Vanguard diehard hbarnard made this post about the U.S. markets, Is it “Half full or half empty?” Taylor’s reply was I think a classic article by
Will value stocks do better than growth stocks? I don’t know, and I don’t care — my index fund owns both. Will health care stocks be the best bet for the next 20 years? I don’t know, and I don’t care — my index fund owns them. What’s the next Microsoft? I don’t know, and I don’t care — as soon as it’s big enough to own, my index fund will have it, and I’ll go along for the ride.
With an index fund, you’re on permanent auto-pilot: you will always get what the market is willing to give, no more and no less. By enabling me to say “I don’t know, and I don’t care,” my index fund has liberated me from the feeling that I need to forecast what the market is about to do.
I agree. The fact is, if you have a low-cost, tax-efficient and well diversified investment plan set up, you really “will have more time and mental energy for the important things in life, like playing with my kids and working in my garden”. You really wouldn’t be constantly fretting over the latest stock pick or hunting for the next hot stock to buy.