Subscription services.  We all have them and, if you are like me, you can’t imagine not having them.  How did we live before that box of fresh, organic food appeared on the doorstep?  Did I really get in the car and drive to a video store to check out movies?  Was there really a time when you bought razors at Target?  Seems like every product or service in today’s economy is available to you for a low monthly fee, conveniently charged to your credit card.  Signing up is easy, stopping is another matter, not just because the process can be a bit thick, but also because inertia sets in and behavior becomes habit.

But you know what?  When certain behaviors become habits, the results can be remarkably beneficial.  A prime example:  retirement savings.  If you work for an employer and contribute to a 401(k) plan, a portion of your pay is set aside from each paycheck, is deposited into the retirement plan, and is invested for your future.  Keep at it over your working years and you will have a bundle of resources to live on once you retire.  The retirement plan industry, armed with scads of research from behavioral finance experts like Nobel-laureate Richard Thaler, has for years taken steps to make the “subscription” business model a reality for American workers.   Today’s retirement plan features automatic enrollment, automatic annual increases and default investment options; all of which are designed to make it easier and more convenient to save for retirement.  Automatic enrollment, in my opinion, is the most important element of all because once you have signed up to participate in the retirement plan, i.e., “subscribed”, the chances are high that inertia will take over and you won’t give your decision another thought.  The subscription service business model is both successful and ubiquitous largely because it requires energy and action to make changes, and a lot of us get comfortable and do not like making changes.

Savvy investors know how to apply the subscription model to their personal savings as well. It’s very easy.  The first step is to open an investment account with a small amount of regular savings.  Second, link a checking account to the investment account to make it easy to move money electronically between the two accounts.  Third, set a certain amount to be automatically transferred monthly from the checking account to the investment account.  Then, sit back and let inertia have its way.  You will have quite easily set up your own subscription model to build wealth in an investment account.  (Note, this can be done to fund an IRA or a Roth IRA annually as well.)

Taking the first step – here, getting started — is the key to success.  Since you do not have a benevolent employer providing an automatic enrollment option for you, you can rely on your Fiduciary Investment Advisor to help you put a “subscription” savings program in place.  The dollar amount you set aside every month for regular personal investment is much less important than the very act of setting it aside for your future.  Over time, by doing the work, and letting your dollars work as well, you will build a nice nest egg to supplement other traditional retirement plan savings.

American Trust Wealth is keen to help its clients (where appropriate) join the group of savvy investors with a personal savings subscription plan.  You will see more information, occasional messaging, and other articles on the topic as we move into 2025.  In the meantime, take the first step by speaking with your Fiduciary Investment Advisor about this and other ways we can help you subscribe for success.