Don’t Delay, Start Investing Now!
Don’t Delay, Start Investing Now!
  • Reporter Ryu Nu-ri
  • 승인 2019.05.17 11:01
  • 댓글 0
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At the 24-hour library in POSTECH, many students study to prepare for quizzes and exams. Some even stay up all night. But why is everyone studying so hard? Some students may just like studying so much that they spend more than half of their day studying. But in general, I believe that the students are studying in order to gain economic freedom in the future. However, even they study so hard to make money later, they often seem surprisingly indifferent to the management and investing of money.
In a recent class, the professor asked the students what they wanted in the near future. Most of the students said they wanted to be “happy”, and continued to say that they wanted to go home, relax without worrying, and so on. What’s interesting is that no one said they wanted to go to a big company and work their guts out in the future. Nevertheless, the majority of students hope to enter companies that boast murderous labor intensity because they think that happiness can be obtained that way and it will bring a fortune. However, even if they enter large companies like Samsung, their working period is much shorter than people expect. In other words, even if you study hard for more than 16 years and enter a top company, job stability will still not be guaranteed and neither will happy life be after retirement. It seems that the dream of achieving economic freedom and happiness cannot be achieved by simply digging into textbooks. 
Often for those in their 20s, self-improvement is emphasized, and the books they are targeted at come out day by day. But I think the study of investment has equal or higher importance to self-improvement. In the real world, rewards for self-improvement are often more indirect and equivocal. In addition, the criteria for verifying that self-development has been successful are often vague. However, the rewards for investment are clear. A successful investment increases money. So, why am I encouraging students who haven’t even started economic activities to study investments? That’s because of the power compound interest. The longer you invest, the more benefits you get. If you put off your investment until you collect your seed money, the magic of compound interest sleeps for as long as you put off. Let’s say you invest 25,000 KRW a month from the age of 25 and earn 6 percent annual return on investment. It’s just a little pocket money, but if you keep going until you’re 65, you’ll get 50,036,000 KRW. 12,000,000 KRW is the principal of the money invested, and 38,036,000 KRW is the interest. If you delay investing until you’re 35, and want to make the same 50,000,000 KRW by the age of 65, you have to invest 50,000 KRW a month. 18,000,000 KRW is the principal and 32,000,000 won is the interest. Just by delaying for just ten years the amount of investment had to be increased twice for each month. 
The point is that the most important variable in investment is time, not money. Even a small amount of money a month can be used to make a huge amount of money by investing in the power of time. It’s good to think of the 25,000 KRW investment every month as training wheels on the “bicycle of investment.” Just as you learn how to ride a bicycle with training wheels, you learn how to invest in small amounts. Just as by the time you take off the training wheels you can ride your bike more freely, by the time it’s time to invest more, you’ll be more skilled and abler to handle the rise and fall of the market. Just by studying hard, or working hard cannot guarantee you wealth. But, if you practice and learn how to invest from now on, you may be able to achieve your dream of early retirement and live happily and without worrying about money until you die.


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