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A big advantage of index funds is that they generally have a very low expense ratio compared to actively-managed mutual funds. Vanguard index funds, in particular, operate very efficiently and don't soak the investors with big expenses. Another Vanguard plus is the wide variety of index funds they offer. I have Vanguard S&P 500, mid-cap and small-cap index funds. Go to their website, they must have about a dozen index funds, all with low expense ratios.

Splitting up some of your money into small- mid- and S&P 500 (which are large-cap stocks) makes sense, or you could go the total market index route. Also consider value vs. growth index funds. Don't forget to put some allocation in overseas stocks, too.
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