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3 Unstoppable Vanguard ETFs That Can Make You Rich

By Katie Brockman - Mar 17, 2021 at 5:30AM

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You get instant diversification without ever picking a single stock.

You don't have to be an expert investor to get rich in the stock market. In fact, you don't even need to be great at picking stocks.

Investing in exchange-traded funds (ETFs) can be a great option for making money. When you invest in an ETF, you're investing in dozens or hundreds of companies at once. This provides instant diversification, and you don't need to worry about choosing individual stocks.

ETFs are also fantastic long-term investments. They perform best when you invest a little at a time for as long as you can. And these three ETFs in particular can potentially make you a millionaire over time.

Jar full of hundred dollar bills

Image source: Getty Images.

Vanguard Growth ETF (VUG)

The Vanguard Growth ETF (VUG 3.76%) includes 258 stocks that all have the potential for rapid growth. A few of the largest stocks in the fund include Apple, Microsoft, and Amazon.

Growth ETFs can be on the riskier side, because high-growth companies are sometimes more volatile than well-established businesses. But with more risk often come greater rewards, which makes this ETF a great choice for those looking to supercharge their savings.

Since the fund's inception in 2004, it has earned an average annual return of 11%. Say you were to invest $300 per month for 35 years while earning an 11% return each year. At that rate, you'd have just over $1.2 million saved.

Vanguard Information Technology ETF (VGT)

The Vanguard Information Technology ETF (VGT 3.78%) contains close to 350 stocks from the information technology sector. Like the Vanguard Growth ETF, its two largest stocks are Apple and Microsoft. It also contains more-established companies, including Visa, Mastercard, and Intel.

One advantage of investing in this fund is that tech stocks are known for experiencing higher returns. But they can be more volatile than stocks in other industries. In addition, investing in a fund that includes stocks from only one industry can be risky. For that reason, it's a good idea to make sure you have a diversified portfolio if you choose this ETF.

The good news is that this fund has experienced above-average returns. Since its inception in 2004, it has seen returns of just over 13% per year. At that rate, if you were to invest $300 each month over 35 years, you'd have close to $2 million saved.

Vanguard S&P 500 ETF (VOO)

The Vanguard S&P 500 ETF (VOO 2.36%) is an index ETF that tracks the S&P 500. It contains all 500 companies in this particular stock market index.

S&P 500 index funds are famous for being strong and steady investments. They still experience volatility from time to time, but they're almost guaranteed to see positive long-term returns. This makes them a great option for more risk-averse investors.

^SPX Chart

^SPX data by YCharts.

Despite having lower risk than some other types of investments, this ETF has experienced a remarkable decade. The fund was established in 2010, and since then it has earned a 15% average annual rate of return. By investing $300 per month at that rate, you'd have nearly $3.2 million saved after 35 years.

Of course, the S&P 500 has experienced an incredible run over the past decade, and it may be unrealistic to expect a 15% return year after year. But even if this fund only experiences, say, a 10% annual return, that's not bad considering it's one of the safest investments out there.

Investing in ETFs can be a great way to build long-term wealth. By choosing your investments wisely, you can make a lot of money with very little effort.

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Stocks Mentioned

Vanguard Index Funds - Vanguard S&P 500 ETF Stock Quote
Vanguard Index Funds - Vanguard S&P 500 ETF
$369.16 (2.36%) $8.51
Vanguard World Fund - Vanguard Information Technology ETF Stock Quote
Vanguard World Fund - Vanguard Information Technology ETF
$350.38 (3.78%) $12.77
Vanguard Index Funds - Vanguard Growth ETF Stock Quote
Vanguard Index Funds - Vanguard Growth ETF
$237.81 (3.76%) $8.62

*Average returns of all recommendations since inception. Cost basis and return based on previous market day close.

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