The money experts at Kiplinger do a fun series of stories asking readers to imagine how small investments made 20 years ago would add up to today.
The results can be astonishing.
So, suppose 20 years ago you had $5,000, the desire to invest it, and exceptionally good taste in stocks. Here are some of the wins you could have made had you invested $1,000 in each of these stocks:
* Amazon. An eye-opener. That cool grand would be worth about $105,000. That's an annualized total return (meaning the change in price and dividends earned over the period) of 26.2 percent.
* Netflix. Hold on to your hat. Your $1,000 over 20 years would be worth $583,000, a return of 34 percent.
* Apple. Take a big bite. $185,000. That's a 29.8 percent return.
* Microsoft. You would get a fantastic annualized return of 16.6 percent, but compared to your other investments, your results would not dazzle you at $21,000. But it would be substantially more than another good $1,000 investment — the S&P 500 — which would earn a solid 10.1 percent or $6,800.
* Nvidia. Your last $1,000. Had you invested in Nvidia, this would be your bonanza. The AI chip maker rules the market today and your $1,000 would have turned into $650,000.
So, in total, your $5,000 investment would have grown to more than $1.5 billion.
Congratulations on those good choices — and in not selling during market downturns.