For instance, even setting aside a monthly amount of $400 (or a lump sum of $5,000 each year) can go a long way when you allow this to compound over time. In the chart above, you can clearly see that because Susan started earlier, she still emerges with more money than Bill, even though Bill sticks to his plan for a longer duration (30 years) and invests more capital (3 times more) than she does.
That is the power of starting early – even if you were to pause later on in life, your money can continue to grow if you’ve parked it in the right financial instruments.
In choosing which tool to grow your savings with, you’ll need to ask yourself, how confident are you when it comes to investing, and are you reasonably good at it?
Whether you prefer to manage your own investments or outsource it to the professionals (e.g. BlackRock or Wellington Management, just to name a few), there are different options to suit your discipline level, skill, budget and even time (or the lack of it, when it comes to actively managing your own investments for growth).