The Oregonian
Well-Known Member
Lots of misstatements on the market…
Here are the returns for VFIAX, Vanguard's S&P index fund.
A few items to note on some things that have been posted:
Here are the returns for VFIAX, Vanguard's S&P index fund.
A few items to note on some things that have been posted:
- I'm not arguing politics, inflation, etc with this info. Those are separate (but very important) discussions - this is in response to the 'I've lost money in my 401k' discussion.
- The market didn't perform poorly in early 2021. It tanked in early 2020, which was under a different administration. See the quarterly return picture.
- If anyone has lost money since Trump or Biden took over, it is due to lack of diversification and risk management or poor investment choices and not due to the broad market performance.
- Target date funds are, IMO, overly conservative and leave lots of returns on the table in the name of conservatism and risk avoidance, at least compared to an S&P index fund. If someone is young that will add up over time (and they can take on more risk while young, also). If someone were to invest $12k/yr ($1k/mo) in a retirement plan for 30 years at 7%, and another did the same and got 8%, the latter person would have $270k more than the 7% person. When you get within 10ish years of retirement, re-evaluate investment choices to lower risk and gain stability if desired.
- If you have been making regular contributions to your 401k then it is even harder to imagine losing money under either administration. With the market dips and being at an all time high (the S&P, not the Nasdaq), virtually all contributions should have generated a positive return.
- The Dow is irrelevant when discussing market returns - it is a collection of 30 stocks, whereas the S&P is obviously 500 and the Nasdaq is 100 stocks.
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