When
should I start investing? Investing early in your career
is one of the best ways to build your retirement fund. Consider
Mary who contributes $5000 per year to her RRSP
for the first 7 years of her career from age 25 to age 32.
She makes no more contributions and retires at age 65. Her
initial investment of $35,000 grows at 10% per year
to a value of $1,333,063.
Her
best friend Jane contributes nothing to her RRSP until
she reaches age 32. She then contributes $5000 in each
of the next 34 years until she retires at age 65. Jane's RRSP,
also earning 10% per year, grows to $1,350,122 or about
8 times more than her total investment of $170,000.
That
compares to Mary's RRSP which has grown to $1,333,063
or about 38 times more than her original investment of $35,000.
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