Bumper Sticker Theory

I was on the highway the other day, watching cars pass, and noticed something. The cars with bumper stickers never had one or two, they had a collection, a full rear bumper manifesto.

Tattoos work the same way

This isn’t just a bumper sticker thing, tattoos have the same shape. Pew Research surveyed 8,480 American adults in 2023, and of the people with tattoos, 69% have more than one, only 31% have exactly one. The shape is the same: zero, or a lot, the middle doesn’t hold.

There’s a flip

I think what is happening is there’s a moment where somebody becomes a bumper sticker person or a tattoo person. Before then, it’s not something they likely expressed interest in, it’s not something they identified with.

Money works the same way

The same thing happens with money, you go from a person who doesn’t have a TFSA or an RRSP, who maybe just accepts the default fund their employer put them in, to a person who has one.

The first action is the zero-to-one change. Psychologists Bas Verplanken and Jie Sui (2019) found that habits become part of your identity through self-perception: you observe your own behaviour, and you infer “this is who I am.” Their conclusion is that “long-term behaviour maintenance may be enhanced if a habit becomes part of an individual’s self-identity.”

This is why the middle doesn’t hold, the action comes first, the identity forms around it, which is what keeps you going. Once you’ve opened the account, you’re now someone who chose to open an RRSP. Plenty of people have one without ever opening it themselves, it got set up through work, automatic, somebody else’s initiative. The engagement is a byproduct of being in the game, not a prerequisite for entering it.

The first sticker is the most important one

A stochastic life-cycle model cited on Rational Reminder episode 217, “The Expected Returns of Financial Literacy,” estimates that 30% to 40% of retirement wealth inequality is explained by differences in financial knowledge, not income, not education, not luck, just the knowledge gap compounding for forty years.

Only about one-third of adults worldwide can pass a basic financial literacy test (the S&P Global FinLit Survey’s “Big Three” on diversification, inflation, and compound interest, run across 140+ countries). The two-thirds who can’t are obvious, but they’re not really the story. The story is that knowledge alone doesn’t change anything. You can know how compound interest works and still never open an RRSP, the same way you can know everything about bumper stickers and never put one on your car. What changes things is the action, which builds the identity, which keeps you acting.

Next Steps

• VEQT vs XEQT — your first sticker. Pick one, buy it, done.
• Cost of Waiting Calculator — see what six months of “I should figure this out” actually costs you.
• Rational Reminder #217 — the deep dive on financial literacy and wealth accumulation, with the academic sources.