How Much Is 1 Million Dollars Worth Compared To Twenty Years Ago?
Actually how much is one million dollars worth nowadays?. a million dollars is worth less today than yesterday. And with that, I mean how much is one million Benjamins or US dollars worth anyway? With prices of goods, services, properties and even basic amenities going up quicker than our pay, that one million dollars that we so desire may not be the same or as much as during our grandfathers’ time, when having a million dollars meant that you do not need to work another day in your life and that you have sufficient money for your children.
One million dollars is worth much less than previously, and some Americans are still living near the poverty line. However the amount of goods or security that one million dollars can buy has definitely and visibly dwindled. Take for example, the price of our homes. Home prices have risen about 300% over the last 20 years. That would mean that a million dollars used to be able to buy a home three times as big 20 years ago versus today. Taking that as a prime example would mean that one million dollars today is only worth three hundred thousand 20 years ago.
However the pertinent question that we should ask, when we ponder the worth of our money is whether we are able to grow our money as rapidly as the annual inflation so as to maintain the value of our cash. If you do not grow your wealth by the rate of inflation, you are getting poorer by the minute. And in twenty years, the one million dollars underneath your bed would decrease down to only a third of the original value. So dun leave your money to fend for itself, it cannot do so within the confines of your cookie jar or even that of your saving accounts.
Investing in the stock market is a good way to grow your money to keep in pace with inflation or to grow above the inflation rate. The safer bet in the stock market would be to buy the index or others would call indexing. That would be about buying the stock index or funds that invests in a basket of goods representative of the market in general Since the stock market tend to rise over the long term, your investment or money would be relatively safer, short of a great depression.
To fight against inflation, you could also invest in real estate. As highlighted above, real estate prices had increase over 300% over the last 20 years. Investing in real estate can mean staying in line with price increases and maintaining the value of your wealth. Do not let your cash sit idling; make sure your cash is working just as hard as you.
Ultimately many people would be wondering whether they can retire with one million dollars. It is possible, but we will have to face the realities that we will not be able to enjoy as much luxuries as we would had twenty years ago. One million dollars would still be sufficient for a modest retirement today but in another twenty years, we would not even be able to afford a home with this amount of money. retirement living may not be possible with just one million dollars tomorrow.
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