Can This Unstoppable Vanguard ETF Make You a Millionaire?

Key Points

• Passive investors can find remarkable success in the stock market, as there are many ETFs to choose from.

• The Vanguard S&P 500 ETF is a very popular choice, and it has put up a fantastic performance in the past decade.

• Investors must realize that generating wealth in the stock market requires patience and discipline.

• 10 stocks we like better than Vanguard S&P 500 ETF ›

There might be a common misconception out there that investors must be skillful at picking individual stocks for their portfolios to achieve success. This just isn't true. A ton of available exchange-traded funds (ETFs) can provide investors with a passive strategy to take advantage of.

Many asset management firms offer these products. Vanguard is one of the most reputable. It's been around since 1975, and it had $11 trillion in assets under management (AUM) as of July 31. It might be a good idea to pick an ETF from this financial institution.

Where to invest $1,000 right now? Our analyst team just revealed what they believe are the 10 best stocks to buy right now. Continue »

Investors should realize that serious wealth can still be generated by going the passive route. But can one of these Vanguard ETFs make you a millionaire one day?

Image source: Getty Images.

Impressive track record

The most popular investment vehicle offered by Vanguard is the Vanguard S&P 500 ETF (NYSEMKT: VOO). It has $1.4 trillion in AUM, which showcases its gargantuan scale. As the name suggests, the ETF follows the performance of the S&P 500 Index. This benchmark consists of 500 leading companies that trade on U.S. stock exchanges.

The Vanguard S&P 500 ETF's performance is worth highlighting. In the past decade, it has produced a total return of 314%, which includes dividends. This translates to a fantastic 15.3% gain on an annualized basis.

It's clear how someone could've become a millionaire by owning this ETF. Had you invested $3,750 per month in the Vanguard S&P 500 ETF over the past decade (between September 2015 and September 2025), making a total of 120 allocations, you'd have $1 million today. This is the power of compounding and dollar-cost averaging. Extending the time horizon would result in more robust gains.

You would immediately think that to achieve such a stellar performance, the costs would be extreme. That's not the case, as the Vanguard S&P 500 ETF carries a low expense ratio of 0.03%. On a hypothetical $10,000 investment, just $3 would go to servicing the yearly fee.

Betting on American companies

Besides understanding the Vanguard S&P 500 ETF's performance and fee structure, it's extremely important that investors learn what exactly they'd be owning. The S&P 500 is the most-watched gauge of the stock market's performance. It provides exposure to all the sectors of the economy. Investors immediately gain solid diversification in their portfolios in a hassle-free way. The benefit gained by buying this ETF is that investors can avoid having to choose individual stocks that will be the winners of tomorrow.

In the past decade, there probably hasn't been a tailwind as impactful as the rise of global technology businesses. The stock market's returns are being driven by these dominant enterprises. The "Magnificent Seven" constitutes 34% of the Vanguard S&P 500 ETF's asset base, so there is some concentration at the top. Investors will have exposure to powerful secular trends that are lifting these companies, most notably artificial intelligence.

Patience is key

The Vanguard S&P 500 ETF's trailing-10-year returns have been incredible. There's no telling what sort of performance it will achieve in the decades ahead. However, I believe this investment product can turn you into a millionaire. Its long-term track record of compounding capital speaks for itself.

Just don't expect to get rich overnight. Successful investing, no matter what your exact strategy is, requires patience, maybe more than any other trait. Generating wealth takes time. Having the right mindset is critical.

It's also important to keep your emotions in check when there's heightened volatility or a market correction, things that are inevitable and can't be avoided. Keeping the attention fixated on the long term, as opposed to the next month or quarter, will also lead to success.

Should you invest $1,000 in Vanguard S&P 500 ETF right now?

Before you buy stock in Vanguard S&P 500 ETF, consider this:

The Motley Fool Stock Advisor analyst team just identified what they believe are the 10 best stocks for investors to buy now… and Vanguard S&P 500 ETF wasn’t one of them. The 10 stocks that made the cut could produce monster returns in the coming years.

Consider when Netflix made this list on December 17, 2004... if you invested $1,000 at the time of our recommendation, you’d have $621,976!* Or when Nvidia made this list on April 15, 2005... if you invested $1,000 at the time of our recommendation, you’d have $1,150,085!*

Now, it’s worth noting Stock Advisor’s total average return is 1,058% — a market-crushing outperformance compared to 191% for the S&P 500. Don’t miss out on the latest top 10 list, available when you join Stock Advisor.

See the 10 stocks »

*Stock Advisor returns as of September 29, 2025

Neil Patel has positions in Vanguard S&P 500 ETF. The Motley Fool has positions in and recommends Vanguard S&P 500 ETF. The Motley Fool has a disclosure policy.