Can Investing $25,000 in the S&P 500 Today and Holding On for 25 Years Make You Wealthy?

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Over an extended period, spanning not just years but decades, following the S&P 500 has been a dependable strategy to accumulate substantial stock profits. Given that this index focuses on the top stocks in the U.S. markets, it provides an excellent low-risk opportunity for long-term growth investment.

Instead of investing small amounts over time, consider putting $25,000 into an exchange-traded fund (ETF) like the SPDR S&P 500 ETF (SPY), which follows the S&P 500 index, and keeping it for 25 years. Could this strategy potentially make you wealthy enough to comfortably retire? Let’s find out.

How much could your portfolio be worth after 25 years?

An approach known as buy-and-hold could help increase the worth of your investments over time. It’s often beneficial to let your investments grow naturally without frequent adjustments. Constantly chasing the newest trends or popular stocks might not only be unnecessary, but it could potentially disrupt your investment plans and aims.

For those with a varied investment portfolio or who own shares in the SPDR S&P 500 ETF, it could be beneficial to adopt a strategy of setting and forgetting. Over the long term, your investments may increase in value, although it’s crucial to remember that there’s no assurance stocks will always climb or be profitable when you need the funds. The factor with the greatest potential impact on your total returns is regrettably hard to predict: your average yearly return.

Given that the S&P 500 is currently close to record levels, it might be prudent to expect its future average returns could potentially dip slightly below its typical historical rate of approximately 10%. Let’s see what a $25,000 investment in the SPDR S&P 500 ETF may amount to after 25 years, assuming an annual return falls within the range of 7% to 9%.

Year 7% Growth 8% Growth 9% Growth
5 $35,064 $36,733 $38,466
10 $49,179 $53,973 $59,184
15 $68,976 $79,304 $91,062
20 $96,742 $116,524 $140,110
25 $135,686 $171,212 $215,577

In this situation, a $25,000 investment would likely expand over the years, though it might not offer exceptionally high returns. This means that while your money could increase substantially, perhaps reaching several hundred thousand dollars, it’s unlikely to make you wealthy or provide enough for a comfortable retirement after 25 years. If your ambition is to amass a fortune exceeding $1 million, this investment strategy may fall short of your goal.

What you can do if you don’t think you’re on track to hit your goals

If you’re concerned that you might fall short of your investment objectives, here are some steps you could consider to potentially improve your outcomes.

Regularly adding funds to your investments can gradually boost your account’s value over time, enabling greater compounding of returns throughout the years. The more you contribute, the faster your earnings will grow.

If that’s not feasible, another strategy worth exploring could be to shift your focus towards high-growth stocks, rather than solely replicating the market trends. By putting your money into technology stocks or businesses with strong growth potential, you might increase your chances of surpassing the market and earning above-average returns.

Choosing specific stocks or concentrating on ETFs that follow growth stocks might require additional study and take longer, but it could prove to be a superior approach compared to mimicking the S&P 500. This method comes with increased risk, but the potential reward could be significant in the long run.

No matter the strategy you choose, it’s beneficial to frequently review your investment portfolio to assess your performance and determine if any changes or readjustments to your investments are necessary.

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2025-07-20 22:11