Status Quo Bias: Why You're Still Sitting in Cash Instead of Buying XEQT

My cousin Dave has been “about to start investing” for five years.

I remember the first conversation. It was Thanksgiving 2021, and we were standing in my aunt’s kitchen while the turkey was in the oven. Dave had just hit $30,000 in his savings account and asked me what I thought about “the stock market.” I told him about XEQT – how it’s a single all-in-one ETF that gives you global diversification, how he could buy it commission-free on Wealthsimple, how he didn’t need to pick stocks or time the market. I even pulled up the app on my phone and showed him how simple it was.

He nodded enthusiastically. “That actually sounds perfect. I’m going to look into it this weekend.”

That was five years ago. Dave still has not invested a single dollar. His savings account has grown to about $45,000 now – he is a good saver, I will give him that – but it has been earning roughly 2% in a high-interest savings account the entire time. Meanwhile, if he had put that original $30,000 into XEQT back in 2021 and continued adding what he was adding to savings, he would have well over $60,000 today.

Dave is not stupid. He is not lazy. He is not even particularly risk-averse – he plays poker, he bets on hockey playoffs, and he once drove his snowmobile across a lake that was questionably frozen. The problem is not intelligence or courage. The problem is status quo bias – the invisible psychological force that keeps you doing whatever you are already doing, even when a better option is staring you right in the face.

And if you have money sitting in a savings account right now that you know should probably be invested, this post is for you.

1. What Is Status Quo Bias?

Status quo bias is the human preference for the current state of affairs. When faced with a decision, people disproportionately favour the option that maintains their existing situation – even when changing would objectively make them better off.

The term was coined by economists William Samuelson and Richard Zeckhauser in their landmark 1988 paper. In a series of experiments, they presented participants with identical choices – but varied which option was framed as the “default” or current situation. Over and over, participants favoured whatever was already in place, regardless of its actual merits. In one classic experiment involving hypothetical investment inheritances, participants chose an investment significantly more often when it was described as “what the money is currently in” versus when it was presented as a new option. Same investment. Different framing. Different decision.

Status quo bias shows up everywhere in real life:

• Organ donation rates are dramatically higher in countries where being a donor is the default (opt-out) versus countries where you have to actively sign up (opt-in). In Austria, which uses an opt-out system, consent rates are above 99%. In Germany, which uses opt-in, rates hover around 12%. The difference is not cultural values. It is default settings.
• Retirement savings participation rates in the United States skyrocketed when companies switched from opt-in 401(k) enrolment to automatic enrolment. People did not suddenly become more financially literate. The default just changed.
• Cable and streaming subscriptions survive for years because cancelling requires action while keeping them requires nothing. How many of you are still paying for a streaming service you haven’t watched in months?

The pattern is always the same: doing nothing feels safe, comfortable, and effortless. Doing something – even something objectively better – requires effort, uncertainty, and the psychological discomfort of change. So people stick with what they have.

And for millions of Canadians, “what they have” is a savings account earning barely above inflation while the greatest wealth-building tool in history – the global equity market – sits right there on their phone, a few taps away.

2. Why Status Quo Bias Is Especially Dangerous for Investors

Status quo bias is annoying when it keeps you paying for a gym membership you don’t use. It is expensive when it keeps you on a bad cell phone plan. But it is devastating when it keeps your money out of the market for years or decades.

Here is why.

Inflation Silently Erodes Your Purchasing Power

The most insidious thing about keeping your money in a savings account is that it feels safe. Your balance goes up a tiny bit every month. You never see a red number. But you are losing money every single day – you just can’t see it.

Over the past decade, inflation in Canada has averaged roughly 3% per year. If your savings account is paying 2%, your money is losing approximately 1% of its real purchasing power every year. Here is what that looks like over ten years:

Read that table carefully. In the savings account scenario, your nominal balance grows to $12,190 – but after adjusting for inflation, you can buy less with that money than you could with your original $10,000 today. You waited ten years and went backwards.

Meanwhile, XEQT at roughly 8% annualized more than doubles your money in nominal terms, and significantly increases your real purchasing power even after inflation.

And the person who waited three years “to feel ready” before investing? They left roughly $4,000 on the table compared to the person who started immediately. Three years of inaction cost them 23% of their potential gains.

The Cost of Waiting Compounds

That $4,000 difference does not stop growing. It compounds. The money you miss out on in year one generates returns in year two, which generate returns in year three, and so on. The longer you wait, the wider the gap becomes – and it accelerates.

Consider a simple thought experiment. You have $10,000 to invest in XEQT today. Here is the approximate difference in outcomes depending on when you start, assuming 8% average annual returns and a 25-year horizon:

• Start today: ~$68,485 after 25 years
• Start 1 year from now: ~$63,412 (you miss out on ~$5,073)
• Start 3 years from now: ~$54,274 (you miss out on ~$14,211)
• Start 5 years from now: ~$46,610 (you miss out on ~$21,875)

Every year you wait costs you more than the last. That is the exponential cruelty of compound interest working against you. And the truly painful part is that from where you are sitting right now, doing nothing feels like a neutral, harmless decision. It is not. It is the most expensive choice you can make.

“I’ll Invest When…” Syndrome

Status quo bias does not present itself as laziness. It disguises itself as prudence. It sounds like:

• “I’ll invest when the market settles down.”
• “I’ll invest when I have more saved up.”
• “I’ll invest when I understand it better.”
• “I’ll invest after the election / after interest rates drop / after the trade war resolves.”

There is always a reason to wait. Always a headline that makes “now” feel like a bad time. And because the status quo – your money sitting safely in a savings account – requires no action and no justification, it wins by default. Not because it is the better option, but because it is the easier one.

The market has climbed a wall of worry for over a century. If you wait for the coast to be clear, you will be waiting forever.

3. The Six Excuses Status Quo Bias Creates (And Why They Don’t Hold Up)

Status quo bias is clever. It does not tell you “don’t invest.” That would be too obvious. Instead, it whispers reasonable-sounding excuses that give you permission to keep doing what you are already doing. Here are the six most common ones – and why each one falls apart under scrutiny.

Excuse #1: “I’ll start when I learn more about investing.”

This is the most seductive excuse because it sounds responsible. You are not avoiding investing – you are preparing to invest. You are being diligent. You want to make an informed decision.

The problem: you will never feel ready. Investing is one of those fields where the more you learn, the more you realize there is to learn. You read one book and it leads to five more questions. You watch a YouTube video and someone in the comments says the opposite. The learning never ends, and the goalposts for “I know enough” keep moving further away.

Here is what you actually need to know to start investing in XEQT: it is a single, globally diversified ETF managed by BlackRock that holds over 9,000 companies across the world. You buy it. You hold it. That is it. Everything else – portfolio theory, factor investing, tax-loss harvesting, sector rotation – is interesting but unnecessary for building serious wealth.

You do not need to understand how a car engine works to drive to work. And you do not need a finance degree to buy XEQT.

Excuse #2: “I’m waiting for the market to dip.”

This sounds smart. Buy low, sell high, right? The problem is that nobody – not you, not me, not the highest-paid portfolio managers on Bay Street – can consistently predict when the market will dip and when it will recover.

The data on this is overwhelming. A Bank of America study analyzed the S&P 500 from 1930 to 2020 and found that if you missed just the 10 best days in each decade, your total return would be 91% lower than if you had simply stayed invested the entire time. And here is the kicker: the best days tend to cluster right around the worst days. If you are sitting on the sidelines waiting for a dip, you will almost certainly miss the recovery.

Time in the market beats timing the market. This is not a cliche. It is a mathematical fact backed by nearly a century of market data.

Excuse #3: “I need to pay off all my debt first.”

If you have high-interest debt – credit cards at 19-29%, payday loans – yes, paying that off first is almost always right. But many Canadians use this excuse while sitting on low-interest debt: a mortgage at 4-5%, a car loan at 3%, or student loans at the prime rate. If your debt costs you 4% and XEQT has historically returned roughly 8%, you are mathematically better off investing while making your regular debt payments.

Status quo bias loves simple, tidy rules. But simple and tidy is not always optimal.

Excuse #4: “I don’t have enough money to invest.”

This might have been valid twenty years ago when you needed thousands of dollars and had to call a broker on the phone. It is not valid in 2026.

On Wealthsimple, you can buy fractional shares of XEQT starting at $1. There is no minimum balance. There are no commissions. If you have $50 per month, you have enough to start. Someone who invests $100 per month starting today will almost certainly end up wealthier than someone who waits five years to start investing $300 per month.

Excuse #5: “My savings account is fine.”

Fine for what? If your goal is to never see a red number on a screen, then yes, a savings account is fine. But if your goal is to build wealth, retire comfortably, buy a home, or achieve any long-term financial objective, a savings account is slowly working against you.

At 2% interest, your money doubles in approximately 36 years. At 8% in XEQT, it doubles in roughly 9 years. That is a four-to-one difference in doubling time. Over a 30-year career, that is the difference between a comfortable retirement and a stressful one.

Your savings account is not “fine.” It is the financial equivalent of walking when everyone else is driving. You will eventually get where you are going, but it will take four times as long, and you will arrive exhausted.

Excuse #6: “What if I lose money?”

This is the big one. The fear underneath all the other excuses. And I want to acknowledge: this fear is completely rational.

The stock market does go down. XEQT dropped roughly 33% during the COVID crash in March 2020. That is terrifying. But the market recovered within months. By the end of 2020, XEQT investors were positive on the year. Over any 15-year period in the history of global stock markets, investors have made money. Every single time.

The fear of losing money is valid. But the cost of acting on that fear – keeping your money in a savings account for decades – is far greater than the temporary pain of a market drawdown. You are trading a guaranteed slow loss (inflation) for the avoidance of a temporary fast loss (market volatility). That is not safety. That is the illusion of safety.

The biggest risk is not that you invest and lose money temporarily. The biggest risk is that you never invest at all.

4. Why Defaults Matter — And How to Make Inertia Work for You

Here is the beautiful irony of status quo bias: the same force that keeps you from starting can keep you going once you do start.

Remember those organ donation rates? Countries with opt-out systems had nearly 100% participation – not because their citizens care more, but because the default was set in their favour. You can do the exact same thing with your investing.

Wealthsimple offers an auto-invest feature that lets you set up recurring purchases of XEQT on a schedule – weekly, biweekly, or monthly. You pick the amount, you pick the frequency, and then it just happens. Every payday, money moves from your bank account into your Wealthsimple account and gets invested automatically. No decisions. No willpower required.

This is the most powerful move you can make, because you are taking a one-time action and then letting status quo bias do the rest. Once auto-invest is set up:

• Inertia keeps you investing. Stopping requires effort. Continuing requires nothing. For once, the default is working in your favour.
• You stop making emotional decisions. The market crashed this morning? Doesn’t matter. Your auto-invest already bought XEQT on Tuesday at the lower price. You didn’t even notice.
• Dollar-cost averaging happens automatically. You buy more shares when prices are low and fewer when prices are high, smoothing out your average cost over time.
• Your wealth compounds silently in the background. While you are living your life – going to work, spending time with your family, sleeping – your money is working.

The hardest part of investing is starting. And it is hard not because it is complicated, but because status quo bias has made “doing nothing” feel like the safe default.

Change the default. Set up auto-invest. Let inertia carry you to wealth instead of holding you back from it.

5. The 15-Minute Cure: A Step-by-Step Guide to Breaking the Inertia Today

I am going to make this as concrete as possible. If you have been sitting on the sidelines, here is exactly what to do, and it will take you less than 15 minutes.

Step 1: Open a Wealthsimple Account (5 minutes)

1. Go to Wealthsimple on your phone or computer
2. Sign up with your email address
3. Verify your identity (you will need your SIN and a piece of ID)
4. Choose your account type – a TFSA is the best starting point for most Canadians because all gains are tax-free

That is it. No fees. No minimums. No phone call with a bank advisor trying to sell you mutual funds.

Step 2: Set Up a Recurring Deposit (3 minutes)

1. Link your bank account to Wealthsimple
2. Set up a recurring deposit that aligns with your payday – $50, $100, $200, whatever you can afford
3. Choose your frequency: every week, every two weeks, or once a month

Start small if you need to. You can always increase it later. What matters is that the money moves automatically.

Step 3: Buy XEQT or Set Up Auto-Invest (5 minutes)

You have two options:

• Manual purchase: Once your deposit lands, search for “XEQT” in Wealthsimple, enter the amount, and tap buy. Done.
• Auto-invest (recommended): Set up Wealthsimple’s auto-invest feature to automatically purchase XEQT every time your recurring deposit arrives. This is the “set it and forget it” option, and it is what I personally use.

Step 4: Never Think About It Again

Seriously. Close the app. Go live your life. Your money is now invested in over 9,000 companies across the globe, managed by BlackRock, rebalanced automatically, and compounding every single day. You do not need to check it. You do not need to do anything.

The entire process takes about 15 minutes. Less time than your commute. Less time than Dave has spent telling me he is “about to look into it.”

Fifteen minutes today can be worth tens of thousands of dollars over your lifetime. There is no better return on your time.

6. What Status Quo Bias Looks Like in Reverse

Here is something nobody tells you about investing: once you start, you will never go back.

I remember my first XEQT purchase. It was anticlimactic. I bought $500 worth in my TFSA, stared at my screen, and thought, “Wait, that’s it?” No fireworks. Just a line item showing 15 shares.

But then something shifted. A few weeks later, I got my first distribution payment. The market went up a bit, and my $500 became $512. Not life-changing money, but I was no longer on the outside looking in. I was an investor. My money was doing something.

Within a month, I increased my automatic contribution. Within three months, I had moved most of my savings into XEQT. Within a year, I could not imagine going back. The idea of earning 2% while inflation ate my purchasing power felt absurd – not because I had learned some complex financial concept, but because I had experienced the alternative.

This is status quo bias working in reverse. Once the new default is “I am an investor who owns XEQT,” inertia keeps you there. You stop agonizing over whether to invest. You stop checking headlines to decide if “now is a good time.” You stop entertaining the six excuses. Your identity shifts from “someone who is thinking about investing” to “someone who invests.”

That shift – from thinking to doing – is the most valuable financial transformation you will ever make. Because once you are in, the system takes over. Contributions happen automatically. Compounding happens automatically. Wealth building happens automatically. All you had to do was start.

7. Your Future Self Is Counting on You

Let me come back to Dave.

Last Christmas, I showed him a quick back-of-the-napkin calculation. If he had invested his $30,000 in XEQT back in 2021 when we first talked, and continued adding the same amounts he had been putting into his savings account, he would have been looking at roughly $15,000 more than what he actually had. Not theoretical dollars. Not projected future dollars. Real money he had already missed out on.

He got quiet for a minute. Then he said, “Yeah, I really need to get on that.”

I love Dave, but I wanted to shake him. Because that is exactly what status quo bias sounds like. “I need to get on that” is the language of someone whose default is still inaction. It is an acknowledgement without a commitment. A nod toward change that requires no change. And unless something breaks the inertia – unless he takes one concrete step today – he will be saying the same thing next Christmas, and the Christmas after that.

Don’t be Dave.

The best time to start investing was ten years ago. The second-best time is today – and I mean literally today, not “soon,” not “this weekend,” not “once things settle down.” Today. Right now. Fifteen minutes from now, you could have a Wealthsimple account open, a recurring deposit set up, and your first XEQT shares purchased. Fifteen minutes after that, you could be doing something you enjoy while your money works for you in the background.

Status quo bias is powerful, but it is not invincible. All it takes is one decision, one action, one moment where you choose to do something different. After that, the same force that kept you on the sidelines will keep you in the game.

You do not need to be brave. You do not need to be confident. You do not need to be an expert. You just need to take the first step. Everything else follows.

Disclosure: I may receive a referral bonus if you sign up through links on this page.