"By investing $100 every month from the ages of 25 to 65 into the likes of a Roth individual retirement account (IRA), Gen Z could retire as millionaires. "With a 12% annual average rate of return-the markets can do that for you-you'd have a million dollars," she explains. Depositing a monthly investment of $100 into an account with a 12% yield would net someone approximately $1,188,342 in 40 years' time."
""You start right now in making your money grow and you'll have more money than you ever dreamt possible," she told Moneywise while adding that delaying your investment journey by a mere 10 years could "cost you $700,000." Unlike Gen X and baby boomers, time is on your side. Investing in your future self can be a hard notion to grasp when you're in your early twenties and simply enjoying life."
"Investing in your future self can be a hard notion to grasp when you're in your early twenties and simply enjoying life. "You want to play and have fun, that's on you later on in life when you can't pay your bills," Orman told Moneywise. "Their priority is their youth, their priority is time," she said. "If there's anything the younger generation needs to understand, it's that the key ingredient to any financial freedom recipe is compounding.""
Starting early and saving consistently gives younger workers a major advantage because compound growth amplifies returns over decades. Investing just $100 per month from age 25 to 65 into a retirement vehicle such as a Roth IRA, assuming an average 12% annual return, can produce roughly $1,188,342 by retirement. Delaying the start of investing dramatically reduces lifetime savings; a ten-year delay can cost hundreds of thousands of dollars, and starting at 30 instead of 25 can lower the accumulated amount to about $649,626 by age 65.
Read at Fortune
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