Even though we’re statistically more affluent than ever, our material affluence hasn’t translated to time affluence with many people increasingly feeling “time poor”.

Defined as chronic feeling of having too many things to do and not enough time to do them, there are a number of drivers leading to time poverty, including; longer work hours and the expectation to be constantly available via digital devices; balancing chores, childcare, and other family obligations; finding time for hobbies, socializing, and self-care and a constant digital information overload from social media, news, and other sources, which together can consume significant amounts of time. 

The impacts of time poverty are wide-ranging, and we’re all familiar with terms like burnout and stress but it can also affect overall wellbeing, work performance, creativity, career advancement and relationship quality. 

Time poverty can also impact decision making. When individuals perceive they have a scarcity of time, it can reduce cognitive capacity and weakened analytical judgment. In some cases, this can lead to individuals neglecting the long-term consequences and instead focusing on short term benefits. Some experimental research has found that people with a stronger perception of time scarcity were more likely to choose smaller and more instant gains.  

This has obvious implications when it comes to investing, as time poverty can impact stable, long term investment decision making, with those who are time poor or having a time scarcity mindset, more prone to chase short term rewards rather than building a portfolio of sustainable investments. It could also mean that existing portfolios are not attended to, and/or new portfolios are not built.    

While time poverty is a challenge for every generation, rates have increased substantially in recent years, with one survey in 2018 finding 80 per cent of employed people ““never had enough time”, according to research in the Journal of Nature and Human Behaviour. This means that younger generations have grown up in a society where time poverty is substantially the norm.

But what does the growing issue of time poverty mean in the context of investment decision-making?

Australia’s generational transfer of wealth is expected to accelerate rapidly in the next several decades, as the baby boomer generation enters retirement and older age. A 2021 Productivity Commission report estimating that $3.5 trillion in assets will be transferred in Australia alone by 2050, and this transfer of wealth is forecast by some to begin much sooner as most baby boomers expected to have fully exited the workforce by 2028.

This means in the coming years, those who’ll be making the primary investment decisions will be more time impoverished and have less time than ever, to consider their investment options.

So, what can time-poor investors do, to combat the perception of not having enough time to invest sustainably and successfully?

• Prioritize and Delegate: Focus on high-priority investment tasks while delegating or outsourcing other responsibilities. This could involve bringing in additional advisors or leveraging specialized investment platforms to manage routine tasks.
• Set Boundaries: Establish firm boundaries between work and personal life. This might include setting specific times for investment review and decision-making, separate from other responsibilities.
• Utilise Technology: Utilise digital tools to streamline investment management. Automated portfolio monitoring, algorithm-driven investment strategies, and time management apps can all help free up valuable time.
• Simplify Investments: Opt for investment vehicles that require less hands-on management, such as index funds, ETFs, or diversified portfolios that align with long-term goals without the need for constant adjustment.

The long-term solution for time poverty is to take control of existing time resources. One study found that a greater sense of control over time is associated with less anxiety from time scarcity, which in turn fosters preference for delayed gains and greater patience in making decisions, which from an investment perspective can reap rewards.