Understanding Your Rate of Return (RoR)

Do you know the power of your Rate of Return (RoR)? This week’s Money Guy episode is about all things rate of return. If you have ever wondered what a reasonable rate of return is or how to actually calculate it and make sense of it, then this show is for you!

You always want to make sure that your rate of return reflects you and what your needs are for your financial road map. Our goal for all of our listeners is for you to attain financial independence, and we want to make sure that you have a clear understanding of your investments. Join us for this week’s episode of The Money Guy Show as we discuss the power of your rate of return.

Here’s What You’ll Find Out in this Episode:

• Understanding the power of Rate of Return
• How compound interest works in your favor and what the concept of 88 times over means to investors
• How time in the market impacts your Rate of Return and why portfolio design should reflect the opportunity of your age
• What is considered a reasonable Rate of Return
• What is a good average stock market return
• What the average Average Investor Return over the last 20 years is according to the 2018 Dalbar Quantitative Analysis of Investor Behavior study
• The difference between Yield and Total Return
• Why average market returns are not always average
• The role emotions play in market cycles and how they can impact investor behavior
• Why Rate of Return can (and should) vary by individual needs
• The specific things that influence your Rate of Return
• How to design a portfolio that will help you achieve your goals
• What the components are of returns, yield, and appreciation are
• What your risk tolerance and capacity have to do with your Rate of Return
• Understanding your savings rate vs your withdrawal rate, and how to interpret your RoR within the context of both
• How to calculate your Rate of Return

Resources Mentioned in This Episode

• Mutual Fund Winners (CNN)
• Vanguard CIO Greg Davis Just Issued a Dire Warning for the US Stock Market
• NerdWallet-What is Average Stock Market Rate of Return
• Investopedia-How to Calculate Your Investment Return

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