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Who will you be in the future? Imagining the answer can be a challenging mental exercise—and many of us don’t bother trying. A survey from the nonprofit research group Institute for the Future reports that 53% of Americans rarely or never think about what their lives could be like in 30 years.
If you’re not giving your older self more than a passing thought, you may want to. Life expectancy is steadily increasing, and you could optimize this longevity by planning for retirement in a new way. Research from Hal Hershfield, an associate professor of marketing, behavioral decision making and psychology at UCLA Anderson School of Management, finds that visualizing our older selves and accounting for future needs and desires may lead to smarter decisions that can pay off in retirement.
Below, explore creative strategies across money, wellness and lifestyle, inspired by Hershfield’s research, to help you envision and prepare for your retirement.
What opportunities and ambitions will your future self pursue? Will you dive into a second act, try new hobbies or open a small business? Will you want to travel, spend money on grandchildren or build a bigger home to accommodate visiting family?
Saving for retirement is tricky for a variety of reasons, but answering questions about your future can help you optimize your savings and face some common obstacles in financial planning. Even if you’re actively saving, it’s still tough to forecast how much you’ll really need. “People just grossly underestimate healthcare and long-term care costs in retirement,” says Grant Kvalheim, president and CEO of Athene USA, a retirement services and fixed annuities provider. “Plus, many of today’s retirement plans place heavy responsibility on the individual to identify any gaps they may have as they plan their financial futures.” Consider these ideas to get started:
Even if you’re aiming to work as long as possible, it’s smart to plan for a future in which that may not be the case. Start the process by setting small, actionable goals to help you build financial literacy: research a retirement plan that suits your outlook, schedule time on your calendar to devote to educating yourself and discuss savings strategies with others. Do you have a financial professional you’re currently working with? If not, consider one and ask family and friends for recommendations.
Compile a monthly figure to inform financial planning. What are your monthly expenses now? What might they be in a decade? How much is required to pay your mortgage, make a car payment, buy food? A monthly figure is easier to grasp and multiplying it can help you predict the resources required for the life you want.
“We encourage people to have a full financial plan, a great way to save for retirement on top of a 401(k),” says Kvalheim. “A fixed-indexed annuity is pretty unique in replicating some of the features that people used to enjoy in a defined-benefit pension plan, which most people no longer have.”
It’s never too early to prioritize physical and emotional wellness, especially if you hope to maintain an active lifestyle in your next chapter. However, just like financial planning, designing a proactive wellness routine that incorporates your future self isn’t always intuitive.
It’s hard to measure how incremental, daily choices—what to eat for lunch, whether to bike or drive, have dessert or abstain—can add up in a big way over time. It’s also challenging to imagine unforeseen health issues or think about how aging’s natural toll might impact the future. Yet, we could actually risk increasing the likelihood of a major health issue disrupting retirement if we disregard future realities. Try these tips as you think ahead about your health and wellness:
Craft a thank you note from your future retired self to current self. What healthy habits would you thank yourself for? Cutting out one sweet a week? Walking a few extra minutes a day? A regular adventure outdoors?
Minimize the obstacles that stand in the way of nutrition and exercise. Keep a set of dumbbells near your desk or invest in a stationary bike, for instance, and have wholesome snacks on hand.
Indulging every so often can contribute to overall wellness—unless “every so often” becomes every day. Pay attention to the patterns that could detract from your future health.
As you position yourself for a fulfilling retirement, savings and health are just part of the equation. Research points to the importance of social groups and meaningful relationships in retirement, particularly given that the transition can be jarring for some. By nurturing friendships and building strong support systems today, you may be able to preemptively combat potential feelings of loneliness or boredom down the road.
Write an email to someone who helped you in the past. For both you and the recipient, this could reinforce a lifelong connection that provides joy as you age.
Explore hobbies and social activities outside of your career that foster a sense of purpose and provide the space to connect with others, potentially easing the transition to retirement.
Incorporating your future self into today’s outlook is essential, but also important is to value the present with the people you love. Retirement preparedness isn’t solely defined by smart savings and healthy choices, it’s also about making memories that will enrich your golden years. Splurge on a family trip, commit to the home improvement you’ve been dreaming about and indulge in a dinner (and dessert) with friends. Your future self will thank you.
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