By: Arlen Macaspac, RFP ®

 Two best friends Marvin and Ryan, were on a race to accumulate as much money as they can with a goal of using them after 10 years, here is the result of their investment choices.

 Marvin, moderate investor will start saving 10,000 per month for 10 years and thought of placing them in a Managed Fund (Bond & Equities) with a projected average return of 8% per annum.

 Ryan, a reluctant investor tends to watch the situation for the first 5years, so he decided to postpone saving. On the 6^th year, he starts investing 20,000 per month up to the 10^th year and also decided to place them in a Managed Fund with a projected return of 8% per annum.

Who gets higher return after 10 years?

 Marvin with just a regular saving of 10,000 per month for 120 months made an accumulation of Ph 1,829,260.00 which he can withdraw at age 50. He gets more after 10 years.

 Ryan who started investing after 5 years or 60 months but placed 20,000 monthly which is higher than the regular savings of Marvin, made only a total of Ph 1,469,537.00 at age 40. He made a similar investment capital of 120,000 pesos.

 But who gets more money at age 55?

 At age 50, assuming Marvin stopped investing 10,000 monthly but allowed his money to accumulate up to age 55, but this time he placed them in a more secured investment facility thru government securities at an assumed rate of 6 % per year, his money will reach up to 2,448,230 pesos.

 At age 40, Ryan decided not to withdraw his money also and placed them also in long term bonds at 6% per annum; his money will be realized at 3,521,830 pesos.

 Hence, Ryan being younger and who invested at earlier age has more money to spend at age 55.

 This tells us that “time” plays a vital component in the accumulation of fund. Many of us tend to procrastinate just how Ryan has chosen to do. Time is significant in investing as it maximizes the return of your money.

Apparently, time is more valuable than money. The way we spent our time in investing may be similar to the way we use it on other things that matters to us. While we have a lot of opportunities to create money, we must always realize that the time spent a minute ago is gone and will never come back. When we embrace our time as an important and limited item for wise consumption, and all our actions as investment, it will indisputably change the way we make and value our choices.

 While time should be invested wisely to attain a balance and fruitful results in our lives, same goes on our financial planning where great profits always go along with the proper use of time.

 For comments, suggestions and inquiries please email info@grand-holdings.com

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