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You could mine the Internet and generate new ideas by bringing together seemingly unrelated bits of information. Some of those ideas are bound to pay off.
Posts: 2655 | Registered: Feb 2004
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Getting Rich is so difficult because he's mine and I don't share my man, especially no with other men.
Posts: 12591 | Registered: Jan 2000
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12% average return is not unrealistic. Please, I encourage you to research the actual performance of mutual funds and the stock market over any ten year period.
Yes, any.
If you've had any type of 401k or IRA, and you haven't averaged above 10% for the last 10 years (yes, even this past 10 years) your money is in the wrong place.
I have not been in for 10 years. However my father's 401k has averaged only slightly less than 12% over the last 10 years (as in, about 11.5%).
The last year? No. The last five years? No. But over the last 10 years, yes.
Expecting a 12% return on a single given year is naive and unrealistic. Expecting a 12% average return over the long term shows you've done research.
Some stocks, like Coca-Cola, outperform even that. Coca-Cola, for decades was performing at 16% for any 10 year period you looked at. People called it the first national bank of Coca-Cola.
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It's actually a 48 year period, but since 10 is less than that, that doesn't change the point at all. Posts: 1894 | Registered: Aug 2000
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docmagic, could you link some sources? The S&P 500 does not average a gain for every 10 year period, let alone a 12% annualized return for each period. See this.
This being the case, you have to show that there's a way to pick the correct stocks in advance. What method to do so is available to someone in a 401k plan?
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With my 401k plan, and I assume most others were like this, you don't pick individual stocks, you pick different funds. I was working for the government and we had a choice between 5 or 6 funds, don't remember the details. and you could distribute any amount between all of them. I think about half of them had averaged over 10% over the last 10 years, and the other half were in the 6-7% range. And that's with a few pretty bad years in there.
Posts: 8741 | Registered: Apr 2001
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The other thing not being taken into account is that you need ramp down time - you have to get your retirement account out of stocks (part of it, at least) so you can start spending it. Imagine if you had to do that in 2000 or 2001? You'd be out a LOT of money.
Dollar cost averaging helps a lot, but it's not a foolproof 12% a year.
Posts: 26071 | Registered: Oct 2003
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Unfortunately I don't have anything that works quickly. However, it is stable to a point. For the past 5 years I have invested $50 a month to mutual funds (minimum. I have invested more on occasion). Since December of 2003 I have been playing the stock market. I do not buy to sell the stocks. I save the dividends. At the moment the dividends get reinvested automatically back into the stock. When the dividend amount increases I will start having it go to my money market account. My mutual funds account is going to be my retirement money. My stocks are going towards my backpacking trip when I get out of the Navy (in 14 more years).
The only stock I have sold was Google. I bought when it just came out public and sold all that I bought when share price went above $200. I made almost $1000 on that. I used it to make payments on my truck and the insurance.
One of my friends practically lives and dies by Roth IRA's. Some others are the same way in that they invest in real estate. There are so many ways to save money and make money (stupid internet scams are not included in this) it is suprising how few people take advantage of them.
Posts: 2208 | Registered: Feb 2004
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These are the Vanguard stock funds. As you can see, most of them that have been around for 10 years are showing over 11% for the last 10 years, and all of them are showing over 10% for the last 10 years.
Also, if you notice the 500 index fund has, since it's inception in 1976, averaged over 12% lifetime.
These types of funds are available to anyone in a 401k.
Posts: 1894 | Registered: Aug 2000
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