Improving Investor Behavior: A Mentality of Abundance, Not Excess

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This article originally appeared in the Denver Post, November 21, 2021.

We’ve often said time is our most precious resource. More valuable than money, more fleeting than possessions, nothing can be done to stop the spending of our time. But like money and possessions, having too much time can be a bad thing. 

I’m a big proponent of having an abundance mindset, an approach to the world that at its core believes there’s an endless supply of nearly everything people need to build, create, share, and grow. But with that belief comes an unexpected requirement, understanding how much is enough. It’s easy to fall into the trap of always going after more: more money, more time, more friends, etc. But when is enough, enough? 

A few months ago, we explored that topic at length as it relates to money. But what about other intangibles like time? Can we have too much time, and is it bad if we do? 

“As an individual’s free time increases, so does that person’s sense of well-being—but only up to a point,” concluded a recent study by the American Psychological Association. The survey of almost 22,000 participants found that while free time increases happiness, it only does so for up to about five hours per day. After that point, participants reported no additional improvement to their happiness or quality of life. The sweet spot of free time seemed to exist between two and five hours per day. 

The outcome of this study seems to contradict most people’s expectations of what retirement will look like: namely, endless free time. So, think about it: how does your ideal retirement look? Yes, there are probably beaches and cold drinks, but what about the next day? The day after that? Do you really want to spend the rest of your life sitting on a beach staring at the water? 

Even if that sounds appealing, the reality is that boredom sets in far quicker than most realize. Without challenge, without difficulty, we never have the opportunity to grow. I suggest that our muscles atrophy without resistance and exercise; similarly, if you are not exercising your mind, it will also atrophy. Ask yourself, what am I retiring to? It’s easy to look in the rearview mirror and see what you’re retiring from, but what does your destination look like? Will it be a bigger future than your past? 

Another study followed thousands of retirees from Shell Oil for a number of years. It found that those who retired at age 55 were twice as likely to die before reaching age 65 than those who retired after age 60. In short, those who retired early tended to pass away prematurely. You would assume early retirement would lead to less stress and a more relaxed lifestyle, ultimately boosting longevity. But the opposite happens. Conversely, mortality rates tend to improve with later retirement ages. 

Now I don’t believe early retirement causes premature death, but boredom and a lack of self-worth derived from not working can be contributing factors. Too often, people go from the height of their careers, when they’re considered the most valuable to a company or employer, to their living rooms with nowhere to be and no task to be done. That’s a hard shift for a lot of people, even if it’s what they think they’ve always wanted. 

As with travel, chocolate, wine, and money, too much of a good thing can be a bad thing. Finding a balance is the key. In reality, no one has life completely figured out. Some workaholics have miserable personal lives; likewise, there are people with extraordinary social lives who hate their job. People who take too much risk put themselves in the position to lose it all someday; people who don’t take enough risk are missing out on the power of compounding. 

A mindset of abundance is a beautiful thing. It encourages a focus on gratitude, growth, and sharing. But abundance should not be confused with excess, which instead focuses on endless accumulation or uninhibited indulgence. It’s your job to understand the difference and to draw your line between the two. Even our most valuable resource (time) can contribute to an early death if we seek too much of it. 

With Thanksgiving a few short days away, I encourage you to embrace an attitude of gratitude, to be thankful for all the good we have in our lives. But also to be grateful for the things that challenge us, move us out of our comfort zones, and inspire us to be better than we were yesterday. I believe that balance is where true happiness exists. 

Wishing you and your family a Happy and Grateful Thanksgiving. 

Steve Booren

Steve Booren is the Owner and Founder of Prosperion Financial Advisors, located in Greenwood Village, Colo. He is the author of Blind Spots: The Mental Mistakes Investors Make and Intelligent Investing: Your Guide to a Growing Retirement Income and a regular columnist in The Denver Post. He was recently named a Barron's Top Financial Advisor and recognized as a Forbes Top Wealth Advisor in Colorado.

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