Paid non-client promotion: Affiliate links for the products on this page are from partners that compensate us (see our advertiser disclosure with our list of partners for more details). However, our opinions are our own. See how we rate investing products to write unbiased product reviews.
- The S&P 500 has gained about 10.7% annually since its introduction in 1957.
- The S&P 500's annual average return in 2023 was 24%, a significant increase from 2022.
- Returns may fluctuate widely yearly, but holding onto investments over time can help.
The S&P 500 average return over the past decade has come in at around 10.2%, just under the long-term historic average of 10.7% since the benchmark index was introduced 65 years ago.
But the stock market return you'll see today could differ greatly from the average over the past 10 years. There are a few reasons why you could see a bigger or smaller return than the average during any given year.
Read Insider's guide to the best online brokers for free stock trading>>
The S&P 500 average return over the past 10 years
There are many stock market indexes, including the . This index includes 500 of the largest US companies, and some investors use its performance as a measure of the market's health. The annual S&P 500 average return in 2023 was 24%. So far, the average return for 2024 is around 19%.
"Investing can be a good way to grow wealth over the long term and offers the potential for higher returns compared to a typical checking or savings account," says Jordan Gilberti, CFP and senior lead planner at Facet.
Here's how the yearly annual returns from the S&P 500 have looked over the past 10 years, according to Berkshire Hathaway data that includes earnings from dividends:
| Year | S&P 500 annual return |
| 2014 | 13.7% |
| 2015 | 1.4% |
| 2016 | 12% |
| 2017 | 21.8% |
| 2018 | -4.4% |
| 2019 | 31.5% |
| 2020 | 18.4% |
| 2021 | 28.7% |
| 2022 | -18.1% |
| 2023 | 26.3% |
Berkshire Hathaway has tracked S&P 500 data back to 1965. According to the company's data, the compounded annual gain in the S&P 500 between 1965 and 2023 is 10.2%.
While that sounds like a good overall return, not every year has been the same.
"Investing carries risks — you may be subject to losses and may even lose all the money you put into an investment," Gilberti notes. Just because this is the S&P 500's current return, you can't count on it going forward.
While the S&P 500 fell more than 4% between the first and last day of 2018, its total return surged 31.5% in 2019. Returns jumped from 18.4% in 2020 to 28.7% in 2021. But when many years of returns are put together, the ups and downs of the S&P 500 annual returns start to even out.
It's worth noting that these numbers are calculated in a way that may not represent actual investing habits. The figures are based on data from the first of the year compared with the end of the year. But the typical investor doesn't buy on the first of the year and sell on the last. While they're indicative of the growth of the investment over the year, they're not necessarily representative of an actual investor's return, even in one year.
Investing in the S&P 500
When buying stocks from the S&P 500, you're not buying the entire index. Indexes shouldn't be confused with index funds, which are investments meant to track the performance of certain sectors or assets in the stock market. You can invest in index funds that track the S&P 500 with some of the best stock trading apps.
Some investors choose to buy shares of individual companies on the S&P 500. Some opt for mutual funds, which allow investors to buy a portion of several different stocks or bonds collectively. These individual mutual funds or stocks all have average annual returns, and that particular fund's return may not be the same as the S&P 500 annual returns.
Plus, even if you invest in an S&P 500 index fund, a high expense ratio may reduce your overall returns to below average. Past performances don't necessarily predict future returns.
Buy-and-hold evens out the market's fluctuations
Investing experts, including Warren Buffett and investing author and economist Benjamin Graham, say the best way to build wealth is to keep investments for the long term, a strategy called buy-and-hold investing.
There's a simple reason why this works. While investments will likely go up and down with time, keeping them long-term helps even out these ups and downs. Like the S&P 500's changes noted above, maintaining investments for the long term could help investments and their returns get closer to that average.
Investing and Retirement Reporter
Tessa Campbell is an investing and retirement reporter on Business Insider’s personal finance desk. Over two years of personal finance reporting, Tessa has built expertise on a range of financial topics, from the best credit cards to the best retirement savings accounts.ExperienceTessa currently reports on all things investing — deep-diving into complex financial topics, shedding light on lesser-known investment avenues, and uncovering ways readers can work the system to their advantage.As a personal finance expert in her 20s, Tessa is acutely aware of the impacts time and uncertainty have on your investment decisions. While she curates Business Insider’s guide on the best investment apps, she believes that your financial portfolio does not have to be perfect, it just has to exist. A small investment is better than nothing, and the mistakes you make along the way are a necessary part of the learning process.Expertise:Tessa’s expertise includes:
- Credit cards
- Investing apps
- Retirement savings
- Cryptocurrency
- The stock market
- Retail investing
Education:Tessa graduated from Susquehanna University with a creative writing degree and a psychology minor.When she’s not digging into a financial topic, you’ll find Tessa waist-deep in her second cup of coffee. She currently drinks Kitty Town coffee, which blends her love of coffee with her love for her two cats: Keekee and Dumpling. It was a targeted advertisem*nt, and it worked.
Senior Wealth-Building Reporter
Rickie Houston was a senior wealth-building reporter for Business Insider, tasked with covering brokerage products, investment apps, online advisor services, cryptocurrency exchanges, and other wealth-building financial products. Before Insider, Rickie worked as a personal finance writer at SmartAsset, focusing on retirement, investing, taxes, and banking topics. He's contributed to stories published in the Boston Globe, and his work has also been featured in Yahoo News. He graduated from Boston University, where he contributed as a staff writer and sports editor for Boston University News Service.
Top Offers From Our Partners
Chime® Checking Account Set up Direct Deposit and get your paycheck up to 2 days before your coworkers.** No overdraft fees. No monthly fees. Chime is a financial technology company, not a bank. Banking services provided by The Bancorp Bank, N.A. or Stride Bank, N.A., Members FDIC. **Early access to direct deposit funds depends on the timing of the submission of the payment file from the payer. We generally make these funds available on the day the payment file is received, which may be up to 2 days earlier than the scheduled payment date.
