9 ms·

Invest your money so they'll be worth 1.07^15 (2.76x) in 15 years of what they are now.

by dannyw 4y ago

awesomegoat_com 4y ago
You missed the chance to include tax and inflation and tax on inflation in your algebra, sir.
- djbebs 4y ago
  He included inflation, and there's plenty of tax advantaged accounts that let you grow tax free
- lotsofpulp 4y ago
  If you invest in a broad market equity index fund like VOO, then you will keep up with inflation. All the inflation has to be reflected in the country’s business’s bottom lines, so it would also be reflected in their share prices.
fegu 4y ago
This is my strategy. Global index funds. 7% is what you can expect. Inflation reduces the net yield. Research ways to avoid tax on stocks until you pay out to yourself, most countries have this in one form or another.
- lupire 4y ago
  "7%" is dead.
  - tw98521358 4y ago
    7 was a lie anyway.
goodpoint 4y ago
...if you live in a country with low enough taxation on investments.
tw98521358 4y ago
Where do I get 14-18% returns so that I can get 7 post tax and inflation real? That’s some crypto bullshit levels of growth
- gruez 4y ago
  Where are you getting "14-18% returns"? The formula in the parent post uses 1.07, which translates to a yearly growth of 7%.
  - tw98521358 4y ago
    You need to need to subtract inflation, otherwise your real increase is negative
    - gruez 4y ago
      right, but is there any reason to believe that 7% inflation is going to continue well into the future? The markets certainly don't think so. They're currently pricing in a 2.33% inflation rate over the next 5 years, measured by the spread between inflation protected treasuries and non-inflation protected treasuries. [1] https://fred.stlouisfed.org/series/T5YIE https://fred.stlouisfed.org/series/T5YIE
      - tw98521358 4y ago
        2.3 is too low. This seems to be based on treasury yields that yield negative real return right now. In order to have v 2.3 you basically need to have 0 for the next 4 years if you average the previous year in.

Invest your money so they'll be worth 1.07^15 (2.76x) in 15 years of what they are now.

by dannyw 4y ago

Invest your money so they'll be worth 1.07^15 (2.76x) in 15 years of what they are now.

awesomegoat_com 4y ago

You missed the chance to include tax and inflation and tax on inflation in your algebra, sir.

djbebs 4y ago
He included inflation, and there's plenty of tax advantaged accounts that let you grow tax free
lotsofpulp 4y ago
If you invest in a broad market equity index fund like VOO, then you will keep up with inflation. All the inflation has to be reflected in the country’s business’s bottom lines, so it would also be reflected in their share prices.

fegu 4y ago

This is my strategy. Global index funds. 7% is what you can expect. Inflation reduces the net yield. Research ways to avoid tax on stocks until you pay out to yourself, most countries have this in one form or another.

lupire 4y ago
"7%" is dead.
- tw98521358 4y ago
  7 was a lie anyway.

goodpoint 4y ago

...if you live in a country with low enough taxation on investments.

tw98521358 4y ago

Where do I get 14-18% returns so that I can get 7 post tax and inflation real? That’s some crypto bullshit levels of growth

gruez 4y ago
Where are you getting "14-18% returns"? The formula in the parent post uses 1.07, which translates to a yearly growth of 7%.
- tw98521358 4y ago
  You need to need to subtract inflation, otherwise your real increase is negative
  - gruez 4y ago
    right, but is there any reason to believe that 7% inflation is going to continue well into the future? The markets certainly don't think so. They're currently pricing in a 2.33% inflation rate over the next 5 years, measured by the spread between inflation protected treasuries and non-inflation protected treasuries. [1] https://fred.stlouisfed.org/series/T5YIE https://fred.stlouisfed.org/series/T5YIE
    - tw98521358 4y ago
      2.3 is too low. This seems to be based on treasury yields that yield negative real return right now. In order to have v 2.3 you basically need to have 0 for the next 4 years if you average the previous year in.