Money and personal finance are emotionally loaded and in money coaching the language we use is so important. Certain words can be motivating or captivating whilst others can be a turn-off. The word “pension” is another one which doesn’t usually bring much excitement and I’d like to introduce more engaging alternatives into our Webinar and Workshop programmes.
In my experience people in the 20-35 years old age group switch-off when the conversation turns to pensions, the idea of needing a pension seems so far away. In recent years I’ve also noticed that many people in their middle age don’t want to talk about pensions. It seems likely that much of this reticence is an emotional rather than rational response – pensions are associated with old age, infirmity and subjects most people would rather not spend time thinking about.
In today’s fast-moving, ever-changing society the purpose of a pension is no longer as clear cut as it once was. For example defined contribution pensions, actually perform more like a savings and investments product, albeit with an age restriction on access. The connection between pensions and not working isn’t as straightforward as it has been in the past. Many people will continue to have some form of paid employment after they start drawing their pension. The whole concept of a pension being a fund you use when you stop working is becoming less and less relevant.
From a personal finance perspective, planning for later life increases the chances of having enough to support your lifestyle and it’s never a good idea to avoid the subject of pensions. In my teaching and coaching sessions I use phrases such as “building wealth for your future” and “investing for my future self”. The key is making a connection between the younger and older self and to that end using something like “Face App” or “Oldify” (or any of the other age progression apps out there) can be really powerful. The visual element gives strength and traction to the idea of planning ahead.
I encourage my coaching participants to print out the image of their older self, pin it to their wall and say “that’s who I am investing for.”