Driving through the Pennsylvania countryside at 7:30 one morning, here’s the news I hear on the radio (read breathlessly): “And in the morning business news, Dow futures are down 300. S&P futures down 40. Nasdaq futures down 80.”
I’m amused by such announcements. Futures prices at 7:30 a.m. are the equivalent of a donut with your coffee: pure junk food.
In an earlier post, I asked readers to share techniques that have helped them to save. After all, spending less than you earn is the essential first step in investing. Vanguard shareholders tend to be people who’ve long made thrift a habit. And it’s a habit many folks, confronted with today’s tougher economic and market climate, are trying to pick up.
The impact of unnecessarily complicating our lives became clear to me this weekend.
With 260,000 miles on our two cars, we decided this was the time to get that new car we’ve been talking about. We did the research, bought the car, and parked it in the garage. For now, we’ll use it on weekends and use our older ones until they’re too expensive to run.
Here’s a table that codifies the pain of investing over the past decade. It compares the results of investing in several asset classes under two scenarios: A $10,000 lump-sum investment at the beginning of the decade, and a regular $1,000-a-year investment over ten years (in a 401(k) plan, for example).
