In partnership with

You have probably heard people say “the stock market goes up 10% per year”… or people like Dave Ramsey say “the market gains 12% per year”. While that is not false, it is not telling the whole story…

When it comes to talking about stock market returns, it is important to note that they are averages. The stock market does not gain 10% per year every year. It averages 10% per year over the long term.

Rise and grind, dollar bills!

Put your money to work in a high-yield cash account with up to $2M in FDIC† insurance through program banks.

Get started today, with as little as $10.

As a matter of fact, the stock market rarely returns exactly (or even close to) 10% per year. Since 1926, there have only been 6 years where the S&P 500 returns are within two percentage points of the long term average of 10%. This means the vast majority of returns are wide spread, but averaged out it is 10%. The stock market does not gain 10% per year ever7 year, just over the long term it has averaged 10% per year. Notice the difference in language?

Look at this chart with returns since 1926, this shows you that the 10% average return is rarely the return of the market on any given year. Most years are either way more or way less than 10%. Over the long term the average is 10%, but rarely does the market return 10% per year.

The yearly returns since 1926 of the S&P 500 have ranged as high as 54% & as low as down 43%. This is the range of potential of returns in the market.

Another cool fact about the S&P 500 is since 1926 the annual returns have been positive 71 times & negative 26 times. Another reason to think long term & not let the one bad year cause you to run from the market.

So what is the lesson?

The next time you hear someone say “well, the market returns 10% per year”, keep in mind that is the long term average of the market. One year it may be up 24% and the next year it may be down 4%. The average of the two years is 10%, but each year returns were not even close to 10%. Rarely does the market return 10% per year on any given year.

Real quick, my podcast called The Decade Investor Podcast releases new episodes every week. This week I dropped three new episodes:

1. 42: Average Net Worth By Age (2024 Updated)

2. 43: Bull Market Returns vs Bear Market Returns

3. 44: Building a Winning Mindset in Investing | Marko - Whiteboard Finance

You can listen to them on any podcast playing app here: https://thedecadeinvestorpodcast.buzzsprout.com/share

The goal of my newsletter, my podcast, my social media is to help educate you on money & make sure you set yourself + your future generations up for success with money!

I want to help you too. I will be able to help you… soon. Stay tuned, I have something coming VERY SOON that will revolutionize the game for Decade Investors.

(x)Tweet of the Week:

Just keep buying.

Thank you so much for reading & I will see you next week! Until then, keep buying assets.🙂 

- Decade Investor