The vast majority of investors earn far less than what the markets return over time due to (1) poor spending and investment habits largely due to the desire to have every iota of material things they can spend and borrow to get and (2) fear displayed in down markets which cause them to never invest or to pull their investments out of the market. The few people who tend to do much better are long-term investors with diversified portfolios that do not follow the above example and who generally avoid investment expenses higher than one-half percent annually.
The long-term average for the stock market has been about 11% since 1926 and has no twenty or more consecutive year period that experienced a loss. However most people earn less than 4% on average some experience huge losses because of the above noted desire and fear and thus fail to work a plan to get out of debt and use a good stewardship platform to help build wealth that serves them, their family, and others. Debt-freedom is the believer's heritage from the LORD that He empowers you to live in and prosper from so you can be all He made you to be.
Most financial pundits lead people down a path that keeps them broke and subject to foreclosure, bankruptcy, and repossession because the behavioral nature of failing to see the wisdom in debt-freedom leads people to take on more and more debt over time because they really do not see it as a problem. In fact, we come into contact with many who are broke and busted who talk about eliminating stress, pressure, depression, and trouble caused by debt by trying to borrow more to pay off their pain causing debt. Somehow, they think new debt (credit cards, personal loans, and such) and salesmen who peddle it are going to treat them better than they have in the past.
Let's not even mention the fact that people who have no aversion to debt do not control their impulses, which usually moves them to get more house than they can truly pay for without problems down the road including pain from the debt-based purchases they will to get all the things for the house as quickly and as often as they can.
It has not been uncommon for me to see people jumping around from house to house every five to seven years building no home equity and no wealth and buying many new furnishings for those houses even more often than that - all on debt. All the while they are putting very little, if anything, into investment accounts (Roth IRA, 401k, 403b, brokerage accounts, etc.) that would help them greatly in future years when they really need the assistance. This behavior often carries over into the use of debt to pay for over-the-top vacations and excessive activities for their kids (sports leagues, dancing, you name it).
Most of them get so used to having debt that they don't even look for better or lower cost alternatives because their use of debt has become a habit they dare not eliminate because it means they will not get things they want when they want them. Much of the getting is not good for them long-term because it is focused on getting things with depreciating value, low liquidity, and/or when their financial situation, if measured, shows they should not be trying to pay for right now.
Believe and employ God's instruction in the bible rather than man's instruction based on worldly habits. Follow His dream for your spiritual and financial fruitfulness versus the American Dream, pay off your debts including mortgages as quickly as possible, seek to stay that way, allow your financial plan (budgeting and debt-freedom) to be one that allows your disposable income to be the engine that will build wealth for the future through the God-given eighth wonder of the world - long-term compound interest and exponential growth.
Please pray for this ministry and email me with any questions. May the LORD bless you richly as you follow His plan!
Deuteronomy 28:12, 44, Proverbs 6:1-2, Proverbs 22:6-7, Romans 13:8
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