Stop Saving, Start Investing: 9 Decisions to be taken before 30 for Economical Stability
By SiliconIndia
The Power of Compounding
Time is the key asset in the investment process.
For example, Punit starts investing Rs 10,000 every year at the age of 25 and stops at the age of 35, but does not withdraw. Rahul starts investing Rs 10,000 every year at the age of 35 and continues till he’s 65 years old. As crazy as it may sound, Punit will have 2.5 times the amount Rahul has (1.28 crores vs 46.5 lakhs), even though Rahul invested for 20 years more. In this case Punit’s money started compounding early, and earned interest, which in turn generated further interest, and this goes on. This is the true power of compounding.
Expert Tip: Start investing today. Even if it’s just Rs 10,000 a year, it will compound to many times that amount by the time you retire.
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