What if I invested $10,000 in S&P 20 years ago?
It's simple to calculate how much money you'd have today if you did just that 20 years ago with $10,000. The total would be more than $65,000, which implies a return of 555%. This includes all dividends, by the way.
According to our calculations, a $1000 investment made in February 2014 would be worth $5,971.20, or a gain of 497.12%, as of February 5, 2024, and this return excludes dividends but includes price increases. Compare this to the S&P 500's rally of 178.17% and gold's return of 55.50% over the same time frame.
The S&P 500 returned 345% over the last two decades, compounding at 7.7% annually. But with dividends reinvested, the S&P 500 delivered a total return of 546% over the same period, compounding at 9.8% annually.
Assuming an average annual return rate of about 10% (a typical historical average), a $10,000 investment in the S&P 500 could potentially grow to approximately $25,937 over 10 years.
It tracked a hypothetical $10,000 investment in the S&P 500 stock index made on Jan 1, 1980 through the end of 2022. If the money was left untouched, the $10,000 invested in 1980 was worth $1.26 million at the end of 2022.
If you had invested in Netflix ten years ago, you're probably feeling pretty good about your investment today. According to our calculations, a $1000 investment made in February 2014 would be worth $9,138.15, or a gain of 813.81%, as of February 12, 2024, and this return excludes dividends but includes price increases.
The S&P 500 index tracks some of the largest stocks in the United States, many of which pay out a regular dividend. The index's dividend yield is the total dividends earned in a year divided by the index's price. Historical dividend yields for the S&P 500 have typically ranged from between 3% to 5%.
Over the past 30 years, the S&P 500 index has delivered a compound average annual growth rate of 10.7% per year. Data source: Slickcharts.com.
The average yearly return of the S&P 500 is 10.04% over the last 30 years, as of the end of December 2023.
If the S&P 500 outperforms its historical average and generates, say, a 12% annual return, you would reach $1 million in 26 years by investing $500 a month.
What if I invested in SP 500 20 years ago?
If you can't beat them, join them
Buffett has said that he's advised his wife to invest all her money in the S&P 500 after his death. It's simple to calculate how much money you'd have today if you did just that 20 years ago with $10,000. The total would be more than $65,000, which implies a return of 555%.
Think About This: $10,000 invested in the S&P 500 at the beginning of 2000 would have grown to $32,527 over 20 years — an average return of 6.07% per year.
So if you're happy with a portfolio that performs comparably to the stock market as a whole, then sticking to S&P 500 ETFs alone isn't a bad idea. However, if you assemble a portfolio of individual stocks that perform better, you might enjoy a 12% or 15% return over time -- or more.
For instance, say your investments are earning a 12% average annual return compared to 10% per year. If you're still investing $100 per month, you'd have a total of around $518,000 after 35 years, compared to $325,000 in that time period with a 10% return.
If you invest $10,000 and make an 8% annual return, you'll have $100,627 after 30 years. By also investing $500 per month over that timeframe, your ending balance would be $780,326. Exchange-traded funds (ETFs) and mutual funds are both excellent investment options.
The table below shows the present value (PV) of $10,000 in 20 years for interest rates from 2% to 30%. As you will see, the future value of $10,000 over 20 years can range from $14,859.47 to $1,900,496.38.
Expert-Verified Answer
According to a 2021 survey conducted by Bankrate, approximately 40% of 18-29 year olds in the United States are investing in the stock market. The gathering of buyers and sellers of stocks, which reflect ownership claims on companies, is known as an equity market, stock market, or share market.
Investment Products
All have higher risks and potentially higher returns than savings products. Over many decades, the investment that has provided the highest average rate of return has been stocks. But there are no guarantees of profits when you buy stock, which makes stock one of the most risky investments.
However, as noted, things have turned south since then. Check out the above chart and you'll see that if you invested $1,000 in NFLX stock 20 years ago – and did not sell at the peak – today you would be sitting on not quite $139,000. That's still a terrific return, of course.
The average stock market return is about 10% per year, as measured by the S&P 500 index, but that 10% average rate is reduced by inflation. Investors can expect to lose purchasing power of 2% to 3% every year due to inflation. » Learn more about purchasing power with NerdWallet's inflation calculator.
What is the highest dividend paying company in the S&P 500?
Altria Group Inc.
Altria is a popular dividend stock that has been atop the list of the highest-paying S&P 500 dividend stocks for a while. That's because of its consistent and reliable yield and a great track record of increases in its payouts.
Overall, the S&P 500 grew at a compound annual growth rate of 13.8% over the last 15 years. Adjusting for inflation, the index grew 11.2% per year during that period.
Ten Year Stock Price Total Return for SPDR S&P 500 ETF Trust is calculated as follows: Last Close Price [ 514.95 ] / Adj Prior Close Price [ 154.12 ] (-) 1 (=) Total Return [ 234.1% ] Prior price dividend adjustment factor is 0.83.
In the last 30 Years, the SPDR S&P 500 (SPY) ETF obtained a 10.26% compound annual return, with a 15.12% standard deviation.
Consider if an investor put their money in the S&P 500. Historically, it has averaged 11.5% returns between 1928 and 2022. In 6.4 years, their money would double, assuming these average returns.
