I recently read this post at millionairemommynextdoor.com:
Q: Pam asks, “After my portfolio value dropped by 40%, I panicked and pulled out of the stock market. I have $150,000 sitting in my savings account, earning squat. I know I should put it back to work, but with the state of our economy, I don’t know what to do with it. Any thoughts?”
I cringe when I read those questions. It reminded me of the free financial advice I gave almost two years ago. That included this image:
Since it’s almost two years later, I thought it would be interesting to see what the real chart looks like. Data Source
I didn’t quite hit the bottom with my “You Are Here” star. That actually happened on March 9, 2009. And the rebound slope isn’t as steep – yet. If we look at it again in a couple of years it may be. Nevertheless, that free advice is currently worth about $300.00 for about a 15% annualized return. I don’t think Pam is making that in her savings account.
Hat tip to this Peltiertech.com page for how to use a star as a marker on an XY chart.