Want to build wealth? Delete your investing app now.

It’s 2025. Defined benefit pensions are a relic of the past for the private sector, which means we have to take responsibility for our own retirement planning. Like it or not, you are your own Chief Financial Officer. You have to decide what to save, where to save it and when. No-one else is going to do it for you.

Sounds scary? 

With freedom comes responsibility. And that responsibility lies with you.

It’s a big ask for the average person. We’ve seen people in our research take decades to answer simple questions like How much do I have? Where is it? What should I do next? As well as information, advice and guidance – easy to use financial products are the foundation of good financial health.

Enter Vanguard

Vanguard is one of the world’s largest investment management companies, known for its low-cost index funds and ETFs. In the UK they have been serving retail investors since 2017. Their web platform is simple and easy to use. Their communication is clear and concise. This is empowering for their customers. I’m a real advocate. In fact Vanguard is one of the few companies I actually recommend.

In September Vanguard launched an app to offer investors more control over their money. I would rather get rid of my smartphone than download it.

Let me tell you why.

Taking the human out of the loop

Once you’re up and running with a platform and investment choice, the best advice is to “set and forget” – automate your month savings and let your provider do the rest.

The rationale is to minimise the impact of emotions on decision-making. Fear during market downturns or greed during booms are the two big ones, which can lead to panic selling or speculative buying. A “set and forget” approach reduces the temptation to react emotionally. It also simplifies the process, reducing the decision load.

The hot-cold empathy gap

But hang on, you’re not the type to panic in a crisis, are you?

In March 2020, during the onset of the COVID-19 pandemic, the S&P 500 experienced a sharp decline of approximately 34% from its previous peak on February 19, 2020. Many though the world was coming to an end, the pressure to cash out (locking in a loss in value) was immense. Little did we know that it would take just five months for markets to regain their pre-pandemic levels.

Psychologist George Lowenstein’s concept of the hot-cold empathy gap suggests that people underestimate the influence of visceral drives on their own behaviour.  In a rational state of mind people just can’t picture themselves in a “hot state” – full of anger, fear or panic. This means they are unprepared when those visceral forces inevitably arise.

Three ways to make good choices  

Evidence from behavioural science can maximise our chances of success in the accumulation phase of our wealth building.

Train yourself to think long term 

Behavioural Economist Sarah Newcomb talks about the concept of “mental time horizon” and its impact on financial health and investment success.

Newcomb’s studies reveal that in every income group, people with longer mental time horizons (10 years +) report significantly higher net worth and financial health than their peers. Cultivating a longer mental time horizon encourages disciplined, long-term financial planning and decision-making.

Check your portfolio infrequently – quarterly, max

Research indicates that investors who monitor their portfolios less frequently tend to achieve better long-term performance. Logging in to see flashing red or green indicators can make us feel like we should take action. However, waiting things out is often the best way. As a seminal paper by Barber and Odean from the Journal of Finance put it: Trading Is Hazardous to Your Wealth. Trading incurs fees which affect your returns – not to mention opening up the possibility of poor decision making.

Avoid investing apps

Your multi-decade mission to build wealth for retirement should be a system 2, not a system 1 activity. For me that means avoiding apps which stare at me from my phone and encourage me to tinker. For you it might mean something else. Your goal should be to avoid reacting in the moment. Anything which encourages you to reflect before you make choices is a benefit.

By avoiding instant access via you are engaging in what psychologists call a situation selection strategy – the deliberate process of choosing circumstances that align with your goals, values and well-being.