Hacker News Reader

45 years from now, $2.1M adjusted for inflation (3%) is $533K. A lot of these compound interest calculators don't show you the values adjusted for inflation. It sounds great when you get 21x your investment. 5x doesn't sound as great, but it's more realistic.

View on HN

The 7% figure they gave is already adjusted for inflation.

Only if you think you're getting 7% returns after inflation, which statistically is highly unlikely.

$2.1M is literally $100k compounded at 7% over 45 years.

The S&P typically returns 10% YoY. 7% per year is the historical average adjusted for inflation: https://www.investopedia.com/ask/answers/042415/what-average...

You can't perfectly time your retirement to match the S&P 500 average. That's the reason your portfolio shifts to bonds as you get older. It's the reason everyone quotes 7 & 8% as reasonable long-term returns for your retirement portfolio.

Right, but if for each of the past 100 years you tracked people who put money in the stock market and held it for 45 years and averaged each of their returns you'd get a 7% YoY return after adjusting for inflation.

Some would end up lower but some would end up higher.

Nothing is guaranteed, but neither is a job.

Reply on news.ycombinator.com