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Originally Posted by Xist
I wonder if Buffett says index funds will only return 7% is because he expects a zombie apocalypse under Turnip.
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No. While I can't read Buffett's mind, the reason for saying that one should expect a 7% annual return on stocks over the long term is simply because that is what the stock market has returned, after inflation, since at least 1950. Of course this is for long-term investing, say 10 years or more. Any individual year can fluctuate wildly.
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Originally Posted by oil pan 4
I know people who lost more than half of their retirement during the 2008 crash because they just let their money sit in Stock funds as the market crashed and burned.
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How did they lose money if they just let everything sit*? Sure, if you looked at the numbers at the end of '08, things were pretty dismal, but if you let it sit until the end of '09, most of that loss was recovered. Let it sit until today, and you're way ahead :-)
*Unless it was a managed fund, and the managers panic-sold.