If your family is like mine, you gather at the Thanksgiving table and, before plunging into a Butterball, turducken, or tofurkey, you take turns expressing what you’re thankful for. To be honest, it’s not my favorite part of the meal. I struggle to verbalize heartfelt sentiments, typically fail to produce something original, and get distracted by the crispy fried onions on my mom’s green bean casserole.
Still, I appreciate the ritual. You’ve got to love a holiday centered around gratitude, which is apparently linked to health benefits. In that spirit, I thought it’d be appropriate to reflect on our many blessings as investors.
I realize that this may come off as Pollyannaish. There are more than enough risks out there to keep us all awake at night. Geopolitics, debt, and robot apocalypse all spring to mind. But there are many more reasons for investors to be thankful. Please feel free to eat while reading my top 10.
1. The fact that we’re investors. If you’re reading this, you most likely have money in financial markets. We’re fortunate. According to a Gallup Poll, 62% of Americans own stocks directly or indirectly, meaning millions do not. It’s hard to invest when you’re living paycheck to paycheck or burdened by debt. For those of us with the means, though, investing is a wonderful way to preserve and grow wealth. Deferring today’s consumption to achieve a future goal, whether it’s retirement, college savings, a down payment, a bequest, or a rainy day, is a smart and responsible thing to do.
2. Fabulous recent investment returns. The US stock market emerged out of the wreckage of the 2007-09 financial crisis to deliver average annual returns of 14% for the past 15 years—far exceeding historical norms. Recent gains have been higher. As of this writing, the Morningstar US Market Index, a broad gauge of equities, was up more than 25% for 2024. Returns in 2023 were similar. We had a bad year in 2022, and the “pandemic panic” of March 2020 was scary. But investors who’ve stayed the course have been rewarded. In the past five years alone, investors holding broad US market index funds have more than doubled their money. That far exceeds the inflation rate. Speaking of which …