Early To Invest, Early to Retire

By Mithun Girishan |

Published: June 08 2020, 12:35 GMT+0

Early To Invest, Early to Retire

Early to invest, early to retire, makes a man healthy, wealth, and wise. This may be slightly different from the nursery rhyme that you all know. However, this modification also holds true.

A lot many people are living a relaxed life off of their investments. They enjoy ample time to relax, exercise, and do things that they always wanted to do. How is that possible? Were they all business tycoons of yester years? No! Not at all! Rather, they are the ones who made wise choices. They are the ones who acted early. They are the ones who worked on their retirement plan consistently. Similarly, you too can retire early and relax if you start off early with the right foot.

So what does it take to retire early? Here are the three crucial steps. Let us call them the three E’s of early retirement.

  1. Early.
  2. Easy
  3. Effective

Early

Well begun is half-done. So start investing as early as you can. Starting early minimizes investment amount. This is especially true if you are fixed income earner. You need to set aside only a small percentage of your total income because you have more time at your disposal to allow the investment to grow. However, ensure that even if the amount is modest, you do it consistently. Because it is consistent investment that creates wealth. This is a law of money. You can increase the percentage of your investment as and when your fixed income increases.

The wise men of the past said,

Just as drops of water gradually fills a pot,

a man acquires wealth, knowledge, and good deeds.

Investing early means your money remains invested for a longer period of time. Time multiplies money. This is another law of money. Understand these simple laws and apply them confidently.

Easy

Because you don’t need to invest a big amount, you have the time to invest in bits and pieces. More importantly, you have the time and energy to spend some extra hours a week to invest in your retirement plan. Just think of all those things you could do effortlessly 10 years back and see if you can do those same things in the same way now. Chances are that you are incapable of doing it with that same level of perfection or ease. Why? The answer is obvious – you are getting aged, and your ability to think and act with the same efficiency is gradually declining. Now think 10 years ahead. Do you think you will be able to get things done with the same efficiency? You may continue to work 15 hours a day, but your productivity will not be as good as your current level of productivity.

The best time to invest was years before.

The next best time is now!

So act now! Now your mind is fresh and you can do multiple tasks at the same time. You can deal with more stress. It may not be so 10 years hence. Therefore, make good use of the energy you have now. It is a lot easier for you to go after an investment now.

Effective

Investment needs some time to grow. Just like how you cannot get mangoes out of the seed that you planted the previous day, you cannot start reaping returns from investment in a very short period of time. Any investment to become effective needs a reasonable length of time. Therefore, it is a wise idea to channel your investment to income-generating assets.

Now let us take an example. For instance, if you are 25 years of age now and plan to invest Rs. 10,000/- per year. Your investment can reap profits and suffer losses, so let us consider that you earn an average of 12% rate of interest per annum on your investment. Then you will have around Rs. 11,200/- at the end of the year as your savings. Now, you are investing the same amount in the next year as well. That would mean you will get interest for Rs. 11,200/- as well as the fresh amount that you deposited in the second year (i.e., 11,200 + 10,000 = 21,200). In this way, by the time you reach 55 years of age, you will be having around Rs. 23.4 lakhs as your investment!

Investing 10,000 p.a. will fetch

23.4 lakhs after 30 years!!

Another effective method is to invest in the most valuable thing in this world – you! Yeah, investing in yourself is the most effective investment you can ever think of. Because that investment will never go futile. You certainly will reap the benefits today or in the near future. Investing in yourself means investing in acquiring specialized skills and knowledge. You may learn a new skill at income generation, gain expert knowledge in matters related to investment, etc. you may then start applying those skills and knowledge in the relevant field and horn your skills. Within a few years or so, you will progress into a highly skilled professional who can generate additional income safely and consistently.

Invest in yourself.

It pays the best interest!

In short, whichever way you choose, you are kick-starting your retirement now itself!

  • Invest Early. Retire Early.
  • Invest Consistently. Retire Wealthy.
  • Invest Wisely. Retire Safely.
  • Invest in Yourself. Retire Happily.
Back