Is Not Investing Now Going to Hurt Your Future?

hansy-kapoorWith all the volatility in the global markets that is our present reality there is a massive amount of indifference or even fear of whether investing is a good thing at all and if now is really the best time to begin.

Arguments can be made that there has always been upheaval in the markets, that bull and bear markets are an innate part of the process, and that the ups and downs associated with markets are purely the natural swings of a free market capitalism system. Now, no matter what side of the argument you fall on if you do decide that you want to be an investor then the time to start is now and that cannot be swung by debate or argument.

The fact of the matter is that the earlier you begin to invest in anything, whether the stock market or real estate or even a macadamia nut farm in the third world, the better chance you may have of having a successful return on investment.

The point is that by beginning to invest in any asset early and by leaving your money in to roll over time and time again if that investment is even marginally successful is the surest way of ensuring gains. The decision to begin investing earlier rather than later is one that cannot be argued against.

Toronto debt consolidationQuite obviously if you invest in a stock or real estate or any asset that will grow over time then the sooner you get your money in the better and the longer you leave it in the higher the gains will be. What this means for the average investor is that by beginning early you can maximize your return over the long haul.

If you were to have invested an amount as small as even $10 with a return on investment of only 8% at the age of 30 and waited until age 65 until you withdrew, you would have realized a return on investment of over $90.000 on your input of only $18,200 over that time period. Not too shabby.

Now, look at the same investment amount with the same rate of return extended by a period of only 10 years. Now you have started at age 20 instead of 30 and the return rate is still 8% and you are still only investing the same $10 per week. Your initial investment has now grown to just over $23,000 BUT your realized rate of return would be a whopping $228,563 at maturity at age 65. The difference realized would be a staggering $129,161.

debt-counsellingThis simplification shows very clearly that by beginning very early and staying in for the long haul will most definitely have a serious impact on your financial future. Nobody truly believes in the get rich quick schemes that permeate our current culture but many also have serious doubts about the viability of any type of investing and this is quite incorrect.

By starting to invest early and picking solid, reasonable investments with realistic rates of return you will have a much better chance of maximizing those returns over the long term. So the answer to the initial question as to whether investing early can affect your future the answer is clear in the affirmative. The earlier the better.