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This article was posted on June 8, 2004. Answer: Never. Using the Retire Early Safe Withdrawal spreadsheet re2002i.xls, the investment returns for both the S&P500 and an I-bond with a 1% coupon were compared for each of the 100 30-year periods from 1871 to 2002. The terminal value of a $1,000 initial investment at the end of 30 years is reported in the table below. There was no 30-year period where a 1% I-Bond beat the S&P500. Note: The S&P500 is assumed to have a 0.20% annual expense ratio. The I-bonds are expense free. Start I-Bond@1.00% S&P 500 1871 $ 2,228 $ 6,777 1872 $ 2,249 $ 7,009 1873 $ 2,411 $ 6,822 1874 $ 2,411 $ 5,842 1875 $ 2,492 $ 7,252 1876 $ 2,516 $ 8,324 1877 $ 2,607 $ 9,584 1878 $ 2,607 $ 7,680 1879 $ 2,720 $ 9,112 1880 $ 2,493 $ 7,181 1881 $ 2,493 $ 5,556 1882 $ 2,284 $ 5,694 1883 $ 2,475 $ 5,884 1884 $ 2,551 $ 5,895 1885 $ 2,602 $ 6,290 1886 $ 2,706 $ 6,401 1887 $ 3,044 $ 6,242 1888 $ 3,477 $ 5,300 1889 $ 4,139 $ 5,971 1890 $ 4,890 $ 6,625 1891 $ 4,723 $ 6,144 1892 $ 4,723 $ 5,683 1893 $ 4,356 $ 6,838 1894 $ 4,530 $ 8,699 1895 $ 4,576 $ 10,534 1896 $ 4,667 $ 12,488 1897 $ 4,667 $ 13,461 1898 $ 4,489 $ 15,253 1899 $ 4,381 $ 17,326 1900 $ 3,748 $ 15,309 1901 $ 3,748 $ 10,148 1902 $ 3,621 $ 5,253 1903 $ 3,270 $ 4,490 1904 $ 3,380 $ 8,155 1905 $ 3,404 $ 5,821 1906 $ 3,454 $ 7,348 1907 $ 3,377 $ 9,594 1908 $ 3,435 $ 8,769 1909 $ 3,293 $ 7,352 1910 $ 2,955 $ 6,578 1911 $ 3,027 $ 6,247 1912 $ 3,405 $ 5,582 1913 $ 3,416 $ 6,192 1914 $ 3,447 $ 7,935 1915 $ 3,491 $ 9,908 1916 $ 3,466 $ 10,507 1917 $ 3,640 $ 8,625 1918 $ 3,353 $ 10,499 1919 $ 2,881 $ 9,924 1920 $ 2,439 $ 9,776 1921 $ 2,662 $ 14,799 1922 $ 2,805 $ 16,274 1923 $ 2,833 $ 14,482 1924 $ 2,782 $ 14,170 1925 $ 2,761 $ 16,336 1926 $ 2,679 $ 16,787 1927 $ 2,786 $ 16,122 1928 $ 2,916 $ 11,306 1929 $ 2,986 $ 10,773 1930 $ 3,017 $ 12,621 1931 $ 3,099 $ 16,822 1932 $ 3,151 $ 32,439 1933 $ 3,225 $ 34,220 1934 $ 3,204 $ 26,982 1935 $ 3,140 $ 33,633 1936 $ 3,154 $ 24,613 1937 $ 3,194 $ 17,512 1938 $ 3,287 $ 28,393 1939 $ 3,466 $ 27,331 1940 $ 3,706 $ 24,313 1941 $ 3,847 $ 28,195 1942 $ 3,568 $ 34,578 1943 $ 3,435 $ 34,126 1944 $ 3,650 $ 23,576 1945 $ 3,989 $ 15,999 1946 $ 4,164 $ 16,001 1947 $ 3,708 $ 19,954 1948 $ 3,594 $ 17,823 1949 $ 3,879 $ 18,777 1950 $ 4,462 $ 18,722 1951 $ 4,617 $ 17,583 1952 $ 4,796 $ 13,767 1953 $ 4,956 $ 15,484 1954 $ 5,106 $ 17,984 1955 $ 5,326 $ 13,414 1956 $ 5,512 $ 13,136 1957 $ 5,430 $ 16,023 1958 $ 5,453 $ 16,596 1959 $ 5,628 $ 14,072 1960 $ 5,861 $ 16,015 1961 $ 6,088 $ 15,002 1962 $ 6,205 $ 16,544 1963 $ 6,322 $ 18,237 1964 $ 6,377 $ 16,850 1965 $ 6,493 $ 14,754 1966 $ 6,544 $ 17,806 1967 $ 6,518 $ 24,017 1968 $ 6,387 $ 26,451 1969 $ 6,221 $ 31,387 1970 $ 6,015 $ 39,329 1971 $ 5,893 $ 34,928 1972 $ 5,808 $ 26,704 |
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Copyright © 2004 John P. Greaney, All rights reserved.
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