See how Nick did better than Tom to improve his retirement outcome by starting to contribute earlier.
Tom starts contributing $50 per week when he’s 40, and manages to contribute an extra $109,833 to his super by age 65. Nick on the other hand, starts contributing $50 per week when he’s 25 and manages to save $249,559 to his super by age 65, which is $139,726 more than Tom.
*Assumptions based on a 7% p.a. return compounded weekly.
Even though Tom started making regular contributions at a later stage, he has still managed to improve his retirement outcome by $109,833. It’s important to note though, that Nick was able to save $139,726 more than Tom because he started contributing earlier.
