Suprising lack of stock market threads

[FreeAndClear]

@Samm

@Guvnah

@Samm

Wrong. It’s very easy to justify. Double value in 24 years is slightly less than 3% per year.

The post you responded to was talking about a doubling in 4 years though.

You are right. I must have misread it … I thought he was referring to since 2000. It’s almost quadrupled since then … making the return about 6% without accounting for inflation. I have an old-fixed rate account that pays 6%.

I am terrible in math but isn’t it 8.33?

[Samm]

it depends on when in 2020 you start counting. If it is on Jan 2, the DOW value was about 28,700. If you start on March15th it was about 18,730 and if you start on May 15th, it was about 23,200. Covid had a huge impact on market values in 2020. So if you look at the pre-covid impact value in January, the market today is up about 40%, not double, which is a return of ~8%/yr.

And if you look and the 10-year historical trend, the market may a little high, but is right about where it should be on that trend line.

The DOW was at about 10,940 in Jan, 2000. 24 years at 6% interest is ~ 44,465. So the average rate of return over that span is actually only about 5.5% not 6% as I estimated before. As I said, some old savings accounts, used to pay close to that.

[DougBH]

@Samm

@DougBH

But if you have it all in bonds, taxes eat up the rest of your “income”, so you can’t even keep up with inflation with bonds.

It depends on the bonds. Municipal bonds are federally tax-free.

Of course, they pay proportionally less in interest so even if you are in the higher tax brackets you will still be lucky to break even with inflation.

[occu]

I use a wealthfront online savings account for my emergency fund money. It is currently paying 5.5% interest which is nice for money i dont want tied up in investments.

Still fdic insured and very easy to transfer money ive been happy using them.