> Why do you say she "obviously beat the market"?
> Feel free to post a better analysis, using real data instead of the annualized return.
Honestly, I get what you're saying, but compound interest doesn't add up here unless she was seriously killing in terms of both her income and the amount of it she was saving. $6300 is probably not enough in terms of saving in her later years, but in her early years it's probably way too high. The early years contribute massively to her investment returns, so i think if you were to pick an error to be on, you're on the side that gives her a little too much credit.
To illustrate this, I created a model that gives one scenario I feel is very generous to her but corrects for the arbitrary $6300 number. The issue with any model here will likely come down to a debate around a) what she earned and b) How much of that she saved. Neither of us have that info, so I'm going to just say that I do feel its obvious you need to beat the market to save ~$9m on the income of someone of her employment class given what I see here, but I'd love to learn more to improve it.
Link: https://docs.google.com/spreadsheets/d/1_Q_HopM3vEHE0qBtfCeQ...
Outcome is that she would have saved $4,469,208.39. If she wanted $9m she had to beat the market, and likely do so in her earlier years of investing.
Assumptions I made:
1. She was at the top of her earning class in 1969 (1), making $200 / week (and having no tax responsibilities).
2. She managed to save 25% of her income, every pay cheque (i think this is unlikely, but generous while not being totally impossible).
3. She managed to get a 4% raise every single year until she retired.
4. Prior to 1969, her income was at least what it was in 1969 (again generous i suspect)
If we switch this to suggest she likely earned less in her early years the model produces much worse outcomes. I.e. If we lower her salary to more realistic levels for 1950-1969 (i picked 1969 as a starting point as it was a healthy year for the economy and in prior years she would have earned less), she had to either get much higher returns, or save a much higher % in order to get close to even the number I've suggested was possible. Overall I've tried to be generous at every turn, and still struggle to get above $5m. I think it's pretty obvious she beat the market in order to get where she landed.
(1) https://fraser.stlouisfed.org/scribd/?item_id=498533&filepat... [TL;DR; Women Secretaries in NY, NY made approx $120-180 / week depending on industry in 1969, again making $200 / week a generous number to work with]