In this episode of Money Made Simple, Jennie and Liv unpack one of the most simple and powerful (yet often misunderstood) tools for building wealth: index funds. They explain what index funds are, why they’re so popular with investors worldwide, and how they actually stack up against actively managed funds. Using strawberries, gift hampers, and a couple of screw-ups along the way (we never said we were perfect!), they strip back the jargon to make index investing easy to understand - and get started!

This episode covers:

• What an index fund actually is and what "mirroring a market" means
• Why index funds are generally lower cost than actively managed funds
• How diversification works in terms of owning “a little bit of everything” 
• The long-term performance data showing how index funds compare to actively managed funds over time
• The role of ethical screening and how one can align index funds with their personal values
• Downsides and risks of index funds compared to other investments

Resources mentioned in this episode:

- Sorted.org guide to investment funds

- SPIVA (S&P Indices Versus Active) research reports

- Bogleheads investing community and information page

Index funds won’t promise a quick win or let you “beat the market,” but they’ve proven to be one of the simplest, lowest-cost, and most effective ways for everyday investors around the world to grow their wealth over the long term. So dive in to the podcast now!

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Disclaimer: This podcast contains personal opinions and is intended to provide educational information only. It doesn't relate to your particular financial situation or goals and is not financial advice or recommendations. Simplicity New Zealand Limited is the issuer of the Simplicity KiwiSaver scheme and investment funds. For product disclosure statements please visit Simplicity's website simplicity. kiwi.