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Why we need to save early: time is money


One of the challenges of Filipinos is our habit of procrastination especially when it comes to saving and investing. Our priorities rarely includes saving. Thus for how many years, a lot of Filipinos still haven’t started saving and investing yet. However, let me show you today that the longer we delay saving, the more we are throwing away potential millions later on. Time is truly money. 
Time is money
Time is money
The High Cost of Waiting - Save Early
Source: IMG Advance Training Materials
Looking at the figures above, if we started saving at age 20, we only need to save 860 per month! That’s very cheap and doable. By the time we started saving at age 35, to get 5 million at age 65, the amount we need to save increases to 3,600 per month. But, if we continue to delay and decide to save later on at age 50, a whopping 14,860 per month is what we needed. Therefore, the longer we delay the higher is the cost for us to retire. 

Another example:
Mr. Save Early versus Mr. Save Later - the importance of saving early
Mr. Save Early versus Mr. Save Later - the importance of saving early
Looking at the figures above, Mr. Save Early and Mr. Save Later both invested 20,000 per year for 6 years at 12% interest per year. However, Mr. Save Early started at age 22 while Mr. Save Later started at age 28. However, by the time they decided to retire at age 62, Mr. Save Early gains: 9.6M while Mr. Save Later gains: 4.9M!! The difference is almost double! They both saved the same amount but the only difference is that the other started earlier. How about you? When do you plan to save?

Last example: 

Looking at both Mr.Save Early and Mr.Save Later, another person, Mr. Catch-up, decided later to save at age 34, but wants to be saving every year 20,000 pesos until age 62 to hopefully catch-up with both Mr.Save Early and Later:
Mr. Catch-up never caught up saving - we need to save and invest early
Mr. Catch-up never caught up saving - we need to save and invest early
Looking at the figures above, Mr. Catch-up never ever caught up with Mr. Save Early and Mr. Save Later. 

Looking at the three examples above, numbers don’t lie. This proves that Time is really Money. The longer we delay saving, the more potential money we have lost. This hopes to convince and remind us that as Filipinos, we need to cure our habit of procrastination. And the only way to do that is by starting now! No matter how small the amount, the important thing is the act of doing it. In health and getting fit, you don’t wait to get fit before going on a diet. You go on a diet in order to get fit. The same with finance, you don’t wait to get rich before saving but you save and invest to have comfortable retirement later on.

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