If you had half a million dollars and invested it in mutual funds, chances are you would leave $25,000 a year of potential income on the table. Over 20 years, that under-performance could cost you over $1,000,000 when you include reinvestment.
This conclusion is based on a recent study by Dalbar, Inc. It found that mutual fund investors individuals and investment advisors consistently earn below-average rates of return. This group’s average annual rate of return for 20 years underperformed the average by over 5%.
Read the complete article at: Rick Kahler: Money Psychology Key to Wise Investment Choices | Financial Awakenings.