Look, we get it. Investing feels scary, complicated, and like something only people in expensive suits should do. A new BlackRock survey just confirmed what we already knew: more than a third of Americans don’t own stocks, and their reasons are pretty much what you’d expect.
“I don’t have enough money.” “I don’t know what I’m doing.” “What if I lose everything?”
Valid concerns! But here’s the thing – Warren Buffett, aka the guy who turned $10,000 into $140 billion, has been giving the same advice for years that basically makes all these excuses… well, excuses.
His solution? Buy an S&P 500 index fund. That’s it. No fancy stock picking, no trying to time the market, no need to understand what a P/E ratio is (though it’s price-to-earnings, you’re welcome).
“But I’m broke!”
Here’s where it gets fun. You can literally start with pocket change. The Schwab S&P 500 fund trades at around $17 a share. That’s less than a decent lunch. And if even that feels steep, you can buy fractional shares of pricier funds. It’s like buying a slice of pizza instead of the whole pie, except this pizza might actually make you money.
The real magic isn’t in the amount – it’s in starting. Think of it like going to the gym. Nobody expects you to bench press 300 pounds on day one, but showing up consistently? That’s where the transformation happens.
“But I don’t know anything about investing!”
Perfect! That’s actually the beauty of index funds. You’re basically saying, “I’ll take a tiny piece of the 500 biggest companies in America, please.” No research required, no staying up late reading earnings reports, no trying to figure out if Tesla is overvalued (spoiler: nobody really knows).
If you’re still nervous, just walk into a Schwab or Fidelity branch. They have people whose literal job is to help you invest your money, and the basic advice is free. It’s like having a personal trainer, but for your wallet.
“But what if I lose money?”
Ah, the big one. Here’s some perspective from Yale economist William Goetzmann: when the market crashes after a good run, there’s a 99% chance you’ll be better off five years later. Ninety-nine percent! Those are better odds than your favorite sports team winning… well, anything.
The S&P 500 has survived the Great Depression, multiple wars, the dot-com crash, 2008, and even a global pandemic. It’s like that friend who always bounces back from bad breakups – resilient and surprisingly reliable.
Now, some experts prefer global index funds since the S&P 500 is pretty US-heavy and valuations are high. Fair point. But honestly? The most important thing is just starting. You can always get fancier later.
As financial planner Chris Chen puts it: “The important part for someone who is just starting is to start.”
So there you have it. Warren Buffett’s advice isn’t sexy, it won’t make you rich overnight, and it definitely won’t impress anyone at parties. But it works. And sometimes the best solutions are the boring ones.