We are confronted with choices to do the right thing, to be more responsible, all the time. Like eat more vegetables, save more, pay off a credit card or hit the treadmill. What is our common reaction to these choices?
I don't have the time.
I don't have the money.
I don't want to think about it right now.
We contemplate for a moment, sigh, and then we get back to busy and back to the moment.
Even when we take action to move in a more responsible direction, we often end up with a false start. Think about how full health clubs are during the first two weeks of January with committed, driven, passionate, determined people. Then think about the same health club in the middle of May. I can remember many false starts in my own life -- especially on the eating front. Times when I have stopped at the grocery store and loaded up with vegetables like fresh kale, celery, radishes, broccoli and big red tomatoes. I arrived home completely committed to turn over a new leaf and eat healthier every day for the rest of my life. But only a few days later, the wilting, mushy, bruised vegetables sit lonely in the vegetable drawer, evidence of my failed commitment even with the best of intentions.
We all know it's hard to change. It's really hard to stick with commitments around our financial or physical well-being, especially if the pay-off is way down the road. When it comes to retirement, we could be talking decades. That's a long time to keep your eye on the prize and stay actively committed.
If one of the ways you are saving for retirement is a 401(k) plan, there's an elegant and simple way to save more for later, but make the commitment today. It's called auto-escalation. While not available in all plans, it's becoming an increasingly popular feature. In a nutshell, auto escalation enables you to make the decision to save more now, but not begin to actually save until later. For instance, you may choose to automatically save one percent more when you get your next raise.
There's no impact to your current income or spending, and in most cases, it can be done quickly and easily online or with a phone call. Just like the line made famous by Ron Popeil and the Ronco rotisserie, this "set it and forget it," strategy can have a huge payoff down the road as your retirement nest egg continues to cook and grow. Shlomo Benartzi, a professor at UCLA, has made this his crusade -- appropriately called "Save More Tomorrow." His Ted video on the subject is definitely worth a look.
By the way, we purchased our first Ronco stainless steel rotisserie more than five years ago. It is all it's cracked up to be. Outstanding quality and you really do just set it and forget it. In our case, it is often prime rib rubbed with rock salt or a Cajun injected turkey breast.