Have you ever learned about Average Rate of Return vs Actual Rate of Return?
Most financial planners will never bring this up
Let’s say I invest $100K into the market in a growth stock fund that does 100% the first year. Sweet I have $200K
Year 2 the market drops 50% dropping me back to $100K
Year 3 is another incredible return year of 100% getting me back to $200K again
Year 4 I experience another 50% drop bringing my money back to my original $100K
The AVERAGE Rate of Return is 25%.
Did I make 25%?
No, I still have the original $100K which has brought no value to my life and tied my money up for 4 years plus has been eroded by inflation, fund fees, and missed opportunity cost.
These are things you need to learn and consider when blindly throwing money into mutual funds
Quick thread:
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Contrary to what the media says,
It's ok to be rich.
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Saving more money won't save you.
Making more money will.
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The vaults inside banks are not for your money.
They're for the money they make from your money.
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Banks give you money at 0.5% interest and lend it at 5-25% interest. You're being flipped for profit.
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You don't want money.
You want the peace that comes from not having to worry about it.
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Hating on money makers is the exact reason why you don't become one.
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You don't need to be a genius to be rich.
You just need to be open minded.
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If college professors knew about proper financial education, they wouldn't be college professors.
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"Capitalism is the unequal distribution of wealth.
Socialism is the equal distribution of misery."