Could This Unstoppable S&P 500 ETF Make You a Millionaire? Here's What 20 Years of Data Says.

This year has been an exciting time for the stock market. Despite some short-term downturns related to the Iran conflict and ongoing uncertainty about inflation and rising interest rates, investors seem bullish on stocks. The S&P 500 (SNPINDEX: ^GSPC) recently reached all-time highs and is up about 13% year to date.

But how should you invest for the future? Is buying the S&P 500 index a good bet for the long term?

Here's what every investor should keep in mind: In the past 98 years, since 1928, the S&P 500 has delivered average annual returns of about 10%. That average return includes many booms, busts, and economic crises along the way.

But if you're a long-term investor, buying the S&P 500 tends to be a smart choice because it lets you own the 500 largest publicly traded companies in America. Those companies tend to be good at making money and delivering returns to shareholders.

If you want an easy, ultra-low-cost index fund that can deliver wealth-building returns, the State Street SPDR Portfolio S&P 500 ETF (NYSEMKT: SPYM) could be a good choice. Let's look at how this unstoppable S&P 500 ETF could make you a millionaire.

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State Street SPDR Portfolio S&P 500 ETF (SPYM): 20 years of 11.26% average annual returns

There are many S&P 500 ETFs available to investors. The State Street SPDR Portfolio S&P 500 ETF might not be as well-known as the popular State Street SPY fund, and it doesn't have as many assets under management as the famous Vanguard S&P 500 ETF.

But the State Street SPDR Portfolio S&P 500 ETF holds about $172.5 billion of assets and charges an expense ratio of 0.02%. It holds the same stocks as the S&P 500, which represents 80% of the entire U.S. stock market. This fund could be a great way for investors to gain exposure to the S&P 500. If it's not on your radar, it's worth a look.

During the past 20 years, since its inception in November 2005, this S&P 500 ETF has delivered average annual returns of 11.26%. It's recently done even better, with annualized returns of about 15.1% for the past 10 years, 12.8% in the past three years, and 19.3% in the past year.

How the SPYM S&P 500 ETF can make you a millionaire

There's no guarantee that any stock market investment, not even the S&P 500, will deliver 10% returns per year. The stock market could crash. U.S. stocks could lag behind international stocks for a long time.

But let's assume the State Street SPDR Portfolio S&P 500 ETF keeps up its run of strong performance and delivers the same average annual return of 11.26% it's earned over the past 20 years.

If you invested $500 per month in this ETF and it earned an annualized return of 11.26%, after 10 years, you'd have $101,597. After 20 years, you'd have $396,902. And after 28 years, your investment would reach $1 million.

Whether it's this ETF or another broadly diversified total stock market index, the idea is the same: Many investors can improve their chances of success by buying and holding lots of stocks. The State Street SPDR Portfolio S&P 500 ETF is competitive with the best S&P 500 ETFs.

Ben Gran has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Vanguard S&P 500 ETF. The Motley Fool has a disclosure policy.