Monday, July 14, 2008

How's Your 401(k) Doing?

I love this quote from the Wall Street Journal:

Exactly 10 years ago, the Standard & Poor's 500-stock Index was at 1164; it closed Friday at 1239. That's an annualized average return of 0.63%. At that rate, it will take you 111 more years to double your money in the stock market.

0.63%?? Maybe you would have been better off putting that money into a savings account?

2 comments:

Anonymous said...

The tax advantages and employer match components of a 401(k) will crush any savings account out there. Rate of return alone is deceiving.

Subleum said...

Many employers no longer match so, that's not a factor for many people. Little by little, employers are dumping the responsibility on the workers, until they've washed their hands of it.