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By: Stuart Ritchie

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December 6th, 2016

Procrastination: How much will it cost you?

Investment

the cost of procrastinating[Estimated time to read: 4 minutes]

From the moment you wake up until the moment you finally switch off and sleep at the end of the day, your brain is constantly making decisions.

  • Alarm goes off – snooze or get up?
  • Make the bed  or leave it for later?
  • Walk to work  or drive?

These decisions have to be made quickly, sometimes instantly – no time to stop and think.

Why 95% of us procrastinate

This constant decision-making continues all the way through your day, and it erodes the ability of the responsible part of your brain, (the dorsolateral prefrontal cortex) to control the impulsive part of your brain, (the ventromedial prefrontal cortex).

As a result, as your day wears on and wears you out, your brain is much more likely to procrastinate, because it needs a break.

take a brain break

When is procrastination a problem?

Procrastination is a problem when it makes your life harder.

If you’re faced with an unappealing task and you know you can put it off forever and face no consequences – procrastinate away – put it off forever – no problem.

If you’re faced with an unappealing task – let’s say a tax return – and you can’t put it off forever with no consequences – don’t put it off at all.

As Mark Twain said:

“If it's your job to eat a frog, it's best to do it first thing in the morning. And if it's your job to eat two frogs, it's best to eat the biggest one first.”

For every day you put something off, you waste a day worrying about it.

That’s a non-productive and damaging problem.

Here are three more:

  1. If you procrastinate and put off getting your car to the garage, it will be more likely to break down, making your life harder.
  2. If you procrastinate and put off getting fitter or losing weight, it will be harder to start, harder to remain motivated, and ultimately harder to get healthier, making your life harder.
  3. If you procrastinate and put off saving or investing for your future, that’s less money that you will have in retirement and/or more years that you will have to work for until you can retire, making your life harder.

How much money does procrastinating cost?

If you’re 40 years old, you want to retire when you’re 65, you earn a salary of £80,000 and you commit to putting £300 per month of your salary towards your retirement, that’s a commitment of just under £10 a day.

This would equate to contributing £90,000 over the course of 25 years and, assuming a net growth rate of 6% per annum, a retirement pot of £209,362.98.

If you procrastinate and put off your commitment by just 2 years, (that’s the average time it takes most employees to sign up to a company pension scheme), you’ll contribute a total of £82,800 (£7,200 less than if you started at 40), which would lead to a retirement pot of £179,336.80, again assuming a net growth rate of 6% per annum.…

the cost of procrastinating

That means procrastination will have cost you £30,026.18.

And delaying by 5 years would cost you £68,990.84

How to stop procrastinating

Because you’ll never be younger than you are today…

Because you’ll never have more time until retirement than you have now…

Because the sooner you act the better your financial outcome…

You need to stop procrastinating and commit to saving and investing for retirement.

Procrastination affects us when our brains are tired and overworked from all our daily decision-making.

So there’s a very simple way to solve this problem.

Take a break.

Switch off.

Literally stop.

Sit down.

Relax.

Just for 10 minutes if that’s all you can manage.

A recent experiment proved that this strategy is incredibly effective.

94% of those who took a break from a series of mind-numbing decision making tasks were more able to absorb information after a short break.

They were 74% less discouraged, and 71% more likely to finish a difficult task as well.

So if you’re feeling overwhelmed at the thought of sorting out your retirement plan, and you’re unable to just get on with contacting us so we can help, take a complete brain break, and then talk to us.

And finally….

What if you’d never procrastinated?

Apparently the average person spends 2 hours procrastinating every day.

If you’re 40 that means you will have spent 3.3 years of your life procrastinating.

In that time you could have:

  • Driven to the moon 100 times
  • Climbed Everest 232 times
  • Taken the rubbish out 175,000 times

If you’re 50 you will have spent 4.2 years of your life procrastinating.

In that time you could have:

  • Made 730,000 cups of tea
  • Done a degree and a masters
  • Painted Michelangelo’s famous frescoed ceiling in the Sistine Chapel

sistine chapel

Ready to act?

Contact us today, get on track for your retirement, and never have to procrastinate or worry about it again.

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About Stuart Ritchie

Stuart Ritchie is a Chartered Financial Planner, Chartered Fellow, and Pension Transfer Specialist.

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