The Dow Jones Industrial Average and the S&P 500 ended the year set new high records on the last day of trading. Major indexes finished 2020 solidly. The Dow was up more than 6% for the year. The S&P 500 was up 15%, the Russell 2000 was up 19%, and the Nasdaq Composite was up 43%.
If you had put just $5,000 in a Vanguard 500 Index Fund on January 1, 2020. Your investment would now be worth $5,748 The expense .04% or $2. If you had your money in a Bank of America savings account your earnings are .05%. CDs (certificate of deposit savings accounts of rates no more than 1.5% or an account worth $5,250 at the end of the year.
I know so many people are fearful of losing their hard earned savings but the S&P 500 has a history of success. If you had put $10,000 in that account ten years ago it would be of $42,844 today. You just have to ignore the down swings like this year’s decline due to the corona virus. This Morningstar graph shows that ten year growth.
I am not a broker but have learned the hard way. It feels good selling my earnings to pay bills or take a trip but leaving my initial investment untouched to earn more money.
Coast Contact 