This is a very frequent question I get asked.  There is only one answer.  YESTERDAY!!  If you are not already investing, you need to start TODAY!  I recently hear of a new rule in the financial world.  (You never stop learning!)  It is called the Bankers rule, or, the Rule of 72.  What the rule does, is tell you how many years it will take for your investment to double, based on the rate of return you are getting.  The math is very simple.  Take the percentage return you are getting and divide 72 by that number.  For example, 3% return.  72 divided by 3 = 24 years.  This tells you that at a 3% it will take 24 years to double.  A 9% return will double your money in, 72 divided by 9 = 8 years.  These calculations are based on compounded interest.

What a great rule to know.  If you put away only $1000.00 at 9%, in 8 years that will grow to $2000.00.  That is without adding anything to the investment!!  In 16 years it will be worth $4000.00.  This example helps to demonstrate another rule of money. The Cost of waiting.  This expense is HUGE!!  I have heard the statement “I’ll start investing next year.” too many times to count.  I even said it myself at one time.  Sure, taking money out of your lifestyle to invest is tough.  So putting it off is easily justified.  I need that $20.00 a month for other things.  Besides it is only $20.00.  What can it get me?

I’ll show you.  $20.00 a month is $240.00 a year.  (It is 67 cents a day!!!)  If you invest that $240 a year from age 20 to age 65 at 9% a year, it grows to about $115,000.00.  That is not bad.  But what if you waited just one year.  What would be the return? $105,000.00.  Buy waiting one year, it cost you $10,000.00!!!!  What if you waited till age 25??  Your return would only be $74,000.00.  That is a loss of $41,000.00. For many people that is a years pay.  Waiting to invest Costs you THOUSANDS over your lifetime.  What did the $20.00 you don’t have to invest buy?  Not even two lunches at Timmies.  You say you really don’t have ONLY $20.00 a month??  How can you afford not to!!!

The last example also demonstrates another of the rules of money.  You have all heard this before, “Time is Money.”  The more time you give money to grow the bigger it gets.  But you can also look at this another way.  If you are an employee, you are trading your TIME for Money.  The only way that you make more money, is to spend more time working.  (That only applies to hourly pay.  Salaries don’t work that way.)  But Investing, is your money working to make more money.  How many hours in a day can your money work? Unlike you, it can work 24 hours a day 7 days a week.  How much effort (work) does investing take on your part?  The time to talk to an advisor, and the time it takes to put away $20.00 a month.  Compare that, to how much effort it takes to work an extra shift, or overtime, or get an extra part time job.

We can also turn that rule around for another rule of money. “Money is Time”.  I am sure everybody would love to have more time for, hobbies, family, golf, sports, the list is endless.  Why don’t you have the time to devote to those things??  BECAUSE I HAVE TO WORK FOR MONEY!!!  If you had more MONEY you would have more TIME.

The only question you have to ask yourself is WHAT ARE YOU WAITING FOR????