“Wealth is not about having a lot of money; it’s about having a lot of options.”
Chris Rock
It’s difficult to get rich quickly but it is relatively easy to accumulate some wealth over 40 years or more. And isn’t that about the average number of years most people work from the time they enter the workforce until the time they exit?
There are many factors to consider if you have a goal of saving a considerable amount of money. Things like discipline. Are you the sort of person that can make a plan and stick to it? Do you need to have the latest, greatest ‘whatchmecallit’ or the biggest TV or that exotic car or can you find a way to get what you really need and still stick to your plan? Speaking of your plan, do you have one? Have you figured out what it would take for you to reach your financial goals? Have you considered what the risks are in achieving that goal and put measures in place to make certain that you will have regular, consistent income no matter what happens?
I’ve always liked the story of the two brothers which goes something like this:
Let’s say an imaginary Tim starts working at 18 years .Lets say he saves $3000 annually until the age of 26 and gets a return on his investment of 10% compounded for 8 years. He never puts another penny in the account, but allows his investment to compound at 10 percent until the age of 65 years old. At age 65 he has a grand total of $1,552,739.35. Let’s also say his older brother Brad squirrels away the same amount of $3000 per year but he waits until he is 27 to start his stash. He continues to annually save $3000 non-stop until age 65 and gets the same 10% return on his investments He would be sitting on a total sum of $1,324,777.67.
Granted, it’s difficult to find investments that will return 10% a year for several decades but that’s not the point of the story, is it? Start now (because you can’t go back in time), so much the better if you’re in your 20’s or 30’s or get creative on how you can put more aside for yourself and your family.
Click on this blog to be directed to Stages Financial’s web set where there is a calculator to help you see what it would take for you to put aside a million, or two or whatever amount you aspire to save.
Best wishes…