adminYou don’t need to develop a secret strategy to get solid returns. The key is targeting growth stocks.
Saving money and investing is not an easy task at this time. Rising costs make it difficult for many people to find ways to set aside money for their future.
But if you look for small wins and cost savings, they can still lead to a big financial reward in the end. Whether it’s cutting back on trips to the coffee shop, eating out less, or cutting back on other daily expenses, saving and investing just $5 a day can be enough to put you on the path to growing your portfolio to $1 million, if you do. for a sufficiently long period such as 30 years.
Through the benefits of compounding, I will show you how you can make the most of any savings you may have with a reliable investment in the stock market.
Growth stocks make the best long-term investments
If you want to get the most out of your money and are committed to letting it grow in the stock market for many years, then growth stocks will be your best options today. Dividend stocks can be great sources of passive income, but are often better suited for investors who need more stability, such as retirees. Although growth stocks can be volatile, they are more likely to generate market-beating returns over the long term.
take the Invesco QQQ Trust (QQQ 2.01%) as an example. This exchange-traded fund (ETF) invests in the top 100 non-financial stocks of the Nasdaq exchange It has a reasonable expense ratio of 0.2%, not a bad price given the upside it can offer investors through the world’s fastest growing stocks. If you want to invest Microsoft, Nvidia, Tesla, or other top names, the background is covered. And as new growth stocks emerge and become more valuable, the Invesco QQQ Trust regularly rebalances its holdings.
Over the past 10 years, the fund has generated a total return (including dividends) of around 420%, compared to just 220% for S&P 500. This represents an annualized return of 17.9%.
Like 5 dollars per day can reach 1 million dollars
If you reserve $5 a day, that’s roughly $150 a month. And over 30 years, you’ll save about $55,000 total. While that’s a good chunk of change, it’s nowhere near $1 million. The key is to invest those savings in a growth-focused ETF like the Invesco QQQ Trust.
Below is a table showing how your balance can grow over a 30-year period, assuming you invest $150 each month while earning an average annual return of 15%.
| Anus | balance sheet |
|---|---|
| 5 | $13,500 |
| 10 | 41,800 dollars |
| 15 | $101,500 |
| 20 | $227,400 |
| 25 | $492,600 |
| 30 | $1,051,500 |
Calculations by author. Balances rounded to the nearest hundred dollars.
In the early years, although your portfolio balance is quite modest, the earnings are not significant. But towards the latter stages, your winnings really start to add up.
Your returns are not guaranteed, but the strategy is solid
This level of earnings is of course not guaranteed. Your rate of return will vary from year to year, and you need to reinvest the dividends you receive to maximize your long-term return.
The Invesco QQQ Trust is also just one popular example of a growth fund you can invest in; there are many great ETFs that can help you grow your savings based on your needs and risk tolerance. The main lesson here is to save consistently, even just a few dollars a day, and then invest that money to put yourself on the path to a sizable nest egg.
David Jagielski has no position in any of the stocks mentioned. The Motley Fool has positions and recommends Microsoft, Nvidia and Tesla. The Motley Fool recommends Nasdaq and recommends the following options: long January 2026 $395 Microsoft calls and short January 2026 $405 Microsoft calls. The Motley Fool has a disclosure policy.
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