In the Justin Timberlake movie In Time, he lives in a world where people are genetically engineered to stop ageing at 25, illness is eradicated, and the affluent can bargain for extra years of life.

“Time is now the currency,” says JT’s character Will Salas. “We earn it and spend it. The rich can live forever.”

While we’re not there yet, the idea of a world where only accident or violence could turn out the lights is not inconceivable. Meanwhile, with our lifestyles and healthcare, Australian millennials could easily live past 100.

This sounds like good news, but there’s a flaw.

We shape our plans towards retiring at 65 with around $1 million of assets. But if we want to keep up our good standard of living, this means we need to drop dead by 75.

Instead, if we want to live a decent life past 100, we’ll need at least $5 million.

So basing our plans on today’s social norms will f**k us over.

We urgently need to question our assumptions, get rid of old models of how and when to do things, and make some financial changes to cater for living longer, now.

Outdated assumptions

Time is a concept that impacts so much of our decision making, and so much of it comes from the patterns of the previous generation.

A classic view of life is that you spend your teenage years at school, then you f**k around in your 20s trying different jobs, locations and travel. You sort your shit out in your 30s, get stuck in ‘parent mode’ in your 40s, and in your 50s you think about ‘winding down’.

In your 60s you do just that. In your 70s you’re ageing. And in your 80s you die.

One of the reasons it took Eric (my high school sweetheart) and I so long to get married was because we felt we had to do ‘all of these things’ first. And now, we’re thinking of starting a family in a few years, and we keep asking, ‘What do we need to get done before that?’

It’s similar to how our generation is always saying ‘I’ll go to London for one year and come back and grow up’.

But why are we so fixated on such short, urgent timeframes? Can’t we still travel later in life? What’s the urgency to get back and get a 9-5 job if we’re going to live past 100?

As millennials, we have time, money, opportunities and mobilisation. Aside from having children, which for women is still in a more restricted window, most of these factors come together to mean we have completely different options available to us than previous generations.

So we shouldn’t be following in their footsteps.

Micro and macro planning

People love the phrase ‘Why do tomorrow what you can do today?’, but I don’t necessarily believe in it. If what you’re doing today is going to f**k up tomorrow, then that’s when you need to take a longer-term view.

If we opened our vision to a 100-year roadmap, we can see we have a long future to do things in. We could have various careers, live in different places, have different friends, and different, yet equally important, intimate relationships.

This means we are thinking about the ‘now’, while also keeping in mind a long lifespan. This means learning to be comfortable with planning for short, medium and long-term goals, and their different financial needs, all at once.

Compounding is our friend

This is where compounding — the eighth wonder of the world — steps in. With compounding, time is truly our currency!

As millennials, compounding should be mandatory, as we have money and a truck load of time on our side.

If we use compounding to build financial freedom, the changes we need to make in our 20s are relatively small. But the impact in our 30s is a little bit bigger, and in our 40s is huge.

This is because we’re regularly putting aside capital, to build a warchest, and then that money is earning money. Over time, it’s less about the money we’ve put in there ourselves, and more about how hard it’s working. In the example I gave in Cut the crap, save the planet, where $50 per week turns into $1.182 million in 50 years, only $130,000 of that was what you put in yourself. The rest is the blessed result of compounding.

It’s about not putting all of our eggs in one basket (such as a house only), but it’s having multiple investment approaches, serving multiple goals, and making sure the money is available in various timeframes.

Short term we might prefer cash savings and the stock market, or medium term we might want bonds that mature at different times. It might be that the ‘Australian dream’ of investing in property is only the right thing very far down the track.

How can we start?

We’re set for a 100-year-plus journey. So we must challenge the social norms in front of us, or else we better die soon.

We must think differently about what we do and when, harness the power of time, and get excited about the magic of compounding so we have financial freedom at every stage of this amazing life.

If you’re pumped to live past 100 and want to embrace the power of compounding now to have financial freedom throughout your life, get in touch!