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Smaller “financial sacrifice” to achieve your goals
Assume you selected a retirement goal of “one million reais” and set your retirement age at 60 years. If you are 40 years old, you have 20 years to accomplish your goal. You’ll have to save more money, but you’ll have to be less aggressive in your investments because the shorter term doesn’t enable you to fluctuate along with the market’s ups and downs.
If you begin saving at the age of 20, you will need to save less every month (and it will have less of an impact on your lifestyle), and you will have more time to benefit from the power of compounded capitalization.
Harnessing the power of compound capitalization
The consultant reminds you that “interest on interest” is a powerful force you should never underestimate. “Anyone in debt is well aware of this,” he continues. The more money invested, the more income it creates, which generates more revenue, resulting in a “snowball” effect that only goes higher.
Possibility of simply having more money
According to Massaro, individuals with a specific objective must make fewer sacrifices to achieve it. Still, those who start early and choose to be aggressive in their applications have the extra benefit of simply having more money in the future. “As a result of it, the investor might come to enjoy an enviable equity situation,” he says.
Possibility of early retirement
Is it feasible to start at the age of 20 and retire at the age of 40 if those who start at the age of 40 have the option of retiring at the age of 60? Many may object, “but a 40-year-old professional makes far more than a 20-year-old!”
But, for Massaro, what matters is not how much money is generated but how much is left behind. A 20-year-old who works and lives with his parents typically saves more money than a 40-year-old CEO with a high salary but high costs. “Sometimes it’s just a matter of planning,” the expert explains.
More time for route corrections
The financial market, the economy, and professional lives have an odd habit of rejecting our intentions and taking our paths. “Unfortunately, financial and asset management is quite reactive – our control over things is much more restricted than we’d want,” adds Massaro.
As a result, the more time we have, the better we will adapt to new realities and alter our activities.
Dilute the “cost of financial learning.”
According to the professional, managing one’s money is more of an art than a science, and keep in mind that the learning curve is complete with barriers and traps. “We frequently make poor financial decisions owing to a lack of information or experience, and they come at a cost,” he adds.
As a result, he maintains that starting gives us an advantage in time. “That way, we’ll have more time to learn and recover from the minor and big mistakes we made along the road,” he explains.
Tailored aggressiveness
Those who wish to “improve” the profitability of their assets must invest in variable income. And, with more time, it becomes much simpler to survive the stock market’s “bumps.”
“Those with more time can be more aggressive (and so earn more”),” he says.
Less stress and better quality of life
The expert points out that those who start investing earlier will have more money, and those with more money live better. “This statement may seem materialistic and even a little cynical, but, like it or not, the world is like that,” says Massaro.
“More money means more freedom, more possibilities, and more opportunities. It’s that simple”, he says.
Regularity is also important
According to Massaro, individuals with a specific objective must make fewer sacrifices to achieve it. Still, those who start early and choose to be aggressive in their applications have the extra benefit of simply having more money in the future. “As a result of it, the investor might come to enjoy an enviable equity situation,” he says.
Money makes money
According to Massaro, the earlier you begin investing, the more money you will have, and the more money you have, the more money you may make.
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The post 10 Reasons You Must Start Saving in Your 20s first appeared on Complete Controller.------------Read More
By: Complete Controller
Title: 10 Reasons You Must Start Saving in Your 20s
Sourced From: www.completecontroller.com/10-reasons-you-must-start-saving-in-your-20s/
Published Date: Tue, 07 Mar 2023 22:00:46 +0000
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