The Hidden Cost of Keeping Your Options Open

Staying flexible is a virtue in investing. Spread your money across everything, avoid betting on a single idea, and the data say the typical investor ends up better off. That logic is now spilling into personal finance advice and lifestyle culture, and writer Nick Maggiulli of Of Dollars and Data argues it is being applied where it does not belong.

His starting point is a viral post telling anyone who reaches $1 million in cash to buy a $550,000 apartment in the UAE, with no property tax, no capital gains tax and no bureaucratic friction. The pitch is freedom. Maggiulli sees a familiar undertone beneath it: do not tie yourself down, do not take risks, always keep an exit. He links it to blunt advice aimed at young men to dump their girlfriends and grind for a year, and to the way many top graduates, himself included, defaulted to consulting and then an MBA because those paths kept the most doors open.

The trouble, he says, is that the costs of optionality are invisible until late. Every year spent holding options is a year not spent on the thing you eventually commit to, whether that is a career, a spouse or a family. Maggiulli married at 35 and had his first child at 36. He notes that the trade meant a few extra single years in exchange for fewer years with future grandchildren, a tradeoff the optionality crowd rarely mentions.

Research backs the concern. Psychologist Barry Schwartz, author of The Paradox of Choice, has found that people who always try to make the best possible choice, so-called maximizers, report less life satisfaction and more depression than those who settle on something good enough. Those with extreme maximizing scores landed in the borderline clinical range for depression. Developmental psychologist Daniel Levinson made a related point: we must make crucial choices before we are wise enough to make them, but waiting until we feel ready carries its own, larger costs.

The most striking evidence is a painting experiment. Participants ranked six paintings, then took home either their third or fourth favorite. Weeks later, they ranked the set again. The painting they had chosen rose, and the one they passed on fell. Participants with anterograde amnesia, who could not recall which painting they had taken, showed the same shift. That suggests the effect is not self-justification. Choosing genuinely changes what you prefer.

For readers, the takeaway is not to commit blindly. Picking the wrong partner or career is worse than waiting. But once you know what you want, the value of extra options fades, while the satisfaction that comes from committing grows. Keep your portfolio flexible, Maggiulli suggests, and keep your life a little less so.