Success, they say, is a worm to the early bird. You are a bird who has just broken out of the nest, and is learning your systems. Everyone today is in the pursuit of that worm… but are you all prepared for everything that comes in the way?
You’re enjoying your life currently in your prime, building a career, an entire life ahead of you, using your income on everything you dreamt of having. As you grow, you will shoulder the responsibility of running a house, and have to manage your income and expenses carefully.
Cut to the age of 60—with retirement around the corner… Can you be sure today, that with everything you’re doing, and everything you plan to do tomorrow, you will sleep peacefully without having to worry about your income?
If your answer is NO, this article is just for you! Because the solution to this is to shift your focus and priorities towards investing, rather than squandering, when you start earning.
Early to bed, early to rise, and early to INVEST; leaves a man happy, healthy, wealthy, and wise!
Also read: Importance of Financial Discipline
Now, how exactly does investing early in life help you? Take a look:
1. More savings = Secure future
When you prioritize investments, it develops a habit of saving first–which is a blessing. The more you save, the less you spend unnecessarily. Your choices, wants, and needs… everything is rationalized. Increased savings means more income at your disposal for the future.
2. Compounding strength
When you invest your money in an instrument, you get returns on it. The longer it stays invested, the more value and returns it collects, the more you prosper. If you invest small chunks steadily from the very beginning, it helps strike two points in one go. Neither do you have to kill your desires or temptations, nor do you have to feel the pinch for saving extra.
3. Preparation for contingencies
The future is full of uncertainties. Can you ever guarantee a consistent income flow? In fact, one of the greatest lessons the Covid-19 pandemic has taught us is this—you never know when an event hampers your earning capacity, temporarily or permanently. The solution to this is to keep a corpus aside just for emergencies, so that you don’t have to run around borrowing, or burn a hole in your pocket, or shed every drop of sweat and blood for it. Early investment is a brilliant way to tackle any sort of contingencies to make up for the loss of income.
4. Risk appetite
Investing early means you can play with small lots. With not much at stake, you can experiment and take risks. Even if you incur a loss, it may not affect you as much, and you will have ample time to recover it. The later you invest, the higher your amounts are, the higher your stakes. Investing early solves exactly that.
5. Retirement plans
We’ve all dreamt of a life with no work, all play, and not having to bother about a single penny spent… so why not work towards it from the time you start earning? Early investments give you the benefits of collecting higher returns over a longer course, which leaves you with a fairly good corpus at your retirement—so you never have to rely on children or anyone else for your finances.
6. More time to grow in value
As mentioned earlier, the earlier you invest, the longer you have to let it work its magic and accumulate more capital. This frees you from having to time the market. You will get a return even if you have invested when the market is on a high.
7. Fewer unnecessary expenses
Planning your investments early on not only helps you secure your future financially, but also pulls you out of the clutches of spending temptations. Because investments become a priority, it leaves you with fewer funds to employ for the month—which automatically puts essential expenses before giving in to wants.
8. Start small—win big
Every wise investor, every finance expert, has one thing to say: invest as early as you can. The biggest factor in play here is the benefit of starting small. Because there is a lot of time at hand, you can start with small bits to invest for various goals. This keeps a balance between financial security and lifestyle needs. With all mentioned reasons working together, you’re in a position to win significantly—since the long span sets off the occasional turmoil the market faces and goes a long way in building your wealth.
Wealth creation is a slow and steady process. You need to put consistent efforts for a wealthy and healthy future… Think over your vision and work around it accordingly. Get in touch with an advisor and figure out your goals, understand the options available for you and start investing right away!
Also Read: Budget: Trivia, Glimpses and Importance