Is it really true that 'time in the market beats timing the market,' and why?

Yes, and the reason is compounding plus the impossibility of consistently predicting short-term moves. The longer your money stays invested, the more years it has to grow on itself, and the more the market's long-term upward drift works in your favor. Trying to jump in and out interrupts compounding and forces you to be right about timing repeatedly.

Because the market's biggest up-days often come during the scariest stretches, sitting out to 'be safe' frequently means missing the rebound. Historically, someone who stayed fully invested through crashes ended up far ahead of someone who bounced in and out. This doesn't mean lump-summing your life savings blindly, it means that once money is committed to a long-term goal, staying put through the noise beats reacting to it. Set an allocation, automate contributions, and let years do the heavy lifting.