Alice started saving $1,000 a year for retirement when she was 21 years old. She saved this much for 8 years and then stopped at age 29 but let the amount build interest until she was 65. She paid a total of $8,000 into her retirement plan.
Ben waited until age 29 to start saving $1,000 a year for retirement and saved that much per year until he retired at age 65. He paid a total of $37,000 into his retirement plan.
Who do you think ended up with the most? The one that paid in $8,000 or the one that paid in $37,000?
Alice ended up with earning $64,693 more than Ben in the end because her money grew through compounded interest 8 years longer.
Starting early makes a huge difference!
- Crown Financial Ministries