3 Reasons: Why You Should Start Your Investments Early

3 Reasons: Why You Should Start Your Investments Early


When it comes to investments, two big questions are how much to invest? and when to invest?

While the answer for how much to invest depends on many factors such as your financial situation, monthly income, financial goals etc; the answer for when to invest is pretty straight forward.


To make your investments to grow, it is essential to start investing early; as early as possible!




Well, the excuses for not investing may be many! I don’t earn enough to start investing! I am far too young to plan retirement! I’ll invest when I can!


If you have been reasoning yourself with above statements, it is time to consider the benefits of investing early.


# 1 Harness the Power of Compounding


Don’t get scared-off by the term! Compounding is your best friend when you start investing early. Albert Einstein once said Compounding is 8th wonder of the world.


The term ‘compounding’ simply means you earn return not only on the capital invested, but also on the return earned!


By regularly re-investing your earned return, one would end up with a larger wealth in long-term.


As it can be understood, the sooner one begins; the richer he is likely to be later in life.


If you are looking for the best way to invest money, a simple SIP (systematic investment plan) can be one of the best ways to harness the power of compounding.


# 2 Master the Investment Game by Doing


Investing successfully into profitable financial products is no luck! Seasoned investors often go through a process of investing money without fear.


By starting your investments early, you get more time for investments to perform better.


Another crucial factor here is less chances of acquiring liabilities in your early adult life.


In most cases, young adults in their 20s don’t have to carry heavy financial burdens or have to pay many bills. This gives them a unique advantage where they can take more risks with their investments by starting early.


Warren Buffet was once asked, what was his greatest investment in his life and he had started investing at the age 11 by buying 6 shares of Cities Service preferred stock [3 shares for himself, 3 for his sister, Doris], at a cost of $38 per share. And he is reported to have said that “I wish I had started 11 years earlier”


# 3 Build Responsible Spending Habits


Building responsible spending habits and curtailing impulsive expenditure are two of the greatest financial habits for young adults.


By building your personal investment portfolio early on, you’ll not only put a stop to irresponsible spending, but also can build a healthy spending habit.


Investing as much as you can at the beginning of your career can be a great way to start your journey towards financial freedom. As the income increases with time, you can gradually increase the amount of money being invested.


These are the 3 benefits of starting personal investments early in life. While as a young adult, one may not feel obliged to start planning for future, but investing early (no matter how little) one would be better prepared to face the challenges of life as well as attain financial freedom.


In case you are still confused about the best ways to invest money, it is always advisable to consult a seasoned Personal Financial Adviser. This way you can get guidance to make prudent investment decisions; else investment mistakes could be dearer!


Need help with personal investment?


Get in touch with our experts now!