More For Your Money - University of Illinois Extension
http://MoreForYourMoney.extension.uiuc.edu
The Impact of Time on Money
For long-term goals, the compounding of money can make a big difference. The more years you have to reach a financial goal, the more you can plan for your money to compound.
The chart below shows a 22-year old who saves $2000 each year for nine years. This person will have more money at age 65 than another person who starts saving $2000 per year at age 32 and saves for 35 years! The sooner you start, the more time you have for interest to accumulate.
| Age | Contributions Made Early | Contributions Made Later |
|---|---|---|
| 22-30 (9 years) | $2,000 annually | $0 |
| 31-65 (35 years) | $0 | $2,000 anually |
| Total Saved | $18,000 | $70,000 |
| Amount Available at 65 | $579,471* | $470,249* |
| *Assumes money earns 9% return | ||