As young adults we should start to invest as soon as possible because investing for our future can only benefit us. It is important to start investing early because starting to invest now when we are young will ensure that we have some financial stability in the future.
It is important to Start Investing for Our Future
Investing for our future can include various goals such as buying our first car, buying a home, as well as saving for our retirement. There are several different investment options available to investors for their different short term and long term goals. Different investment options include Stocks, Mutual Funds, GICs, and Exchange Traded Funds. These different investment options can be purchased in both Registered Investment Accounts for our retirement, as well as Non Registered Investment Accounts for other goals such as saving for a car or other major purchases.
It is important to start investing now for our future because a little contribution every month can really add up to a large investment amount later on down the road. Starting to invest even $50 per month now can add up to a lot of money over time, when we consider all contributions as well as compounded interest and growth on our investment.
Investing For Our Future Can Really Pay Off
There are several different financial calculators available to Young Investors to show us the benefits of starting to invest now for our future. RBC Royal Bank offers Retirement Calculators such as a Pre Authorized Contribution Calculator, a Compound Interest Calculator, a Future Value Calculator, as well as a Retirement Cash Flow Calculator.
The Pre Authorized Contribution (RSP-Matic) Calculator is a great example of how contributing a little bit now can be a good investment for our future. If we use the example of a young investor who starts to contribute $50 per month for their future at 23 years old, they will have a total retirement investment of $104, 827 when they are ready to retire at 60 years old. This example uses an average annual rate of return of 7%.
The Compound Interest Calculator shows us how our lump sum contribution can grow into a future retirement savings account. If we use the same example of a 23 year old who invests $5000 at an annual rate of return of 7%, our $5000 will be worth $61,118 in 37 years when we are ready to retire at 60 years old.
Regardless of whether we invest a lump sum contribution or we choose to contribute regularly into our investments on a biweekly or monthly basis the future benefits of starting to invest are priceless. It is important to start saving now for our future financial stability.
Photo by MJTR