For most South Africans, investing sounds complicated and risky. But it doesn’t have to be. Index investing is a simple way to grow wealth without guessing which shares will rise or fall.

An index fund doesn’t try to beat the market, it is the market. It tracks a group of shares like the JSE All Share or the S&P 500, giving you instant diversification at very low cost. Warren Buffett put it plainly: “The goal of the non-professional should not be to pick winners…but to own a cross-section of businesses that in aggregate are bound to do well.”

Even Buffett’s own instructions for his family trust are built on that principle: “Put 10% of the cash in short-term government bonds and 90% in a very low-cost S&P 500 index fund.” John Bogle, founder of an investment advisory firm, Vanguard, which is credited with creating the first index fund, said: “Don’t look for the needle in the haystack. Just buy the haystack.”

The numbers back them up. A 2024 study by Morningstar, an investment research organisation, found that only 25.5% of South African active equity funds and 3.9% of global ones beat their index over ten years.

Index investing isn’t exciting; but it works. It rewards patience and consistency instead of luck. You don’t need to outsmart the market, just stay invested and let time and growth do the rest.