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I keep things simple: a Couch Potato portfolio (75% total stock market/25% total bond market), an extended market fund to balance out my S&P500 fund in my 401k (and increase my mid and small cap exposure if desired), and a money market fund for short term stuff. I rebalance on my birthday. I sleep fine at night and have a healthy nest egg. I couldn't say the same when I was investing in a managed fund years ago (which ended up being one of those that got caught in that recent fund scandal re: after hours trading!).

I know that many people pooh-pooh index funds, but frankly I don't feel like wondering whether I picked the "right" fund, which would occur if I chose a managed fund. Average performance is good enough for me, and indexing just makes sense to me for my lifestyle and personality.

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