Investing, like almost anything else valuable in life, brings more benefits when you start early. Even when you’re only in your early 20s, there’s no better time than now to begin planning for your retirement. The sooner you do, the higher the potential return on investment (ROI) you get to enjoy.
This holds true for every consumer out there, whichever industry you belong to. The earlier you take advantage of your young age, the bigger your savings headstart will be. To help you understand why it pays to do this, Palmetto Citizens Federal Credit Union cites the following reasons.
You can never predict what will happen in the future.
No one likes to dwell on such dark thoughts, but it doesn’t mean you should no longer factor them in. While you don’t want to think of them, accidents and illnesses may happen to anyone, and it’s better that you prepare yourself than to suffer from serious financial problems when they do take place.
You don’t want to burden your family or friends financially, and having other sources of funds outside of your income is one way to prevent this from occurring.
It takes time for interest – both regular and compound – to deliver benefits.
The interest you earn – for instance, on your capital savings – takes time before it can amount to something substantial. This is one of the main reasons you want to start a savings account as soon as possible.
Another incentive is the considerable difference that compound interest makes in the long run. At its core, this is the interest that you earn over the primary interest. So long as you don’t touch your savings, you’re reinvesting what you earn continuously. This, then, leads to a drastic increase in your ROI.
These are just some of the numerous extra benefits of investing as early as possible, but they should be enough to prompt you to do it now.