I have written previously that Investing is like Golf. The punch line is that you need to go back in time, about 20 years and start doing it then. It was one of the first theme stories I wrote a while ago. The thematic premise was taking two investors:
- Young Buck $2,000 away yearly in an investment that grows by 6% annually on average, from age 22 until he is 55.
- Old Geezer decides to start saving later in life and puts away $6,000 a year from age 40 until age 55, with the same growth rate.
If you look at your Future Value function in your favourite spreadsheet program. Assuming a 6% interesting compounded yearly, and a 1 payment per year model as well.
- Young Buck with FV:
=FV(0.06, 33, -2000, 0, )makes $194,686.33 - Old Geezer with FV:
=FV(0.06, 15, -6000, 0, )makes $139,655.82
Feel free to fiddle with this more if you wish. Does seem to prove the assertion, better to start early for investing, and golf. The other thing that starting early does, is it gives you time to recover from mistakes by you or worse, market corrections.
Another Punchline: Luckily I have invested better than I have golfed.
Interesting Writings from other folks
My April Writings
Didn't get too much written per se. Ah, well, busy times.
- Medical Expenses add Up for the CRA Discover the surprising medical expenses I had in 2023. From ambulance costs to orthodontic work, find out what insurance didn’t cover.
- March Money Madness Uncover the financial insights on my blog. My posts cover everything from overcoming financial phobias to exposing banking service charges.
