|Years of investment||Annual return required for break even with a 5% CD|
Thus, money invested in the stock market for X years had to return at least Y% in order to match the return of a 5% CD. If the return is below the percentage shown, then a 5% CD was the better investment. If the return is above the percentage shown, then equities were the better investment.
With the S&P 500 return for the last 10 years close to zero, a 5% CD beat the stock market for 5 and 10 year periods. Although I couldn't find the data, a 5% CD also likely beat the stock market for the 15 year period. One has to go back 20-25 years for the stock market to break even with a 5% CD at the end of 2008.
Essentially, the bear market of 2008 has erased the additional gains of the stock market over fixed income. For now, a 5% CD appears to be the better investment for the past 15 years.
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This is not financial or investment advice. Please consult a professional advisor.
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