Early investor beats latecomer by Rs 2 crore despite investing Rs 20 lakh less; here's how

We all have dreams — buying our dream car, planning a grand destination wedding, or funding a child’s higher education. But here’s a reality check: dreams need discipline, and time is your biggest ally in achieving them.

Let’s say you want to get married in 7 years and need to save Rs 20 lakh. You decide to invest in equity mutual funds. While these funds don’t offer guaranteed returns, they’ve historically delivered around 12% annual returns over the long term.

If you start now, you’d need to invest just Rs 15,000 per month to reach that Rs 20 lakh goal in 7 years. That totals Rs 12 lakh.

But if you delay by just 2 years, you’ll need to invest Rs 25,000 per month to reach the same goal in 5 years — and end up investing Rs 15 lakh. The delay will cost you more money and a heavier monthly burden.

Now let’s look at a powerful long-term example that proves early investing doesn’t just ease short-term goals — it transforms long-term wealth too.

Same SIP, different outcomes

CA Nitin Kaushik shares the story of Aman and Rahul to show the magic of early investing.

Aman started a SIP of ₹10,000/month at age 25 and invested for just 10 years, stopping at age 35.

His total investment: ₹12 lakh. After that, he didn’t touch the money — he let it grow.

Rahul began investing the same ₹10,000/month at age 33 and continued till he retired at 60.

His total investment: ₹32.4 lakh — almost three times Aman's.

Assuming a 13% CAGR return from a Nifty 50 Index Fund, here’s what they had by age 60:

> Aman’s corpus = Rs 25.2 crore > Rahul’s corpus = Rs 22.9 crore

Despite investing far less, Aman ended up richer. His money had 35 years to grow — and that made all the difference.

In short, Aman invested Rs 12 lakh by age 35 and stopped. Rahul invested Rs 32.4 lakh from age 33 to 60. Yet, Aman’s corpus grew to Rs 25.2 crore — beating Rahul’s Rs 22.9 crore — simply because he started earlier. Time, not money, was the real wealth creator in the long run.

Why does this happen?

Because compound interest rewards time, not just effort. Aman’s early start allowed his investment to compound over a longer period, even without further contributions. Rahul, despite being consistent, had less time — and that limited his growth.

Key lessons for investors: > Start early, even with as little as ₹2,500/month > Choose low-cost index funds like Nifty 50 > Stay invested — don’t interrupt compounding > Don’t wait for the “right time” — the best time is now

Tax angle: Equity mutual fund gains above ₹1 lakh/year attract 10% LTCG tax. Unlike debt funds, there's no indexation benefit, so tax planning is key.

In investing, you can't buy lost time — not even with triple the money. Start now, and let time work its magic.