January 25th 2010 archive

A tale of two investors

By John Ameriks on January 25, 2010 8:12 am

Here’s a pretty simple chart showing hypothetical investment results for two hypothetical investors. Each of them saved $2,500 a year for 25 years, using investment strategies that delivered identical 7% rates of return each year. After 25 years, one investor ended up ahead of the other by more than $11,000. Can you guess why? Read more »