Investing early on is a forward-thinking way to potentially grow your money and meet your financial goals. Consider these ways your money can work for you:


1. Keeping ahead of inflation

A key reason to invest is to try and keep your nest egg growth faster than the rate of inflation. Based on the Consumer Price Index (CPI), inflation rates reflect the rising costs of basic needs, such as food and clothing. Consider this: $20 in 1980 had the same buying power as $63.72 in 2018. If you invest, you have the potential to grow your savings at a similar or higher rate – making it easier for you to afford your expenses when you retire.

2. Compound growth

When you reinvest your returns back into your account, you can potentially enjoy compound growth. With compound growth, you earn returns on both your invested principal and on the earlier returns you reinvested. For example, imagine you’ve invested $1,000 for a year at a 5% rate. You would make $50 in that first year. But in the second year, you’d multiply $1,050 by 1.05 to get the new total, $1,102.50. Over time, compound growth can dramatically increase the value of your investments. Therefore, to get the greatest potential benefit, you should invest as early as possible.

Getting started with investing is easy. If you learn about the basic types of investments and find the right advisor, you can begin making more informed financial choices for the future.

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