3 Financial Principles to Live By in a Bad Economy

The S&P 500 index is a very diversified fund. It represents the 500 largest companies in the US. The key to building a nice nest egg is to invest money every month on a long-term basis.

I tell people to pay now so you can play later. As an example, my SIL wants to buy a BMW, but I would think it is more prudent to put that kind of money into investments.

Now if you want to make a ton of money, start a business, but the risk can be tremendous.

Excellent share and great advice!

The vast majority of my portfolio is the total index fund and the S&P 500 index.

What's not to like about passive investing? The costs are incredibly low. Why? 2/3rds of my portfolio are only 2 basis points. I have one third in FNILX, which literally has NO costs from Fidelity and its perfoming better than the other Indexes!

The capital gains and dividends are invariably less than 2% OVERALL a year so it can simply grow without a lot of taxation. I don't get huge dividends in December like I used to with other funds.

And get this: indexes outperform, over time, well over 80% if active managers of portfolios. No investment is perfect. But it's close as it's ever going to be to one. I only wish I had done this abut 30 years ago instead of chasing returns and usually losing out over the long run.