Ten steps to financial freedom: Invest! Seriously, it's simple

The Motley Fool

Invest! Seriously, It's Simple

What would you do if we said you were missing out on an investing strategy that, in the long run, has produced returns that far outweigh those offered by a building society? One that outperforms cash in a deposit account or bonds? Well, meet the stock market.

Internet bubble and credit crunch included, over the last 90 years or so, the UK stock market has returned an average annual rate of around 11%, outperforming bonds and cash in a deposit account by around 5% to 6% a year. Although recent falls have shaken many people's belief in shares they also do pretty well over shorter periods too. For example, over period of five years, the returns from shares have historically beaten cash around 80% of the time. Over ten years, this rises to about 90%, and for twenty-year periods, it's 98%. With odds like that, investing for the long term remains one of best ways of building your wealth.

Investing in the stock market can be financially savvy, simple, and inexpensive.