Why Slowing Down is Guaranteed to Improve Your Life

Good things come to those who wait

 In recent years, we’ve seemed to have forgotten this simple, yet powerful phrase.  With the rise of social media and smartphones more information than we can imagine may seem great, it also has its downsides.

Now we are addicted to our smartphones and allow social media to impact our spending habits. That’s why per Frank Partnoy, author of Wait: The Art and Science of Delay all our lives would be improved if we just slowed down.

Professionals vs. Amateurs

To Partnoy, the ability to delay one’s decision-making process is what sets professionals and amateurs apart.  Most people think that professional athletes have a faster reaction time than amateurs, but that isn’t the case.  In his book, Partnoy describes a study of world-class tennis players.

It turns out they can’t react to a tennis serve any faster than the average human (it takes our brains about 200 milliseconds to react).  What sets them apart from the weekend tennis player is their ability to delay and stretch the amount of time before they hit the ball.

Because, in the case of tennis, you only have around 300 milliseconds to hit the ball back, every millisecond you can wait gives you more time to prepare.  Professionals spend countless hours practicing so they have time to adjust their rackets or position before returning the serve.  The same is true for great baseball players.  It’s not that they see the pitch faster than others, it’s that they can wait as long as possible before swinging.

Professional Investors Wait Too

Waiting can make you a better investor too.  Warren Buffett typically reads thousands of documents on a company before deciding to invest.  Since he’s always focused on achieving returns years and even decades into the future, he doesn’t feel the need to rush to a decision.  He will typically wait until the last possible moment until making an investment.

While it’s not possible for the average investor to read thousands of documents; think about how much better of an investor you could be if you just waited an extra day or week before you made a purchase.

In my own experience, some of my worse losses have come after I rushed into a trade.  I get caught up thinking it’s now or never only to have the stock price drop shortly after investing.  If I would have just built a waiting period into the time I choose a stock and the time I purchased, I could have avoided some of these losses.

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Living in the Present

Social media hasn’t helped our ability to wait.  The instant gratification of likes and comments conditions us to constantly check for updates.  I think this is one of the reasons we are so present-oriented nowadays.  Partnoy discusses numerous studies in Wait, but essentially, we all discount the future much more than the present.

For example, if I offered you $100 today or $150 a month from now, which would you take?  Depending on how you answer shows your discount rate.  If you take the $100 today, it’s because the future amount is worth less than $100 to you today.  You’re discounting the future amount.

Often, we get so caught up in the present, that this discounting gets out of control.  Why save for retirement when there’s something we want to purchase right now?

Adding some extra time to really think about our purchases could prevent us from making financial decisions we’ll regret down the line.  Also, learning to break our addiction to social media will help us to stop focusing on the present and look more toward the future.

Slow Down

Next time you feel like you’re rushing to a decision, remember it’s best to wait.  Try creating an investment checklist to help remove your emotion.  Or institute an automatic increase to your retirement each year so you are tempted by present bias.

Adding a little pause into our lives can help improve our financial, professional and personal lives.

When was a time you rushed to a decision and it turned out poorly?  Let me know if the comments.