I have recently hit a significant milestone in my investment portfolio, and while I should feel good about it, I am starting to feel unsure. I’m definitely thankful for the gains, but something feels off.
I have been consistently investing in index funds and a few reliable individual stocks. I follow the usual advice DCA, hold for the long term, avoid panic selling and it worked out well. But when I look at people with massive portfolios, it’s surprising how easily the wealthy seem to accumulate even more. For instance, if someone had $10M in SPY at the beginning of this year, they’d already be up by $1.5M. It feels almost unreal.
It makes me wonder, what actual value is being created? I have been investing for a while, but seeing how money can grow like this makes me question whether it’s just a mix of compounding and luck. I’m pleased with the returns, but what’s the deeper value behind it? Has anyone else ever felt like investing becomes strangely easy once you reach a certain point?
I am not trying to sound unappreciative, but I would really like to hear others’ thoughts. Am I overanalyzing this, or is this just how things work once you reach a certain level?
Some investors with $100K might view the returns of those with $1M as extraordinary. This is the nature of investments, assets are meant to generate returns. Eventually, your portfolio’s growth may surpass your contributions. During market downturns, however, your portfolio could shrink even with ongoing contributions.
It’s a gradual process. I recall investing my first $100 in college, noticing how a 1% change equaled just $1. Then came $1,000, then $10,000, and so on. It’s easy to become desensitized because the growth occurs over time. It is similar to how kids don’t usually notice themselves getting taller, but when you see them once a month, the growth seems significant.
You might not feel skeptical at all. It is possible that you are now thinking more defensively and about capital preservation because your risk tolerance has altered. Furthermore, I don’t think it’s abnormal to give capital preservation more thought if you’re older, have a family, children, or other such responsibilities.
Indeed. In the end, a lot of trading, investing, etc. is psychological in nature. The true measure of a person’s risk tolerance is their feeling towards taking financial risks.
Exactly. There is nothing inherently special about $1,000,000, you could just as easily create a mental barrier at $987,654 or $696,969, or any other number.
I think what the original poster is experiencing is a sense of uncertainty about how they reached this point, which is making them feel unsure or uneasy about maintaining it now that they have hit their personal milestone.
Many Americans find it challenging to save even 5% of their paycheck. It took years of saving, waiting, and working to reach your current position. Congratulations, you have achieved it, and for you, the hard part might not have felt so difficult.
I think you are overthinking this. Long-term investing pays off, and your portfolio is evidence of that. Keep doing what you are doing and revisit in 5 years.
