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Have a fresh start! Just not on New Year's.

Many decide to run a marathon at 29, 39, 49... There is something about turning the corner on another decade which nudges us to do something meaningful. Something you've always wanted to do. Something you've been putting off for a while.

Motivation for growth is a fundamental human need. You want to improve, to grow, to be better. The rub is mustering the will to commit to better. The second rub is choosing when.

A group of scientists led by Harvard's John Beshears studied the effect of so-called fresh starts on money saving behavior. A fresh start is a new beginning -- the day when you return to the gym, give regular feedback to your team, or kiss your kids good night every time before bed.

In this really cool field experiment, 6,082 employees at four large US universities received customary letters urging them to enroll in a savings plan, just like in previous years. But they were assigned to different groups based on their birth month (that was the experimental tweak!). Those in the control group were given options to start saving immediately, in a month, in 2 months, in 3 months, etc. Then, one experimental group received the invitation to start saving right now or on their birthday, while the delayed option for the other experimental group was framed as a holiday (New Year's, the first day of spring, Thanksgiving, Valentine's, or Martin Luther King Day).

What did they find?

First, one would expect that if you offer someone to do something they don't like in the future instead of now, they will choose a later date. That's why we eat a muffin today but plan to start exercising next week. But no. In this study, the option to start saving in the future did not decrease the uptake in decisions to begin immediately compared to the historical trends.

Second, the fresh start framing was significantly more effective to nudge saving than an equivalent time delay, such as "in 3 months". This is what makes psychology so fascinating! While there are exactly 90 days in both "start saving in 3 months" and "start saving on the first day of spring", as humans we overwhelmingly respond with action to the latter.

Finally, not every fresh start is the same. In an accompanying study, the researchers found that the birthday or New Year's are perceived as fresh starts, while Thanksgiving or St. Valentine's Day are not. Which intuitively makes sense: we are wired to be motivated by a start of something bigger (the next school year, the next season, the new job). What really surprised the scientists was that New Year's did not result in a noticeable uptake in savings. People were much more likely to begin on their birthdays or the first day of spring. Maybe it's because New Year's is a natural start for something big or maybe because we already know that New Year's resolutions don't work (we default on 88% of New Year's resolutions), but to be on the safe side... pick something else.

To sum this up:

  • The best time to invest in yourself was... in the past.

  • The next best time: it depends. Plan your fresh start well.

  • Research found that people are likely to start saving for the future either straight away (often going cold turkey works) or when they had a fresh start framed as a meaningful calendar milestone, such as their birthday or the first day of spring.

  • Starting a new life on New Year's... not so sure about that one.

So, what's your next fresh start? And when will you begin?

This blog represents the authors' views and not those of associated organizations or institutions.

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