Are You Ever “Too Old” to Start Investing?

Most of us hope to retire and enjoy our golden years in the future.

To achieve our retirement goal, some of us may have started investing at a young age. Others though, may not be as fortunate and could have started investing only at a later stage in life. Such investors may be worried as they have less time on their side. But, there is no reason to fear.

A successful fund manager, Cheah Cheng Hye did not start his investing career at the youngest of ages either. Yet, that has not stopped him from generating stunning results.

A value investor nurtured

Born in 1954, Cheah took up a simple job of folding newspapers for the Star in Malaysia in 1971. That humble beginning helped him to secure a job as a trainee reporter later on. He had little interest in investing back then, as he had little money to spare.

But, the fire for investing was slowly lit when he moved to the Asian Wall Street Journal.

His reporting scope narrowed to economic and business news and he found himself slowly learning about investing in order to write better. His curiosity led him to study the history of businesses and how it is intertwined with politics and social issues.

That budding interest in investing that Cheah had then developed greatly due to his in-depth research of financial stories and he eventually found himself at the investment bank Morgan Grenfell.

From there, at a ripe young age of 39, he started his own investment firm Value Partners in 1993. The rest, as they say, is history – from April 1993 to December 2014 Value Partners’ flagship investment fund generated a total return of 2570.3%, or an annual return of 16.3%.

For perspective, a return like that comfortably smashes the 8.3% long-term annual total return that the SPDR STI ETF (SGX: ES3) has delivered. The SPDR STI ETF happens to be an exchange-traded fund which closely mimics the fundamentals of Singapore’s market barometer, the Straits Times Index (SGX: ^STI).

Foolish takeaway

Cheah’s story of starting late is not unique. My colleague Ser Jing has also recounted the tale of one Shelby Davis who started investing at the age of 39 (without prior investing experience) in 1947 with US$50,000; Davis went on to accumulate a princely sum of US$900 million by the time of his passing in 1994.

With that in mind, it is my opinion that nobody is ever “too old” to start investing.

Even from the current retirement age of 65, there is still a good 15 years and 20 years before an individual would hit the current average lifespan of a Singaporean male and female respectively. That’s a good decade or two for your wealth to compound for you.

For more investing analyses, insights, and important updates about Singapore's stock market, sign up for The Motley Fool Singapore's free weekly investing newsletter, Take Stock Singapore. Written by David Kuo, it can help you grow your wealth in the years ahead.

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The information provided is for general information purposes only and is not intended to be personalised investment or financial advice. Motley Fool Singapore contributor Chin Hui Leong doesn’t own shares in any companies mentioned.