The Advantages of an Early Start
We’re often reminded to save money for a rainy day, but young people don’t always think in the long term. While it’s true that many people start investing later in life and enjoy comfortable returns on their investments, one only needs to see a few friends have financial troubles to realize that things don’t always work out that way. Investing earlier in life can sometimes make the difference between retiring when you are ready and retiring when you are able; while you may be healthy well into your senior years, that’s not always guaranteed.
A powerful force. Perhaps the greatest advantage to investing at an early age is the effect that compound interest can have on your savings. A long-disputed quote has Albert Einstein claiming that compound interest “is the most powerful force in the universe.” Regardless of who actually said it, there is some truth to the joke.
What makes compound interest special? It is interest based not only on the principal but from previously accrued interest. In the short term, it’s not impressive, but over thirty years or more, it can produce a handsome dividend.
No guaranteed path. There is no guaranteed path to financial security, but a young person has advantages that shouldn’t be squandered. A combination of investments, with an eye to the long-term, can make all the difference.
Advisory services offered through Meridian Wealth Management LLC, a Registered Investment Advisor.