The Cost of Procrastination

Some of us share a common experience. You’re driving along when a police cruiser pulls up behind you with its lights flashing. You pull over, the officer gets out, and your heart drops.

 

“Are you aware the registration on your car has expired?”

 

You’d been meaning to take care of it for some time. For weeks, you had told yourself that you’d go to renew your registration tomorrow, and then, when the morning comes, you repeat it again.

 

Procrastination is avoiding a task that needs to be done – postponing until tomorrow what could be done, today. Procrastinators can sabotage themselves. They often put obstacles in their own path. They may choose paths that hurt their performance.

 

Though Mark Twain famously quipped, “Never put off until tomorrow what you can do the day after tomorrow.” We know that procrastination can be detrimental, both in our personal and professional lives. From the college paper that gets put off to the end of the semester to that important sales presentation that waits until the end of the week for the attention it deserves, we’ve all procrastinated on something.

 

Problems with procrastination in the business world have led to a sizable industry in books, articles, workshops, videos, and other products created to deal with the issue. There are a number of theories about why people procrastinate, but whatever the psychology behind it, procrastination may, potentially, cost money – particularly, when investments and financial decisions are put off.

 

As the example below shows, putting off investing may put off potential returns.

 

Early Bird. Let’s look at the case of Cindy and Charlie, who each invest a hypothetical $10,000 to start. One of them begins immediately, but the other puts investing off.

 

Charlie begins depositing $10,000 a year in an account that earns a hypothetical 6% rate of return. Then, after 10 years, he stops making deposits. His invested assets, however, are free to keep growing and compounding.

 

While Charlie fills his account, Cindy waits 10 years before getting started. She then starts to invest a hypothetical $10,000 a year for 10 years into an account that also earns a hypothetical 6% rate of return.

Cindy and Charlie have both invested the same $100,000, but procrastination costs Cindy, as Charlie’s balance is much higher at the end of 20 years. Over 20 years, his account has grown to $237,863, while Cindy’s account has only grown to $132,822. Charlie’s account has not only put the power of compound interest to work, it has also allowed the investment returns more time to compound.

 

This is a hypothetical example of mathematical compounding. It’s used for comparison purposes only and is not intended to represent the past or future performance of any investment. Taxes and investment costs were not considered in this example. The results are not a guarantee of performance or specific investment advice. The rate of return on investments will vary over time, particularly for longer-term investments. Investments that offer the potential for high returns also carry a high degree of risk. Actual returns will fluctuate. The types of securities and strategies illustrated may not be suitable for everyone.

Office Locations

Louisville

2201 High Wickham Place
Louisville, KY 40245
502.753.0609

Cincinnati

100 E-Business Way
Suite 110
Cincinnati, OH 45241
513.842.1700

Bowling Green

1048 Ashley Street
Suite 301
Bowling Green, KY 42103
270.843.4115

Indianapolis

5750 Castle Creek Parkway North Drive
Suite 170
Indianapolis, IN 46250
877.634.9757

Grand Rapids

607 Cascade West Parkway
Grand Rapids, MI 49546
844.476.2744

Elizabethtown

2901 Ring Rd

Elizabethtown, KY 42701
270.990.9000

Lexington

176 Pasadena Drive
Suite 3B
Lexington, KY 40503
859.286.5085

Paducah

4730 Village Square Drive
Suite 100
Paducah, KY 42001
270.443.8711

Bardstown

713 McDowell Blvd
Bardstown, KY 40004
502.348.1433

Atlanta

3625 Cumberland Blvd., Suite 1485
Atlanta, GA 30339
678.681.9518

All information herein has been prepared solely for informational purposes, and it is not an offer to buy or sell, or a solicitation of an offer to buy or sell any security or instrument or to participate in any particular trading strategy. Portions of the content on this website were prepared by Marketing Library Inc.

Please note: When you link to any of the websites provided herewith, you are leaving this site. We make no representations as to the completeness or accuracy of the information provided at these sites. Nor is the company liable for any direct or indirect technical or system issues or any consequences arising out of your access to or use of third party technology, sites, information and programs made available through this site. By clicking on links above you will leave our website and assume total responsibility and risk for your use of the site you are linking to.

Respective services provided by ARGI Investment Services, LLC, a Registered Investment Adviser, ARGI CPAs and Advisors, PLLC, ARGI Business Services, LLC, and Advisor Insurance Solutions. All are affiliates of ARGI Financial Group. View our privacy policy here.

Argi Gateway Login

Forgot your password?

Call 866-568-9719