10 Rules: Starting Early

The first rule in the series of ten towards building wealth is probably the most important tip of the ten and it’s the one that every young professional should take to heart, even if they don’t really want to worry about retirement in forty years: start early. Not much else to it!

The tip compares two employees enjoying the same growth rate (8%) except one puts away $100 a month for ten years starting when she’s 22; the second starts at 32 with the same contribution but continues until he’s 64. At the age of 64, the early contributor will have $234,600 saved up while the later contributor will only have $177,400. More importantly, while not mentioned in the article, the first contributor only contributed $12,000 while the second contributor had to put away $38,400 and was still $57,200 behind!

Source: Fortune