Why fast returns come last

Return chasers are the people at parties boasting about their hot stock pick, NFT, ETF or crypto successes. A bit like social media posts, they never share the ugly ones that failed or blew up. Return chasers are like the hare in the fable of the tortoise and the hare: they overemphasise fast returns as the route to wealth. Yet the formula to wealth building through investments is mostly not flashy, it is simply: Wealth = Capital x Returns^Time and it favours the slow and steady tortoise. Capital saved and time invested (tortoise traits) are far more powerful drivers of long term wealth.

Why chasing returns doesn’t work

Returns are the least controllable variable. Investment returns are uncertain by nature and are influenced by economic cycles, interest rates, geopolitics, sentiment and randomness. By contrast, you can control how much you save, how early you start and how long you stay invested. Focusing on returns places your financial outcome largely outside your control. Focusing on capital and time places it firmly back in your hands.

In the early years of wealth building, saving more has a far greater impact than earning a marginally higher return. Increasing your monthly contribution by as little as R1,000 often outweighs the benefit of switching to a marginally higher returning investment.
This is why people who save aggressively – even in average investments – often outperform those who chase superior returns but save inconsistently.

Time is your greatest advantage

Time is the most powerful multiplier in investing: it is not linear, but exponential. Because returns compound, the later years contribute disproportionately to total wealth. A portfolio invested for 40 years does not merely double the outcome of one invested for 20 years – it can grow several times more. This is important because the first 10 years of investing often feel unrewarding and people give up or cash out of investments and go backwards as a result. The last 10 years frequently account for the majority of total growth, as this graphic illustrates:

This is why starting early matters more than almost any other decision. Someone who starts investing at 25 with modest contributions can outperform someone who starts at 40 but earns higher returns.

Time allows compounding to work on your contributions, on your returns, and on your previous growth. No investment strategy can replicate that effect.

Be the tortoise – consistency beats brilliance

As mentioned, there is also a powerful psychological benefit to focusing on what you control. When investors focus on capital and time, they are calmer because progress is visible and measurable. Their motivation comes from savings momentum, and market volatility becomes background noise. This mindset shift improves decision‑making and reduces emotional errors – two of the biggest threats to long‑term wealth.

When investors focus on returns, they often feel anxious during market volatility, second‑guess decisions and are tempted to intervene unnecessarily.

Return chasing can lead to:

• Switching into a top-performing investment at its peak – where past performance is unlikely to be repeated
• Triggering large capital gains tax (CGT) events – which erode the capital base
• Selling during market downturns
• Taking inappropriate levels of concentrated risk or chasing fashionable investments.

These behaviours interrupt the simple, powerful benefit of compounding – and even missing a handful of the market’s best days can dramatically reduce long‑term outcomes.

None of this implies that returns are irrelevant. Returns absolutely matter over long periods, but successful investing is not about chasing the perfect return. It is about building a system that works even when markets are unpredictable. Capital and time are the foundations of wealth – they are the steady steps of the tortoise, who often finishes wealthier and with greater peace of mind than the return-chasing hare.

With thanks to Dr Jimmy Muchechetere for the inspiration behind this article.