Here is a suggestion for those who are planning a big change in the New Year: Don’t forget to make them small.

This approach should be particularly useful in 2021, after a year in which many experienced financial difficulties. People who are stressed or overwhelmed can’t make big changes and probably won’t even try, says BJ Fogg, a behavioral scientist at Stanford University.

To increase your chances of success, he advises you to focus on even small changes, such as doing two push-ups a day or saving 1% of your salary.

According to Dr. Fogg, author of Tiny Habits, the easier the task, the greater the chance that you will persevere when motivation inevitably decreases: The small changes that make the difference. If a small habit develops, it paves the way for more serious habits, such as six push-ups a day or saving 2% of your salary.

Here are the strategies to consider.

Do not rely on motivation

The New Year is a time when many people feel motivated to make changes, especially when it comes to saving for retirement. But the motivation can quickly evaporate, like everyone who signed up for the gym in January and quit in February.

Motivation may be enough for one-off performance, but it is not enough for lasting change, according to Dr. Fogg, who recommends instead finding ways to reduce targets so that they are easier to achieve.

Low bar maintenance

According to Dr. Fogg, people often expose themselves to failure by opting for vague or over-ambitious goals, such as financial security.

It is above all a question of linking these objectives to concrete actions, such as, for example, the creation of an emergency fund or the catching up of retirement savings, and starting with a realistic step, as follows

Dan Egan,

Managing Director of Behavioral Finance and Investments Betterment LLC. For example, you may decide to save $500 for an emergency or contribute 1% of your salary to your 401(k).

If you stick to a 1% saving rate, you’re more likely to maintain that habit for unexpected expenses, Dr. Fogg says.

Highlight the positive points

People tend to focus on the negative. But resist the urge to worry about how far away you are or to worry about past mistakes, for example. B. cashing in your retirement savings when you leave your job.

Instead, you need to focus on how the small steps you’re taking now will add something substantial over time, Byrne said.

Ramit Sethi,

Author of I’ll Teach You to Be Rich.

One of the reasons we don’t like to make small changes is that they seem so ineffective and meaningless, he said. That’s how it feels: What’s the point? This isn’t going anywhere. But if you understand addition, you understand that what normally happens can add up.

Calculate the effect of minor changes

A person who earns $50,000 and saves 1% a year receives almost $19,000 in 20 years and more than $77,000 in 40 years with an annual rate of return of 6%.

Even a seemingly small reduction in investment costs can lead to significant savings over time. According to the Vanguard Group, the investment rises from $100,000 at 6% a year to $429,000 after 25 years at no cost. With an annual contribution of 1 percent, the balance rises to $339,000.

Application of the experimental approach

If you’re looking for ways to save for retirement, Mr. Sethi warns you to save for things you love, big or small. If you are looking for a holiday, restaurant visit or


If you have become a smoker, you may feel helpless and lose the motivation to continue smoking.

In order to save money, he recommends starting with winches that don’t take much effort.

For example, you can forgo subscriptions that you do not use, negotiate discounts with mobile or cable providers and retain part of your refund or tax increase.

Ready to do more?

Click here for six weeks of simple exercises for personal finance in difficult times.

Ultimately, he recommends trying to make larger cash donations, such as refinancing a mortgage or negotiating a rent reduction or salary increase, and regularly reviewing your spending to identify potential savings.

Don’t feel bad if you fail, Dr. Fogg said. Think of it as an experiment, he said. Try to understand why it didn’t work, change your approach and try again.

Take only one step

In contrast to a healthier diet or exercise programme, pension savings can be put on automatic pilot by means of wage deductions from a 401(k) account or automatic transfers from a savings account to an individual pension account or emergency fund.

Many 401(k) plans now allow employees to negotiate an automatic increase in their contribution for the future, often by one percentage point per year.


What are your tips for saving for retirement? Take part in the discussion below.

When it comes to tasks that cannot be automated, such as opening an LIRA or reviewing your expenses, Dr. Fogg recommends two techniques to facilitate these tasks.

The first is to take a single step. For example, if your goal is to open an IRA, you can simply establish a connection with the brokerage firm and schedule a reminder schedule to take the next step later.

Also set a five-minute timer and tell yourself you can stop when it goes off. If you go for it, it could be that it’s not so bad, or that the hurry makes you want to end it, Dr. Fogg said.


When you have completed your task, celebrate as soon as possible by quietly congratulating yourself.

Celebrating can cause your brain to release good neurotransmitters that are demonstrably useful in your intestinal habits, Dr. Fogg said.

Mr. Egan said that after reviewing their monthly expenses, he and his wife treated themselves to a nice dinner and a bottle of wine.

Send an e-mail to Anna Tergesen at [email protected]

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