What is the best way to invest money if you do not need the money for ten years or more?
The survey from Bank Rate:
1. Real Estate – 28%
2. Cash – 23%
3. Stock Market – 17%
4. Gold – 15%
5. Bonds – 4%
Bank Rate conducted a survey for the last five years, yet the stock market has not managed to ever come in above number three on this list! That’s in spite of the fact that the stock market has tripled the last ten years according to Money.com.
Let’s look at the winner, real estate. Going all the way back to 1900 through today, real estate has increased 1.3% per year. The stock market, on the other hand, averaged 7% per year. I get it. Real estate makes money. However, according to Forbes, from 1980 to 2005, real estate increased by an impressive 247%. Meanwhile, compare that to the S&P, which gained more than 1,000%, and there’s really no comparison. Stop the “Flip it” mentality. Yes, you can make money in real estate, but you can also lose a lot of money too.
An example of this is the ‘CAT’ smart beta hypothetical ETF—Back Testing data yielded multiple analysis depending on the time frame. The ‘Cat’ Smart Bata ETF hypothetical returned 849,751%.
Another scary statistic is that ½ of all Americans say they do not own stocks of any kind.
Guys! Seriously! CASH at number two????? C’mon! There just isn’t much of a return in that at all!
Invest for success. Use science and proven data for your investment decisions, not some TV show or hot trend! A diversified portfolio is crucial to winning when it comes to investments.
RELATED ARTICLE: Questions to ask when choosing a financial advisor