The Decade That Costs You Half Your Wealth
Starting at 25 vs. 35: a 10-year head start doubles the outcome
An investor saving $500/month at 8% annual return from age 25 accumulates approximately $1.75M by age 65. Starting at 35 with the same contribution yields approximately $850K — despite contributing only 37% fewer total dollars. The 10-year head start roughly doubles the outcome.
What history says
Editorial commentary written by ALAN analysts. Figures cited below are analyst-authored context — they are not derived from the chart above and may reflect different windows or sources.
At 8% annual return, ~65% of the terminal value is created in the final 10 years. Starting 10 years earlier gives you an extra period of maximum compounding power.
To match the 25-year-old's outcome by starting at 35, the monthly contribution would need to increase from $500 to approximately $1,100. Time is cheaper than money.
A 25-year-old who sees this chart and starts investing $500/month will accumulate more wealth than most people who earn twice as much but start later.
Automate contributions early at whatever size is sustainable — this entry's own math shows time compounds harder than money, so a modest amount started today beats a larger one begun after the 'right moment' finally arrives.