How to Start Investing in Index Funds: S&P 500 vs. Total World Stock Market

I am completely new to investing and want to start putting money into index funds for the long term. I keep seeing debates on whether I should just stick to the S&P 500 or go with a total world stock market fund like VT. Given that the US market has historically outperformed the rest of the world, is it still safer to diversify globally, or should I focus purely on the US economy? I would love to hear your thoughts and what your current strategy looks like.

Welcome to the investing journey! It can feel overwhelming at first, but keeping it simple is the best approach. Personally, I do about 80% S&P 500 and 20% international. Past performance doesn't guarantee future results, so having some global exposure helps me sleep better at night.

If you want the ultimate set-and-forget portfolio, just go with VT and call it a day. The US has had a great run over the last decade, but international markets take the lead in cycles. For anyone looking for side income to fund their investments, check out these tips on how to start freelancing.

I was in your shoes a few years ago. I started purely in the S&P 500 because of the tech exposure, but eventually added a total international fund to hedge my bets. Home country bias is real, so diversification is a smart move.

People often forget that the biggest US companies in the S&P 500 get a massive chunk of their revenue globally anyway. Apple, Microsoft, and Google sell products worldwide, so you're already getting some international exposure.

My strategy is 100% VT. I don't want to try to time whether the US or the rest of the world will perform better. I just want to own the entire global haystack instead of looking for the needle.

The S&P 500 has crushed international stocks recently, but back in the 2000s, international actually outperformed the US for a whole decade. Markets move in cycles. Keep your investment routine steady, much like maintaining consistency with intermittent fasting for fat loss.

I split mine 70/30. 70% in VOO (S&P 500) and 30% in VXUS (Total International). It gives me a heavy US tilt since I live here, but still captures global growth.

Honestly, for a complete beginner, starting with a broad index fund and automating your monthly contributions is the most important step. Don't overthink the exact percentage split right out of the gate.

Make sure your mental health is in check while managing your finances too. Sometimes staring at charts all day leads to stress, similar to dealing with remote work burnout. Set your automatic transfers and go live your life!

VT is great because it automatically adjusts market caps for you. If the US starts shrinking and another country booms, the fund shifts weight naturally.

I just stick to the S&P 500. The US economy has the most resilient companies, deepest capital markets, and strongest legal protections for investors. I don't see a reason to dilute those returns.

Great question! There's no single right answer, only what you can emotionally handle. If the rest of the world outperforms the US for the next ten years, will you regret not buying VT? If yes, buy VT. If you'd regret missing out on US tech gains, stick to S&P 500.