Somewhere, deep seated in human psychology, lies a belief that it will all work itself out for the best, regardless of what you want to achieve in retirement.Īs part of our ‘ What’s Your Number’ study, we interviewed 1,500 UK adults and uncovered some worrying findings. Yet a surprising number are giving little or no thought to how they will maintain their lifestyle in retirement. Many of the people we meet are primarily concerned with paying the bills and school fees, while also affording a nice holiday or two a year. Most of us are pre-disposed to the belief that ‘it will never happen to me’.īut what if that belief transcends our finances? As wealth planners, we see the consequences of unrealistic optimism every day. We saw it in action amid the coronavirus crisis as people flocked to pubs and restaurants before ‘lock-down’ ensued, and then continued to attend parks and natural beauty spots, despite the restrictions. Optimism bias – where people believe that they are unlikely to experience a negative event – is common across all genders, nationalities, age and ethnicity. This finding says so much about human psychology. In a study published in the journal Risk Analysis, scientists found that people tend to underestimate the risk of medical interventions and overestimate their benefits, meaning they convince themselves that it’s better to undergo an operation or invasive medical treatment, than not – even if the chances of negative consequences are reasonably high.
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