Power of Compound Interest

Let's look at the difference in how much you would have if you started today, compared with how much you would have if you start in 3 years' time? Assumptions: Invest RM1,000 initially then RM100 per month at the end of each month. Return 8%p.a. compounded monthly. No allowance for inflation. If you start investing now, then 10 years from now you would have RM20,171. If you started in 3 years time you would have just RM12,808. But the compound interest is the really amazing thing. This is shown in yellow on the chart. If you start now then in 10 years you will have earned RM7,131 compound interest, but if you wait just 3 years to start investing you will have earned RM3,408 - less than half as much! And the longer you are investing for, the greater the difference in compound interest. Over 30 years, starting in 3 years means you miss out on more than RM30,000 of compound interest!