Summary of this article
Retirement depends on how early you start.
Compounding is the secret behind wealth building.
Planning early ensures that you get to retire early and comfortably.
Retirement is often treated as something distant and planning for the far future is often neglected. It is quite the contrary though. Your retirement depends on how early you start.
For women, especially, retirement planning starts around their forties. By then, they have missed a crucial window where they could have converted a sum of money into a reliable cushion for their later years. The reality most women don’t face is that the delay in retirement planning could severely affect their financial freedom in the most important years of their life, their later years, and also takes away their peace of mind.
Women already face a lot of financial breaks throughout their lives, which makes early planning non-negotiable. Women earn less compared to men, which, if compared, would be less than a man’s savings and investments for retirement, even if it is for the same amount of time. Their career breaks are also something to be considered; these gaps cause a significant difference in their total savings and investments. The low time horizon of their earning and investing also equals less compounding of their investments.
How Early Investing Can Help In Compounding
Compounding is the secret behind wealth building. Time is what makes compounding work in your favour and develop a corpus that can grow multi-fold over a long investment horizon. Starting midlife means you lose out on a lot of time where your money could have been compounding. These money practices help you reach goals while juggling family, mortgages, and other expenses.
Early financial planning is about autonomy, not numbers; many women rely on their partners even to this day, believing that their partner’s income and assets will be enough for them. They ignore factors like divorce, death, or even unexpected illnesses that can change their initial planning entirely.
Contributing early and consistently to retirement accounts and diversifying investments periodically can help build wealth over time. Ideally, 40s should be the age when you fine-tune your finances and streamline them, not start from scratch.
Planning early ensures that you get to retire early and comfortably and do not depend on your spouse or children for financial help in your later life.
The takeaway is simple: waiting for a better salary, environment, or time can stifle the growth that your money can have if you start investing early. The best time to start was yesterday, and the next best is today.
