Refresher from last the last post:
Millennials: 83 million 14- to 34-year-olds
Boomers: 67 million 50- to 69-year-olds
All their lives, the Baby Boomers have been sold a bill of goods from Wall Street.
They’ve been told by one sales person after another that they can “beat the market” in their investments by using “guru” investing methods: Track Record Investing, Stock Picking, and Market Timing. “It’s not what you know, but who you know,” they’ve been told.
How did they fare?
Well, on average, they performed just a little bit better than inflation. And that was average! Some did far worse, a few did better.
Dalbar, Inc. studies investor returns in equities and consistently shows that investors get returns net of fees in the range of 3.5 to 4.5%, while the market (the S&P 500 for example) for the same time periods, comes in at over 10%.
Here is a truth worth promoting:
If the 83 million invest like the 67 million did, they will end up with pretty much the same results.
Why? Because the average investor pretty much follows the crowd. The crowd is getting pretty much inflation-rated returns still today. Don’t think this applies to you? Funny, no one does.
You should find out why . . .