Investasi
29 Jun 2024

The Reasons Why Investing Early Is Better

Key Points

  • Investing from a young age means you have more time to grow your assets, benefit from compound interest, and the opportunity to build good financial habits.
  • Starting investments early gives greater control over financial future and allows for effective portfolio diversification.
  • With the digibank by DBS app, access various insights and recommendations from DBS experts, curated investment products to support your early investments.

 

Ready to start your investment journey with more confidence?

 

 

Reasons why investing at a young age is recommended

 

  1. More Time, More Opportunities to Profit

Starting an investment at a young age gives you the advantage of more time to grow your assets. This time allows you a greater chance to enjoy the benefits of market fluctuations and overcome any losses that may occur. In addition, you can learn from early investment mistakes and improve your investment strategy over time.

  1. Compound Interest

Compound interest is a concept where the profit generated from investing in one product, such as a time deposit, is reinvested to generate additional profit. This means your initial investment will grow exponentially over time. The longer the investment period, the greater the benefit of compound interest. Starting investing at a young age allows you to experience the full benefits of compound interest, resulting in more significant asset accumulation in the future.

  1. Navigating the Future

Starting to invest from a young age gives you more control over your financial future. The right investments can help you achieve various financial goals, such as buying a house, paying for your children's education, or preparing for a comfortable retirement. Having strong investments gives you a sense of financial security and stability, allowing you to better cope with unexpected situations.

  1. High Risk Tolerance

Young investors generally have a higher risk tolerance compared to those who started investing at a more mature age. You have more time to recover from losses that may occur due to risky investments. Higher risk tolerance allows you to choose assets that are more aggressive and have the potential to provide greater returns, even though they come with a higher level of risk.

  1. Invest More, Grow More

Starting your investments early gives you the opportunity to invest more funds over time. Even a small amount invested regularly can grow into a significant amount in the long run. Consistency and discipline in investing is the key to achieving optimal asset growth according to your financial targets.

  1. Good Financial Habits

Starting investments, such as time deposit investments, at a young age also helps you form good financial habits. Managing your finances wisely, saving regularly, and investing are habits that will provide great benefits in the future. These habits will help you to be more disciplined in terms of managing your finances and making wiser decisions in various aspects of your financial life.

  1. Tax Benefits

Some types of investments offer tax benefits that young investors can take advantage of. For example, investments in pension funds or education funds usually offer significant tax incentives. Taking advantage of these tax benefits early on can help accumulate assets more efficiently.

  1. Portfolio Diversification

Starting investing young allows you the opportunity to build a well-diversified portfolio. Diversification helps reduce risk by spreading your investments across different types of assets, such as buying deposit investment products with bonds or mutual funds. This provides protection of your purchasing power against drastic market fluctuations and ensures more stable and consistent asset growth.

  1. Provides Passive Income

Everyone desires additional income. Starting investing early allows you to earn more than just extra income, passive income. The assets you own work for you through investments and grow even bigger. It gives you income even "without doing any work" except analyzing investment performance and implementing investment strategies. You get passive income in the form of returns or dividends that can be used for daily living expenses or reinvested.

  1. Realizing Financial Freedom

Investment is one of the smartest steps to realize the financial freedom that many people dream of. Who would have thought that investing in a small amount of time deposit but doing it consistently in the long run would lead you to a stable financial condition. You have enough reserve funds to fulfill your daily needs in the future, even without working. Therefore, choose an investment instrument that suits your risk profile that allows you to get a return according to the target time of financial freedom you want.

 

Tips for Investing Since Early Age

  1. Keep Learning and Adapting

The investment world is always changing. Don't be afraid to try new strategies and learn from your mistakes.

  1. Portfolio Diversification

Don't put all your eggs in one basket. Invest in different assets to reduce risk.

  1. Utilize Technology

Use investment apps that provide market analysis and product recommendations, such as digibank by DBS App, to maximize your returns.

 

By investing in digibank by DBS App, you can also access economic insights and views from DBS Experts to make better investment decisions.

There are more than 120+ investment products such as Bonds, Mutual Funds, including Deposit Investments in Rupiah or Forex, which can be customized according to your needs.

If you need more in-depth guidance, you can chat about your investment plan with a digibank Advisor!

So, what are you waiting for? Start your investment journey now with digibank by DBS App and achieve a more stable financial future. Check out the full information here and make your financial dreams come true!