7 Reasons You Need to Consider Index Fund Investing

Index fund investing is the perfect strategy for beginners. We’ll talk through 7 huge benefits below, but at a high level, it’s easy and effective. It takes the complexity out of stock picking.

1. Low Expense Ratios

7 Reasons to Take Up Index Fund Investing

It is important to keep expense ratios as low as possible, which index funds typically do.

2. Index Funds Do Not (Usually) Have Hidden Fees

7 Reasons to Take Up Index Fund Investing

Index funds, in general, do a good job of eliminating or minimizing these fees so that you can keep more of your money in the long-term.

3. Free Trades

7 Reasons to Take Up Index Fund Investing

If you invest through the right broker you can trade their index funds for free!

4. Simplicity

7 Reasons to Take Up Index Fund Investing

Index fund investing is simple and easy to do. Anyone can do it! Yes, anyone! 

5. You Have “Guaranteed” Returns

7 Reasons to Take Up Index Fund Investing

No, you are not guaranteed to have positive returns (I wish I could promise that to you), but you are guaranteed to match market returns.

6. They are Tax Efficient

7 Reasons to Take Up Index Fund Investing

Index funds are tax efficient because they have low turnover.

7. Diversification

7 Reasons to Take Up Index Fund Investing

Diversification is a fundamental investing principle that involves owning multiple investments to limit your risk of one investment taking a tumble.

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