If you are new to the investment world or are looking to simplify your investment strategy to a proven system, then look no further. Is it sexy? No. Is it thrilling? Can be. Will it make me a certified baller over night? Absolutely not. Investing in the market is playing the long game. Be disciplined, consistent and patient and you can achieve your financial goals over time.
Here’s the five-sentence answer:
Invest in index funds.
Buy one stock fund that represents your country, one stock fund that represents the rest of the world, and one fund that represents your nation’s bond market.
Hold these in tax-advantaged accounts, such as your 401(k), IRA and HSA. Switch to taxable accounts only after: (1) you’ve exhausted these other options, or (2) you need to access the funds within the next 5-10+ years but before retirement.
Keep investing regularly (weekly, biweekly or monthly), regardless of whether the market is up or down.
Feel neither excited about highs nor depressed about lows; trust in this process.