October 2016

By Peggy Creveling, CFA, and Chad Creveling, CFA

As a survey from earlier this year showed, one of the top concerns expats have is how they will finance retirement. We all know that saving for retirement is challenging—just the sheer amount of money required is a barrier for many. Saving for the future goes against human nature. Behavioral economic studies suggest that at a basic level, we're more strongly motivated by short-term concerns than long-term possibilities. We're also more likely to avoid pain before we seek out benefits. It follows that it's only human to resist cutting discretionary spending today (avoiding short-term pain) even if it’s at the expense of getting the retirement we want (a long-term benefit).