Think you need to accumulate wealth before wealth management applies to you? Building wealth has to start somewhere, and the amount you begin with is only part of the equation. Russell Rivera explains why starting earlier may give your investments more time for potential compound growth and help you work toward long-term financial goals.
Topics Discussed:
Wealth starts before you feel wealthy
Waiting reduces your investing time
Compounding rewards an earlier start
Small contributions have time to grow
Start investing with what you have
Transcript:
Hey everybody, Russell Rivera, founder, president of Voice Wealth Management, and I want to welcome you back to this month's Sidewalk Talk.
One of the issues that I've had is talking to people, and I tell them the name of my company. And they look at me and they say, I don't have any wealth to manage. And I sit there and I say, you know, I don't care how much you have. The question is, are you thinking you're trying to have more of it, right? Do you want to eventually build up some wealth, whatever that might be? And then people start to think about it and say, okay, yes, that makes sense.
You know what ends up happening is, right? It shows a thought process that people will wait to invest until things settle down, until they have things more organized. And the thing is, that plan has a cost, and it's bigger than most people realize, right? Because let's say you plan to invest $200 a month starting at age 25. You wait three years and start at 28 instead. And that's not just three years of missed contributions. That's three years of returns, three years of compounding. If you use a regular growth rate over time, that can lead to tens of thousands, hundreds of thousands of dollars. The longer you wait, the more you are going to contribute that you won't have later, right? So the time to always start putting money away is yesterday. So it's about time and not how much. It's about doing it. It's not about how big because a smaller amount invested today can grow to much, much bigger in future years.
I once saw a study, and it indicated that if someone started putting the same amount of money in at age 18 and stopped at age 27 or versus putting money in starting at age 27 and ending at age 65, again, same amount every year. The first person would actually end up with more money at age 65. That tells you the power of compounding and putting money to work yesterday rather than waiting. Waiting has a high cost, and it shouldn't cost anybody more. Don't wait.
If you've thought about putting money to work, to invest for you, for a goal, for retirement, whatever it is, start yesterday, start today. Open an account this week, wherever it needs to be, just because the benefits will be so much bigger later, even if it takes you a while to think your city. This is Russell Rivera. This is Sidewalk Talk. Thanks, and we'll see you next time.
Russell D. Rivera, CFA, CFP®, is the Founder and President of Voice Wealth Management, an independent financial services firm serving professionals, entrepreneurs, and families in New York City and beyond. Focusing on helping clients make informed decisions about saving, investing, and financial planning, Russell is committed to providing a customized approach that reflects each client’s unique priorities and experiences.
