Planning...
Planning is bringing the future into the present
so that you can do something about it now.
Planning your finances can provide you with more choices for how you live your life both now & in retirement.
Many people live day to day, week to week, without thinking of the future.
As humans we are wired to choose today over tomorrow, but we also hate to feel like we are missing out on something.
A recent research study was conducted with monkeys.
5 monkeys were given a banana each – and high levels of excitement were measured.
5 other monkeys were given 2 bananas each – and high levels of excitement were measured.
However, when a change was made, and the monkeys with 2 bananas had one taken away, they still had 1 banana, but they became angry and irate.
Does this happen to us?
Do we forget what we already have?
If we feel like we are losing something, then we avoid it, we don't do it.
This is why so many people do not save & invest.
Saving sounds like you are giving something up or losing something today. But you’re not. It is giving yourself a gift today of peace of mind, certainty, of a secure financial future.
Therefore, those that choose today over tomorrow, often find themselves at the cusp of retirement realising that they will not be able to continue their current standard of living. This is not a fun place to be and can cause a lot of stress and uncertainty. By having a goal and a plan can help alleviate stress both now and in the future.
Choosing your goals or knowing where you want to end up is a crucial part of setting your vision. They help lay the steppingstones to success.
When it comes to our financial lives, common goals are often “save for a house deposit”, “get out of debt”, “sort out my super”, “save for retirement” or “pay for the kids education”.
These are all fantastic goals.
In our experience, we have found when people attach their values or why this particular goal is important to them, it provides more meaning and increases the probability of achievement. Most of the time past experiences and individual filters will be placed on each goal. For example, I was not given the opportunity to go to a private school & I want to give my children every possible chance to succeed in the future by paying for their education. Or my parents are living off the age pension in retirement, I do not want this to be me. Or even, my friend had to set up a GoFundme page when he got sick, as he had no insurance, and I am too proud to have my family begging for money so I want to put insurance in place to support them.
What is important to look at is what type of lifestyle aspirations you want to achieve. Everyone has different goals and that is ok.
Money doesn’t buy happiness, but the unfortunate reality is that it does buy choices and choices are something that you want at all stages of life.