Warren Buffett still actively manages Berkshire Hathaway's massive portfolio, but he's given his wife surprisingly simple directions for managing her inheritance once he passes away: Invest 90% into a low-cost S 500 index fund and the remaining 10% in short-term government bonds.

John Bogle, who popularized index funds through The Vanguard Group, shared a similar view. Bogle argued that since most fund managers couldn't consistently beat the S 500, it was smarter to simply invest in a fund that passively tracked the benchmark index. S 500 index funds also charge much lower fees than actively managed funds.

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Source Fool.com