‘The early bird gets the worm’. This is an adage most of us have grown up listening to. Success in all aspects of life, including
investments, is usually attributed to the early starters.
- Riskier or volatile investments usually offer the higher returns. Starting early allows
investors to take more risks
and have an opportunity to earn better returns since they can recover from wrong
decisions without affecting the long-term financial goals.
- Compounding or interest earned on interest is a powerful tool for investors. If you start
early, then you give your money enough time to generate wealth. Even a small amount
saved every month, when you are young, can snowball into a large sum by the time you
- Investing early helps you build a healthy spending-saving balance. Since you have a
financial commitment to your investments, you will have lesser disposable income on hand
and will not make unnecessary expenses.
- Having the security of a saved up fund will help you during emergencies. Marriage,
children’s education and retirement are few of the big-ticket expenses that most
people try to prepare themselves for and starting early will help you to have the funds
when you need them. It will also keep you away from impulsive financial decisions.
Merely saving without investing can be counterproductive as you might get tempted to spend
the saved up funds on a big-ticket expense. Investment that keeps your funds locked in
or at least makes it difficult to withdraw can ensure that these funds are available to
you as per your investment plan. The best time to invest will always be yesterday, pull
up your socks, understand the options available and start investing for a
financially healthy future.