Many of us are so busy with our day-to-day lives, making short-term decisions left and right, that we don't pay much attention to the long term -- to our futures. When we do think about it, we often put off doing things that we ought to do -- like saving and investing for our retirement years. That can be a costly error.

Here are five long-term investments that are well worth making -- ones you'll likely be very happy you made.

A seated person has hands clasped, looking ahead seriously.

Image source: Getty Images.

1. Index funds

Let's start with index funds because for most of us, they're the best way to invest for our futures and the easiest way, too. Being an index-fund investor means you don't have to learn much about the stock market or investing. You don't have to spend a lot of time studying and keeping up with stocks. And you don't have to decide which stocks to buy, when to do so, and when to sell.

Instead, you just invest in one or a few low-cost index funds and keep doing so over time -- ideally, for decades. They'll deliver roughly the same return as the indexes they track -- so a broad-market index fund (such as one that tracks the S&P 500) will deliver roughly the overall market's performance.

Some index funds worth considering are the SPDR S&P 500 ETF, Vanguard Total Stock Market ETF, and Vanguard Total World Stock ETF, which will, respectively, spread your dollars across roughly 80% of the U.S. market, all of the U.S. market, or most of the world's stock market. There are index funds that track bonds and other segments of the market, too.

2. Dividend stocks

Next, consider adding some carefully chosen dividend-paying stocks to your portfolio, if you're willing to learn more about investing and to learn more about dividends.

Dividends are surprisingly powerful. Consider this: A 2013 J.P. Morgan Asset Management report that studied companies that regularly made (and increased) dividend payouts, along with companies that paid no dividends between 1972 and 2012, discovered a startling difference. The average annual return for the payers and increasers was 9.6%, versus only 1.6% for non-payers.

Here are some familiar companies and their recent yields:


Recent Dividend Yield



Verizon Communications






Duke Energy


Walgreens Boots Alliance














Source: Yahoo! Finance.

3. Growth stocks

Growth stocks -- those tied to companies increasing their revenue and earnings at a faster-than-average clip -- can really turbocharge your portfolio, but they'll require your learning more about investing, the business world, and the companies (and their industries). They can also be riskier propositions than dividend payers, and some can be overvalued, with no margin of safety.

So what should you do? Well, consider our investing philosophy at The Motley Fool, which is to buy 25 or more stocks, expecting to hold them for at least five years. That way, you'll have a better chance of ending up with some big winners in your portfolio (along with, inevitably, some losers) -- and you'll be giving the companies time to perform and grow into their future selves.

A smiling person is outdoors, with arms outstretched.

Image source: Getty Images.

4. Invest in yourself

Here's a kind of investing that doesn't have to cost much but can pay off handsomely: investing in yourself. There are lots of ways you might go about this:

  • Buy or check out good books on investing, to improve your results.
  • Take courses to earn a degree or professional certification that can help you advance in your career or switch into one that you'd like more.
  • Learn new skills that can help in your career or with a side gig. For example, mastering another language might make you a more valuable asset at work.
  • Get healthier. Exercising more and eating more nutritious meals can lengthen your life and even save you a lot in future healthcare expenses.
  • Invest in your personal relationships by spending more time with your loved ones, perhaps having some adventures and making great memories, too.
  • If you don't feel content or happy much of the time, consider investing in some self-care, such as by seeing a therapist. Simply exercising and volunteering have been shown to help lift one's spirits, too.
  • Spending a little money refreshing your work wardrobe may give you a boost.

5. Invest in your kids

Finally, if you have kids, invest in them, too. You should spend lots of time with them, of course -- to the degree that you can. But consider spending some of that time teaching your kids about money and investing. This can be a super powerful move because if they're money-savvy as they exit college, they can make lots of smart decisions from the get-go, such as not racking up credit card debt and saving for a down payment and retirement.

Since your kids might have 40 years or more in which to invest, their dollars can grow really powerfully. Consider that a single $1,000 investment that grows at, say, 8% annually can become close to $22,000 over 40 years. Just imagine what multiple thousands can do.

These are five kinds of long-term investments that can really pay off. See which one(s) make sense for you, then take some steps to act on them as soon as you can.