Originally Posted by
Cruz5350
One could make an argument that the stock market is a scam as well, food for thought.
Not if it is done properly.
Originally Posted by
Excargodog
Heck, with a 30 year timeframe you can just leave it in an index 500 fund. Thirty years will tame a $hitload of stock market volatility.
Kind of, but it's a bit more nuanced than that. You're on the right track though.
There have been decades where international and small cap / value outperforms the S&P 500. So you really need a proper mix of everything if you want the most return for the lowest risk. Just being in the S&P 500 can be risky too in the fact that you wouldn't have made as much as you would if you were globally diversified among all asset classes. You won't lose money over the long term in the S&P 500, but it isn't always the best performer in and of itself.
Also, the closer your time horizon draws, the more you should be putting into bonds instead of stocks so that you are less subject to volatility when you are going to need to start drawing off of the portfolio.