Now is the time of year when those New Year’s resolutions that you so earnestly made at the end of last year have become an afterthought. That is why gyms have far many more memberships than they can actually handle. The more concrete your goals the more likely you were to stick with them.

As Cass Sunstein notes in a piece at Bloomberg we are a weak  lot. When our goals conflict with our desires, our desires often win out. We do however know something about the science of keeping resolutions. Sunstein writes:

But how can we ensure that our resolutions actually stick? Behavioral economists have three answers: Make them easy and automatic, make them a matter of habit, and make them fun. A resolution is more likely to work if it is concrete and can be translated into a simple routine.

For investors we cannot simply resolve to generate higher returns in the new year. That is largely a function of the capital markets themselves. However we can control how much money we save. This is especially important if over the long run generating so-called “real, real returns” or those returns after taxes and inflation is more difficult than it seems on the face of it.

There are some simple ways in which we can make saving easier. Christine Benz at Morningstar in this piece talks about the importance of saving and a few relatively painless ways we can save more. These include saving any tax refunds we might accrue and taking any raises we might receive and funneling them into savings automatically.

There other ways of making savings more of a habit (and fun). We recently came across a startup Acorns in this survey of the consumer financial technology landscape.* Acorns’ goal being to allow you to “invest spare change automatically from everyday purchases into a diversified portfolio.” With everyone spending so much time on their phones these days here is a chance to make it into a more productive activity.

Saving is important. It provides us with the means to meet the goals for our families and retirement. After a certain point however our happiness does not materially change with income and assets. Our happiness is far more driven by other more intangible things. As The Accumulator at Monevator writes:

Independence, purpose, love, respect and social interaction is what really makes us happy.

Our resolutions matter. Our ability to save for our goals matter. Making these things easy, automatic, habitual and fun matter. They matter because they provide us with the means and ability to do the things that truly matter.

*Not an endorsement. An interesting idea however.

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