The financial news cycle is designed to spike your cortisol. Turn on the TV or scroll through social media, and you are bombarded with “experts” screaming that the market is about to crash — or that you just missed the opportunity of a lifetime.
It’s exhausting. Worse, acting on that anxiety usually leads to expensive mistakes.
There is a better way. It doesn’t require checking stock tickers every morning or analyzing quarterly earnings reports. In fact, this strategy works because you ignore those things.
It’s called “lazy” investing, and for the vast majority of people, it is mathematically superior to trying to outsmart Wall Street.
Why boring is beautiful
In the entertainment world, excitement sells. In the financial world, excitement is usually a warning sign.
“Exciting” investments — like picking individual stocks, day trading or chasing the latest cryptocurrency trend — rely on luck and timing. You have to be right twice: You must buy at the perfect bottom and sell at the perfect top. Even professional fund managers, who have armies of analysts and supercomputers, rarely get this right consistently.
“Boring” investing relies on time and math. It acknowledges that while the stock market fluctuates wildly in the short term, its long-term trajectory has historically been up. By removing human emotion from the equation, you protect your money from your own worst impulses.
The problem with stock picking
Trying to find the “next Amazon” is like finding a needle in a haystack.
A comprehensive study of stock market history found that over a 90-year period, more than half of all individual stocks actually lost money. The massive gains of the overall market were driven by a tiny percentage of superstar companies.
If you pick individual stocks, you risk holding the losers. But if you buy the whole haystack, you are guaranteed to own the winners.
The vehicle: Index funds
This is where the index fund comes in. Instead of betting on one company, an index fund allows you to own a slice of hundreds of America’s most profitable corporations at once.
The most famous example is the S&P 500. When you buy an S&P 500 index fund, you are buying a tiny piece of the 500 largest publicly traded companies in the U.S.
- If one company goes bankrupt, it is a barely noticeable blip in your portfolio.
- If a new tech giant emerges, you automatically own it.
Data consistently shows this simple strategy beats the pros. Over a 20-year period, roughly 90% of actively managed funds—where a human tries to pick the best stocks—performed worse than the simple S&P 500 index.
The strategy: Dollar-cost averaging
The “lazy” investor doesn’t care if the market is up or down today. They use a technique called dollar-cost averaging.
Simply set up an automatic transfer of a fixed amount of money — say, $100 or $500 — from your checking account to your investment account every single month.
- When the market is expensive (high), your $100 buys fewer shares.
- When the market crashes (low), your $100 buys more shares.
This automates the advice to “buy low.” You don’t have to guess when the bottom is. You just keep buying.
The math of doing nothing
Let’s look at the numbers.
Imagine you invest $100 a month for 20 years. You never increase your contribution, and you never sell a single share.
- Total cash invested: $24,000.
If you earned the S&P 500’s historical average return of roughly 10% (before inflation), that $24,000 wouldn’t just sit there.
- Potential value after 20 years: Approximately $76,000.
That is the power of compound interest. Your money makes money, and then that money makes more money. The longer you leave it alone, the faster it grows.
Your only job is to wait
The hardest part of lazy investing isn’t the math—it’s the psychology.
When the market drops 20% (and it will), the news will tell you to panic and sell. When your neighbor brags about doubling their money on a risky tech stock, you will feel the urge to gamble.
Your only job is to do nothing. Stay the course, keep your automatic contributions running, and let the rest of the world stress over the daily headlines. Your future self will thank you for being so lazy.