Investing is about making money grow over time. The earlier you invest, the more time you let your money grow. Time is critical because of the miracle of compound interest. Compounding means you gain returns not only on the money originally invested, but also on the interest it earns. With the power of compounding, a small investment made earlier in life could generate a larger amount as compared to a big investment made later in life.
You stand to gain much more if you invest a smaller sum of money now and stay invested for a longer period of time than waiting until you have a bigger amount of money to invest later. Therefore, it makes sense for you to start investing as soon as you can afford, and as early as you can. To illustrate, say you invest $10,000 at 12% returns compounding annually. At the end of 10 years, you'll have about $31,100. At the end of 20 years, you'll get $96,500. If you stay invested and take out the money at the end of 30 years, you'll gain close to $300,000!
Kelvin Wong is a millionaire investor, author, and landlord in 3 countries. He currently owns a multi-million dollar property portfolio in Singapore, Australia and Malaysia. With his assets generating multiple streams of income to sustain his desired lifestyle, Kelvin became financially free at 39. He holds a Bachelor of Business (Dean's List) degree and a Diploma in Business Management. Kelvin writes about building wealth and achieving financial freedom in his free time.
Copyright © 2011 Kelvin Wong
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