Every January, people around the world list things they hope to achieve during the next spin around the sun. Even if plenty of those ambitions soon vanish, their economic impact does not.
‘This year, I will…’ Our annual promises of personal transformation reflect a collective desire for self-improvement. But beyond the individual benefits of a slimmer waistline or a tidier inbox, these goals impact the very fabric of the economy.
Consider the most common goal for 2024 among U.S. citizens: to save more. Americans now hold over US$831b in personal savings – money that’s used by banks to provide loans or even finance the government through treasury bonds. As hefty as that sum may seem, it’s still well below the US$4.4t all-time high of 2020, and the personal savings rate is dwindling. Currently at a low of 4.1%, there are signs it could sink even further, which obviously influences consumer and investment behaviour.
According to research conducted by Intuit ($INTU), Gen Z is choosing personal growth and emotional wellbeing over saving for retirement, a phenomenon that’s been labelled ‘soft saving’. High inflation and costs of living are important factors, as per Bank of America ($BAC) research, but Intuit’s piece submits that Gen Z values quality of living over financial stability much more than Boomers, Gen X or Millennials – indicating that jacking up those savings can be a challenging exercise.
Speaking of exercise, improving fitness is also one of the top priorities for 2024, as always. Not only for Americans, but also for Brits and Australians. An enormous industry awaits with open arms: health clubs are worth over US$96.7b, and sports apparel brands like Nike ($NKE), Adidas ($ADDYY) and many others are estimated to gross more than US$213b in 2023 alone.
And that’s just a part of the economic importance of the fitness industry. Just in the 52 countries that compose the OECD, EU28 and G20, health spending related to obesity should surpass US$425b per year. According to the same OECD study, when factoring in labour market effects, obesity lowers annual GDP per capita by US$863 and increases tax rates by 0.62% on average.
There are reasons to be optimistic, though. GLP-1 drugs like Novo Nordisk’s ($NVO) Ozempic and Eli Lilly’s ($LLY) Saxenda can help patients lose up to 17% of their body weight, with studies showing that their usage in U.S. healthcare systems could generate economies of up to US$100b per year. Whether you’re looking to save more, exercise more, eat better or whatever it may be, how should you go about making your resolutions stick? Well, science says you should strive for a positive change, instead of an avoidance-oriented one. That is, instead of trying to avoid sweets, focus on eating healthier food. Instead of cutting expenses, create a budget plan. This way, your ‘new year, new me’ goals are less likely to repeat themselves next year.