Vanguard has been revolutionary in the creation of low-cost funds for investors. They were the first to create the index fund and then started to develop low-cost ETFs to compete with companies like Blackrock, which owns iShares ETFs.
As you can see, you can choose from many different Vanguard ETFs. These three Vanguard ETFs are some of the highest-performing ETFs, and with a good amount to them, you can take advantage of the high performance to reach millionaire status.
VTI: Vanguard Total Market Index Fund ETF
VTI is the first Vanguard ETF ever created with its popular VTSAX index fund. VTI tracks the total market index allowing investors to have a piece of every company on the U.S. stock market.
It does have a high concentration of the S&P 500, making it track closely to the S&P 500, but it has a minor concentration in small and mid-cap stocks as well. Allowing this diversity to help grow your money even more.
If you want to grow your money with a simple all-in-one ETF, then VTI would be a great ETF to make that happen. Over the last ten years, it has averaged 11.81% and a dividend yield of 1.58%.
The average in the previous 15 years has been around 8.93%, beating the S&P 500. So it will take about 19 years to hit million dollars if you invested $20,000 a year at 8.93%. That return also accounts for crashes in 2008, the covid impact, and 2022. So good of a recovery in a long period.
Past returns do not indicate that future returns will be the same, so it would be best to use a more conservative rate of return, but as you see, VTI has done well for the last couple of years. It is hard to beat.
VUG: Vanguard Growth Index Fund ETF
VUG is a growth ETF that seeks to track the performance of the CRSP US Large Cap Growth Index. It is a great ETF that invests in growth companies like Google, Amazon, and Tesla. It is mainly compared to ETFs like QQQ.
VUG has been averaging 13.16% returns over the last ten years. In the previous 15 years, it has an average return of 10.06%. With a low expense ratio of 0.04%, it is a cheap ETF to hold compared to QQQ, which has an expense ratio of 0.20%.
If you want to make a million dollars off of VUG, it will take 18 years to use the average of 10.06% and invest $20,000 per year. So that is one year sooner than using VTI as your ETF.
With a growth ETF, there will be more volatility in the market. Many growth companies could go belly up or skyrocket to the moon. The Dotcom Crash of 2000 saw many growth companies go to zero, and in 2022, you saw many companies on the Nasdaq crash down as well.
If you have a long time horizon investing in VUG can help you reap the rewards of buying and holding.
VGT: Vanguard Information Technology ETF
VGT is a Tech ETF that seeks to track the MSCI US Investable Market Information Technology 25/50 Index. VGT and QQQ are the top growth and tech ETFs out there and have been competing with each other to see which is better.
VGT invests in companies like Apple, Microsoft, Visa, and Texas Instruments. Many other technology companies help make this ETF a high-return ETF. It has 367 different companies and an expense ratio of 0.10%, making it much cheaper than QQQ.
If you are looking for a suitable Vanguard ETF that will help push you to a million dollars, VGT is one of the best choices. Over the last ten years, it has averaged 18.66%. In the previous 15 years, it had a CAGR of 13.48%. If we invest $20,000 for the next 15.5 years, you will hit a million dollars by investing with VGT.
ETFs will also go up and down as markets go up and down. So it is always best to diversify your investments. If you invest in one or even all of these ETFs, you can hit a million dollars within the next 20 years by investing $20,000 a year. Investing takes time, patience, and continuing to invest money. These Vanguard ETFs can help make it happen.
I’m Steve. I’m an English Teacher, traveler, and an avid outdoorsman. If you’d like to comment, ask a question, or simply say hi, leave me a message here, on Twitter (@thefrugalexpat1). Many of my posts have been written to help those in their journey to financial independence. I am on my journey, and as I learn more I hope to share more. And as always, thanks for reading The Frugal Expat.