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Four in 10 investors lack forward planning

Long-term savings and investments provider Standard Life has found that seven in 10 UK adults would wait five years for option two - the luxury holiday, rather than head off on the short break.

However, this contrasts with earlier research which found that less than four in 10 (38 per cent) investors apply the same forward planning principles to their finances.

So let's ask again. Would you like £640 cash today or £5,000 in cash in 2016? Would your answer be any different? If so, ask yourself why. To turn £640 invested today into £5,000 within five years would be investment genius, needing a return of more than 50 per cent every year on the investment.

Even if you would prefer option two on both counts, you still might be taking too short a term view with your finances. For example, are you missing out on the huge effect of compounded income tax relief from contributions to a pension because you don't like the thought of having no access to your money until you are 55? Are you invested in high-risk Alternative Investment Market (Aim) stocks that could lose your money overnight because you want a gain this year, rather than waiting for a blue-chip stock to return in five years' time?

And the bottom line - are you really putting enough away today so that you can live comfortably () in future years? Finding extra money to invest may not seem easy - it's not as if we all have several hundred pounds spare at the end of each month that we can't think what to do with. But if you want to carry on having a £5,000 holiday today you may have to put up with rather less than a £640 holiday in retirement.