Add another one to the list. Seems like everyone is recommending index funds as the best investment alternative. In this case, Bankrate gives us a choice of three ways to invest:
a) Hire a broker to get the latest research about the hottest performing mutual funds as well as some direction about whether the market is poised to climb or collapse.
b) Hire an investment adviser to select some good, solid no-load mutual funds.
c) Forget about hiring anyone. Just invest money on a regular basis in some low-cost, no-load index funds regardless of what's going on in the market.
And their answer:
The worst answer to the above multiple-choice question is A. The best answer is C.
Oh yeah!
Is this news to anyone? Not really. But some people think that they can spend a boatload of time and effort and beat the market over the long-term. Hey, mutual fund managers spend their lives trying to beat the market and most don't succeed. What makes you think you can?
For more details, see Why I Like Index Funds.
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