When you start early i.e. at a young age, you stand to gain the most with the help of compound interest and dollar-cost averaging concepts. You are also investing at a lower risk level and maximising of returns over the longer term. Importantly, you have a long-term investment horizon to play with.
You have to believe in the principles of compound interest and time horizon. It works wonder! An illustration I read shows that an individual started a yearly investment of $1,000 at age 25 for a period of 10 years @ 6% return. He allowed his investment to continue growing at 6% from say age 35 to 62 without any further yearly contributions. Wow! at age 62 his investment totalled $71,420.
On the other hand, another guy started on a yearly investment of $1,000 from age 35 [i.e. 10 years later] continuously upto age 62 he would receive $72,640. See the different, one invests only for 10 years while the other needs to contribute continously for 20 plus years.
Understandably young people especially those who just started working may not have the means to invest big but they can start on a regular savings plan. Set aside a small monthly contribution of say $50 or $100 and let time and compound interest work for you.
NTUC INCOME has a wide variety of investment plans that give attractive returns. Surely you can find one that meet your need. If you are still in doubt no problem, I'm here to help to fulfill your future financial goal.
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