Small Changes Don’t Really Help

Over the years I’ve found myself, both here and in my real life, telling people with financial problems that small changes will help. I’ve told people that, “If you just stop eating out,” or “Stop spending on magazines at the grocery store,” or “Save $10 per pay period,” you can really help your financial situation. Other financial gurus pitch the same thing. I used to think this was good advice. After all, any amount of money you can save is a help, right? Recently I’ve given this some thought and I’ve about decided to change my tune. I’m not sure that little changes really help all that much for most people.

The reason for my about face is that lately I’ve seen a lot of people who make one little change and then expect everything to get better. It’s like making one small change is supposed to yield magical results.

“Well, I stopped eating out. Why am I still living paycheck to paycheck?” is one real-life example I’ve heard. Another was the person who came to me and said, “I don’t get it. I’m saving $20 per week in coupons at the store, but I still have thousands of student loan debt.” All the books and websites tell these people to just make small changes and the tone is often to the tune of, “And if you do, all your problems will be cured.” It’s no wonder people get confused.

We in financial circles tell people all the time to make small changes because it’s motivational. When faced with a financial mess, it’s overwhelming to think about dealing with the whole thing. So we tell people to just make a small change. Have that $10 automatically deducted from your paycheck and put into savings. The idea is that the person will be motivated by the success of that one small thing that they will try another and another until they’ve managed to get their situation under control.

Unfortunately, I don’t think some people are getting this message. Instead they’re getting the message that changing one small thing will magically solve everything. How can you blame them? Everything in our culture is geared toward the quick fix; the “now” mentality. From fast food to speed dating everything is about solving your problems in ten minutes or less. So when a book tells you to cut down on your lattes, it’s easy to think that this is the cure to your financial problems.

But finances don’t work that way. Sure, you can improve things with ten minutes of coupon clipping or five minutes of flicking off electricity. After all, if you’re in the middle of financial Armageddon some action is better than none. However, you cannot solve a big financial problem on little steps alone. At some point you’re going to have to wade into the big stuff like paying off thousands in debt, figuring out why you overspend in the first place, getting another income, dealing with legal issues, or selling things you love to pay the bills. There’s no easy fix for a big financial mess.

The real truth is that it’s hard, it’s ugly, it’s no fun and it often takes years to clean up finances that have gone seriously awry. But that’s not easy to hear. It’s easier to hear that little changes will cure your problems. Granted, little things will help and often little changes lead to bigger ones, particularly in people who are motivated. But please don’t get confused and think that if you just stop buying lunch at McDonald’s every day that all of your financial issues will resolve themselves. You have to deal with the big stuff if you want to have healthy finances. There’s no other way around it. The little things might set you on the right path, but they are not the whole path.

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11 Responses to Small Changes Don’t Really Help

  1. Leigh says:

    If someone truly believes all they have to do is cut the Starbuck’s habit and they’ll retire with millions, than there’s really no hope. I suggest we stop trying to spoon feed them and just let Darwin thin the herd. Moo.

  2. PatientSaver says:

    If you spend all your time and energy doing “little” things to save money, you’ll have no energy left for the bigger things that count so much more.

    So start with stuff like refinancing your mortgage or shopping around for car or homeowners insurance and forget about clipping .25 coupons if you’re not in the habit of doing so.


  3. Andrea Guennewig says:

    I completely agree. Cutting the occasional latte won’t help individuals in the long run. What needs to happen is a re-evaluation of current expenses as they are now. Pay your bills and debt re-payments first. What’s left over is what you can spend on groceries, gas, dining out, etc. If that isn’t enough, request more hours or get a second job. Both are not easy, but they are necessary to getting ahead. It can be a long road…

  4. Allison says:

    I agree with Leigh. Although I’m not sure what cows have to do with that…

  5. Maybe the mantra should change to ‘one small step at a time’.

    Small steps can add up to big things, but basic math will tell you a big problem needs a big fix. You can’t get a big fix from one small step, you need lots of them. just not necessarily all at once.

    Sometimes I think the old Tortoise and Hare story is more useful for adults than kids. Kids while they are impatient, are generally more willing to do a little bit and come back later to do more, adults have a ‘you must finish it all right now-or don’t bother’ mentality.

  6. Rachel McTague says:

    The problem for many people is that they say, well I saved $10 with grocery coupons and $15 on the electric bill this month, so I have an extra $25 dollars (TO SPEND)…..

  7. larabelle says:

    I agree with Rachel people do save an extra $25 dollars just to spend and then they wonder why they are still in debt. Drastic circumstances (high debt) require drastic actions (extreme actions to delete debt).

  8. Jimmy says:

    Who cares about debt, corporations don’t pay their debts, the Govt. doesn’t pay their debts, why should you pay your debts? They can’t us all, just rack up as much debt as you can and don’t pay a dime, they can’t do crap to you.

  9. Rick says:

    Small steps may help you from racking up additional debt, but it takes major steps to start paying it back.

  10. Jo/GaelicWench says:

    We are a society of immediate gratification. It’s like we have to have it yesterday. Stop the lattes, the lunches out and watch yourself get richer. You can’t see immediate results with moves such as this, but it helps as a start-up point. They’re called baby steps.

    I tend to think that slow and steady wins the race, although a major step with refinancing one’s mortgage, as long as the savings are $200 and above can truly be a big boon for one’s budget. The caveat is that it won’t do any good if the savings aren’t reinvested somewhere else, such as paying down a car payment, put in retirement, set aside for any up and coming major purchase.

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