What is Long Term Investing, anyway?

A huge red flag when I’m talking to potential new clients is when they are upset at their current advisor about their returns.  Especially when I hear things like, “I’ve been with this guy 2 whole years and haven’t made any money.”

Two years?  That’s a blip in time in an investor’s return history.  As an advisor, I know that unlucky timing starting with a new advisor is probably more to blame for disappointing returns than bad investment decisions (mostly).

To remind you what long term returns are versus what a bad year can look like, here is a handy chart:


Index Name

30-year average rate of return 10-year average rate of return Worst year in the last 10 years
S&P 500 (1993 – 2023)

US Large Companies

12% 16% -18% in 2022
Bloomberg Aggregate Bond Index (1991 – 2021)

US Investment Grade Bonds

6% 3.5% -13% in 2022
MSCI EAFE Index (1994 – 2024)

International developed market stocks

4.7% 5.4% -14% in 2022


What am I trying to say here?  Patience, perspective, and understanding the reason why you are in a portfolio are more important than last year’s returns.



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