Start late, pay more: What happens when you delay your investments by 5 years?
Starting your SIP five years late could cost you double the investment and crores in lost returns. This story of Priya and Rahul shows how timing—not just amount—defines long-term wealth. Understand the true cost of delay and why compounding rewards early starters the most.
- Jun 20, 2025,
- Updated Jun 20, 2025 1:36 PM IST
Delaying the initiation of investment plans can have substantial repercussions on the potential corpus accumulated by the time of retirement. Time is one of the most powerful tools in wealth creation—but it’s also the easiest to ignore. A striking example shared by CA Rohit Gyanchandani reveals how even a small delay in starting your investment journey can drastically alter your financial future.
Let’s meet Priya and Rahul, both 25 years old, with a shared dream: building a corpus of ₹1 crore. But while Priya acts on it immediately, Rahul decides to wait five years, thinking he’ll start investing when he earns more.
Priya, taking the disciplined route, starts a Systematic Investment Plan (SIP) at the age of 25. She invests Rs 5,322 per month in a fund that delivers an annual return of 12%. Over the next 25 years, this regular contribution helps her build a Rs 1 crore corpus. In total, she puts in Rs 15.96 lakh from her own pocket—the rest is pure compounding.
Rahul, however, postpones his start. By the time he’s 30, he still wants to reach the ₹1 crore goal by age 50, which now gives him only 20 years. To achieve the same target, he needs to invest ₹10,108 every month—almost double Priya’s amount. His total contribution over 20 years ends up being ₹24.25 lakh.
That five-year delay cost Rahul over ₹8 lakh in additional principal alone. While he still benefits from compounding, the shorter runway gives it less time to work its magic. The real difference? Lost compounding potential. Those early years, even with smaller investments, do the heavy lifting over time.
Here’s a comparison table of their investment patterns:
Investor Start Age Investment Duration (Years) Monthly SIP (₹) Total Invested (₹ Lakhs) Final Corpus (₹ Lakhs) Priya 25 25 5,322 15.96 100 Rahul 30 20 10,108 24.25 100
The comparison highlights a crucial truth: waiting to invest is more expensive than it seems.
Retirement planning is more about timing than just fund selection. It involves setting future income goals and taking steady financial steps during your earning years. One crucial, yet often overlooked, aspect is starting early. Even a short delay can significantly shrink your retirement corpus—a concept known as the Cost of Delay.
What is Cost of Delay?
Cost of Delay reflects the wealth lost when you postpone investing. Thanks to compounding, a delayed start doesn’t just reduce investment years—it drastically cuts returns. The sooner you invest, the more your money multiplies.
Compounding rewards early action
Compounding allows your returns to earn more returns. The earlier you start, the more cycles your investment passes through. Waiting even five years could mean doubling your monthly SIP or settling for a smaller corpus at retirement.
Example: Rs 5,000 SIP over different timeframes Assume four people invest Rs 5,000 monthly at 12% annual returns, retiring at 60. The only variable is their starting age:
Investor Start Age End Age Monthly Investment Investment Period Total Invested Corpus at 60 Cost of Delay A 25 60 Rs 5,000 35 years Rs 21 lakh ₹2.96 crore – B 30 60 ₹5,000 30 years ₹18 lakh ₹1.76 crore ₹1.2 crore C 35 60 ₹5,000 25 years ₹15 lakh ₹1.01 crore ₹1.95 crore D 40 60 ₹5,000 20 years ₹12 lakh ₹57.6 lakh ₹2.38 crore
Investor A, who starts at 25, retires with Rs 2.96 crore. Investor B, who delays by 5 years, ends up with Rs 1.76 crore—despite investing just Rs 3 lakh less. The gap widens further for those who start even later.
Each investor contributed Rs 5,000 monthly, but time made all the difference. Early investing doesn’t just build wealth—it multiplies it.
What investors should note
Delaying investments even by a few years can cost you crores. Start investing early, even with small amounts, to leverage compounding and build a larger, more secure retirement corpus. The best time to start was yesterday. The second-best time is today.
Engaging in early investment, even with modest amounts, can leverage the benefits of compounding, offering a path to a larger and more secure retirement corpus. The analysis exemplifies the financial wisdom of beginning investment strategies as early as possible, with the adage “The best time to start was yesterday; the second-best time is today” resonating strongly with this financial reality.
Delaying the initiation of investment plans can have substantial repercussions on the potential corpus accumulated by the time of retirement. Time is one of the most powerful tools in wealth creation—but it’s also the easiest to ignore. A striking example shared by CA Rohit Gyanchandani reveals how even a small delay in starting your investment journey can drastically alter your financial future.
Let’s meet Priya and Rahul, both 25 years old, with a shared dream: building a corpus of ₹1 crore. But while Priya acts on it immediately, Rahul decides to wait five years, thinking he’ll start investing when he earns more.
Priya, taking the disciplined route, starts a Systematic Investment Plan (SIP) at the age of 25. She invests Rs 5,322 per month in a fund that delivers an annual return of 12%. Over the next 25 years, this regular contribution helps her build a Rs 1 crore corpus. In total, she puts in Rs 15.96 lakh from her own pocket—the rest is pure compounding.
Rahul, however, postpones his start. By the time he’s 30, he still wants to reach the ₹1 crore goal by age 50, which now gives him only 20 years. To achieve the same target, he needs to invest ₹10,108 every month—almost double Priya’s amount. His total contribution over 20 years ends up being ₹24.25 lakh.
That five-year delay cost Rahul over ₹8 lakh in additional principal alone. While he still benefits from compounding, the shorter runway gives it less time to work its magic. The real difference? Lost compounding potential. Those early years, even with smaller investments, do the heavy lifting over time.
Here’s a comparison table of their investment patterns:
Investor Start Age Investment Duration (Years) Monthly SIP (₹) Total Invested (₹ Lakhs) Final Corpus (₹ Lakhs) Priya 25 25 5,322 15.96 100 Rahul 30 20 10,108 24.25 100
The comparison highlights a crucial truth: waiting to invest is more expensive than it seems.
Retirement planning is more about timing than just fund selection. It involves setting future income goals and taking steady financial steps during your earning years. One crucial, yet often overlooked, aspect is starting early. Even a short delay can significantly shrink your retirement corpus—a concept known as the Cost of Delay.
What is Cost of Delay?
Cost of Delay reflects the wealth lost when you postpone investing. Thanks to compounding, a delayed start doesn’t just reduce investment years—it drastically cuts returns. The sooner you invest, the more your money multiplies.
Compounding rewards early action
Compounding allows your returns to earn more returns. The earlier you start, the more cycles your investment passes through. Waiting even five years could mean doubling your monthly SIP or settling for a smaller corpus at retirement.
Example: Rs 5,000 SIP over different timeframes Assume four people invest Rs 5,000 monthly at 12% annual returns, retiring at 60. The only variable is their starting age:
Investor Start Age End Age Monthly Investment Investment Period Total Invested Corpus at 60 Cost of Delay A 25 60 Rs 5,000 35 years Rs 21 lakh ₹2.96 crore – B 30 60 ₹5,000 30 years ₹18 lakh ₹1.76 crore ₹1.2 crore C 35 60 ₹5,000 25 years ₹15 lakh ₹1.01 crore ₹1.95 crore D 40 60 ₹5,000 20 years ₹12 lakh ₹57.6 lakh ₹2.38 crore
Investor A, who starts at 25, retires with Rs 2.96 crore. Investor B, who delays by 5 years, ends up with Rs 1.76 crore—despite investing just Rs 3 lakh less. The gap widens further for those who start even later.
Each investor contributed Rs 5,000 monthly, but time made all the difference. Early investing doesn’t just build wealth—it multiplies it.
What investors should note
Delaying investments even by a few years can cost you crores. Start investing early, even with small amounts, to leverage compounding and build a larger, more secure retirement corpus. The best time to start was yesterday. The second-best time is today.
Engaging in early investment, even with modest amounts, can leverage the benefits of compounding, offering a path to a larger and more secure retirement corpus. The analysis exemplifies the financial wisdom of beginning investment strategies as early as possible, with the adage “The best time to start was yesterday; the second-best time is today” resonating strongly with this financial reality.