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No one said 10% real returns. It’s 10% counting inflation, which is the number I provided. > The average stock market return is about 10% per year for nearly
by Mistletoe 3y ago
No one said 10% real returns. It’s 10% counting inflation, which is the number I provided.
> The average stock market return is about 10% per year for nearly the last century, as measured by the S&P 500 index.
I don’t know why people are getting hung up on this 10%, it’s just the historic returns everyone in Boglehead and FI/RE communities uses. If you wanted to use the 6-7% real returns after inflation that is fine too. The numbers still are the same, you’ll just get an inflation adjusted number. You’ll need inflation adjusted numbers on your college earnings too though, I don’t think the “extra 1 million earned by a college grad” is inflation adjusted.
- HDThoreaun 3y agoI get hung up because the last century was by far the best economic century for humans ever, and it seems reasonably likely that the next will not be as good growth wise.
- readthenotes1 3y agoThat affects the value of a college degree as well, of course. I believe there have been studies that show that graduates who are unlucky enough to be job searching during a one or two-year recession have a lifelong income deficit compared to those who don't
- HDThoreaun 3y agoDo high school grads not face the same issue?
- readthenotes1 3y agoNot sure, but they won't have traded 4 years and $200k for a high salary future