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Are English-speakers Less Likely To Save Money?

If you speak English, you probably have a harder time saving money than someone who speaks German.

That's because the language you speak influences your money habits, according to a Yale study published this year. In The Effect of Language on Economic Behavior: Evidence from Savings Rates, Health Behaviors, and Retirement Assets, behavioral economist M. Keith Chen writes:

"Languages differ in whether or not they require speakers to grammatically mark future events. For example, a German speaker predicting rain can naturally do so in the present tense, saying: Morgen regnet es which translates to 'It rains tomorrow'. In contrast, English would require the use of a future marker like 'will' or 'is going to', as in: 'It will rain tomorrow'. In this way, English requires speakers to encode a distinction between present and future events, while German does not. Could this characteristic of language influence speakers' intertemporal choices?"

Chen found that it does. "After scouring many datasets with millions of records on individual household savings behavior -- along with a number of peculiar health performance metrics like grip strength and walking speed -- I find that languages that oblige speakers to grammatically separate the future from the present lead them to invest less in the future, " he writes. "Surprisingly, this effect persists even after controlling for a speaker's education, income, family structure and religion."

That means those who speak "future-less" languages, like German and Mandarin, often come out ahead. Financially, speakers of future-less languages are 31% more likely to have saved in any given year and have accumulated 39% more wealth by retirement.

Speakers of future-less languages are also:

  • 24% less likely to smoke

  • 29% more likely to be physically active

  • and 13% less likely to be medically obese

For a fun overview of the study's findings, check out this video:

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Connecting to our future selves

"This study demonstrates how language can influence our understanding of time, and how this can impact spending and saving behavior," says Julie Ewald from eBay Deals, which created the video. "This correlation can show people that in order to change their saving habits, they may have to change their mindset to 'the future is now' instead of 'I always have more time.'"

But changing that mindset is a lot harder that it seems, and a 2010 study in the Journal of Consumer Research may explain why. According to the researchers, our willingness to give up short-term rewards to benefit our future self depends on how connected we feel to our future self. "When we think of saving money for the future, the person we think of can seem different from the person we are now," explains Science Daily. "People have trouble sacrificing in the present for that stranger in the future."

For instance, in the study, the researchers asked study participants to evaluate how connected and similar they felt to their future selves. Three weeks later, they were then given a choice: they could have a smaller gift card right away, or they could wait for a larger-value gift card. The result? The people who felt more connected to their future selves were willing to wait for the higher-value card, while the people who felt less connected to their future selves were less patient, choosing the lower-value card.

And speaking a futured language makes a person less connected to their future self, says Chen. "[If you speak a futured language], every time you discuss the future, or any kind of a future event, grammatically you're forced to cleave that from the present and treat it as if it's something viscerally different," Chen said in his TEDTalk. "Now suppose that that visceral difference makes you subtly dissociate the future from the present every time you speak. If that's true and it makes the future feel like something more distant and more different from the present, that's going to make it harder to save. If, on the other hand, you speak a futureless language, the present and the future, you speak about them identically. If that subtly nudges you to feel about them identically, that's going to make it easier to save."

So what's an English-speaker to do?

One thought is that imagining your future self could help you connect with your future self, helping you to save more money. Close your eyes and imagine yourself in one year, five years, 10 years. What are you doing? Where do you live? Where do you work? Think about how your future self might be similar to your present self. For instance, my future self is still a writer and still enjoys baking and travel. Thinking about those probable similarities helps me connect who I am today with who I'll be one day.

Another idea for connecting to your future self comes from Chris Bailey at A Year of Productivity: "Send an email to your future self. Seriously, do it. lets you send an email to yourself in the future at a date you specify. A great way to bridge the gap between your present and future selves is to tell your future self how your current actions will make your future self better. Here's a letter I sent."

Personally, I do feel disconnected from my future self. The rare times that I do think about her, it's like she's a different person altogether. (A person who's really got it together, by the way. Future April pre-sorts her laundry and effortlessly throws dinner parties for 12.) Even though I've learned how to save and spend within my means, I can see how connecting with my future self might make saving money something I want to do, instead of something I do because I'm supposed to do it. And if I feel less "deprived," maybe I'll be motivated to save even more.

Do you ever imagine your future self? Do you think imagining your future self would motivate you to save more?


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