Is a simple index fund really the best strategy for most ordinary investors?

[Phil7]

Low cost index funds tracking broad markets get recommended constantly as the best strategy for most ordinary investors, backed by decades of data showing most actively managed funds fail to beat the market consistently after fees are actually accounted for. The appeal is genuinely simple too, low fees, broad diversification, and no need to constantly research individual stocks or time the market. This isn't financial advice, just discussing the general strategy debate. Curious whether people think index investing actually deserves that default recommendation or whether it's overly simplified advice for genuinely varied financial situations

The counterargument usually points out that index funds still expose you fully to broad market downturns with zero downside protection, and that some genuinely skilled active managers or specific sector strategies have beaten the market over certain periods. Individual circumstances like age, risk tolerance and specific financial goals can also make a purely passive strategy genuinely suboptimal for some people's actual situations. Worth remembering nobody here is a licensed financial advisor and individual circumstances vary a lot

What's actually shaped your own approach to this, and why. Genuinely curious how differently people weigh simplicity against customization here