Index Funds Are Boring! You Can Do Better!

Index mutual funds are boring, and you can do better. Don’t get me wrong. I am a huge fan of both growth and value mutual funds. And, there is no denying that stocks are one of the best long term investments out there. Stocks have had an 8% historical return, but I’m not happy with that. I’m too young. I have a long time remaining before retirement. I want 10 to 12% return, and index funds just won’t give you that.

Index funds are like our parents certificates of deposit (CDs). When we are too lazy to look for a great, sound mutual fund with an outstanding long-term track record, we put our investment money into our safe, fall back position. For this generation of young workers (ages 20-40 years-old), that is index funds. For our parents, it was CDs. We should demand more from our investments. Do not be lazy and accept the ease of index funds. We need more from our investments.