I hope to become financially independent in about 10 years (I'm currently 26), so I can retire if I want to and live from a passive income from my investments.
Index funds combine the stocks of all individual companies that are traded in the market. So they are well diversified and increase/decrease along with the market movement. Since the market increases overtime, the value of your investments has an increasing trend. Vanguard offers the best and lowest cost funds.
Not many people are able to do this, because everyone thinks they need to spend all of their income to maintain a decent standard of living.
I never went that route, I bought stocks and let them grow and eventually moved to income stocks over time. Now I just wait for a great opportunity like when Ford was at around $2 a share and they didn't take the bailout, I got in and made a killing.
