Why FOMO Matters For Your Investments

You've probably felt it. A friend mentions a share price that's soared, a headline announces the “next big thing”, and a small voice in your head asks whether you should be getting involved.

Fear of missing out, or FOMO, isn't just a social media phenomenon, or something you experience when you can’t make it to a party. It's also a powerful emotional force that can shape how people invest.

The concern or regret you feel about potentially missing out on a profitable opportunity, whether that's a rising share price or a friend's crypto gains, is a consistent driver of behaviour. Advisers measure it as part of the attitude to risk questionnaire you will have completed, alongside other financial personality traits, like how comfortable you are with uncertainty.

Recognising FOMO in yourself

FOMO is a common trait, but around 10% of investors with a financial adviser have particularly high FOMO. This varies across demographics, tending to run higher among younger investors than older ones, and higher among men than women. Of course, none of that makes it any less real or valid if you recognise it in yourself.

FOMO can show up in a few recognisable ways. You might find yourself dwelling on what you'd lose by not acting, focusing more on the downside of missing an opportunity than on whether it actually suits your plan. You might feel drawn to timing the market, buying or selling based on what everyone else seems to be doing rather than your own strategy. You might feel pushed towards making an impulsive decision, jumping into an investment quickly because you're worried about being left behind.

Research also links FOMO to other common behavioural patterns among investors, including herding behaviour (following the crowd rather than your own judgement) and loss aversion (feeling any losses in your investment more strongly than equivalent gains). Together, these can lead you to be even more reactive to market swings and experience them as more significant than they really are.

Why it matters for your plan

Decisions driven by FOMO are, by definition, decisions driven by something other than your own goals. A financial plan that you’ve built with your financial adviser works because it's built around your objectives, your time frame and your circumstances, not around what the market did last week or what someone else is doing with their money. When FOMO takes over, the plan can end up taking a back seat to the emotions you are feeling in the moment.

There's also a knock-on effect. If a FOMO-driven decision doesn't work out, it can dent your confidence, and that dent can matter more to your long-term outcomes than the money involved. Confidence affects how willing you are to stick with a sound plan through the ups and downs that are a normal part of investing.

It's worth knowing, too, that FOMO cuts both ways. The same fear that pushes some people to buy impulsively can make others too cautious to act at all. Both extremes – jumping in because of the fear of missing out and freezing because of the fear of getting it wrong – can lead to outcomes that don't match your goals. And because FOMO is closely linked to panic selling, the same emotional pull that gets you into an investment can just as easily pull you back out again when markets wobble.

What helps

The most useful thing you can do is notice FOMO before it turns into a decision. If you catch yourself thinking mainly about what you might miss out on, rather than whether an opportunity fits your plan, it’s worth pausing.

Spending time reviewing your plan helps too. Rather than weighing up the merits of a specific investment in isolation, think about how it fits with your long-term objectives and your existing portfolio's diversification. A well-diversified plan is built to capture growth over time without depending on getting every individual call right.

It also helps simply to talk about it. If you're feeling the pull of an opportunity, or the discomfort of having missed one, share that with your adviser. These conversations are far more useful before a decision than after one, and there's no need to feel embarrassed about this common emotion. Your adviser isn't there to tell you the feeling is wrong, but to help you weigh it against your plan.

2 September 2026