While inflation is widely recognised as a silent killer of wealth, there is another equally dangerous but lesser-known monster — the cost of delay. Unlike inflation, which gradually erodes your purchasing power, the cost of delay affects your ability to build wealth altogether. This concept is especially crucial when it comes to SIP (Systematic Investment Plan) investing.
Let us take the story of 2 friends, Ram and Shyam, to understand how timing plays a crucial role in wealth creation. Both had the same opportunity and income, but their approach towards investing was very different.
Ram chose to invest early in his life, beginning at 25. Over a span of 25 years, he invested a total of ₹30 lakhs through his monthly SIP. Thanks to the power of compounding, his investment grew to an impressive ₹1.90 crore by the time he turned 50. Calculations are done using a SIP calculator.
Shyam, on the other hand, decided to delay his SIP by ten years. He spent his weekends dining out and enjoying life, postponing his investments until he turned 35. Despite investing the same monthly amount as Ram, his wealth grew to only ₹50.46 lakhs, a significant difference.
Read More: SIP Calculator: Start with ₹17,000 a Month for 25 Years—See How It Can Grow.
The 10-year delay reduced Shyam’s final corpus by over ₹1.3 crore when compared to Ram. This is the true cost of delay, a fortune lost not by poor investments, but simply by postponing the decision to start.
Now, let us assume Shyam realises his mistake at 35 and decides to catch up. To build the same corpus as Ram by the age of 50, he will need to make much higher monthly contributions.
As the numbers show, Shyam now has to invest more than double each month and contribute over ₹38 lakhs more in total, just to match Ram’s final corpus.
The comparison between Ram and Shyam highlights a key takeaway in the world of investing: time is more powerful than money. The earlier you begin, the greater your chances of achieving long-term financial success, all without needing to stretch your budget. The cost of delay is real, and it can be massive. The best time to start was yesterday. The next best time is now, but remember, this is just information, not advice.
Disclaimer: This blog has been written exclusively for educational purposes. The securities mentioned are only examples and not recommendations. This does not constitute a personal recommendation/investment advice. It does not aim to influence any individual or entity to make investment decisions. Recipients should conduct their own research and assessments to form an independent opinion about investment decisions.
Investments in the securities market are subject to market risks. Read all the related documents carefully before investing.
Published on: May 23, 2025, 2:07 PM IST
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