Are These 10 Vanguard ETFs the Smartest Investments You Can Make Today?

These are particularly uncertain times, with tariffs, threats of tariffs, potentially rising inflation, and all. If you're wondering how to invest in such an environment, here are some suggestions.

First, don't put any money you'll need within five, if not 10, years into stocks because anything can happen in the relatively short term. You don't want to need to sell stocks after they've crashed to raise money for a college tuition bill, for example.

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With your long-term money, consider exchange-traded funds (ETFs), which are funds that trade like stocks. Many ETFs track indexes, making them cost-effective investment options. I offer 10 suggestions below, all from Vanguard, largely because Vanguard is known for low fees, and fees can make quite a difference in your investment results.

Any of these funds could be one of the smartest investments you make. Choosing between them will depend on your goals and risk tolerance, among other considerations.

10 Vanguard ETFs -- with low fees and some dividend income

I've sorted the ETFs below into a few main groups: The first three are broad index funds, the next two are dividend-focused ETFs, followed by a value-oriented ETF, and a handful of growth-seeking ETFs. This first table lists their expense ratios (annual fees) and their dividend yields.

An expense ratio of 0.10% means you'll be charged about $10 annually for each $10,000 you have invested in the fund. Each of these ETFs sport ultra-low fees. A dividend yield of, say, 1% means you can expect to collect about 1% of the value of your investment annually. So with a $10,000 investment, you'll likely receive about $100 in dividends. Healthy, growing dividend payers tend to increase their payouts, often annually. So a $100 in total dividends today may end up being $300, and perhaps $500, in dividends in future years.

Source: Morningstar.com, as of March 12, 2025.

Note that the growth-oriented funds tend to have lower dividend yields. That's because many fast-growing companies don't yet pay dividends -- or pay relatively little -- as they're busy deploying most of their money into furthering their growth.

10 Vanguard ETFs -- with solid performances

Here's what you may be most interested in: the ETFs' performance records. That's natural and important, but remember that past results are in the past. The future remains unknown.

If the stock market has one or a few bad years soon, these average gains will drop. The overall stock market has averaged annual gains of close to 10% over long periods, so the fairly steep S&P 500 returns below suggest that we've had more good years recently than bad.

Source: Morningstar.com, as of March 12, 2025.

Which ETFs are for you?

So...which of these ETFs might you invest in? Well, it depends. Here are a few thoughts:

• If you simply want exposure to broad swaths of our economy or the world's, focus on the top three. The Vanguard S&P 500 ETF will plunk you in the S&P 500, which encompasses 500 of America's biggest companies. The Vanguard Total Stock Market ETF will give you all that, plus almost every other U.S. stock. The Vanguard Total World Stock ETF will give you most of the world's stocks. If you're feeling pessimistic about the U.S. economy right now, adding more international holdings might make sense.
• If you're interested in receiving income from your investments, take a closer look at the Vanguard Dividend Appreciation ETF and the Vanguard High Dividend Yield ETF. The former is looking for growing dividends, while the latter is willing to give up some growth for higher yields. Both have solid results over long periods.
• The Vanguard Value ETF fits multiple scenarios. It's focused on seemingly undervalued stocks, so it could be a nice counterweight if you've loaded your portfolio with growth stocks. Or, if you're worried about the market experiencing a downturn in the near future, this ETF's focus on undervalued stocks could work well for it.
• You might be seeking faster-than-average growth, though. If so, take a closer look at the last four ETFs. Note that if the market does head south for a while, they may fall harder than less growth-oriented investments.

Of course, it can be smart to opt for several of these funds. You certainly don't have to pick only one or two. There are many other terrific Vanguard and non-Vanguard ETFs out there, too -- some focused on particular sectors, such as healthcare or financial services or real estate. However you do it, be sure to be investing for your future financial security.