Question:
Which of the following factors has the biggest long-term impact on how much money you’ll have in retirement?
A) How much you save
B) When you start investing
C) Picking the “right” stocks
D) Avoiding taxes altogether
Answer:
B) When you start investing
Here’s why:
When you start investing is the best answer — even over saving more or avoiding taxes:
A. How much you save
Yes, saving more helps. But starting earlier, even with smaller amounts, has a greater compounding effect over time. For example, $100/month invested at 25 can outgrow $300/month invested starting at 40. Time is the multiplier.
B. When you start investing
This is the winner because compound growth is exponential. The earlier your money starts working, the longer your money is invested, and the more time it has to grow—and growth on top of growth is what builds real wealth. Time in the market matters more than timing the market.
C. Picking the “right” stocks
Trying to pick winners sounds appealing, but even most professionals don’t beat the market consistently. A solid, diversified strategy over time usually performs better than chasing performance.
D. Avoiding taxes altogether
There are ways to reduce or eliminate taxes on some investments—like municipal bonds, Roth accounts, or certain life insurance strategies. But tax benefits alone won’t beat the impact of time and consistent investing. Ideally, smart tax planning supports your strategy—it doesn’t replace it.
