February, 2021

Rags to Riches!! How often have you heard a story like this? You know, people that arrived in Canada, the land of
opportunity, with only 2 dollars in their pocket. Now, because of their generosity, they have wings of hospitals or
performing arts centers named after them. These people came to our country to find a better life for themselves and
their families. It is not that they were lucky. It was that they were motivated. They took advantage of what they saw
as opportunities in the economy that were not being satisfied. They were willing to work hard, make difficult choices
and take the chances necessary to reach their objectives. There were times, no doubt, that failure seemed imminent,
but they made adjustments and pressed on. Opportunity is available to us all…really it is! We don’t all have to start
companies or take risks. For some, the opportunity is to be a good employee in our chosen career. But we all can
make a difference in our lives and the lives of our families.

There are principles that guide us and govern our daily activities. Let’s consider a principle we learn from Moses. In
Psalm 90, Moses requests, “Teach us to number our days, so we can have a wise heart.” The principle is this: we have
been given a number of days. We know our beginning day but we do not know our ending day. Between these two
days, we have TIME! Time to love, time to help, time to work, time to serve, time to make a difference. The wise
heart comes when we realize our given amount of time and then set priorities that make a difference in our lives, our
families and the world around us. The sooner we gain this perspective, the more time we will have to effectively
impact our world. In a way, it becomes our own rags to riches story!

This principle is true in all parts of life. Take your savings for instance. A wise heart understands that what you do with
your resources is important. Spending all your earnings each year on your current lifestyle desires, while not planning
for your retirement needs, may be fun now but not so much later. It is a wise heart who realizes that a few sacrifices
now can be beneficial later in life.

The factors that make your investments grow are your contributions to the plan, the rate of return on investment and
the TIME you have to reach the finish line. Regular contributions and consistent rates of return are good. However,
the factor that makes the most difference to reaching your objectives is TIME. Understanding the effect of time on
your financial plans is imperative. You may have heard the saying, “The best time to plant a tree is 20 years ago…the
second best time is now!” Obviously, we cannot change the past, yet we can learn from it. We can, however, make a
difference for the future. To get time working for you, it is best to just get started.

Here is a demonstration of the effect of time on our financial planning. Let’s say you want to retire at age 65. In all
these examples we will use 5% annual compound rate of return. When you start investing you contribute $250.00 per
month to your RRSP.

● If you start at age 50, after 15 years, the funds you invested from your pocket total $45,000.00 and the value
of your plan at age 65 is $66,900.00.
● If you start at age 40, after 25 years, the funds you invested total $75,000.00 and the value of your plan at age
65 is $148,900.00.
● If you start at age 30, after 35 years, the funds you invested total $105,000.00 and the value of your plan at
age 65 is $285,000.00.
● Yet if you started at age 20, after 45 years, the funds you invested total $135,000.00 and the value of your plan
is $507,000.00. For a plan to produce this same amount in 15 years, (the first scenario), you would need to
make monthly contributions of $1,900.00!!

Do you see how having a wise heart about time can affect our financial plan? Your TIME is your most important asset.
How can you best use the time you have?