Reasons to Begin Investing at a Young Age


At Earn More and Save, our mission is to help you figure out creative ways to supplement your income as well as offer unique methods for saving more money. Today, we’re going to take a look at the reasons to invest money when you’re young. Investing at a young age gives you a leg up later in life, and there are a few key reasons that the practice does this.

The Magic of Compound Interest

For illustrative purposes, let me first regale you with an example from the oh-so-famous Motley Fool website. It explains how you’d do if you invested $100 once at 15 years old:

Compound interest is indeed a magical thing, and as you can see from the example above, the more time you have on your side, the better your chances of making big bucks over the long haul. Here’s a little more food for thought: this example illustrates a one-time investment of $100. Imagine if you start very young and invest regularly instead. You’d create a little nest egg that could stand to set you up for life.

With Age Comes Obligation

Let’s face it, the older we get, the more responsibilities we have. It’s life, and it’s natural. The average family lives paycheck to paycheck and struggles just to make ends meet every month. The cost of living is through the roof, and the older people get, the more the financial obligations pile up.

FlexyFinance small loans assistance take out student loans to get through school, and while you’re there, you meet that special someone and you get hitched. There’s the wedding, a brand new mortgage, and then the two of you are blessed with a couple of adorable rug rats. Before you know it, you are scrambling to figure out how you’ll pay for the kids’ college in between scraping together enough dough to retire. Who has extra money to throw at investments that earn compound interest?

On the other hand, imagine you’re fifteen. You sock away half of your paycheck from your first job and it begins to earn that magical compound interest we talked about. You’ve just made an important investment in your future, and you’ve done it before all the other obligations of life begin to unfold for you.

Old Habits Die Hard

Don’t be a person that lives in the future. That is, don’t say you’re “going” to do something later and never follow through. Instead, start investing a little each month and earning compound interest on that seed money at a young age. The advantage of doing this is that you’ll establish healthy saving patterns you’ll carry with you throughout your life.

The older you get, the harder it is to change the deep-rooted behaviors you begin to exhibit in your youth. If you start socking away money when you’re very young, you’ll continue to do it for the rest of your life, and your future family will be much more secure as a result.