What happens if you invest $1,000 monthly in the S&P 500 for 30 years?

Based on an average annual return of 9.5%:
- 5 years of investment: $60,000 → $72,500
- 10 years of investment: $120,000 → $186,700
- 20 years of investment: $240,000 → $649,500
- 30 years of investment: $360,000 → $1,796,000

By then, you could live off the dividends alone. Currently, the S&P 500 dividend yield is only 1.2% (dragged down by tech giants), but if we use the historical median of 2.9%, a $1.79 million portfolio could generate about $52,000 in passive income annually.

Sounds boring? But this is the power of compound interest — no need to pick stocks, no need to work a job, time is your best friend. Of course, when you reach retirement age, you might want to shift some funds into more stable assets like bonds, but the principle is that simple.