Meager Income

Pay Off Debt, Retire Comfortably on Meager Income, Win the Lottery, Not Necessarily in that Order

What investment returns should you expect?

Posted on | February 7, 2011 | No Comments

The graphic below was published in the New York Times a few weeks ago.  It contains the annualized returns for the S.& P. 500., for nearly 4,000 periods.

It was created by Ed Easterling, who runs an investment management and research firm from Corvallis, Oregon.  It was a response to the question: “…whether investors should expect to achieve long-term average returns in the future.”  You can read the full article here

Annualized returns for the S.& P. 500., for nearly 4,000 periods.

In Investing, It’s When You Start and When You Finish

Unfortunately (for me), I really only started investing right around the year 2000 — what an awful time to start investing in stocks!  I was too late to take advantage of the dot com craze in the 1990’s and instead saw my 401k drop in value during the ensuing bust.  I’ve been able to take advantage of the stock market drop between 2007 – 2009 to make up for my losses.  I hope the next 10 years are better than the last 10.

I think the lesson here is to keep a reasonable amount of cash available for investing when the stock market falls dramatically.


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