Investing from age 35 could halve retirement savings compared to age 25
UKPulse Money Desk
Starting to invest at 35 instead of 25 may significantly reduce a retirement nest egg due to less time for contributions and compound growth.
- Starting investment at age 35 rather than 25 can more than halve a nest egg.
- Reduced contributions contribute to a smaller nest egg.
- Less time for money to compound also reduces the final amount.
New analysis suggests that individuals who begin investing at age 35 could see their retirement savings more than halved compared to those who start at 25. This potential reduction is attributed to two main factors.
Firstly, delaying investment by a decade means a shorter period for contributions to be made. Secondly, and significantly, the money has less time to benefit from compound growth, which is a key driver of long-term investment returns.
What this means for you: Starting to invest earlier could lead to a substantially larger retirement fund.