Page 101 - FlipBook BACK FROM SARAN - MAY 5 2020 - Don't Make Me Say I Told You So_6.14x9.21_v9_Neat

Don’t Make Me Say I Told You So 87

In this example, over the last 20 years, the ending value for
the Investment Company of America was $156,612 and the

ending value for a six-month Treasury Bill was $67,690.

Summary

► Owning stocks and bonds entails risk. The primary
risk for bonds, if quality bonds are used, is the loss of

purchasing power due to the effects of inflation over
time. The risk for stocks is a loss of principal because of

stock market declines.

► Stocks have historically provided the growth to give

you a larger nest egg to serve as a source of income
during retirement. While bonds typically do a better

job of preserving principal, that principal loses value,
or purchasing power, as inflation progressively makes

things more expensive.

1 Center for Research in Security Prices. “Luminaries at CRSP Launch
World Renowned Database - 1926 Marks the Beginning of Time for
Modern Financial Research.” PRWeb, March 31, 2010. http://www.prweb.
com/releases/2010/03/prweb3803424.htm

Chapter 3: You Must Have Growth In Your Portfolio