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>I'm one that believes that the only way to be successful is to be in it for the long term, 10+ years, and in a winning ETF or mutual fund. There was a study d

>I'm one that believes that the only way to be successful is to be in it for the long term, 10+ years, and in a winning ETF or mutual fund. There was a study done a while ago that found that nearly all funds fail to consistently beat a simple index fund. So I don't think you need to invest in a "winning" fund so much as you need to stick with the consistent returns of an index fund (which tend to give you a nicely diversified basket of stocks). And index funds also have some of the lowest possible management fees -- the one thing you can control. The rule-of-thumb is to assume the S&P 500 grows by at least 7% a year -- so, your investment doubles every 10 years. That's a good rate of return. If you're investing for retirement, you can also factor in your tax savings when investing in an IRA. (Since you also get to keep the 10-20% of your investment that would otherwise have gone to the IRS.) My advice would be to check into a low-fee S&P 500 fund for your IRA. It's had positive returns in 22 of the last 28 years. https://www.investopedia.com/ask/answers/042415/what-average-annual-return-sp-500.asp https://www.investopedia.com/ask/answers/042415/what-average... The average annualized return since adopting 500 stocks into the index in 1957 through Dec. 31, 2022, is 10.15%.

WheelsAtLarge 3y ago
My view on index funds is that they have changed a lot over the last 20 or so years. The default for most financial advisors is to divide your stock investment in index funds with an emphasis on the S&P 500 and it doesn't seem like it's going to change anytime soon. So going forward there's going to be a continuous flow of money into those stocks. Additionally, companies are more likely to buy their own stock versus declaring a dividend which reduces the supply of available stock which in turn makes the stock rise. All of this is very positive for index funds going forward. Also, we have seen that the FED will do their best to make sure the stock market does not fall apart for any long period of time. All of this adds to my confidence that it's really the only way to invest as long as you have a broad period for your investments. During the Covid-19 bear market they were thinking of buying stocks to help the market. I don't think they did but it was on the possibility list. That says a lot about how far they will go. Lastly, Warren Buffet's view is that if the S&P falls apart it won't matter since it's likely that there are bigger issues to worry about so it won't really matter. He's got a good point.

WheelsAtLarge 3y ago

My view on index funds is that they have changed a lot over the last 20 or so years. The default for most financial advisors is to divide your stock investment in index funds with an emphasis on the S&P 500 and it doesn't seem like it's going to change anytime soon. So going forward there's going to be a continuous flow of money into those stocks. Additionally, companies are more likely to buy their own stock versus declaring a dividend which reduces the supply of available stock which in turn makes the stock rise. All of this is very positive for index funds going forward. Also, we have seen that the FED will do their best to make sure the stock market does not fall apart for any long period of time. All of this adds to my confidence that it's really the only way to invest as long as you have a broad period for your investments. During the Covid-19 bear market they were thinking of buying stocks to help the market. I don't think they did but it was on the possibility list. That says a lot about how far they will go. Lastly, Warren Buffet's view is that if the S&P falls apart it won't matter since it's likely that there are bigger issues to worry about so it won't really matter. He's got a good point.