[na85]

Sure but even a meagre 8% return on $950M is $76M. Buying and holding SP500 index funds in 2021 would have returned more than triple that, at 26% or so.

You can give away 50 mil a year and still get tens of millions dollars richer if you're sitting on $1B.

It's only "easy" to lose $1B if you have absolutely no idea what you're doing.

[sangnoir]

Since when is an 8% return "meagre"?! I get it, the last year had a crazy stock price increase, but it was an outlier.

[na85]

The average SP500 return for the last 50 years is north of 10%, so I consider 8 to be meagre.

[whiddershins]

4%. 4% is the number. Don’t count on anything over this.

[jnwatson]

The next 10 years? 0%. We’ll be lucky if the market is flat in the next decade.

[na85]

10 year treasury bonds are essentially risk free, as they are guaranteed by the US Treasury. Current 10-year yields are a bit less than 2%, so that's essentially your minimum return there.

[kenneth]

Assuming that interest rates remain above inflation, which is already no longer true. What's the point of earning 2% a year when the USD is losing 6% a year in value (and that's likely far undercounted).

[na85]

The point is it's possibly the most secure investment available, so that's why it's a good proxy for the risk free rate.

Whether or not you want to invest at that rate is entirely a separate conversation.

[mwint]

Is that 4% inflation-adjusted?

[largbae]

Usually yes. In times of inflating asset prices, the value of the investment tends to inflate with it.

[whiddershins]

Usually yes. But … not every year exactly, so it works best when viewed over a longer term.

[supperburg]

A meager 8%. You have betrayed your total ignorance when it comes to anything having to do with money. You have no idea what you’re talking about. The only investment that will give you 8% is an extremely risky one and that’s not an appropriate vehicle for a billion dollars. And you say this in the world wide environment of negative interest rates…

The reason not many rich people lose their money is because becoming rich is hard and you have to be smart to do it. You don’t have to be good or moral but you have to be smart. Even then there’s a ton of washout among new millionaires. But you don’t get to a billion by accident. Look at all the people who make tons of money through some other means than intelligence — lottery winners and football players — they all lose their money even if it’s millions. Sorry bud, the system isn’t rigged. Life is just hard.

[na85]

>The only investment that will give you 8% is an extremely risky one and that’s not an appropriate vehicle for a billion dollars.

Buying SPY returns on average 10% or so, year over year.

Do you consider the S&P500 to be "extremely risky"?

>Sorry bud, the system isn’t rigged.

I feel like you replied to the wrong person? Between you and I, the only one who brought up the question of whether "the system" is rigged or not is you.