So last month I turned 32, and a handful of friends asked how it was like spending my first lockdown birthday at home. While I do use birthdays as an annual excuse to catch up with friends, I’ve always considered birthdays as 母难日, and I usually spend the day itself at home on 母难日。So my answer is “no difference la”.
This brings me to the next point about turning 32. Sharing something I read that kinda shook me and reminded me of the importance of starting one’s investing journey as early as possible.
“Interest can be compounded annually, monthly or even daily. The more frequently your interest is compounded, the more it will grow.
Say you invest $2,000 a year for 10 years from the time you’re 22 until you’re 32. Then you stop investing and let the money compound at 10 percent for 28 years until you’re 60 years old. You’ll have $505,629 after contributing a total of $20,000 and letting it compound.
On the other hand, if you wait until you’re 32 years old to begin investing and you put away $2,000 a year for 28 years until you’re 60 years old, you’ll only have $295,262, even though you’ll have contributed a total of $56,000. Since money compounds more the longer you leave it in your account, it makes sense to start as early as you can.”
Look, this is nothing new. We always talk about the miracle of compound interest, and it’s repeated so often that it permanently sits at the back of our minds. Much like how we all KNOW the importance of getting enough exercise, cutting down on alcohol and sugar, getting enough sleep etc. but do nothing about it.
Because like many people out there, I’m definitely guilty of not getting enough exercise and sleep.
Cutting down on alcohol and sugar? Sure, let’s start next week after my bubble tea. Yep, am guilty again.
And how many of us still leave too much of our money sitting around in the bank as fats? Happily allowing inflation to erode our money and letting inflation devour the life we could possibly have in the future? For something called “sense of security” or an opportunity that we can’t even properly define.
At best it’s an “aiya, wait for market to drop lor”, but when such an opportunity is staring you in the face, how many people took real action?
People are always trying to time the market, always waiting for the next big opportunity, or constantly playing the DBS Multiplier/OCBC 360 game trying to squeeze out the extra 0.1% without seeing the big picture: that beyond a reasonable amount of emergency funds, all the money that’s not invested is just being held hostage and not being put to good use for us.
If you don’t know how, ask your financial advisor or go attend a course. Invest time and money wisely and the two will combine to bring you great results.