It's a common interview question, and a favorite if not crucial one asked by potential employers. From the minute this question is tossed in your lap, your reaction and response is noted. Although the question is designed to evaluate one's ambition and focus, it's very linear. In fact, if you approach and respond to this question from a holistic perspective, you will probably talk yourself right out of a job; which means that the question of where you see yourself is really a trick question - unless you specify where you see yourself within the company you are seeking employment.
Psychology teaches us that at the root of our happiness is our self-concept and self-efficacy. Where you see yourself in 5 years is conditional, and has more to do with your self-concept and sense of self-efficacy, relative to how they shape the view of who you are, your vision of who you can become, and the belief you have in your abilities to accomplish anything, now and in the future.
Any future that entails working for someone else harmoniously must be congruent with the self-concept you have of the future you, which is difficult for most people because their current self-concepts are (usually) unconsciously preventing them from doing so. When your current self makes no plans for the future you, growth is impeded - both professionally and personally.
So when the question of "Where do you see yourself in 5 years?" arises, think to yourself "how do I want to grow 5 years from now?" Remember, now is just a bridge to the future and the future you. If the job you are interviewing for can facilitate that process then it's the correct bridge to cross.
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