The Cost of Waiting to Invest
Compound interest is the most expensive thing to delay. Enter your numbers and see exactly how much waiting costs.
Data as of April 2026 · IRS contribution limits per IRS Notice 2025-67
Waiting 5 years costs you $0
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$0
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$0
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$500/Month: Starting Age vs. Final Balance
Contributing $500/month at 7% annual return until age 65, by starting age. The earlier you start, the more compound interest does the heavy lifting.
| Start Age | Years | Total Contributed | Final Balance | Earnings |
|---|---|---|---|---|
| 25 | 40 | $240,000 | $1,312,407 | $1,072,407 |
| 30 | 35 | $210,000 | $900,527 | $690,527 |
| 35 | 30 | $180,000 | $609,985 | $429,985 |
| 40 | 25 | $150,000 | $405,036 | $255,036 |
| 45 | 20 | $120,000 | $260,463 | $140,463 |
| 50 | 15 | $90,000 | $158,481 | $68,481 |
A 25-year-old contributes 60% more than a 40-year-old ($240K vs $150K) but ends with 3.2× the final balance. That spread is pure compound interest doing what it does best: working on the earliest dollars longest.
Assumptions & Sources
Default 7% annual return approximates the historical S&P 500 real return (after inflation) over the last century. The nominal return averages closer to 10%, but inflation eats roughly 3% per year — 7% is what your money actually buys you in future dollars. Underlying S&P 500 price data: FRED series SP500.
- Contributions made monthly, compounded monthly at the rate you enter.
- No taxes or fees applied. A 1% expense ratio cuts long-term returns by roughly 18% over 30 years (at 7% gross, the same $500/month grows to $609,985 vs. $502,258 net of fee) — use a low-cost index fund.
- No catch-up contributions modeled. 50-and-over investors can contribute an extra $1,100/year to an IRA in 2026 (IRS Notice 2025-67).
- 2026 IRA contribution limit: $7,500/year (or $625/month). 401(k) elective deferral limit: $24,500/year. Source: IRS Notice 2025-67.
- Past performance doesn't predict future returns. Historical averages smooth out crashes — your real path will be lumpy.
Sources
- IRS Notice 2025-67 — 2026 retirement contribution limits
- Federal Reserve Economic Data — S&P 500 historical price series (FRED)
- SEC Investor.gov — Compound interest mechanics and investor education
- Compound interest formula: future value of an annuity, monthly compounding (standard finance math)
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Rates, limits, and default assumptions as of July 2026. Report an issue.