1 Vanguard Index Fund Could Turn $500 Per Month Into a $968,400 Portfolio That Pays $16,000 in Annual Dividend Income

The median annual income for full-time workers aged 25 to 34 was $57,200 in the second quarter, according to the Bureau of Labor Statistics. That means after-tax earnings would be about $43,800 in the worst case scenario. Financial planners generally advise saving 20% of after-tax earnings for retirement, which would be $8,760 per year or $730 per month for the median earner.Even a percentage of that figure invested wisely could grow into a sizable portfolio given enough time. For instance, history says $500 invested monthly in the Vanguard Dividend Appreciation ETF (NYSEMKT: VIG) would be worth about $968,400 after three decades. The portfolio would initially generate about $16,000 per year in dividend income.However, the underlying investment would continue to grow even without further contributions, so the dividend payout could be even larger by retirement, depending on when that occurs. For instance, the portfolio would reach $1.2 million after three more years, at which point it would generate about $19,800 in annual passive income.Continue readingWeiter zum vollständigen Artikel bei MotleyFool Weiter zum vollständigen Artikel bei MotleyFool