Today marks my 36th birthday. An age which feels a little strange as whilst its certainly not old, I am definitely no spring chicken either!
As often happens when a new year ends and a new one begins, it provides a great opportunity to reflect on the past and to plan for the future. Whilst reflecting on my own personal trading/investing performance specifically, one thing that strikes me hard once again (and is something that is getting more pronounced as the years pass) is the importance of starting early. And so today’s blog post is going to be tackling the concept of starting early when it comes to trading/investing, and why its so, so important. Even I, who starting investing/trading from a relatively early age (mid-twenties), wish I had put my money to work much sooner and now it’s the number one piece of guidance I give to all aspiring traders/investors that I come across. Start small, yes, but START TODAY as it could make the monetary difference of thousands of pounds/dollars/euro’s in your future wealth.
Naturally everyone wants to make as much money in the shortest possible time and in the safest possible way but, sadly, this combination is rare and unattainable to most. Quick and substantial returns on investments are of course available (just ask the people who invested in Bitcoin at the start of 2017 where they saw their investment growth explode in just a matter of months) but they are normally accompanied by a huge amount of risk too (just ask the people who bought bitcoin at the top of the market only to see their investment collapse in a matter of months). The key thing to note here is that substantial investment growth can be obtained without having to take huge risk (although some risk is always present). You just have to give your investments time to grow. Time to ride out the inevitable bumps that happen along the way. As an investor/trader, TIME is the most powerful tool you have. The longer you have to grow and compound your investments, the much greater potential growth there is.
If you want to get a really good grip of your potential long term investment growth potential i.e. what your trading/investment account could look like in the future, using a very simple-to-use spreadsheet, then you will want to sign up for our FREE COMPOUNDING CALCULATOR HERE. Go and have a play around with the numbers (we provide simple instructions on how to use the tool) and we are confident that you will be very surprised at how much growth you could potentially see once you give your investments TIME to grow.
To illustrate just how powerful TIME is, when it comes to investing, let’s dive right into an example:
PERSON A starts investing TODAY. £150 per month, every month for 10 years. This (excluding any investment gains/losses), in total, would have accumulated £18,000. This trader then STOPS investing after 10 years but leaves the money invested (for example in the stock market).
However in comparison…
PERSON B starts 15 years LATER than PERSON A. They then start to invest £150, every single month, but for 25 years (so 15 years LONGER than person A). This would put away £45,000 into their investment account over this time period (again excluding any investment gains/losses). So PERSON B has saved 2.5 times the amount of PERSON A.
Then, taking a modest +5% average growth/return on investment per year (highlighting that this of course is not guaranteed, but acts as an example for illustrative purposes), the total size of each persons investment after 40 years is as follows:
PERSON A = £100,480 (£18,000 investment with a huge £82,480 growth on this investment)
PERSON B = £88,218 (£45,000 investment with a more modest £43,218 growth on this investment)
The key lessons here to takeaway:
- PERSON B invested £27,000 MORE than PERSON A but this grew their money by £12,262 LESS over the 40 year time horizon.
- As a result of this, and by waiting 15 years longer they are £39,262 worse off than PERSON A.
- All because PERSON A started to invest SOONER.
The power of time and compound interest laid bare right here. Remember that this is not a real example, just a projection, but does powerfully illustrate the power of time and compound interest.
The main thing we want you to takeaway from this blog post is BE PERSON A. Start small but start NOW. Whether that’s investing in the stock market, forex, commodities, these are the areas where you can put your money to work over time so that you get the best possible return. You can of course use a regulated company who will put your money to work on your behalf (if you have no desire to do it yourself) but if you want to learn the skills to grow your money over time via the forex markets, then you can start by taking our 3 flagship courses BELOW. This could help speed up your journey to reaching the financial goals you have set yourself for the years ahead.
Our core objective with this blog is to provide you with incredible value whereby our free content is better than most paid material. So if you read our blogs and go away feeling more knowledgeable then we have succeeded in our objective.
That said we understand that there will be a few of you reading our content and getting interested in a career in forex trading. And so, if this blog has sparked a desire to become a forex trader, then do take a look at our ‘7 figure trader’ course bundle (3 courses included). Our ‘Learn to Trade The News’ course will enlighten you on all things fundamental analysis, as well as introduce you to our approach to trading the news, whilst our ‘Learn to Trade The Technicals’ course will show you how to blend technical analysis on top of the fundamentals for efficiency into and out of high probability trades. The third course, ‘Learn to Trade A Fund’ , will then showcase all the routes you can take (once consistently profitable) in order to access trading capital up to £1m and beyond. That may sound crazy to you now if you are just starting out on your journey but we have students (see HERE, HERE & HERE) who started in your position many months ago but who are now well on their way to trading 7 figure accounts and our number one goal as a company is to help as many students as possible take their trading from a hobby to a full time career. You can find all the details of the bundle in the link below:
Risk Disclaimer! Forex, Futures, Options, Equity trading, and any such derivatives, can be highly leveraged and carry a large amount of risk and are not suitable for all investors. Please do not trade with more money than you can afford to lose. All content (news, views, analysis, research, trade ideas, commentary, videos or articles) on this channel does not constitute ‘investment advice’. Past performance is for indicative purposes only and is not an indication of or a guarantee of future results.