3 Reasons You Should Start Investing Early
Recently, in my podcast Figuring Out, I had the opportunity to converse with Rana Duggabati. You know him as an actor, but there is more to him. He is also an investor, an entrepreneur, and a businessman, and he aspires to take the entertainment industry to a new height.
During the conversation, I asked him how he wished he had spent his money in the initial days of his earning. The reply will resonate with a lot of people. He said that he wished he had invested more, and he regretted the lack of awareness about investments and returns on investment at that time. This brings us to today’s topic: why you should start investing your money in your 20s.
1. Grow your wealth
The first and most obvious reason why one invests money is to increase their wealth. If you have the ambition to buy a luxurious car or travel the world, you need to start planning early.
It takes quite a while for your investments to actually bear fruit, so you need to start investing early and give it the necessary time to yield the result. Eventually, the return on investment will be pretty high.
2. Risk averaging
When you start investing early and invest in a disciplined manner at regular frequency, you unlock the benefits of risk averaging. The stock market is a highly volatile place where prices can come down crashing one day and be sky-high on another.
So, if you are in here for a long time, even the low returns will get averaged out because of the longtime period. The net return on investment will be huge.
3. A better spending habit
During the first few years of our job, there is little to no responsibility for most of us. So, we tend to spend all our money unnecessarily. But when you start investing money, you automatically have to start living on a budget. This will shape you to be a responsible person.
It might be difficult initially, but you will get the benefit in the long term, and the numbers will be impressive in the investment calculator. With considerable savings, you will never have to ask for help during an emergency.
Though it sounds enticing, investment is a tricky subject. What actually helps is first-hand experience. When you invest, you gain some; you lose some. You gather experience and where to invest your money and where not to. There is no fast-track process to grow your wealth, you have to be patient and consistent and you will get the returns in due time.
Liked what you read? Tap here to learn about more such facts!
Instagram | LinkedIn | Twitter | YouTube | Facebook | Buzzsprout | Spotify | Apple | Google
