The Power of Starting Early and Reinvesting Dividends

Once you establish a foundation for your investment, you can help its potential growth by reinvesting any income dividends and capital gains your mutual funds pay you right back into the market. Compounding may produce dramatic results over time.

The sooner you begin investing, the more time you'll have to take advantage of the power of compounding. In fact, by investing early, you have the potential to invest less money yet earn considerably more than someone who waits to invest.

Following is an example illustrating the difference that starting early makes. Two friends, Greg and Sue, invest $2000 a year, but at very different times. Sue gets an early start and invests actively for ten years and reinvests all her earnings, but then stops. After that, she continues to grow her investment purely by reinvesting any earnings and letting them compound.

Greg, on the other hand, puts off investing; he's only starting to invest when Sue is finishing her active investment years. Greg invests actively for 30 years, compared to Sue's eight years.

From the chart below you can see that Greg earned considerably less than Sue, even though he actively invested four times longer.

Sue (started sooner) Total Investment: $20,000 Total Earnings: $294,871 Total Account Value: $314,871 Sue invested $2,000 a year for 10 years   Greg (invested more) Total Investment: $60,000 Total Earnings: $184,692 Total Account Value: $244,692 Greg invested $2,000 a year for 30 years This chart assumes an 8% annual rate of return. Typically, the greater the return potential, the higher the risk. It is for illustrative purposes only and is not indicative of the Huntington Funds' results. Actual investment returns and principal values will fluctuate. Past performance is no guarantee of future results.

The Funds are distributed by Unified Financial Securities, Inc. (Member FINRA) a wholly owned subsidiary of Huntington Bancshares, Inc. and an affiliate of Huntington Asset Advisors, Inc. the advisor to the Huntington Funds.

Mutual Funds are subject to risk and fluctuate in value.