3 Reasons You Shouldn't Be Afraid to Invest in Index Funds

For many people, the idea of putting their hard-earned cash into the stock market is daunting. After all, when you invest in stocks, there's always the risk of losing money.

On the other hand, investing in stocks opens the door to potentially big rewards. If you invest $500 a month in stocks over a 40-year period, and your portfolio generates an average annual 7% return (which is several percentage points below the market's average), you'll wind up with roughly $1.2 million. And that's by putting in only $240,000 of your own money.

Still, a lot of people are too nervous to buy individual stocks. If you're one of them, a good solution may be index funds.

Source Fool.com