Why You Should Be Skeptical of Financial “Rules of Thumb”
Prairie Eco-Thrifter
MAY 1, 2013
While it’s nice to think that stocks offer 10% annualized returns over 20 years, the reality is that the S&P recently only returned 7.89% over a 20-year period (according to the most recent DALBAR survey). If you are buying a home, start with the 30% rule, and then evaluate where that puts you in terms of finances.
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