{"id":13054,"date":"2025-06-03T15:29:49","date_gmt":"2025-06-03T07:29:49","guid":{"rendered":"https:\/\/www.infinitysolutions.com\/?p=13054"},"modified":"2025-06-03T15:29:49","modified_gmt":"2025-06-03T07:29:49","slug":"retirement-planning-why-starting-now-beats-starting-big","status":"publish","type":"post","link":"https:\/\/www.infinitysolutions.com\/blog\/retirement-planning-why-starting-now-beats-starting-big\/","title":{"rendered":"Retirement planning: Why starting now beats starting big"},"content":{"rendered":"

Relying solely on a state pension will not afford you a comfortable retirement. That\u2019s why retirement planning is essential for everyone. Consistency and time are the key ingredients to success, so the best advice is to start early, save regularly, and let time work in your favour.<\/em><\/p>\n

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Starting small is better than not starting at all<\/strong><\/h2>\n

It\u2019s a common misconception that you need a large sum to begin saving for retirement. You absolutely don\u2019t. As with many things, getting started is the most important step, although also often the hardest.<\/p>\n

It\u2019s very easy to find excuses<\/a> to delay saving, but this is a costly mistake. Consistency and time trump every time when it comes to retirement saving. Let\u2019s take a look at why.<\/p>\n

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The power of compound interest<\/strong><\/p>\n

Small, regular contributions to a retirement fund grow exponentially over time. In fact, the effect is so big that time is considered to be the most valuable asset in investing.<\/p>\n

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Case Study 1: Linda, early saver<\/strong><\/p>\n

 <\/td>\n

Case Study 2: Derek, late saver<\/strong><\/td>\n<\/tr>\n
Linda started saving into a retirement fund aged 25.<\/td>\n <\/p>\n

Derek started saving into a retirement fund aged 45.<\/p>\n

 <\/td>\n<\/tr>\n

\n
    \n
  • Monthly contribution: $<\/strong>100<\/li>\n
  • Starting age:<\/strong> 25<\/li>\n
  • Ending age:<\/strong> 65 (40 years of saving)<\/li>\n
  • Assumed annual interest rate:<\/strong> 6% (compounded monthly)<\/li>\n<\/ul>\n

    \u00a0<\/strong><\/td>\n

\n
    \n
  • Monthly contribution:<\/strong> $500<\/li>\n
  • Starting age:<\/strong> 45<\/li>\n
  • Ending age:<\/strong> 65 (20 years of saving)<\/li>\n
  • Assumed annual interest rate:<\/strong> 6% (compounded monthly)<\/li>\n<\/ul>\n

    \u00a0<\/strong><\/td>\n<\/tr>\n

Result:<\/strong><\/p>\n

Total contributions: <\/strong>$48,000<\/p>\n

Saving timeframe:<\/strong> 40 years<\/p>\n

Retirement pot after interest:<\/strong> $200,000<\/p>\n

Growth from interest<\/strong>: $152,000.<\/p>\n

\u00a0<\/strong><\/td>\n

Result: <\/strong><\/p>\n

Total contributions: $120,000<\/p>\n

Saving timeframe:<\/strong> 20 years<\/p>\n

Retirement pot after interest:<\/strong> $233,000<\/p>\n

Growth from interest<\/strong>: $113,000<\/p>\n

\u00a0<\/strong><\/td>\n<\/tr>\n<\/tbody>\n<\/table>\n

 <\/p>\n

\"\"Source https:\/\/www.investor.gov\/financial-tools-calculators\/calculators\/compound-interest-calculator<\/a><\/p>\n

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Key takeaways:<\/p>\n