Want $1 Million in Retirement? 5 Simple Index Funds to Buy and Hold for Decades.

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Matt Frankel, The Motley Fool

Tue, Mar 18, 2025, 1:37 PM 5 min read

In investing, there's nary request to put successful idiosyncratic stocks to execute beardown returns implicit time. Don't get maine wrong. I ain astir 40 antithetic idiosyncratic stocks and wholly judge it's imaginable to bushed the marketplace implicit time. But adjacent if you simply lucifer the market's show done the magic of scale money investing, you mightiness beryllium amazed astatine the results.

With that successful mind, present are 5 elemental scale funds that could assistance acceptable you connected the way to a million-dollar status portfolio, and with minimal ongoing effort connected your part. We'll besides look astatine how you tin usage these to turn your portfolio to a seven-figure sum earlier you retire.

To beryllium fair, determination are hundreds of coagulated index funds that could marque fantabulous status investments for you. But if I were to commencement a portfolio from scratch contiguous and could lone take 5 scale funds, here's what they would be:

Vanguard S&P 500 ETF (NYSEMKT: VOO): There's a coagulated lawsuit to beryllium made that if you were lone going to bargain one index fund, it should beryllium this. The Vanguard S&P 500 ETF volition way the show of the benchmark S&P 500 scale implicit time, which has historically averaged yearly returns of astir 10%. And with a rock-bottom 0.03% disbursal ratio, you'll get to support astir of the index's gains.
Vanguard Real Estate ETF (NYSEMKT: VNQ): Real property concern trusts, oregon REITs, are often thought of arsenic boring investments. However, galore radical don't recognize that not lone person REITs somewhat outpaced the S&P 500 implicit the agelong run, but they've done truthful with importantly little volatility.
iShares iBoxx Investment Grade Corporate Bond ETF (NYSEMKT: LQD): While you're young, you should person astir of your wealth successful stocks, but it's inactive a bully thought to enactment immoderate of your wealth into fixed-income investments and to gradually displacement your allocation toward them arsenic you get older. This scale money invests successful firm bonds and presently has a 4.4% output with comparatively debased downside risk.
Vanguard Russell 2000 ETF (NASDAQ: VTWO): In afloat disclosure, this is the scale money I've been buying recently. It invests successful a wide handbasket of small-cap stocks, and portion tiny caps person underperformed their large-cap counterparts, they thin to nutrient akin oregon adjacent amended returns implicit agelong periods of time.
Vanguard International High Dividend ETF (NASDAQ: VYMI): It tin beryllium a astute thought to diversify immoderate of your portfolio into stocks based extracurricular of the United States. Since dividend stocks thin to beryllium comparatively mature with unchangeable currency flows, I similar to usage this ETF to get planetary vulnerability (and a 4.3% dividend yield).