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Investing can feel like stepping into a maze. Do I buy individual stocks? Mutual funds? ETFs? Treasury bonds? Or do I just hide my money under the mattress and hope for the best?
With the rise of artificial intelligence hype — and fears it could replace entry-level jobs — market sentiment can swing wildly. Stocks are unpredictable. Prices can surge on optimism one day, plunge on a tweet the next, and leave investors feeling like they’re strapped into a financial roller coaster with no seat belt.
If you’re tired of trying to time the market, chasing the latest buzzstock, or refreshing your brokerage app every five minutes, there’s a smarter way to grow your money: low-cost index investing. And one of the best places to do that is with Vanguard.
Vanguard is a pioneer in passive investing — offering funds that simply track the market, not try to beat it. Over the long run, these funds have delivered steady returns with minimal stress, making them ideal for the “buy and forget” investor.
Below are seven of the best Vanguard funds to consider if you want simplicity, diversification, and long-term growth — without the sleepless nights.
Why Choose Vanguard?
Before we dive into the list, a quick primer on why many financial advisors recommend Vanguard:
1. Ultra-Low Costs
Vanguard’s expense ratios (the fee you pay annually to invest) are among the lowest in the industry. Lower fees mean more of your money stays invested and working for you.
2. Broad Diversification
Most Vanguard funds track entire market indexes — meaning your investment owns pieces of hundreds or thousands of companies at once. This diversification (spreading risk) reduces the impact if one company or sector underperforms.
3. Simple, Passive Approach
Instead of trying to outguess the market, Vanguard funds typically mirror market performance. Over time, this approach has beaten a majority of active managers net of fees.
4. Ideal for Long-Term Investors
If you’re building a retirement nest egg or just want steady growth over years and decades, Vanguard is hard to beat.
How to Use This Guide
This list focuses on Vanguard ETFs and mutual funds that are well-suited for long-term, “set it and forget it” investing. Some are all-in-one portfolios, others focus on specific asset classes like stocks or bonds. Depending on your risk tolerance and goals, you can choose one — or combine several to build a diversified portfolio.
1. Vanguard Total Stock Market ETF (VTI)
Best for: Broad exposure to the entire U.S. stock market
If you want one fund that essentially is the U.S. stock market, this is it.
What It Is
VTI tracks the performance of the CRSP US Total Market Index — covering large, mid, small, and micro-cap U.S. companies across all sectors.
Why It’s Great
- Extensive diversification: Owns thousands of U.S. stocks in one fund.
- Low fee: Expense ratio is extremely low, meaning more of your returns stay in your pocket.
- Growth-oriented: Historically, the U.S. market has grown over long periods despite short-term volatility.
Who It’s For
Long-term investors who want maximum U.S. equity exposure without picking individual stocks.
2. Vanguard Total International Stock ETF (VXUS)
Best for: Adding global diversification
While U.S. stocks are powerful, the global economy includes other major markets — Europe, Asia, emerging markets, and more. VXUS gives you exposure to companies outside the United States.
What It Is
This ETF tracks the performance of a benchmark index representing thousands of non-U.S. companies across both developed and emerging markets.
Why It’s Great
- Diversification beyond the U.S.: Reduces reliance on one economy.
- Exposure to emerging markets: Includes fast-growing regions like China, India, and Brazil.
- Simple way to invest globally without picking individual foreign stocks.
Who It’s For
Investors who want global balance alongside U.S. stocks.
3. Vanguard S&P 500 ETF (VOO)
Best for: Core U.S. large-cap exposure
This is one of the most popular index funds ever created — tracking the S&P 500, which represents the 500 largest publicly traded U.S. companies.
What It Is
VOO mirrors the performance of the S&P 500 Index — companies like Apple, Microsoft, Amazon, and others that drive the U.S. economy.
Why It’s Great
- Highly diversified large-cap exposure
- Low cost
- Benchmark to which most U.S. portfolios are compared
- Historically, large-cap U.S. stocks have been strong performers.
Who It’s For
Investors who want strong exposure to established American corporations.
4. Vanguard Total Bond Market ETF (BND)
Best for: Stability and income
Not all growth should come from stocks. Bonds help balance risk and smooth out volatility.
What It Is
BND tracks a broad index of U.S. investment-grade bonds — including government and corporate bonds.
Why It’s Great
- Income generation: Bonds pay interest that can add stability to your portfolio.
- Lower volatility: Bonds historically fluctuate less than stocks.
- Diversification across thousands of fixed-income securities.
Who It’s For
Investors who want a more balanced portfolio or are closer to retirement and want less risk.
5. Vanguard Target Retirement Funds (e.g., VTTSX / VTHRX)
Best for: Hands-off, age-based investing
If you want a true set-and-forget solution, these funds are designed for you.
What They Are
Target retirement funds adjust their mix of stocks and bonds based on your expected retirement year. For example:
- VTTSX is Vanguard’s target fund for retirement around 2065.
- VTHRX targets retirement around 2050.
As you approach retirement, the funds automatically shift toward more bonds and fewer stocks — reducing risk as your time horizon shortens.
Why They’re Great
- One-ticket solution: You don’t need to rebalance manually.
- Automatic risk management: Allocations are age-appropriate and shift over time.
- Diversified across U.S., international stocks, and bonds.
Who They’re For
Investors who want a turnkey retirement portfolio.
6. Vanguard Growth ETF (VUG)
Best for: Focused growth exposure
If your long-term goals are growth-driven and you’re comfortable with volatility, VUG might be attractive.
What It Is
VUG tracks a growth-oriented U.S. stock index — meaning it leans toward companies expected to grow faster than the overall market.
Why It’s Great
- Focuses on innovation and long-term growth
- Includes many technology and high-growth names
- Low cost relative to active growth funds
Who It’s For
Investors who are comfortable with risk and want heavier exposure to growth catalysts.
7. Vanguard Dividend Appreciation ETF (VIG)
Best for: Dividend growth and long-term income
This ETF focuses on companies with a history of increasing dividends year after year.
What It Is
VIG tracks an index of U.S. companies that have a strong track record of raising dividends.
Why It’s Great
- Income plus growth: Dividend growers often provide income and market-like returns.
- Quality focus: Companies that increase dividends tend to be financially sound.
- Smooths returns: Dividends can cushion downturns.
Who It’s For
Investors who want steady income with a long-term growth bias.
How to Build Your “Set and Forget” Portfolio
You don’t have to pick just one of these funds — in fact, most investors combine several to diversify across asset classes.
Here are a few portfolio examples based on different goals:
Simple 3-Fund Core Portfolio
For many investors, this is a classic, balanced approach:
- 40% Vanguard Total Stock Market (VTI)
- 30% Vanguard Total International Stock (VXUS)
- 30% Vanguard Total Bond Market (BND)
This mix gives you broad U.S. and global stock exposure plus a foundation of bonds.
Aggressive Long-Term Growth
If you’re young and focused on growth:
- 60% Vanguard Total Stock Market (VTI)
- 30% Vanguard Total International Stock (VXUS)
- 10% Vanguard Growth ETF (VUG)
Higher growth potential, but also higher volatility.
Income + Stability Hybrid
For those closer to retirement:
- 30% Vanguard Total Stock Market (VTI)
- 20% Vanguard Dividend Appreciation (VIG)
- 30% Vanguard Total Bond Market (BND)
- 20% Vanguard Target Retirement Fund (age-appropriate)
This blend emphasizes income, diversification, and stability.
Important Investing Principles
1. Time in the Market Beats Timing the Market
Trying to guess short-term moves is a losing game for most investors. Broad index funds reward patient holders.
2. Rebalance Annually
While Vanguard’s target retirement funds rebalance for you, other portfolios benefit from an annual check-in to reset your target weights.
3. Think Long-Term
These funds are not designed for day trading. They work best over years and decades.
4. Automate Contributions
Set up automatic monthly contributions and treat investing like a “bill” you pay yourself.
Final Thoughts
Investing doesn’t need to be stressful. You don’t have to scour earnings reports or predict when the next tech boom will hit. If the idea of volatility makes you uneasy and you prefer a simple, disciplined approach, these Vanguard funds offer a time-tested way to grow wealth with minimal effort.
From broad market exposure and global diversification to bond stability and dividend income, Vanguard’s lineup has something for every long-term investor.
So if you’re ready to stop riding the market roller coaster and start building something that lasts, these funds are a great place to begin.
