# Start Now, Not Later

November 12, 2021 | Jim Seyers

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Throughout life there seems to be a never ending to do list where some things just never get checked off. There is either not enough time in the day, you aren’t sure how to get it done, or maybe it’s just not that simple.

This summer, I set out to complete something that has been on my to-do list for many years. That task was to build a wood shed at my cottage. For years, I stored the fire wood stacked up beside the garage which was exposed to all types of weather including sun, rain, and lots of snow. Overtime, some wood became dozy and no longer burned well. In addition to the wood deteriorating, I also was unsure of exactly how much I had and how long it was going to last.

I built my shed with a few things in mind. I made sure the dimensions could store exactly four bush cords, which allows me to gauge if I have enough to last us through the winter and when and how much I should order to replenish my supply. The shed also has a sloped tin roof to keep the wood dry and out of the elements. Although it was a lot of work, now that the shed has come to fruition, I wonder to myself… Why did I not build the wood shed sooner?

Finances can also be one of those things that people put off until they are forced to confront it. I am here to tell you that the sooner you take care of your finances, the sooner you will start to reap the benefits of compounding.

The following example demonstrates the importance of starting now and not waiting until later:

Scenario One: If you began contributing \$2,000 per year into a TFSA at age 20 and stopped contributing at age 30, the total contributions would amount to \$20,000. Assuming you receive a rate of return of 7%, the total value of your TFSA at age 65 would be about \$295,015.

Scenario Two: If you began contributing \$2,000 per year at age 30 until age 65, your total contributions would amount to \$70,000. Assuming you receive a rate of return of 7%, your total TFSA value would be about \$276,473 at age 65.

Even though in Scenario One you contributed \$50,000 less than in Scenario Two, you would retire with about \$18,500 more because you simply began contributing earlier. Your savings compounded for an additional 10 years with a rate of return of 7%.

The earlier you start investing and the more you keep saving, the greater your net worth will be in the future. If you invest in great quality companies that pay a growing dividend, you will also benefit from a growing income that could one day replace your current income in retirement. The best time to start investing is when you are young but the next best time to start is today. Even if you are 40, 50, or 60 years young, it is never too late to start especially since we are all living longer.

If I had built my wood shed sooner, I would have benefited from it for a lot longer. The fire wood I purchased would have gone farther and I could have saved some money in the long run. As the old saying goes, "It is better late than never!" What really matters was I built the wood shed and I can still benefit from it for years to come.

"How will you replace your current income in retirement?" - Jim Seyers