Plan Now by Envisioning Your Future

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My wife recently returned from an extended girls’ weekend to celebrate a good friend’s 40th birthday. They left town on an American Airlines flight just before 7am on a Wednesday and returned around 6pm the following Sunday. Rather standard fare for a trip of this magnitude, although what intrigued me most wasn’t the actual vacation, but the level of planning involved. My wife attempted to quantify the amount of trip prep over the previous year by offering some hard statistics on the communication between the quartet: approximately 150 emails, 300 texts and five planning meet-ups.

These aren’t single women in their 20s with nothing better to do than sit around and plan a five-day trip down to the infinite details. These are professional women with more chores than time available who happen to be mothers of both young children and grown men, and yet they were able to carve out time in their hectic schedules to daydream and plan a short vacation that would serve as a temporary break to their daily stresses and responsibilities.

Oddly enough, that’s not a unique approach to trips in our household. My method of dealing with stress is often scouring the Internet for ways and places to spend our limited allotment of vacation days. We likely spent as much time planning for a brief Disney trip last summer as we did traversing the Magic Kingdom. Sometimes it seems as though the only way to make it through the next six months of work grind is to have an excursion on the horizon, close enough to warrant discussion and initial preparations. Once the calendar countdown drops below the 100-day threshold, reality sets in and the excitement builds exponentially.

Why is it that we can plan a trip, complete with dinner reservations and activities, and then revisit the details ad nauseam in the days and months leading up to the departure date, but are often incapable of doing the same with the more significant, more permanent event that is retirement?

There is a bit of current moment bias in play here. We inherently favor short-term pleasure over the long-term option, even if that long-term option (in this case, retirement) carries greater importance. Looking too far into the future and attempting to imagine the impact of decisions is difficult, so by immersing ourselves into an event only months ahead instead of years, we are able to enjoy our efforts in short order. Our return on investment is much more defined and once we savor the culmination of our planning, we can quickly turn our attention to the next destination on our list.

Beyond the current moment bias is a vagueness that permeates and blurs our distant future. It’s easy to envision yourself on a beach four months from now, leaning back in a lounger with sunglasses on and feeling the sun warm your skin. After a leisurely nap, you meander back to the house for a lengthy stay in the outdoor shower before dressing for a night of seafood, miniature golf and ice cream. The specifics spark the imagination and make that future trip more appealing, thereby encouraging you to save enough to cover the costs while also pushing away from the dinner table so that last year’s bathing suit will fit appropriately.

Ever have those types of thoughts about retirement? While those summer plans play on repeat in your mind due to their short-term proximity, we all too often fail to daydream about the permanent vacation that is financial independence. An inability to envision ourselves 20 years down the road allows the future to become a cloudy long-term destination that just seems too far away. As a result, we confine ourselves to the here and now and fail to plan adequately.

Financial advisors have good intentions but miss the mark when they harp on determining your all-important number for retirement. That is, the targeted dollar value that insures your post-work expenses will be met. I suggest taking it a step further and determining how you want to use that money beyond the basics. If you are a RV enthusiast, go ahead and plan a six-month trip across the country. If you have always wanted to take a wine-and-dine tour through Italy, research your options now. Find an actual vineyard that matches the vision in your head, print out a photo and tack it to your pinboard at work.

While I have a target date in mind for retirement, I am well aware that various obstacles will appear in my path between now and then that could delay my plans. However, what won’t change is my daydream of an extended stay in Hawaii. On the southwest coast of Maui, just below the bustle of Wailea, is Big Beach. A walking trail through a wooded area opens up onto a shoreline bordered by forest and a lava rock cliff on the north end that protrudes into the water. Not only will the snorkeling be fantastic, but that food truck back up the road, the one idling quietly on the shoulder of Makena Road, will offer a delectable fish taco to fill the belly.

That image is the starting point in my quest for financial independence, not the other way around. Once you have a goal in place – not unlike a girls’ weekend trip some 12 months away – you can more accurately determine the monetary costs and sacrifices involved. The more progress you make, the more exciting the journey becomes because the destination is that much closer.

Greg

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