The opportunity cost of locking $80,000 away for 10 years #wealthplanning

If you’ve got $80,000 and you’re deciding between a term deposit or the share market for the next 10 years, here’s how the maths can look.

Using MoneySmart’s compound interest calculator as an example:

If you put $80,000 into a term deposit earning around 5% for 10 years, you might end up with roughly $130,000.

If that same $80,000 earned an average 10% return in the share market over 10 years, you’re looking closer to $207,000.

That’s a difference of about $77,000 over the same time period.

Of course, term deposits are stable and predictable. Share markets fluctuate and returns aren’t guaranteed.

So it comes down to your time frame, your risk tolerance and what you’re comfortable with.

General advice only.
Amy Lehmann is an Authorised Representative (No. 1292710) of Consortium Private Wealth Pty Ltd (AFS Licence 495401).