Is it Better to Be Future-Oriented or Present-Focused?

Let’s have a moment to take a closer look at a common dilemma: is it better to make saving for a house deposit or planning for retirement your number one priority? Are you future-oriented or present-focused? Should we spend more time focusing on what we need right now rather than obsessing over the future? The answer is simple.

Is it Better to Be Future-Oriented or Present-Focused?

When it comes to planning the future ahead, you can’t help but worry about it and so pensions certainly form a large part of what’s to come, and often determine how financially stable your life will be after retirement. And so how you decide to save or invest for retirement can have life-changing consequences. When considering your future after work, most people depend on their pensions to live comfortably; however, many have not ever thought about the potential of property investment as a means to be financially secure.

Pensions play a big part is everyone’s future but buy to let property investment, in particular, offers a different alternative, one that may not have ever been thought about at great length.

The property has long been regarded as a prosperous investment, producing robust returns for each investor involved. However, over recent years due to a somewhat erratic nature in the industry, the trust in property has dwindled, and uncertainty has arisen as a result. Stagnating house prices, the growing divide between the North and the South, and a range of cynics doubting the buy to let landscape has created a hesitation surrounding investing for many.

With this being said, property values over recent years have skyrocketed leaving many people finding it increasingly difficult to step onto the property ladder, although this comes as good news for investors as capital appreciation comes into play. This refers to the purchase price of property versus the current price, the difference in figures is the appreciation value, a statistic that investors look for in a property to judge its potential for high return on investments. James David, the founder of an online letting agency, said,

“Assuming that property prices continue to increase over the coming 20 years in a way that they have in the past 20 years, a property of today’s average value of £235,000 will be worth £1 million by 2038.

“Even working on the worst-case scenario of not making any monthly profit, you’ll still have realized a significant capital appreciation.”

It was noted that during the same period, a pension would require at least a monthly contribution of £1,200 after an initial investment of more than £90,000.

Should I invest in property or a pension?

Property investments and pensions work in two different ways, and each way works well for some and not others.

It all boils down to each set of circumstances, the strategy they plan to undertake, and their appetite for risk. To truly discover which avenue is more beneficial to any given person, it is important to consider both forms of saving.

Property investors ought to calculate how much disposable income they have as investing in property requires a rather large initial outlay to secure your investment.

On the other hand, pensions give you the chance to save for your future in more achievable monthly payments, as opposed to a hefty lump sum that some pay find in high-value properties.

A property will indefinitely outperform a pension in terms of gaining a return, but you must ensure you are clued up on all factors relating to investment to be truly successful.

One more notable point to make is that pensions may end up falling significantly short compared to the amount of money that can be achieved through single property investment.

For instance, in The UK, the average pension pot stands around £50,000, producing an annuity of just over £200 a month if you retire at a typical age.

In terms of property, an individual has the potential to achieve a return of £50,000 through staggering capital appreciation values and income from rental returns. RW Invest, for instance, offers affordable properties in key UK locations with strong rental yields and capital growth. Therefore, it is essential to view property as a worthwhile asset class that stands resilient in the face of an ever-changing market.

So, is it better to be future-oriented or present-focused? Slow down and check in with yourself. See what the next right move for you is, and take action.

📌It is in your moments of decision that your destiny is shaped.

photo source | pexels 

READ NEXT: How to Be Happy with What You Have & Stop Wanting More

100 000+ people follow Havingtime for daily inspiration, support, and motivation.

Get your FREE weekly havingtime newsletter on how to reduce stress, boost your self-esteem, get things done and live a much fulfilling life!