THE NEW HOLISTIC RETIREMENT • 25 Let me put it another way. You have $10. You lose 50 percent of it. Now you have $5. You grow that money by 50 per cent. N ow you have $7.50 . You’r e s till $2.50 shor t of wh ere you st arted. The Impact of Volatility IUm. Sa. gmi naer kyeotuhhi satdo rt yo . sAa vme adr uk reitnsgo t bh ae dwyoorus t wdoe uc al dd, eo inn amv eo rdaegren, lose money every year. A market that saw not just one but two crashes that wiped out more than a third of your savings’ val ue. We fee l fo r ou r parent s an d grandparent s w ho l ived thherroeu’sgh that kind of market with the Great Depression. But a surprise: Their generat ion isn’t t he onl y one that ha d to save during one of the worst markets in history. You did, too . The yea rs 2000 t hrough 20 09 are estimated to be the single worst decade in S& P 500® history. You might have hea rd it call ed t he “lost deca de of investing” beca use t he market that decade ended lower than it started. How ba d wa s it? If you had a 401(k) with $100,000 in it, completel y invest ed in t he S&P 500 ® , 14 wh at would have happened over the firs t decade of this century ? We ll, loo k at the line o n the preceding chart marked, “Annual Total Return of the S& P 500 ® .” This represents your account value. Then, the market crashes from 2000 to 2002. It takes you four years t o earn 14 It's no t possible to inves t directly in an index. However, one can inves t in the stock s that make up the S&P 500 ® or purchase shares of a mutual f und that tracks the S&P 500 ® Index.
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