From an analytical perspective, The median annual income for full-time workers aged 25 to 34 was $58,500 during the first quarter, according to the Labor Department.
Additionally, That means after-tax earnings would be $44,300 in the worst-case scenario.
Financial planners typically recommend saving 20% of after-tax income for retirement, which would be $8,860 per year (or $740 per month) for the median worker.
Even a portion of that figure invested wisely could compound into a sizable portfolio with sufficient time.
In contrast, For instance, history suggests $425 per month in the Vanguard Dividend Appreciation ETF (VIG 0. 59%) could be worth $807,700 after three decades.
Moreover, And the portfolio would initially generate $13,700 per year in passive income -- but that figure could rise even higher with more time. Furthermore, Image source: Getty Images.
Vanguard Dividend Appreciation ETF vides exposure to hundreds of financially strong U. Stocks The Vanguard Dividend Appreciation ETF tracks the S&P U.
Dividend Growers Index, which itself measures the performance of 337 U, given the current landscape. Additionally, Stocks that have consistently raised their dividends each year for at least 10 years.
Additionally, It excludes companies with dividend yields in the top 25% to avoid stocks with unsustainable payments and minimal growth spects.
The Vanguard Dividend Appreciation ETF pays a dividend yield of 1 (an important development).
7% as of July 17, and half its assets are invested in companies with a market value exceeding $225 billion, given current economic conditions.
What the re reveals is evidence shows fund is most heavily weighted toward the information nology and financial sectors. Here are the top 10 holdings: Broadcom: 5.
Meanwhile, 6% Microsoft: 4 (something worth watching). 8% JPMorgan Chase: 3. 9% Apple: 3. 3% Eli Lilly: 3% Visa: 2. 8% ExxonMobil: 2 (something worth watching), in today's financial world.
Additionally, 3% Mastercard: 2, in light of current trends. 2% Costco Wholesale: 2 (something worth watching).
At the same time, 1% Walmart: 2% In short, the Vanguard Dividend Appreciation ETF is essentially a ready-made portfolio filled with companies that have the financial strength to not only pay a dividend, but also to raise the payout consistently (quite telling) (this bears monitoring).
The fund has an expense ratio of 0. 05%, meaning holders will pay just $5 per year on every $10,000 invested.
At the same time, The Vanguard Dividend Appreciation ETF could turn $425 per month into $13,700 in annual dividend income Assuming dividends were reinvested, the Vanguard Dividend Appreciation ETF has returned 502% since it was created in 2006, which is equivalent to 9.
8% annually. At that pace, $425 invested monthly in the fund would be worth $807,700 after three decades. As mentioned, the Vanguard ETF currently pays a dividend yield of 1.
However, 7%, which is slightly lower than the 10-year average of 1. I will use the current payout to keep my estimate conservative, in light of current trends.
So, if holders stop re dividends after 30 years, the $807,700 portfolio will generate $13,700 per year in dividend income.
Meanwhile, the underlying investment will continue to grow without further contributions, in today's market environment.
Moreover, For instance, excluding dividends, the Vanguard Dividend Appreciation ETF has returned 310% since its inception, which is equivalent to 7, considering recent developments.
Nevertheless, 6% annually, considering recent developments.
At that rate, the $807,700 portfolio would be worth $1 million in another three years, and that sum would generate $17,000 in annual dividend income.
Nevertheless, Here's the big picture: The scenario I've described involves saving $425 per month (noteworthy indeed).
But the median worker aged 25 to 34 should be saving $740 per month, which means we have yet to account for $315 of that total, in today's market environment.
That money (and any additional capital) could be invested in individual stocks, vided the investor is comfortable doing the requisite re.
Conversely, Alternatively, it could be invested in an S&P 500 index fund, which vides exposure to the most influential U.
On the other hand, JPMorgan Chase is an advertising partner of Motley Fool Money. Trevor Jennewine has positions in Mastercard and Visa.
The Motley Fool has positions in and recommends Apple, Costco Wholesale, JPMorgan Chase, Mastercard, Microsoft, Vanguard Dividend Appreciation ETF, Visa, and Walmart (which is quite significant), in this volatile climate.
The Motley Fool recommends Broadcom and recommends the ing options: long January 2026 $395 calls on Microsoft and short January 2026 $405 calls on Microsoft. The Motley Fool has a disclosure policy.