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How Much Income Can I Expect to Receive From Safe Investments?

A Historical Perspective on Safe Investment Returns

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Safe Investments Produce Some Investment Income: But It Varies From Year to Year

What kind of investment returns, or approximately how much investment income, would you expect to receive from safe investments? It depends on the year.

In 1981 a safe investment (such as a certificate of deposit) yielded 17.2%. For every $100,000 you had invested, you would have received $17,200 in interest income.

In 2003 that same investment yielded 1.2%, or $1,200 of interest income, per year, on every $100,000 invested.

If you retired in 1981, and only invested in safe, interest bearing accounts, you would have found it difficult to maintain your standard of living, as inflation would have caused prices to rise while your investment income from safe investments would have steadily declined.

Below is a table that shows you the amount of interest income you would have received each year since 1973 for every $100,000 invested in short term certificates of deposit.

After looking at the table you will also want to see how these returns, and other safe investment returns, compare to alternatives like bond and stock funds by looking at rolling returns.

*Returns data in table below from Dimensional Funds Advisors, using their Returns software program.

Safe Investment Returns*

Historical 1 Month CD Returns
Year Return Annual Income Per $100k
1973 8.4% $8,400
1974 11.0% $11,000
1975 6.6% $6,600
1976 5.3% $5,300
1977 5.6% $5,600
1978 8.1% $8,100
1979 11.5% $11,500
1980 13.6% $13,600
1981 17.2% $17,200
1982 13.0% $13,000
1983 9.4% $9,400
1984 10.9% $10,900
1985 8.4% $8,400
1986 6.9% $6,900
1987 7.2% $7,200
1988 7.9% $7,900
1989 9.7% $9,700
1990 8.7% $8,700
1991 6.3% $6,300
1992 3.9% $3,900
1993 3.2% $3,200
1994 4.4% $4,400
1995 6.2% $6,200
1996 5.6% $5,600
1997 5.8% $5,800
1998 5.7% $5,700
1999 5.4% $5,400
2000 6.6% $6,600
2001 4.2% $4,200
2002 1.8% $1,800
2003 1.2% $1,200
2004 1.4% $1,400
2005 3.2% $3,260
2006 5.1% $5,150
2007 5.4% $5,450
2008 3.1% $3,140
2009 .44% $440
2010 .24% $240
2011 .20% $200
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