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The calculation seems off by almost one order of magnitude. Even investing 10$ a month for 50 years (!), and managing to get a net return of 7% for such half a
by alberto-m 2y ago
The calculation seems off by almost one order of magnitude. Even investing 10$ a month for 50 years (!), and managing to get a net return of 7% for such half a century, will build up only about 50K. Except that, by that time, even a modest inflation rate of 2.5% will make it worth less than 15K in real terms.
Which makes sense, otherwise any childless person in the West with a decent job could save 1k a month and retire with 10M, or a Google SWE5 living with a SWE4 lifestyle could save 10k a month and retire with 100M.
- RGamma 2y agoGP giving financial advice to the poor.
- Mashimo 2y agoWas about to say that 7% is low, as I got ~13.5% and 15.5% return this year on medium risk profile. But it seems the average over the last 10 years was indeed 7.9%, only 10.22% on high risk profiles. (At my "bank" thing, not worldwide)
- blackeyeblitzar 2y agoThe historical average for the S&P 500 is 6% with inflation adjusting. But even with your math, 15K is a big change given the current median retirement savings.