Incremental progress pays off
Comment Take small steps to achieve your goals and don’t get lost in the big picture, says Natalie Holt of The Lang Cat
What is it that fuels some people to act, and others not to? How do you build good habits that actually stick, rather than fall by the wayside?
It’s interesting to think about now that January is behind us, and beyond any New Year resolutions that may or may not have lasted the month. It’s tempting to go for the big shiny goals, or the long-term life-changing stuff that will supposedly make us happier, healthier, better human beings.
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Yet psychology tells us that these big-picture – often unrealistic – goals might be setting ourselves up for failure. They can be too big, too much, too soon.
The late Dr Michael Mosley took a completely different approach with his BBC podcast series Just One Thing and it proved hugely popular. In each episode, he presented one simple tip to boost health and wellbeing for listeners to try for a limited time to see if it made a difference.
Sometimes, action and habit forming can come out of a different place entirely, like getting a jolt of reality.
Take the State Pension as an example. This is currently worth up to £230.25 a week for most people, depending on your National Insurance record. At the moment, this entitlement can be claimed from age 66, although this is set to rise in the future.That might lead you to think that’s the future dealt with. As it turns out, many people assume the State and the government will take care of them in later life.
Research from investment firm JP Morgan Asset Management, based on a survey of 2,000 UK adults, found that 40 per cent of respondents aged 18-34 think the State will be equally or more generous when they retire compared to today.
Unfortunately, that’s unlikely to be the case. In fact, JP Morgan’s chief market strategist, Karen Ward, recently advised a financial conference to stop factoring in the State Pension to financial forecasts for younger clients. This is due to the possibility it might not exist in future, or at least, not in the way it does now.
I don’t mean to scare you with this information, I present it as an example of how understanding what you’ll get in future – whether from the State or your own pensions and investments –can be a helpful starting point in assessing your personal finances. And one which might help you take action as a result.It is important to stress that inaction with money and finances is pretty commonplace. Many people think they’re supposed to know more about money than they do, or that everyone else is sorted. That’s not true.
Cut yourself some slack and make things easier. A resolution to master the guitar from scratch might instead be better framed as booking your first hour’s tuition and going from there.
With your personal finances, as with New Year resolutions, small steps win out. Such as cancelling an unused subscription, or setting up a direct debit to an existing investment. Or booking in a free initial chat with a financial adviser.
Your “just one thing” will be different from the next person’s. But it may be enough to move the dial from doing nothing to doing something. Hopefully, that will leave you feeling that bit more sorted when it comes to your money.
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