Here’s the deal: In a few weeks, all other things remaining thesame, workers across the country will be getting a pay raise.

This raise isn’t coming from their company. It’s coming courtesyof the 2017 Tax Reform Act.

Workers will immediately face a fork in the road. They’ll needto make a decision about which path to take into thefuture.

It’s a choice that may mean the difference between buying a fewimmediately gratifying items and living a more comfortable retirement.

Employees can either figure things out for themselves, or theycan rely on plan sponsors and financial professionals, (see“How Can Fiduciaries Use New Tax Cuts to Nudge 401kand IRA Retirement Savers?” FiduciaryNews.com, January3, 2018). But there is one thing that’s important -- this rareopportunity will exist for only a short time.

While the tax cuts will be seen in every paycheck going forward,the habits that reveal themselves as a result of this sudden payincrease will be formed only once. The moment these habits arise,they become set. The time to influence behavior, then, is now,before it’s too late to change them.

Many expect the fruit of the tax cuts to hit American’spaychecks sometime in February. This means plan sponsors and retirement advisers have onlya few weeks to prepare workers for the decision they will soon needto make. Let’s quickly explore the impact of the new tax law on thetypical employee and what it might mean for their retirement.

First, it is estimated that, on average, each of us will seeroughly a $2,000 annual savings as a result of the new tax law.Granted, this will be reflected in each paycheck. For those gettingpaid bi-weekly, they’ll see about $70 more in take home pay forevery pay period. It’s not much, but it adds up.

But before we get to the “adding up” part, consider this: Rightnow, most folks are able to survive (no matter how austerely) ontheir current paychecks. As a result, there might not be animmediate need for that extra $70.

That’s where the fork in the road appears. What shall become ofthat extra $70?

It’s quite easy to see how the temptation to spend it onsomething that “rewards” the recipient. After nearly a decade of astagnant economy, it’s natural for people to want to “finally” buysomething the failed economy had kept them from purchasing.

The immediate gratification derived from this act will no doubtbe very pleasing if not downright therapeutic.

But what is the real cost of the short-term satisfaction? Thisis the part where “adding up” comes into play. This is what workersneed to look very closely at. This may mean the difference betweena more comfortable retirement and a less comfortable retirement.Here’s what I mean.

What if, instead of spending that extra $70, you save it? That’s$2,000 a year that could go into your retirement savings.

Let’s say you earn 8% a year on that extra savings. At theend of 20 years, you’ll have an extra $100,000 in your retirementaccount. At the end of 30 years, that extra retirement savingssurpasses $200,000. After 40 years, you’ll have more than half amillion in extra savings.

That $70 a paycheck may not sound like much, but over time itreally adds up.