Boring money grows faster – The one investing habit that beats all the others
By David Samuel
Everyday Finance Coach
Every few months, a new headline convinces someone to make a move with their money. Rates are rising. A recession is coming. Crypto is back. Tech is dead. AI is unstoppable. The market feels like a story you’re supposed to keep up with, and if you’re not adjusting your portfolio in response, you’re falling behind.
Except the data keeps saying the opposite. The people who barely touch their investments tend to end up with more money than the people who are actively managing them. And Morningstar just put a very specific number on how much that tinkering costs.
The $3.8 trillion mistake
Every year, Morningstar publishes a study called “Mind the Gap.” It compares two numbers: what mutual funds and ETFs actually earned over the past decade, and what the average investor in those funds actually earned. In a perfect world, those two numbers would be identical. If a fund goes up 10%, you go up 10%.
They’re never identical. And the gap between them is entirely explained by one thing: when investors chose to buy and when they chose to sell.
The 2026 report, which covers the ten years ending December 31, 2025, found that U.S. funds and ETFs collectively returned 9.9% per year. But the average dollar invested in those same funds only earned 8.7%. That 1.2-point shortfall might sound small until you scale it across the whole industry. If investors had simply left their money alone, fund assets would have grown to roughly $35 trillion. Instead they grew to $29.7 trillion. The missing $3.8 trillion is what bad timing cost people, collectively, in a single decade.
That’s not market losses. That’s not fees. That’s just the price of trying to be clever.
Where the damage was worst
The gap varied wildly depending on what people were investing in — and the pattern is telling.
Investors in U.S. stock funds did remarkably well. They captured 12.8% per year against the funds’ 13.3%. That tiny gap suggests most stock fund investors stayed put during a strong decade, which is exactly what you’d want them to do. Morningstar called this potentially the biggest wealth-building decade in fund history for ordinary investors.
Crypto ETF investors were the opposite story. The funds themselves posted big gains, but the average crypto investor earned dramatically less. Why? Because people piled in after prices had already surged and sold after they crashed. The volatility that made crypto exciting also made it nearly impossible to hold onto.
The most interesting finding was about buffer ETFs — funds designed to cap both your gains and your losses within a set range. Investors in those funds actually beat the funds’ own returns. The likely reason is quietly profound: when a product removes the extremes, it also removes the emotional triggers that cause people to panic-sell or performance-chase. The guardrails protected investors from themselves.
Why smart people still get this wrong
Here’s the uncomfortable part. The investors creating this gap aren’t reckless or uninformed. Many are doing what feels responsible — watching the news, adjusting to conditions, reallocating when something looks risky. Morningstar is careful to say the gap isn’t proof that individual investors are foolish. Even good habits like rebalancing or dollar-cost averaging create small gaps.
The problem is that our instincts are mis-calibrated for investing. In most areas of life, paying more attention and taking more action produces better outcomes. If your car is making a noise, you investigate. If your business is struggling, you intervene. Investing punishes that reflex. The market goes up over long periods and down over short ones, so anyone reacting to short-term noise is almost guaranteed to sell during fear and buy during excitement — the exact opposite of what works.
What this means to you
The takeaway isn’t complicated, but it’s hard to internalize: your investment strategy should be boring enough that you’re never tempted to check on it. Automate contributions. Pick an allocation that matches your timeline and risk tolerance. Rebalance on a schedule, not a hunch. Then leave it alone.
The 12% haircut Morningstar found isn’t the cost of bad markets. It’s the cost of paying attention. Which means the single most powerful thing most investors can do is nothing at all. The people who won the last decade weren’t the ones who timed it best. They were the ones who forgot to try.
If you’re ready to make progress in your effort to take control of your finances, this is exactly the kind of work done with my coaching clients every day—clarifying priorities, creating a practical plan, and following through on it. If you’d like support with your own situation, you’re welcome to reach out anytime right here, or by email at david@everydayfinancecoach.com