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Well that is true, I used the stock market. It also depends on your age and where you want your investments. If you put the money into less risky and thus lower return investments the model doesn't work. I am considering it because I am only 34 and can afford to wait out the ups and downs of the market. If you are in a different stage of life or have a different risk tolerance the answer might be very different.
Historically the equities market has averaged 10% per year. The country has seen wars, depression, bull markets, and bear markets in that time. I suppose it is possible that the market would deviate from its 100 year history in the next 50 years, but I think it is more likely to continue its winning ways. The thing is you have to have the time to let the peaks and valleys even out. People get burned in the market when they invest for the short term. If that is what you are doing you may as well go to Vegas, IMHO.
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Rick
1984 911 coupe
Last edited by Nathans_Dad; 12-20-2006 at 02:56 PM..
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