If you want to build wealth before you reach retirement age, you need to start as early as possible. So what if this is your first job and you aren’t earning that much? Starting small is much better than none at all.
Here are other compelling reasons to convince you:
Experience helps a lot
Books can teach people to do certain things. However, it is experience that will hone skills and improve abilities. The only way to gain as much experience is to start as early as you can. It’s natural to fear failure, but it’s a complete waste of time if you don’t try. So don’t worry about struggling or making mistakes. What’s important is that you learn from those mistakes.
Compounding is powerful
Compound interest helps you build your wealth faster. Imagine investing $1,000, you will gain 10% interest each year, which means that you’ll get $1,100 after 12 months. This also means that the investment earns $100 over the one-year period. On your second year, you will earn $110 in interests. In short, you can earn interest on your initial principle. In other words, the earlier you invest, the more interest you will acquire.
It becomes a habit
When you start investing at an early age, this becomes a habit. Thus, you will not stop finding ways to invest in more profitable things and earn more money. In fact, even when you retire, you will still be able to continue managing your investments.
Of course, this is the ultimate goal for many people. Being able to retire at a younger age is much better than when you reach 60 years old. This is because you will still have the energy and enthusiasm to enjoy all the things you want to do when you were still stronger.