Lost time

As I slowly reached the conclusion that I seriously needed to invest for my future, the realization that hit me the hardest was that I had lost a lot of years not making any meaningful investments. A year past is a year lost. There is simply no taking back lost time. I wish I had started sooner!

The sad thing is that most people still don’t see it themselves either. Most people don’t fully comprehend that the best ally you have in investing for your future is not necessarily investing more money. All you really need is longer time. Investing more is good but nothing beats investing earlier.

Consider the following comparison I put together below. On the left is someone who at age 25 starts investing P3,000 every month until he reaches 65. On the right is someone who, only at 45 years old, starts investing P5,000 every month until 65. The assumption is an interest rate of 8% per year. The figures tell everything.



Plotted on a graph below, you can clearly see that investing more may not be enough for you to reach your goals. There is a gap that you simply cannot make up for with more money.



The realization here is that with the power of compounded interest, you can build a strong momentum on your investments. But it takes years to build. Start early. Because your biggest asset is time, and as you read this, it is running out on you.