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Originally published: February 6, 2025
Life is a carousel of decisions, and often, we make choices that prioritize the immediate gratification of the present over the uncertain, far away future. It's especially challenging when that future includes something as distant and intangible as retirement.
How do we prepare for a phase of life that feels so disconnected from our current reality?
Last year as we were building Savvly's first product, we conducted user research with hundreds of people. We found that virtually everyone — no matter their age — viewed the future version of themselves as a stranger.
Consider this quote from one of our respondents:
“Outliving my savings... I guess that would be a nice problem to have. But it's hard to even fathom... I'm 64 and don't feel that old.”
While we believe in the power of feeling young at heart, it can also prevent us from taking care of our future selves. Running out of money was not a top-of-mind issue for the respondent above, but it's an unfortunate reality for many Americans who outlive their savings, no matter their income or net worth.
Renowned Social Psychologist Hal Ersner-Hershfield is recognized for his groundbreaking research in this field. In a study aimed at exploring the emotional connection individuals have with their future selves, he analyzed how this link correlated with their savings habits.
He used the Venn diagrams shown below: one labeled “current self” and the other labeled “future self”. Starting with a pair that had no overlap, each pair gradually increased the degree of overlap until the final pair was nearly completely overlapping. Participants were then asked to select the pair of circles that best represented the connection they felt with their future selves.
Those who selected the circles with greater overlap were more likely to have higher savings compared to those who did not feel tightly connected with their present and future selves.
With the challenges of the current retirement system and increasing life expectancies, it's never been more important to shift your mindset and take care of the future you. So, how can you get more connected to your future self?
1. Face aging tech: If you're curious about what you might look like many years from now, try using apps like AgingBooth or Oldify. Seeing a future version of yourself can be fun (and potentially a little scary). But it might inspire you to increase your savings and take care of the person you will become.
2. Treat yourself like a loved one: If thinking of your future self feels abstract, imagine them as someone you deeply care about — a child, a partner, a family member. This shift in perspective can make you feel more responsible toward your future wellbeing.
3. Create a vision board: Envision your ideal future with a vision board. Include where you'll live, your hobbies, and who you'll be with. This can turn the abstract into something tangible and motivating.
4. Write to yourself: Write a letter to your future self detailing all you've achieved. This exercise can build a personal connection and make your future needs feel more immediate. If writing letters isn't your style, try journaling about your life five, ten, or twenty years from now. What does your life look like, and how are your actions today shaping that future?
While the thought of retirement may seem distant, beginning to save and invest now can make a big impact on your comfort and happiness later. The journey toward financial security is deeply rooted in the vision we hold for our future selves.
Savvly's Longevity Benefit is designed to help investors build potential income for the later years of retirement. It adds a longevity-based reallocation layer to market-linked performance, creating the opportunity for additional payouts at ages 80, 85, 90, and 95 for investors who reach those milestones. Savvly is not insurance, not a guaranteed product, and not FDIC insured. For full details on fees, assumptions, risks, eligibility, and disclosures, visit savvly.com/disclosures.
To learn more, visit savvly.com/contact-us.
Recognizing the gap between our current and future selves is important as you think about saving for retirement. By closing that divide and implementing some of the strategies mentioned above, you can strengthen your bond with the person you'll become and set yourself up for a better future. This will help transform retirement saving from a burden into an important part of your present journey.
This article is for informational purposes only and does not constitute financial, tax, or investment advice. Consult a qualified financial professional before making retirement planning decisions.
Disclosures
The information on this page is provided for educational purposes only and is not intended as investment, legal, or tax advice. It is designed solely to illustrate how longevity-linked investment benefits may work under certain assumptions. Actual results will vary. All illustrations, examples, and case studies are hypothetical and are intended to demonstrate potential scenarios — not to predict or guarantee actual outcomes. They do not represent the performance of any individual investor, portfolio, or account.
Key Assumptions Used in the Illustrations
Life expectancy and mortality projections are based on the most recent Social Security Administration (SSA) tables available at the time of simulation.
In the event of death or early withdrawal, hypothetical scenarios assume that investors who exit early, or their estate in the event of death, may receive 75% of the lesser of the initial investment or current market value, plus 1% for each full year the account was active. Case studies assume standardized market growth of 8% annually and do not incorporate unexpected market volatility, inflation, changes in interest rates, or changes in an investor's personal circumstances.
Simulations may assume a 3% annual early withdrawal rate prior to payout or death. All figures shown are net of fees. No forecast, projection, or hypothetical return should be relied upon as a promise or representation of future performance.
Past performance is not indicative of future results. The 8% annual market growth rate used in illustrations is a standardized assumption for modeling purposes only and does not represent the historical or expected performance of any specific investment. Note that early or voluntary withdrawals by other participants can affect fund performance and the size of distributions, and that a higher-than-expected number of participants reaching payout milestones may reduce the per-participant benefit received.
Savvly's Longevity Benefit is not a bank product, not FDIC insured, not insured by any federal government agency, not a guaranteed or insured investment, and not insurance. Investment values may decline.
Savvly's Longevity Benefit may not be suitable for all investors. Eligibility to invest is subject to qualification requirements and not all investors will be eligible. Investors should carefully consider their investment objectives, risk tolerance, time horizon, and financial situation before investing. See savvly.com/disclosures for current eligibility criteria, fees, risks, withdrawal terms, and fund assumptions.
This content is published by Savvly, Inc. Savvly has a financial interest in the products described and this content should not be interpreted as independent financial research or analysis. Investors should carefully evaluate their own circumstances and consult a qualified financial professional before making any investment decision.
