Your surefire financial investment plan can start with Larry Ferstenou's book You CAN Retire Young. The rewards are great. Mr. Ferstenou has based the following article on Chapter 5 of his book. A financial investment plan is essential if you wish to retire young.
A Surefire Way to Accumulate a Lot of Money
By Larry Ferstenou
Based on You CAN Retire Young
Most people would like to have more money than they have; and they can. The answer to accumulating a lot of money, even though you may not earn a lot, is to start investing while you are young. Here’s an example.
Assume we have two 22-year olds just getting started in careers they absolutely love and believe they will continue pursuing until they retire at age 67. Individual A immediately starts a tax deductible, tax deferred IRA and invests $2,000 per year for ten consecutive years ($20,000 total). Not another dollar is added to the account thereafter, but that initial $20,000 is left to ride at a 10 percent average annual return (a realistic return based on stock market performance over the past 77 years) until retirement at 67.
Individual B procrastinates and doesn’t start investing in an IRA until age 32, but then puts away $2,000 every year for the next 35 consecutive years ($70,000 total) at the same 10 percent average annual return. Who will have the most money when they retire at age 67? Would you believe Individual A, and it isn’t even close?
Individual B invests over three times as much money into retirement, but by starting ten years later, still falls $355,000 short in the retirement fund. Who among us couldn’t use an extra $355,000 at retirement?
It cannot be any clearer. While it is never too late to start investing, a more financially-secure retirement can be achieved by starting as early as possible. To have choices later in life that may not otherwise be possible (like being able to choose whether to continue working or retire to do whatever you want), start investing early, invest as much as you can, and invest wisely.
Larry Ferstenou retired over ten years ago at age 42 and is the author of You CAN Retire Young: How to Retire in Your 40s or 50s Without Being Rich (American Book Business Press, 2002). More information can be found at www.youcanretireyoung.com. Copyright © Larry A. Ferstenou, 2002–2003
Articles by Larry Ferstenou
Based on His Book
More Articles by Larry Ferstenou