The Motley Fool Discussion Boards
Retirement Discussions / Retire Early CampFIRE
|Subject: Re: Ten Mental Exercises Leading To Freedom||Date: 4/10/2000 1:44 PM|
|Author: intercst||Number: 7729 of 757322|
<<<If that means I had to spend $3000 of my savings to take a 2 week vacation with my wife when I was only 25, well that's probably worth it.>>>>
You picked a good example for making your point. On the one hand, vacations can be very expensive. For most of us, vacations are one of the highest discretionary items in our budget. Perhaps someone who speaks Spreadsheet can tell you the lifetime value of putting $3,000 in a mutual fund at age 25. My guess is that the number would be high enough to make many of us think twice.
The S&P500 has returned 13.67% over the past 30 years. A 25 year old should live at least to age 80, so you have 55 years of investment returns:
$3,000 x 1.1367^55 = $3,449,000
Of course, 55 years is a long time to wait.
Over on the DELL board last year, we had a DELL employee lamenting the fact that he had sold $5,000 worth of DELL stock to take his wife on a Lake Tahoe ski vacation in 1992. Value today of $5,000 worth of DELL stock bought in 1992? A little over $1 million.
Maybe I'm warped, but I think the investor that bought the $5,000 in stock got the better part of that exchange. <grin>
|Copyright 1996-2014 trademark and the "Fool" logo is a trademark of The Motley Fool, Inc. Contact Us|