A few days ago my latest statement arrived, bearing grim tidings. It tells me that on 22 July last year, my investment was worth £5,814. During the following six months, I paid in a total of £300 of my cash, topped up with £117 of reinvested dividend income. But despite that, its value had shrivelled to £4,862 by 22 January this year. In total, I have paid in £5,250 since April 2000.
Back in July 2007, my Isa was valued at £6,605 – so how can it have fallen so far, when it has had £1,200 pumped into it since then?
We understood that shares go down as well as up. But over 10 years, all the data suggested we'd be in the money. Nothing could be further from the truth.
If I'd put my £50 a month into a savings account starting back in April 2000, I'd have £6,138 by now, according to the Halifax. It's a cliche, but I'd have been better off putting the money under the mattress.
Yet I was only doing what the experts advised, wasn't I? I've been "drip-feeding" money into my Isa, as is recommended. At the time I took it out, I specifically opted for a fund with very low charges (experts often recommend that, too), and one that would invest my cash in a wide spread of companies in order to reduce risk (ditto).
The conventional wisdom is that shares always outperform other investments over the long term. Even government leaflets state that when putting money away for a long time, "accounts that invest in shares almost always produce a better return than savings accounts."
For the record, back when I was working in England, between 2000 and 2003, I put about 3125 quid into a pension fund. The current value of that fund is now 2939 pounds. Although in 2007 it was worth over 4000.
Update : Chris Dillow points out that "long term" success can still be bogus.