The Surprising Cost of a Single Year's Delay

Deciding to "start next year" may seem like only a one-year delay, but in the world of compounding, it creates a gap you might not expect. Contributing 30,000 yen per month at 5% annual return for 30 years produces approximately 2,497 man-yen, but starting one year later (29 years) yields about 2,340 man-yen. The difference is roughly 157 man-yen - a single year of procrastination costs more than four years' worth of 30,000-yen monthly contributions.

For historical comparisons, books on investment timing and opportunity cost compare lump-sum and regular investing using past market data.

This gap widens with longer time horizons and higher returns. At 7% annual return, the difference between 30 and 29 years grows to roughly 250 man-yen. There is a saying in investing: "The best time to invest was yesterday; the second best is today." The numbers back it up.

The Decisive Gap After 5 or 10 Years of Delay

At 30,000 yen per month and 5% annual return, here is how the final balance changes with the start date: 30 years yields approximately 2,497 man-yen, 25 years (5-year delay) about 1,787 man-yen, and 20 years (10-year delay) about 1,233 man-yen. A 10-year delay cuts the final balance by more than half.

To reach the same 2,497 man-yen target after a 10-year delay, you would need to increase your monthly contribution to roughly 61,000 yen - more than double what the early starter contributes. Whether time works for you or against you completely changes the effort required.

You Do Not Need to Wait for the Perfect Moment

The desire to "wait for a crash" or "study more first" is understandable, but accurately timing the market is difficult even for professionals. Historical data shows that dollar-cost averaging - steadily investing a fixed amount each month - has delivered results equal to or better than attempts to time the market.

You do not need perfect preparation to start investing. Begin with a small amount and increase it as you learn. Try our simulator to see for yourself how the start date affects your final balance. Once you see the numbers, you will want to start today.

getting-started guides for new investors walk you through the steps from opening an account to making your first purchase.