This is the most common investor regret — and it's easy to avoid


The sooner you start investing, the easier it is to grow wealth for the future. Which is why the most common regret among investors is that they didn't start sooner, according to a new poll from MagnifyMoney.

Procrastination regrets affected 3 in 4 investors, according to Brianna Shoaf, a consumer research specialist at MagnifyMoney. Nearly one-third (31%) said they wished they had started saving for retirement sooner, while 24% lamented not investing in stocks sooner. Even 69% of Gen Zers, which the survey defined as those between the ages of 18 and 22, had regrets about not investing earlier, despite being about 45 years away from retirement.

And the advice those investors would offer younger Americans? More than half (54%) say younger people should begin investing as soon as possible, and 16% recommended that they prioritize retirement savings.

An early start harnesses the power of compound interest

Time is a powerful asset for investors, thanks to compound interest. Compounding helps your money to grow at a faster rate because you earn interest on your savings as well as interest on the interest you've earned.

The sooner you start investing, the more time your money has to grow, and the less you need to contribute from each paycheck to meet your retirement goals.

"Millionaires are made in their 20s and 30s, not their 50s and 60s," Fred Creutzer, president of Creutzer Financial Services told Grow last year. "If you wait until you're 50, you're never going to catch someone who started at a young age. When it comes to investing, the early bird always gets the worm."

For example, say you're 31 years old and earn $50,000 each year. You need to set aside 15% of your salary, or $643 each month, if you want to retire by 67. However, if you start saving at 29, you'll be able to set aside about $61 less each month, or you can save the same amount and consider retiring closer to 66.

Even if you're at a stage of your life where you're not earning a lot of money and retirement feels distant, it's still wise to get started investing for those long-term goals, says Joshua Brown, CEO of investment advisory firm Ritholtz Wealth Management.

"An average investor with a longer time horizon is going to have better results that an amazing investor with a shorter time horizon," he says.

Experts recommend aiming to put aside 15% of your pay for retirement, but even setting up your 401(k) with an initial 3% contribution can help you make meaningful strides toward that goal — especially if your company offers an employer match, money it contributes on your behalf. Last year, the average match was 4.7%, according to Fidelity.

Setting up automatic increases makes it easy to boost your contribution over time.

You can work your way up to bigger contributions over time, but the most important thing you can do is get started, says certified financial planner Carolyn McClanahan, director of financial planning for Life Planning Partners in Jacksonville, Florida.

"Start with a little bit," she says. "Just start with something, anything so that you can experience what it's like to save money."

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