Here is the surprising part. Save just under £40 a month from age 18, and by 67 you reach roughly the same pot as someone who saves £200 a month but only starts at 45. The early starter pays in far less each month, yet time does the heavy lifting. This assumes a steady 5% return every year. Real investment returns rise and fall, and are never guaranteed.
Two students leave school at eighteen. One starts saving £30 a month into a pension. The other waits, plans to start "when there's more money", and gets serious at thirty-five. The first student keeps going until sixty-seven. So does the second. Who has more? Drag the sliders. The answer is not what most people think.
All four people stop saving on the same day, at age 67. They just started at different times.
When you save money in something that earns a return (a pension, a Stocks and Shares ISA, a long-term savings account), your money earns money. The next year, both the original money and last year's earnings are earning money. Then the year after that, all three are. This is compounding.
It looks slow at first. After ten years, it looks like nothing special is happening. But after thirty or forty years, the line on the chart curves sharply upward. The work is being done by time, not by the amount you pay in. That's why starting at eighteen, even with very little, beats starting at thirty-five with a lot. You can't buy back time.