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Zen Rogue Xuan

30 Sep 2019

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Is money invested in your 20s worth more than that in your 30s?

I read an article which gave an interesting scenario, in which if person A invested starting from 20 to 30, as compared to person B who started from 30-60, surprisingly, at the end of the day, Person A would have more than that of Person B. How does the math work out?

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Adam Wong

30 Sep 2019

Editor-in-chief at The Fifth Person

Yes! This is due to the power of compound interest. The more time you have to compound your wealth, the larger it can potentially grow.
We covered this in one of our articles on how saving $11 a day can make you a millionaire (when invested prudently): https://fifthperson.com/saving-just-11-day-can-...

Hope this helps!

Hariz Arthur Maloy

03 Sep 2019

Independent Financial Advisor at Promiseland Independent

Let's do this right now.
Assume you invest 12k/yr @ 6% return.

20yr old to 30 years old. 120k invested. Return @ 6% would be $158,169.50.

You stop investing additional money and let it roll for another 30 years.

$158,169.50 @ 6% after 30 years would be $908,445.30.

Now the same 12k/yr @ 6% return for 30 years. 360k invested.

Return would be $948,698.20.

You'd have returned almost the same amount of money but in the latter case, invested 3 X your capital.
You can simply use the TVM formula to calculate this.

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