On top of that, the top stock pickers and fund managers can't beat that number consistently for anywhere near as long. Oh they get a few stellar years, but over time, they do well to hit the average. This is also true for active traders, especially when considering trading costs plus taxes on short term activity.



So if the pros can't do it, how can I make this claim of an 18% return on your money?

It's simple. I'm talking about the thing you should do before ever putting a nickel in the market.

The odd thing is there are millions who don't do this and keep throwing away money year after year, while maintaining the illusion they've got their money working hard for them.

What is this simple step? Paying off credit card balances.

If you carry a balance on your credit card(s), you pay a certain rate of interest along with that principal payment every month. On average, that rate is 18%. Hence paying off the balance eliminates paying 18%, thus giving you an 18% return.

No, this isn't hocus-pocus, and it's no trifling matter. It's real money in your pocket.

People tend to focus on how well their investments are performing while ignoring the ridiculous amounts of interest they pay during their lifetime of credit card debt.

The simple fact is, that if you aren't earning more on borrowed money (debt) than you pay in interest, you are by definition, losing ground.

Millions of folks do this every day without even thinking about it. I'm not even referring to those investors who play the market regularly, yet keep a balance on their cards. I'd expect them to know better since they live and breathe ROI. Rather I'm speaking about those diligent earners funding their various retirement plans in the form of 401k's, 403b's, IRA's, whatever.

They watch with concern at how much their nest egg grows, which we've already seen will likely average around 10% over time. Yet they always have a balance on their credit cards that they just as diligently pay on month after month.

If their interest rate is 18%, and their investments make them 10%, they're really losing 8% each year. That's assuming the market isn't tanking like it's been recently. With today's volatility, you could actually be down 10% or more. Add that to paying 18%, and hmm ? that's a 28% loss.

Something else to be aware of ? it takes a 50% gain to wipe out a 25% loss!

Even if you have a low rate on your cards, anything over the average 10% return, will still lose you money over time. Do the smart thing ? use credit cards only for convenience, and pay them off every month. Your investments will thank you.