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The 80/20 person refuses to spend money or time where there is no worthwhile payoff.  He/she looks deeply enough to get enough of an understanding to make the decision plus enough to get past the illusions and myths in any field.  He learns:

Try to beat the market and you're likely to go the way of the David but squashed by Goliath, though with high hopes.  There are now too many experts that are much more skilled than you and they shave the premium off of picking better down to close to zero - and there are no outstanding experts that are proven to beat the others.   (Read the books that follow, so you understand and can decide what is true and why it is true.)

The 80/20 Person would pick Option 2 with very little work, no worry, no wishful thinking, and better results with higher odds of doing well.   He learns that the high cost of management and portfolio turnover costs can be quite costly, as in Option 1 and 3.  Of course, in #3, the person or his manager somehow gets lucky and beats the averages (though many actually end up lower, by chance), but his costs are still fairly high, so he doesn't win either - and is the most likely to have a greater variation on the downside. 


The 80/20 Person buys a copy of

1.  "The Little Book Of Common Sense Investing: The Only Way to Guarantee Your Fair Share of Stock Market Returns," by John C. Bogle - and you'll probably use that group of no-load funds. 

2.  "The Smartest Investment Book You'll Ever Read - The Simple Stress Free Way To Reach Your Investment Goals", Daniel R. Solin - Do this and you'll do what works and what also saves an enormous amount of time and cut any concern dramatically.

(He/she could stop there and be fine, but eventually he/she might end up reading "The Truth About Money", by Ric Edelman.) 


The 80/20 Person spends very little time on the investment area, yet has high confidence in his/her approach, letting the fools try to beat the market, and avoiding confusing activity with results.. 


One caveat:  You may, but don't need to, hire a financial advisor, asking that all costs (including turnover costs and anything else deducted from the returns) be revealed, but only if you've passed at least a $1,000,000 investment portfolio - so the costs are low enough per dollar of investment so as not to impair return by much.  The advisor, if he is a true professional and not just another great salesman, may give you other advice that may be helpful. 

However, an unlimited amount of money can be invested using Option 2, however.  The 80/20 Person would definitely, when about to retire or when above $500,000 hire a financial advisor on an hourly fee basis to add some strategies, such as the "lifetime annuity" strategy, as that is in the top 20% of potential strategies to use, on the key sister site. 


OPTION 1 - Little work
10% minus 3.5% = 6.5%
$10,000 over 20 years = $35,236
Odds: Pretty good
OPTION 2 - Very little work, no worry
10% - 1% = 9%
$10,000 over 20 years = $56,044
Odds: Very good
OPTION 3 - Lots of work, worry, stress
11% minus 3.5% = 7.5%
$10,000 over 20 years = $42,478
Odds: Pretty low, highly variable