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How Much Would You Have Had To Invest In Tesla 10 Years Ago To Retire Today?

JasonDoiy / Getty Images

JasonDoiy / Getty Images

Even though Tesla’s stock value has had a rough couple of months, the electric car manufacturer is still worth 10 times more than it was 10 years ago. As one of the top stocks in the S&P 500, Tesla has driven a good share of the market’s growth in recent years.

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So how much would you have today if you had invested in Tesla stock in 2014? How much would you need to have invested to comfortably retire?

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How Much Money Is Enough To Retire?

When you’re deciding how much money to set aside for retirement, the best thing to do may be to speak to a financial advisor. Everyone’s financial situation may be different, with different sources of income and expenses, so there is no one-size-fits-all solution. Retirees who don’t account for all of their expenses correctly may risk outliving their savings and running out of money.

However, there are a few guidelines you can use to get an idea of how much you should be aiming to save. One of these is the 25-times rule — to get an idea of how much you need for your retirement fund, multiply the amount you’ll likely spend in your first year of retirement by 25.

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How Much Does the Average American Need To Retire?

You can use the 25-times rule to see how much the average American might need to save for retirement. According to the latest data from the U.S. Census Bureau, the median U.S. income was $75,149 in 2022. Once you adjust this number for inflation, you get a 2024 median of $82,948.

The average Social Security benefit as of January 2024 is $1,907 a month. This means that the desired annual retirement withdrawal for the median American would be:

$82,948-( $1,907×12) = $60,064

If you multiply this number by 25, you get $1.5 million as your retirement savings estimate for the average person in the U.S.

How Much Has Tesla Grown in the Past 10 Years?

As of March 28, 2024, the price of Tesla’s stock was $175.79. Ten years ago, at market close on March 28, 2014, Tesla’s stock was trading at $14.16 per share. This means that $10,000 invested in Tesla in March 2014 would be worth about $124,145 today.

So how much would you need to have invested in Tesla 10 years ago to be able to retire? Let’s take our previous estimate of the savings you would need in retirement if you earned the median U.S. income and compare it with the 10-year return for Tesla’s stock:

 $14.16 / $175.79 * $1,501,600 = $120,954.87

This means that if you had invested $120,954.87 in Tesla stock in 2014, you may have been able to sell it today and retire. Of course, investing all of your money in a single stock would have been incredibly risky — if Tesla had gone under due to unforeseen circumstances, you would have lost all your money instead.

How Much Does the Average American Have in Savings?

Americans may have much less money in their savings accounts than would be optimal. According to the Federal Reserve’s latest Survey of Consumer Finances, in 2022, the median American between the ages of 65 and 69 had only $50,650 in savings.

The top 1% of 65- to 69-year-olds in the U.S. have at least $10.4 million in savings, which may be why the mean, $785,099, is so much higher than the median.

How many people have $1 million in retirement savings?

Fifteen percent of Americans had at least $1 million in retirement savings in 2022-23.

There’s a growing gap in retirement savings between low- and high-income earners in the U.S. One in five low-income households had money in a retirement account in 2007 — that number had dropped to one in 10 by 2019. Meanwhile, the amount saved by high-income earners had almost doubled in the same time period. When you’re trying to set aside money for retirement, it’s important to not take unnecessary risks. While the idea of finding the next Tesla or Bitcoin can be tempting, it can also be incredibly risky. Historically, around 40% of companies in the Russel 3000, an index of the top 3,000 companies in the U.S., have experienced a 70% or more decline from their peak and not recovered. Make sure to talk to a financial advisor before making any serious financial decisions.

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This article originally appeared on How Much Would You Have Had To Invest In Tesla 10 Years Ago To Retire Today?

Read More: How Much Would You Have Had To Invest In Tesla 10 Years Ago To Retire Today?

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