Suppose you have $100,000 in the market, if it goes down by 50% to $50,000: To get back to EVEN, market has to go up 100%, or double the amount lost.
To put things into perspective, if you invested $100,000 in January 2008:
January 1, 2009 it was worth $60,770 (Loss of 39.23%)
January 1, 2010 gain of 23.45% (Now worth $75,020.57)
January 1, 2011 gain of 12.78% (Now worth $84,608.20)
January 1, 2012 gain of 0.0% (Now worth $84,608.20
January 1, 2013 gain of 13.41% (Now worth $95,954.15)
January 1, 2014 gain of 29.6% (Now worth $124,356.58)
It took more than 6 years to get back to even. This 6-year return is 3.75% per year, with the ever present risk of loss.
Historical Market Perspective
Greatest gain in 46 years: 34.11% in 1995.
Greatest loss in 46 years: 39.23% in 2008.
When is the next crash going to be? No one knows for certain, but if you are near retirement, can you afford to wait another 6 years before you recover your money lost in the next crash?
I can help you protect your finance from market volatility. Call 856-428-3353 or use the contact form to schedule a no-obligation appointment today.