Here’s What Happens When You Wait a Decade to Start Investing

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If you wait to start investing, it becomes a lot more difficult to accomplish your financial goals. Find out why it’s so important to start early. 

If you want to build wealth and have a high net worth, you are going to need to invest some money. It’s really hard to amass a substantial sum if you aren’t earning generous returns on your investment, so opening a brokerage account and buying stocks is crucial. You simply can’t earn the returns you need if you just stash your money in a savings account.

It can sometimes feel impossible to find spare cash to invest, though — so you may be tempted to put it off until later. Unfortunately, that can have dire consequences. In fact, here’s what happens if you wait a decade to start investing.

Waiting a decade can cost you much more than you think

Putting off investing for 10 years can make your life a lot harder going forward because you will have less time to take advantage of compound growth. This means you’re going to have to invest a lot more money to end up in the same place.

As soon as you begin investing, your money will (ideally) begin earning returns. Those returns can be used to buy more investments — without you having to put extra money in. Your account balance grows with no extra effort from you. And the returns you reinvested earn returns too, so you can earn even more money than you did before thanks to the fact your account balance is bigger.

When your invested returns earn more money for you, this is called compound growth. And the more time you have for compound growth to help your balance grow, the better off you’ll be. Say, for example, you start investing at age 30 and put aside $250 a month. Assuming a 10% average annual return, at age 65, you’ll have $813,101.21. But if you started at age 40 and put aside the same amount and earned the same returns, you would only end up with $295,052.01.

From age 30 to age 40, you would have invested a total of $30,000. But, your account balance would have ended up with $518,049 less in it because you’d have lost that decade of compound growth.

Putting off investing for a decade can cost you more than half a million dollars. Can you afford to give up that much money for your future?

Here’s how to start investing money now

As you can see, waiting a decade to start investing comes at an astronomical cost — and one you should not pay. Even if you can’t invest $250 a month right now, and even if you are older than age 30, you should still start investing today so you don’t give up any more opportunities for compound growth to begin working for you.

To get started investing, make a budget that prioritizes paying yourself first. Ideally, you’d want to invest at least 10% to 15% of your income, but if that seems infeasible, start with 2% or 3%. Work that into your budget first as a must-pay bill and then plan your other spending around it. Once you get used to that, inch up your investments by 1% every few months until you find you simply can’t do it any more.

Even if you have to start small, don’t lose a decade of wealth building. Get started today. As you can see, it will have a huge impact on your future.

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