Don’t Procrastinate, Start Investing Early

Today’s Youth are getting lakhs of money in their early stages of their career, isn’t it? But when we closely observe their lifestyle, they like to be in “consumption mode” rather than “savings mode”.

EvenThough their elders warns them to save and invest their money for future, most of them fall on deaf ears! This has became a common thing today! But our elders save money when they are young, as a result India is said to be “Saving Economy”. But the trend has changed. Even we have to accept the current trend, ignoring the basics of “Personal Finance” would lead to suffer financially in your olden days.

What our parents and grandparents does is- “They save First, Plan their Finances and leads a peaceful life”. But today, the silent killer- “Inflation” is at its rise. If you enjoy the current moment without thinking of future, your financial life would be miserable. If you don’t want like to be that- “Start Investing Right Now”

Why Starting Early is important– At young age, you have fewer responsibilities and that is the best time to invest for the future! As you grow older, you would have financial responsibilities and it would not be possible to invest then.

If you think that your salary will hike and you can invest more with that money, your financial responsibilities won’t allow you to do that.

Still you assume that you can invest in your 30-40’s, the accumulated corpus would be lower when compared to investing corpus when you are in 20’s. Surprised to hear this?But it is fact!

If you invests early(even smaller amount)and stayed invested for long term you would accumulate huge corpus when compared to investing at your 30’s. Still not convinced?Read the full story-

Let’s take example of two friends-Sunil and Anil. Both of them are graduated in the same year and got campus placements in the same year. Out of them sunil is a savvy person while anil is enjoyable person.

Sunil starts investing 5,000 rupees from his 1st salary through sip(Systematic Investment Plan)in an equity mutual fund, while anil enjoys the 1st 5 years and upon advice of his friend sunil, he also invests through sip of double the amount 10,000 rupees in the same fund. Both stayed invested for long term and assume both get 12% compounded annual growth return(CAGR), whom do you think accumulated higher corpus?Anil?-No, The beneficiary is sunil, Surprised? Let’s understand the benefits of investing early in the below table-

Investment DetailsSunilAnil
Invested at(age)2530
Invested Amount5000 Rupees10,000 Rupees
SIP Step-up5%5%
CAGR Returns12%12%
Investment Period35 Years30 Years
Accumulated Corpus at the end of the tenure7.58 Crore7.40 Crore

Feeling hard to digest the above data, but it is fact. Though you may argue that anil invests double the amount(10,000 Rupees)why he can’t cross sunil’s corpus? The answer is simple- Due to “Compound Interest”

If you still not convinced, ask your grand parents about “Power of Compounding”. They can motivate you by analysing the difference between simple and compound interest and makes you realise the power of compounding.

If you realise the compound interest, you won’t procrastinate, You would start investing today! That’s the magic of compounding. What you have to do is “Making compounding works in favour of you. It would be possible if you start investing early!”

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