Why You Should Start Investing Early?

Why You Should Start Investing Early?

Invest in today for better tomorrow – Start Investing in your early age

We always hear from our elder that save money for your future and we always ignore them by saying that it’s too early.

It’s too early because we studied hard for past 20 years, we run through job sites to job fair to get the job and now after getting the job, we want to enjoy our life first.

If it is too early than what is the right time to save and invest money, at what age we should start investing?

Answer to all this question is that you must start investing money in your 20s when you start your career.

Also read: Step by Step Guide to Start Investing in Stock Market

Let’s discuss some important points describing that why you should start investment early.

Investing Vs Desires

Let’s assume that you start your job with monthly salary of Rs 25,000/-. You are independent now and this is not bad thing to spend money on branded clothes and other things.

But just think about it, there are more expensive brands available, more gadgets available, you can go for parties every night and you can travel with luxury packages. So, the fact is you cannot buy everything.

If you are buying an expensive watch, than another much expensive watch is also available there.

With Rs 25000 per month you cannot spend Rs 50,000 per month. But if you invest Rs 10,000 per month than in coming years you can create a good corpus and use that money as you want.

Open Demat with Zerodha

Compounding Effect

Mr A and Mr B of same age started their career in 25 year age. Mr A started to save Rs 1 lakh every year for his retirement and save it up to 35 year age. Mr B started Rs 1 lakh saving at 35 year age and saved it for up to 60 year age. Let us assume that they got 10 percent return on their investment every year. At the end of 60 year Mr A will have Rs 1.92 crore in return of his 10 lakhs investment whereas Mr B will have Rs 1.10 crore in return of his Rs 25 lakhs investment. This is the effect of compounding. As early you start you will get most out of it.

Money Management

When you start investing early, you will be able to manage your income and expenses perfectly. One famous saying is if you spend money on the things you don’t need today, you will have to sell the things you need tomorrow.

Also read:Top 6 Steps Salaried Person should take before Investing in Stock Market

Risk taking ability

When you start early, you will definitely make mistakes. It is advisable that in starting start will small amount.

When you invest small amount and make mistakes during your investment decisions, this would be small mistakes. It is always better to make mistakes early in your life. Because possibility to overcome from those mistakes and learn from them are very high in early age.

So, you can take more risk when you are young, when you have less responsibility as compared to later stage of your life, when others become dependable on you.

Secured Future

As you seen above, saving for only 10 years of early life will give you a big amount at the time of your retirement. Even you can use this amount in case of need during difficult times.

Also read:

Step-By-Step Guide to Open Demat account with Zerodha in less than 15 minutes

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10 Best YouTube Channels to learn Stock Market in India – Updated in Oct 2019

All about Mutual Fund – Smart way of Investing

Understand SIP : Systematic Investment Plan – Step toward wealth creation

 

 

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