You know you should be investing more but you keep putting it off. How much is it costing you to wait?
An investor that saves $10,000 per year beginning at age twenty eight who stops at age thirty five only saves $80,000. If they invest their savings with an 8.5% rate of return thirty years later when they turn sixty five they will have $1,251,833.
Another investor starts saving the next year at age thirty six. This investor saves at the same rate and invests in the same investment with an 8.5% rate of return. This investor continues saving $10,000 per year for thirty years, investing a total of $300,000. At age sixty five this investor has $1,242,147. After thirty years of playing catch-up they still have $9,686 less than the first investor. They have also contributed $220,000 more. Putting off saving for just eight years cost the second investor $229,686.
The investor that saved early on saved himself nearly $230,000. When twenty year old Katie Molinskiof College Park, MDlearned what a difference early saving makes she decided to start saving for retirement as soon as she gets her job out of college.
There are lots of ways to begin saving. One of the easiest is to contribute to a retirement plan on a regular basis. You workplace plan can deduct the money from your account before you get paid so you don’t have to think about it. Most other investment companies offer similar options. They can automatically transfer funds directly from your bank account.
The best thing you can do is to get started now. You can learn more about the next steps you should be taking in this article:
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