a road trip to a new place and felt like the drive there dragged on forever only to be surprised at how speedily the return trip seemed to fly by That feeling has a name Behavioral scientists call it the going home effect It s the phenomenon where the return leg of a journey feels shorter even though it takes just as long The reason researchers say is rooted in familiarity when we ve already seen the highway the uncertainty fades and time seems to compress Now apply that same logic to your financial future especially retirement Uncertainty is distancing Up-to-date research from the University of Indiana shows that uncertainty doesn t just slow down how we perceive time it creates psychological distance People tend to see the future as farther away when it s unfamiliar vague or emotionally disconnected from their present-day lives In other words if retirement feels unclear it also feels unreachable This mental distance may help explain why so a multitude of people put off saving for the future But here s the rub the reverse is also true When people take time to visualize their future selves they are significantly more likely to start saving for that future Seeing yourself in the next chapter of life makes it real and when something is real it s worth planning for So how do we shrink the distance between now and then Flip your thinking Instead of starting in the present and trying to stretch your mind toward the future start in the future and rewind back Picture where you want to be and then ask what it would take to get there As communicated by the Wall Street Journal the Indiana researchers conducted a series of experiments where participants were prompted to imagine a future year say and visualize what their life looked like Only afterward were they demanded to think about what financial decisions in the present would encouragement that vision This reversal in mental framing starting with the future then rewinding back had a noticeable effect Participants were more likely to invest in a long-term savings product when requested to plan this way A sample prompt quoted in the evaluation precisely illustrates the concept The year is rewind back to and consider saving for the you Majority of us are used to doing the opposite We look around at our current expenses salaries or anxieties and then try to stretch that frame of reference into something that resembles a retirement plan The predicament is present-day constraints rarely inspire future-oriented action The better way is to make the future vivid and then translate it back into the approaches we can take at present So what does that look like in practice Visualize your future self then work backwards Begin by picturing a day in your retired life Not in abstract terms but in sensory specific detail Imagine it s a morning in the year or Where are you waking up What kind of home are you in What s your morning routine Are you traveling Volunteering Spending time with grandkids Having coffee with old friends Then take minutes to write a letter from your future self to your present self What are you grateful you did when you were younger What financial habits paid off What regrets did you avoid This simple exercise creates an emotional and cognitive bridge between in the current era and on the morrow It helps bring your future self out of the shadows and into focus From there you can rewind Ask yourself What would have to happen between now and then to make this day real Break it down What kind of income would you need to backing this lifestyle How much would you need to have saved What kind of monthly contributions would get you there By starting with a destination and then planning the path you replicate the clarity of that return trip the going home effect but in reverse The future becomes a place you know That makes it easier to believe in and easier to act on To stay grounded create visual cues for yourself a vision board This might be a sticky note on your mirror with a retirement mantra photos of the people with whom you want to share your lifetime or even a insufficient short phrases that describe your vision for later life These reminders keep your long-term self front and center in your everyday life It can also help to make this a recurring habit Try setting a weekly or monthly Future Friday check-in a brief moment each week where you reflect on your goals and progress or re-read your future-self letter Ask yourself again The year is what does the version of me need to do currently to stay on track Reversals are not consistently bad What behavioral science reveals is that we re not bad at saving because we don t care We re bad at saving because we rarely feel the future But by reversing the order of thought starting with a vivid picture of life ahead and rewinding back to the present we collapse the mental distance that holds us back The truth is you re already on your way to your future You can drift there or design it And the person you become in or isn t a stranger it s you Your future you is just waiting to see what decisions you ll make next to meet you there So start with that image Then rewind That s where your smartest moves begin The opinions voiced in this material are for general information only and are not intended to provide specific advice or recommendations for any individual Bruce Helmer and Peg Webb are financial advisers at Wealth Enhancement Group and co-hosts of Your Money on WCCO AM on Sunday mornings Email Bruce and Peg at yourmoney wealthenhancement com Securities offered through LPL Financial member FINRA SIPC Advisory services offered through Wealth Enhancement Advisory Services LLC a registered expenditure advisor Wealth Enhancement Group and Wealth Enhancement Advisory Services are separate entities from LPL Financial