It is never too late to start investing

“I wish I had started when I was younger”…

You might have felt that way
after seeing the simulations
I have shared previously,
such as “What if you invested 5 million yen at age 20 with a 5% annual return” or the “power of compound interest.”

Certainly,
the earlier you start investing, the more advantageous it is.

However, today,
I would like to face this theme head-on,
and together,
while looking at concrete numbers,
examine whether “it is too late to start now.”

“Starting earlier is more advantageous” is a fact. However, that does not mean “starting late is meaningless.”

First,
this is a point I do not want you to misunderstand.

As I explained in “What does it mean to make time your ally?“,
the longer you invest,
the greater the effect of compound interest becomes,
so it is indeed a fact
that “the earlier you start, the more advantageous it is.”

But this is
not equivalent to saying
“it is already meaningless for those who did not start early.”

It is just that “the earlier, the more advantageous,”
but “even if you start late, it is still sufficiently meaningful.”

These two things
are completely different stories.

Let’s actually run a simulation.

Let’s check with a concrete example.

Assume you can invest 30,000 yen every month
at a 5% annual return.
(This is a calculation based on a fixed rate of return.)

Starting at age 45
・Investment period until age 65: 20 years
・Estimated asset value at age 65: approx. 12.32 million yen

Starting at age 50
・Investment period until age 65: 15 years
・Estimated asset value at age 65: approx. 8.02 million yen

Starting at age 60
・Investment period until age 65: 5 years (10 years if invested until age 70)
・Estimated asset value at age 65: approx. 4.66 million yen over 10 years until age 70

Comparing starting at age 45
with starting at age 50,
the difference at age 65
is as much as approximately 4.3 million yen.

The impact of “being 5 years late”
is by no means small.

But,
what I want you to focus on here is

that even if you start at age 50,
you can accumulate about 8.02 million yen in the 15 years until age 65,

and even if you start at age 60,
you can accumulate about 4.66 million yen in the 10 years until age 70,

a fact that these are amounts that cannot be ignored.

It is natural to have regrets like “I wish I had started sooner,” but
that does not lead to the conclusion that “there is no point in starting now.”

That conclusion does not follow at all.

The “earliest time to start” is always “today.”

As I mentioned in “For those who cannot start for fear of failure“, this way of thinking becomes even more important now that you are older.

For a 45-year-old, the earliest time to start investing is “today.”

• For a 50-year-old, the earliest time to start investing is “today.”

• For a 60-year-old, the earliest time to start investing is “today.”

Even if you look back at the past and think, “If only I had started sooner,” you cannot go back in time.
However,

if you look at it from the perspective of “the future,” today is always the earliest starting point in the rest of your life
.

As the simulation above shows, whether or not you start from that earliest starting point will significantly change your future asset amount.

There are also strengths that come with age.

Starting late actually has different strengths than starting when you are young.

Income is often more stable than when you were young.

As I mentioned in “The meaning of investing by age group“,

as you get older, it is not uncommon for your income to stabilize and the amount you can invest to be larger than when you were young.

Even if the investment period is short, you can compensate to some extent by increasing your monthly investment amount.

You often have a deeper understanding of yourself.

As I mentioned in “Changing your mindset from a savings-oriented to an investment-oriented one“,

the more life experience you have, the more accurately you can usually grasp how much risk you can accept and what kind of personality you have when dealing with money.

This is a strength that is hard to have when you are young.

It is often clearer “what the money is for.”

As mentioned in “Why use NISA? The purpose is what matters“,
as you get older,

you can visualize your retirement life and when you will use your money
more concretely.

Having a clear purpose
is a great help
in deciding on a reasonable investment amount.

A realistic strategy for “starting late”

If you are starting at a relatively late stage,
such as in your 60s,
you do not need to take
the exact same strategy as someone starting in their 20s.

“NISA and stock exit strategies” or “
Understanding the relationship between risk and return simply“, it is important to adjust the concepts mentioned in
to fit your situation.

• Since the time until you use the money is short, do not focus only on assets with large price fluctuations, and be conscious of the balance with stable assets.

• Instead of lump-sum investing, use installment investing to diversify your purchase timing.

• Rather than “increasing it significantly,” have a realistic goal of “creating another source of income to supplement your pension.”

Just because you started late,
you do not need to take
the same risks as the younger generation.

It is important to choose a reasonable strategy
that fits your own situation.

Summary

• While it is advantageous to start investing early, that does not mean “starting late is meaningless.”

• Calculations show that even if you start at age 50, you can accumulate approximately 8.02 million yen over 15 years, and even if you start at age 60, you can accumulate approximately 4.66 million yen over 10 years, which is by no means a small amount of assets.

• The “earliest time to start” is always “today,” regardless of your age.

• Precisely because you are older, you have strengths such as stable income, self-understanding, and clarity of purpose.

• When starting late, it is important to choose a reasonable strategy that differs from that of the younger generation.

The feeling that “it is too late”
is, in many cases, just the result of comparing the past with the present.

What is important is
how you use the time ahead.

No matter your age,
starting today
has sufficient value.

This article is written as part of a learning series for NISA and investment beginners. Please feel free to check out other articles as well. The calculations in this article are estimates based on the assumption of a 5% annual return and do not guarantee future returns.