With public concern over retirement readiness extending beyond the Baby Boomers to include Gen Xers and even Millennials, the majority of the American workforce seems to find itself on the wrong side of the finger-pointing.
So far, the primary culprit behind this collective resistance to long-term planning—aside from the American sport of consumerism—seems to be a general lack of awareness as to how much money is needed to fund retirement. But, recent and ongoing research by Keith Chen, a behavioral economist currently affiliated with the UCLA Anderson School of Management, may have found a more fundamental cause than poor math skills. He is pointing his finger at our grammar.
Lost in Translation
Chen, a Midwestern-raised Chinese-American, observed that there is a significant difference between how language forces him to describe the same concept in English versus Chinese. Specifically, unlike English, Chinese is a futureless language. All communication occurs in the present tense.
For instance, in English, when we refer to tomorrow’s weather forecast, we will say: "It will rain tomorrow," or "It’s expected to rain tomorrow." It creates some sense of distance to the event’s occurrence. In a futureless language, there is no distinction: "It rains today…it rains tomorrow." Both statements take place in the present tense.
Essentially, a futureless language causes its speakers to flatten time…and that got Chen to thinking about whether or not language influences the economic choices individuals make.
Chen’s research uncovered a surprisingly high correlation between national savings rates (and health-related choices, among others) and grammar.
"Every time you discuss the future [in English], grammatically you’re forced to cleave that from the present and treat it as if it’s something viscerally different," says Chen in his TED Talk on the subject.1
His thesis: When you are accustomed to verbally distancing yourself from the future, it is harder to make the emotional connection between your needs today and your needs tomorrow. That makes it easier to postpone planned activities like retirement savings…you feel like you have the time to think about it tomorrow. It’s different when the present is spoken of as coexisting with the future. Your immediate needs are less easily distinguished from your future needs since you think and speak of them in the present tense.
Overall, Chen found that nations with futureless grammar structures were 30% more likely to save at a higher rate and had up to 25% more in savings. By the way, of the 76 countries he studied, the U.K., U.S. and Greece—all future tense speakers—had the three lowest savings rates.
Implications for Marketers
While so far subsequent research has focused on substantiating Chen’s thesis, as marketers we may want to begin challenging ourselves to refrain from reinforcing the subliminal distance we attach to the future. Our goal should be to help individuals make a more immediate and more intuitive connection to their retirement savings efforts.
- Look for alternatives to presenting retirement as some brave, new world disconnected from the present. Focus instead on how it is likely to feel more like a continuation of the present.
- Resist portraying the recently retired as some newly emerged alien who is starting afresh, but as the same person with greater freedom—and more options—for truly embracing the interests they have always nurtured.
- Learn to frame recommendations and products not in terms of time—near-term versus long-term, for instance—but in terms of endurance. Consider positioning financial decisions and investments as being able to move with you through your life (not as one-time events that quickly fade into the past or slowly appear on the horizon as the future approaches).
At Blue Flame Thinking, we are always looking for new perspectives to incorporate into our clients’ initiatives—it’s how we help them find their better. If you have thoughts you would like to share for creating a greater sense of continuity between "now" and "when," we’d like to hear from you.
 Keith Chen, "Could your language affect your ability to save money?" TEDGlobal 2012, June 2012.