Savour your spending
Life planning
Have you noticed that time seems to pass more quickly as you get older? That’s the effect of the Holiday Paradox. It’s worth making efforts to understand this before life passes by and you’re in old age before you know it.
As most of the UK begins the school summer holidays this week, we’re more than half-way through, here in Scotland. It seems almost unbelievable that nearly four weeks have passed already.
You might have noticed a similar phenomenon when you’re away on a fortnight’s holiday. As you approach the end of the first week, you’re adjusting nicely to being “off work” and you’re starting to feel comfortable in your surroundings. The stress of day-to-day life is lifting, the holiday’s going well and you think “great, we’re only half way through our holiday and still have another full week to enjoy.”
Then, before you know it, you’re packing up to return home again. What happened to the 2nd week? Time just seems to disappear!
That’s the Holiday Paradox in action and a similar thing happens on a much bigger scale with life in general. Your ‘2nd week of life” seems to pass in the blink of an eye, so you need to take action to make the most of your 40s, 50s and beyond.
Time and money can be two of the hardest things to manage in life. They’re limited in resource and we can view each from many different perspectives.
Psychology writer Claudia Hammond offers this explanation of the Holiday Paradox in her book “Time Warped”:
“The Holiday Paradox is caused by the fact that we view time in our minds in two very different ways — prospectively and retrospectively. Usually these two perspectives match up, but it is in all the circumstances where we remark on the strangeness of time that they don’t.”
Claudia Hammond
So what could you do to embrace the 2nd half of life and maximise the use of your time?
Build awareness of your life expectancy
The biggest uncertainty in life, for most of us, is that we don’t know how long we’ve got. A common observation in the world of financial planning, is that people tend to under-estimate their life expectancy. With improvements in healthcare and lifestyle, we’re living longer, but that doesn’t take away the feeling that later years seems to pass more quickly. Making the most of our time whilst fit and healthy takes a bit of planning.
The Office of National Statistics publishes annual tables on national life expectancy for the UK. It takes a bit of effort to understand the data, but this is where you can discover the average number of years someone your age can expect to live, based upon gender and where you live.
For example, if you are aged 65 now and live in the UK, you can expect to live to around 85 if you’re male and 87 if you’re female.
You can use this life expectancy calculator for a quick estimate on how long you might live, together with your chances of reaching age 100.
Measure your life in months, not years
Try this little exercise:
- Calculate how many months you can reasonably expect to live
- Then calculate how many months you have lived already.
Measure your time in months
On my next birthday, I can expect to live another 33 years. This sounds ok at first, another three decades ahead of me sounds fine.
But when I convert this to months, it’s 396. On my next birthday, I will have already lived for 612 months. That doesn’t sound quite so appealing, as I’m well past the half-way mark.
It makes you think, doesn’t it? You might find that you’re well into your “2nd week of life”, but there’s still an awful lot of stuff you might like to do. So, now’s the time to get planning, because a goal without a plan is just a wish.
Create your Inspiration List (or “bucket list”)
It’s important to remember that you only get one shot at life and if you’ve not done so already, it’s time to dream big and think about what you’d like to experience before it’s too late.
If you sometimes struggle for inspiration, there are plenty of websites and apps to give you ideas. The website “Bucket List Ideas” might be a good start.
Once you have decided on some inspiring goals, write them down or better still, draw or print a picture of them. You can also use apps to help keep you motivated. Just search “bucket list” in your mobile device’s app store and loads of options will come up, such as “iWish”.
Embrace Childlike Wonder
James Clear, author of bestselling book Atomic Habits offers these words:
"Children are joyful and treat each day as a miracle—in part because they are continually surprised.James Clear
Each day, they hear a new word or listen to a new song or learn about a new animal. It's their first time visiting that restaurant or jumping in that pool or riding that rollercoaster. The world is continually unfolding before them.
How can you introduce more surprise into your life as an adult? How can you renew your sense of childlike wonder?"
Try to fill your Inspiration or Bucket list with new experiences that will surprise you.
Plan your life and finances
If you complete the tasks above, you’re on the way to creating a life plan. It’s about dreaming of what you’d really like to achieve for you, your loved ones or causes that you care about. The next step would be to plot those ideas onto a timeline that’s reasonable, based on your age now.
Often, our life goals will have financial or time implications. This could mean saving money regularly to do or buy something in the future. Or maybe you need to find ways to free up time, such as reducing working hours or retiring a bit earlier.
This is where financial life planning comes in. It matches up what you want to do with your life and overlays the money side of things.
Financial planners and coaches can help with this. The use of lifetime cashflow modelling software can help create a visual representation of how well your finances will empower you to live the life you really want. Read more about how to Design Your Future in my article here.
Summary
The Holiday Paradox helps to explains why your 2nd week away can feel shorter than the 1st. The same concept can help explain why time seems to pass more quickly as we get older. Do you need to take action to make the most of the 2nd half of your life?
Creating financial options in life is a key factor to financial wellbeing. It’s a question of striking the balance between enjoying life now and investing for your future self.
A combination of coaching and financial life planning can help achieve this balance. It can bring clarity to how and when you might start ticking off that bucket list. If you’d like to chat about this over a coffee, why not arrange a free, initial chat to find out more?
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