How much was $10,000 invested in the S&P 500 in 2000?
$10,000 invested in the S&P 500 at the beginning of 2000 would have grown to $32,527 over 20 years — an average return of 6.07% per year.
Stock market returns between 2000 and 2023
If you invested $100 in the S&P 500 at the beginning of 2000, you would have about $488.05 at the end of 2023, assuming you reinvested all dividends. This is a return on investment of 388.05%, or 6.93% per year.
Stock Market Average Yearly Return for the Last 20 Years
The historical average yearly return of the S&P 500 is 9.74% over the last 20 years, as of the end of February 2024. This assumes dividends are reinvested. Adjusted for inflation, the 20-year average stock market return (including dividends) is 6.96%.
Barchart on X: "Fun Fact 🚨: A $10,000 investment in the S&P 500 back in 1970 would be worth $2.3 million today" / X.
Assuming an average annual return rate of about 10% (a typical historical average), a $10,000 investment in the S&P 500 could potentially grow to approximately $25,937 over 10 years.
In 1980, had you invested a mere $1,000 in what went on to become the top-performing stock of S&P 500, then you would be sitting on a cool $1.2 million today.
The one time it's okay to choose a single investment
That's because your investment gives you access to the broad stock market. Meanwhile, if you only invest in S&P 500 ETFs, you won't beat the broad market. Rather, you can expect your portfolio's performance to be in line with that of the broad market.
If you'd invested back in October 2022 when the S&P 500 bottomed out, you'd have earned substantial returns by today. But hindsight is 20/20, and since you can't go back in time, your only options are to invest now or wait. Between those two options, investing now is almost always more lucrative.
For a point of reference, the S&P 500 has a historical average annual total return of about 10%, not accounting for inflation. This doesn't mean you can expect 10% growth every year; you could experience a gain one year and a loss the next.
Looking at the S&P 500 for the years 1993 to mid-2023, the average stock market return for the last 30 years is 9.90% (7.22% when adjusted for inflation). Some of this success can be attributed to the dot-com boom in the late 1990s (before the bust), which resulted in high return rates for five consecutive years.
How much will $1,000 invested be worth in 20 years?
Discount Rate | Present Value | Future Value |
---|---|---|
2% | $1,000 | $1,485.95 |
3% | $1,000 | $1,806.11 |
4% | $1,000 | $2,191.12 |
5% | $1,000 | $2,653.30 |
Rate of return | 10 years | 30 years |
---|---|---|
4% | $72,000 | $336,500 |
6% | $79,000 | $474,300 |
8% | $86,900 | $679,700 |
10% | $95,600 | $987,000 |
Buffett has said that he's advised his wife to invest all her money in the S&P 500 after his death. It's simple to calculate how much money you'd have today if you did just that 20 years ago with $10,000. The total would be more than $65,000, which implies a return of 555%.
Here's how a 10.25% return would break down if you invested $5,000 at the beginning of each year over four decades. Data source: Author's calculations. As you can see from the chart, investing $5,000 annually in the S&P 500 would make you a millionaire in a little over 30 years, assuming average 10.25% annual returns.
We saw in the previous section that investing in the S&P 500 has historically allowed investors to double their money about every six or seven years. Your initial $1,000 investment will grow to $2,000 by year 7, $4,000 by year 14, and $6,000 by year 18.
- 1 – Flip Stuff. Imagine buying a chair at a yard sale for $5, fixing it up, then selling it online for five times as much. ...
- 2 – Start a Blog. ...
- 3 – Invest in Real Estate. ...
- 4 – Start an Online Business. ...
- 5 – Write an Email Newsletter. ...
- 6 – Help Others Learn.
If you invest $100,000 at an annual interest rate of 6%, at the end of 20 years, your initial investment will amount to a total of $320,714, putting your interest earned over the two decades at $220,714.
Does the S&P 500 Pay Dividends? The S&P 500 is an index, so it does not pay dividends; however, there are mutual funds and exchange-traded funds (ETFs) that track the index, which you can invest in. If the companies in these funds pay dividends, you'll receive yours based on how many shares of the funds you hold.
In fact, at the end of the five years, if you invest $1,000 per month you would have $83,156.62 in your investment account, according to the SIP calculator (assuming a yearly rate of return of 11.97% and quarterly compounding).
There are many ways to start investing, but one that's worked for billionaires like Warren Buffett is investing in low-cost index funds.
Can you live off the S&P 500?
Once you have $1 million in assets, you can look seriously at living entirely off the returns of a portfolio. After all, the S&P 500 alone averages 10% returns per year. Setting aside taxes and down-year investment portfolio management, a $1 million index fund could provide $100,000 annually.
- High-yield savings accounts.
- Certificates of deposit (CDs)
- Bonds.
- Money market funds.
- Mutual funds.
- Index Funds.
- Exchange-traded funds.
- Stocks.
There are some who believe that certain days offer systematically better returns than others, but over the long run, there is very little evidence for such a market-wide effect. Still, people believe that the first day of the workweek is best. It's called the Monday effect or the weekend effect.
As long as your time horizon is three to five years or longer, an S&P 500 index fund could be a good addition to your portfolio. However, any investment can produce poor returns if it's purchased at overvalued prices.
For beginners, the vast array of index funds options can be overwhelming. We recommend Vanguard S&P 500 ETF (VOO) (minimum investment: $1; expense Ratio: 0.03%); Invesco QQQ ETF (QQQ) (minimum investment: NA; expense Ratio: 0.2%); and SPDR Dow Jones Industrial Average ETF Trust (DIA).
References
- https://www.investopedia.com/world-s-11-greatest-investors-4773356
- https://www.kotaksecurities.com/share-market/how-to-earn-1000-rs-per-day-in-the-share-market/
- https://www.investors.com/how-to-invest/investors-corner/sell-a-stock-cutting-losses-short-is-first-rule/
- https://www.investopedia.com/articles/financial-theory/09/probability-without-formulas.asp
- https://www.nasdaq.com/articles/is-the-sp-500-all-you-need-to-retire-a-millionaire-12
- https://www.mypivots.com/dictionary/definition/25/80-rule
- https://www.deskera.com/blog/short-selling-risks-and-rewards/
- https://www.linkedin.com/pulse/why-do-so-many-traders-lose-money-dr-william-odion-6hzgf
- https://www.investopedia.com/articles/professionals/052113/day-life-day-trader.asp
- https://www.quora.com/Can-you-lose-money-in-stocks-if-you-dont-sell
- https://www.dukascopy.com/swiss/english/marketwatch/articles/top-10-most-successful-forex-traders-in-the-world/
- https://www.linkedin.com/pulse/why-25000-minimum-day-trading-forex-trading-for-beginners2-dfjac
- https://www.fool.com/investing/2023/11/26/want-to-outperform-92-of-professional-fund-manager/
- https://www.investopedia.com/articles/basics/03/060603.asp
- https://www.fool.com/the-ascent/buying-stocks/articles/heres-what-happens-when-you-invest-500-a-month/
- https://www.morningstar.ca/ca/news/234575/what-happens-if-a-companys-stock-falls-to-zero.aspx
- https://www.officialdata.org/us/stocks/s-p-500/2000
- https://www.afrugaldoctor.com/home/market-zero
- https://www.fool.com/investing/2024/01/09/you-can-shred-the-average-hedge-fund-by-doing-basi/
- https://tradethatswing.com/average-historical-stock-market-returns-for-sp-500-5-year-up-to-150-year-averages/
- https://www.science.org/content/article/stock-market-traders-life
- https://tradethatswing.com/win-rate-risk-reward-and-finding-the-profitable-balance/
- https://www.fool.com/the-ascent/buying-stocks/articles/heres-what-happens-when-you-only-invest-in-sp-500-etfs/
- https://fx2funding.com/blog/can-you-day-trade-for-a-living-with-1000/
- http://www.ft.com/partnercontent/capital-com/new-research-success-is-limited-until-diy-investors-break-bad-habits.html
- https://www.investopedia.com/articles/trading/11/automated-trading-systems.asp
- https://tradingdrills.com/trading-success-rate/
- https://www.titan.com/articles/is-sp-500-a-good-investment
- https://www.litefinance.org/blog/for-beginners/trading-strategies/three-profitable-forex-trading-strategies/
- https://www.sofi.com/learn/content/average-stock-market-return/
- https://www.nerdwallet.com/article/investing/the-best-investments-right-now
- https://poe.com/poeknowledge/1512928000358234
- https://www.touchdownmoney.com/how-to-double-10k-quickly/
- https://www.cmcmarkets.com/en/trading-guides/top-3-trading-mistakes-and-how-to-avoid-them
- https://www.moneyshow.com/articles/tradingidea-60554/
- https://www.bankrate.com/investing/how-to-buy-sp-500-index-fund/
- https://tradethatswing.com/the-day-trading-success-rate-the-real-answer-and-statistics/
- https://www.fool.com/investing/2023/06/25/if-you-invested-10000-in-the-sp-500-20-years-ago/
- https://www.gobankingrates.com/investing/stocks/can-i-make-1000-a-day-by-day-trading/
- https://lanningfinancial.com/why-the-average-investor-underperforms-the-market/
- https://thebossmagazine.com/day-traders-fortune-foresight/
- https://www.wallstreetzen.com/blog/what-happens-if-a-stock-goes-to-zero/
- https://finance.yahoo.com/news/buy-everyone-selling-203708979.html
- https://www.nerdwallet.com/calculator/investment-calculator
- https://www.marketwatch.com/story/even-warren-buffett-is-no-match-for-the-s-p-500-a6e096c5
- https://www.datasciencesociety.net/what-proportion-of-day-traders-find-themselves-profitable/
- https://www.forbes.com/advisor/investing/what-is-day-trading/
- https://www.investopedia.com/financial-edge/0711/how-to-double-your-money-every-6-years.aspx
- https://www.quora.com/What-percentage-of-traders-actually-succeed-as-full-time-traders
- https://www.nerdwallet.com/article/investing/3-day-trading-tax-tricks
- https://medium.com/@newsalertforex/is-40-win-rate-good-2f91ab9c49db
- https://time.com/personal-finance/article/how-to-invest-in-index-funds/
- https://www.linkedin.com/pulse/why-do-most-retail-traders-90-lose-money-how-can-more
- https://www.moneylion.com/learn/can-you-lose-money-in-stocks/
- https://www.tradebulls.in/trading-account-basics/10-best-rules-successful-trading
- https://www.linkedin.com/pulse/can-i-become-millionaire-trading-forex-trader-forex
- https://www.nasdaq.com/articles/6-smartest-money-moves-made-by-billionaires
- https://www.investopedia.com/articles/trading/09/how-to-trade-for-a-living.asp
- https://tools.carboncollective.co/future-value/1000-in-20-years/
- https://www.investopedia.com/articles/markets/071616/history-sp-500-dividend-yield.asp
- https://www.investopedia.com/ask/answers/09/stock-delist.asp
- https://www.investopedia.com/terms/d/daytrader.asp
- https://www.linkedin.com/pulse/10-biggest-trading-losses-ever-habeeb-mahmood
- https://www.angelone.in/blog/why-95-percent-of-indian-traders-lose-money
- https://www.reddit.com/r/stocks/comments/tkr8me/is_it_possible_to_make_significant_money_if_you/
- https://www.fool.com/investing/how-to-invest/famous-investors/
- https://www.fool.com/investing/how-to-invest/stocks/day-trading/
- https://www.bankeronwheels.com/9-reasons-why-active-investing-is-difficult/
- https://www.marketwatch.com/story/majority-of-active-u-s-large-cap-stocks-funds-fail-to-beat-s-p-500-in-2023-a-worse-year-for-underperformance-than-2022-89fad8a1
- https://en.wikipedia.org/wiki/Elon_Musk
- https://www.quora.com/How-much-money-do-you-need-for-day-trading-to-earn-500-per-day
- https://www.timothysykes.com/blog/why-traders-fail/
- https://www.finra.org/investors/investing/investment-products/stocks/day-trading
- https://finance.yahoo.com/news/13-stocks-outperform-p-500-165621345.html
- https://www.mstock.com/articles/5-reasons-why-traders-lose-money-in-stock-market
- https://www.investopedia.com/articles/active-trading/022715/20-rules-followed-professional-traders.asp
- https://www.linkedin.com/pulse/what-90-rule-forex-broker-forex-global-czp0c
- https://trendspider.com/learning-center/the-rule-of-90/
- https://medium.com/@Levente22/shocking-but-true-90-of-people-lose-money-in-stocks-9da95870cbe8
- https://www.rocketmortgage.com/learn/1-rule-real-estate
- https://finance.yahoo.com/news/more-money-investing-10-000-220010726.html
- https://bigthink.com/sponsored/day-trading-reality/
- https://www.fxstreet.com/education/golden-rules-of-trading-202312051327
- https://stockanalysis.com/article/can-you-beat-the-market/
- https://finance.yahoo.com/news/ask-advisor-am-giving-away-195756248.html
- https://pro.thestreet.com/trade-ideas/use-these-3-steps-to-be-a-successful-day-trader
- https://www.investopedia.com/day-trading/best-time-day-week-month-trade-stocks/
- https://finance.yahoo.com/news/much-interest-earn-1-million-150000229.html
- https://www.ig.com/en/news-and-trade-ideas/nvidia-takes-the-record-for-the-biggest-stock-market-gain-ever-240223
- https://refi.com/calculator/investment-returns-calculator/
- https://www.moneyshow.com/articles/daytraders-28139/
- https://www.investopedia.com/terms/p/putoption.asp
- https://www.linkedin.com/pulse/what-type-trading-should-beginner-start-prince-john-paul-rpige
- https://www.investopedia.com/ask/answers/04/030504.asp
- https://www.ironfx.com/en/is-there-a-100-winning-strategy-in-forex/
- https://www.ramseysolutions.com/retirement/what-is-day-trading
- https://www.capitaltopics.com/blogue/is-100-stocks-really-the-best-option-for-your-portfolio
- https://www.nasdaq.com/articles/the-sp-500-is-surging.-have-you-missed-the-best-time-to-invest
- https://www.ironfx.com/en/what-percentage-of-forex-traders-quit/
- https://www.investopedia.com/articles/basics/10/investing-or-gambling.asp
- https://www.warriortrading.com/how-to-make-a-living-day-trading/
- https://ungeracademy.com/blog/90-win-percentage
- https://twitter.com/Barchart/status/1748556276768854513
- https://www.investors.com/how-to-invest/investors-corner/how-to-build-long-term-profits-in-stocks-take-many-gains-at-20-25/
- https://www.investopedia.com/ask/answers/08/minimum-amounts-of-money-to-start-trading.asp
- https://www.investopedia.com/articles/trading/05/011705.asp
- https://www.tradersmastermind.com/what-is-the-11am-rule/
- https://gitnux.org/day-trading-statistics/
- https://www.fool.com/investing/how-to-invest/stocks/can-you-owe-money-on-stocks/
- https://financebuzz.com/can-you-lose-more-than-you-invest-in-stocks
- https://www.fool.com/the-ascent/buying-stocks/articles/can-you-retire-with-just-index-funds/
- https://www.wsj.com/finance/stocks/hundreds-of-stocks-have-fallen-below-1-theyre-still-listed-on-nasdaq-c8e36abf
- https://www.sarwa.co/blog/invest-1000-per-month-5-years
- https://tradethatswing.com/the-real-reasons-most-traders-lose-money-day-trading-or-swing-trading/
- https://www.fool.com/investing/general/2013/09/21/the-best-performing-stock-on-the-sp-500-since-1980.aspx
- https://tradeciety.com/24-statistics-why-most-traders-lose-money
- https://www.quora.com/When-I-lose-money-in-the-stock-market-where-does-that-money-go-Does-it-just-disappear-into-thin-air-or-does-someone-else-get-it