Retirement Psychology

When I first met Husband, when he was a whopping 22 years old, he was already saving for his retirement. I thought this was HILLARIOUS! What a dork! What a conservative old man! Retirement is AGES away.

As I got older I stopped thinking of him as a dork. I could see the wisdom. But I wasn’t too concerned about saving for retirement myself. I mean, I had it vaguely in the back of my mind but I figured that we should buy and payoff a house first and THEN start saving for retirement.

But that changed just over a week ago. And what changed my mind? Not the fact that everyone knows that they need to save for retirement, that it’s the ‘right thing’ to do. Not that the earlier you start the more you will have. Not even the Frugalwood’s brilliant explanation of compound interest being a magical unicorn (see Frugalwood Unicorn). But rather, two simultaneous realisations:

  • Retirement is something good/a reward (i.e. the financial freedom to travel, play and study as much as I want)
  • It could happen soon. Like really soon. Like 7 – 10 years soon if we are really good.

And boom, just like that I was ALL for it.

Let’s look at my two realisations: The fact that retirement can actually be whatever the hell I want it to be immediately makes it a reward. This is in stark contrast to traditional concepts of retirement. This shift in perspective however is magical because suddenly behavioural psychology 101 can kick in:

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What this means is that retirement suddenly becomes something that I am prepared to work really hard for i.e. save for:

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The magic with early retirement is doubly powerful because:

  • My reward is MUCH closer than retirement is traditionally presented as.

The key here is the immediacy. If consequences are delayed then our brains take a lot longer to learn to increase the behaviour (if ever!). For example, I have struggled to cut out chocolate (which I love!) my whole life. I know it would be healthier for me in the long-run but I just can’t seem to manage it. However, when I went through a stage of immediately getting a bladder infection every time I had any beer or wine (which I equally love!) you can bet I cut it out pronto. I didn’t even mind not tasting the stunning wine of the day when out with friends (which is significant given how much I hate missing out!)

  • My behaviour has a direct impact on how quickly my reward comes about. This points to a fundamental problem with the traditional concept of retirement as something that just happens at 65 years old. In this sense it is presented as an objective “fact” (/life stage) quite divorced from any action or lack of action the individual may or may not take. In other words, time has the power rather than the individual. This is clearly not a recipe to encourage saving:



What this all basically means is that traditional concepts of retirement suck ass. And early retirement is the winner of the world for always 🙂 Also, irrespective of how this Brat Experiment goes, I already feel grateful to Early Retirement for teaching my brain that retirement is something that I want ❤


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