I often hear about getting 8% return on investment? Where can I invest to get 8% interest?!?

Recently CNNMoney.com had an article that reads: "Beginning at age 30, if you save $671 each month at an 8% return, you'll have $1 million by age 60. Begin at age 40, and you need to save $1,698 each month." My bank sure doesn't offer that interest rate. And the stock market isn't reliable. So where is this much-quoted 8% rate of return? Any ideas where one can invest to guarantee that kind of a return?

Those answers are correct for the most part except for Daniel B. Who seems to confused on the difference between annuitized and annualized... but we will let him slide for now.

The long and short of it is that you are not going to find an 8% gauranteed product right now and I doubt you will see it for a long while. Interest rates are the highest they have been in a long time. The Fed has raised rates I believe 17 straight times and it is now at 5.25%. More than likely that rate is not going to go up again, unless inflation continues to rise, but that is a conversation for another day.

Historical return of the stock market is 12%. But if you do not want to put your money at play in the market you could probably get an annuity that pays around 4% and since the money grows tax free it comes out to about 5.5%. Only problem being that you will have to pay taxes on your gains on the back end.

Hope that answered it for you.

P.S. Don't listen to everything you hear on TV. If you want financial advice, get a financial advisor... thats what we get paid for.

I wish there was a magic answer as well... wait a second.. then I would be out of a job... I guess I don't =o ) Report It

The 8% return is a guestimate on a porfolio mix of bonds stocks and money markets. You will not get an 8% rate at a bank right now.

They are talking about the stock market. Over the long haul 30+ years the SP 500 gives those returns of 8% or more per year annuitized..

Go to yahoo and type "SP 500 historical returns" and you will see.

I'm not sure of the exact rate of interest, it probably varies from group to group. However, you could start an annuity account with one of many financial groups. Some of the best interest rates will be found with investment groups that offer their services to a particular subset of people. The example I'm about to give is the only one that I have personal acquiantance with.....Thrivent Financial for Lutherans. I'm sure that other faiths have similiar organizations. Another one that comes to mind is International Order of Foresters. I would imagine that other brotherhood-type groups may also have an investment group for their members. So if you belong to the Elks or Eagles or some other, inquire there as well.
It's all still based on the stock market, but your risk is diluted by the diversity of the stocks in the fund. Unlike Jimma, I am not any kind of financial expert, but I hope this gives you some ideas about things to investigate.

If you contact a financial adviser and you explain that you want an 8% return over the next 20 years, he will be able to put together a portfolio that can give you type of performance.

If you want a better return, then you will need to take more risk. An 8% - 9% return is very realistic if you invest regularly and don't pull money out of the market when the investments are going down.

Good Luck.