I is for the Importance of Investing when you’re Young

The investment world can be quite overwhelming and perhaps a bit intimidating to new investors, but this is no reason not to begin an investment strategy as soon as possible. The earlier you start investing in the markets, the more you will be able to learn and grow your investments.

It may not seem urgent now, because you are young and retirement is decades away, but the sooner you start investing, the more you will have when you retire. Below are some reasons that make investing when you’re young an excellent start for a prosperous financial future.

Compound Interest – is the interest earned on interest when you continue to reinvest the interest, this accumulated interest will help increase your return on your investment over time. The younger you start investing the more time you will have to benefit from compounded interest.

Investing when you’re young – gives you a tremendous advantage, time. Having years ahead of you to save and invest, offers you the opportunity to take more risk. Typically ventures with more risk tend to provide higher yields so you may make more significant gains. If something does go wrong, you have more time to recover from mistakes unlike those who invest later in life.

Financial Education – starting to invest in your twenties gives you many years to study the markets, learn from your mistakes and create an investing strategy that’s right for you.

Increase Your Confidence – by having financial goals and putting your focus on saving for your future, you can learn to create a reasonable budget, cut unnecessary spending and form healthy spending habits for life. You’re bound to feel good about yourself.

It’s never too early to start investing in your future, do your homework, learn about all the different investment options and make sure you diversify your portfolio. Investments do come with risk, and there is no way to predict how each year will turn out. But by starting young and staying in the market, the better your odds for success.

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About Ann Zuraw

Ann Zuraw, the voice behind "Chicks, Chat and Change", is a Certified Financial Planner (CFP®), Chartered Financial Analyst (CFA®), and Certified Divorce Financial Analyst (CDFA™). If you have comments on this post contact Ann Zuraw

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