Why Vanguard Dividend Appreciation ETF (VIG) Belongs in Your Portfolio Now

Dividend stocks are the tortoises of investing—slow, steady, and often overlooked in a crypto-crazed world. But here's why VIG might just be your hedge against the next 'stablecoin' collapse.

The Low-Volatility Cash Machine

VIG tracks companies with a proven track record of growing dividends—think less meme stocks, more 'boring' blue-chips that actually turn a profit. No hype, just compounding.

Defensive Play for Overleveraged Portfolios

While DeFi degens chase 1000% APYs, VIG's holdings (hello, Microsoft and Johnson & Johnson) quietly stack cash. A 2.5% yield never looked so rebellious.

The Ironic Twist

In a market obsessed with 'disruption,' this ETF thrives on something radical: profitability. How delightfully old-school.

Why long-term investors should consider the Vanguard Dividend Appreciation ETF

Specifically, the Vanguard Dividend Appreciation ETF tracks the S&P U.S. Dividend Growers Index, which consists of large-cap stocks that have an established track record of growing their dividends every year. It is a weighted index, meaning that certain stocks make up more of the assets than others, and there are 337 stocks altogether.

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Like most Vanguard index funds, this one has an extremely low fee structure with an expense ratio of 0.05%, which means that for every $10,000 in assets, your annual investment costs will be just $5. To be clear, this isn't a fee you have to pay -- it will simply be reflected in the performance over time.

Because it isn't focused on stocks with a high current yield, it has more exposure to fast-growing companies than most dividend ETFs. Just to name one example, the top holding of the Vanguard Dividend Appreciation ETF is(AVGO 0.40%), which has a dividend yield of only about 1% today, but has increased its payout by 82% over the past five years alone.(MSFT 0.22%), with its 23-year streak of dividend increases, is the No. 2 holding.

The point is that although stocks like these don't have the highest dividend yields today, they could pay much more in five years, 10 years, 20 years, and beyond. If you're still a decade or more away from relying on your stock portfolio for income, the Vanguard Dividend Appreciation ETF can help you set up a future income stream without sacrificing near-term growth potential.