In theory, the iShares S&P 500 ETF and the Vanguard US Total Market ETF are quite different.

For one, IVV is an index fund that tracks the S&P 500 Index. This flagship index represents the largest 500 stocks on the US markets, weighted by market capitalisation (size).

Meanwhile, the VTS ETF tracks a far less common index, the Morningstar U.S. Total Market Index. Instead of following just the largest 500 stocks on US markets, this index tracks more than 4,000. As such, it offers significantly more coverage of mid- and small-cap US stocks than IVV.

Is this enough to make VTS the better choice over IVV? Well, diversification is usually a good thing for investors seeking to increase their exposure to an entire market.

However, as we touched on above, the differences between the IVV and VTS ETFs are more theoretical than practical. That's because, while both funds have different scopes, they both weight their portfolios by market capitalisation. That means the largest shares take up far more room than the smaller ones in both funds. Since both IVV and VTS both share the same stocks at the top of their portfolios, buying either will get you a similar investment profile.

IVV vs. VTS: Top ETF holdings compared

To illustrate, as of 31 July, IVV's top five holdings, and their respective weightings, were as follows:

NVIDIA Corporation (NASDAQ: NVDA) at 7.53%

Apple Inc (NASDAQ: AAPL) at 7.03%

Alphabet Inc (NASDAQ: GOOG)(NASDAQ: GOOGL) at 5.85%

Microsoft Corporation (NASDAQ: MSFT) at 5.35%

Amazon.com Inc (NASDAQ: AMZN) at 4.12%

Meanwhile, the VTS ETF's largest stocks, as of 31 July, were:

NVIDIA at 6.39%

Apple at 6.28%

Alphabet at 5.2%

Microsoft at 4.78%

Amazon at 3.64%

As you can see, there's not a lot of daylight between these two ETFs' holdings.

But let's look at performance.

Over the 12 months to 31 July, IVV returned 9.42%. That rose to an annualised 17.41% over three years, and 13.61% per annum over five.

Meanwhile, the VTS ETF returned 9.82% over the year to 31 July. Over three years, it managed an average of 17.19% per annum, and 12.77% per annum over five years.

So it's clear we're doing a bit of hair splitting here. Overall, these two ASX ETFs can be expected to deliver a similar return over time, given their overlapping, heavy exposure to the largest US stocks on the market. It's my view that ASX investors who are looking for cheap, easy exposure to US stocks can't go wrong with either fund.

The post Is the Vanguard US Total Market ETF (VTS) the best buy for investing in America? appeared first on The Motley Fool Australia.

The iShares S&P 500 AUD ETF (ASX: IVV) gives Australian investors access to many of America's largest companies through a single ASX-listed fund.

For me, that makes it a strong long-term option.

Access to some of the world's strongest businesses

The IVV ETF tracks the S&P 500 Index, which contains around 500 large US companies, including Apple, Microsoft, Nvidia, Bank Of America, Walmart, Merck & Co, and Verizon.

That gives investors exposure to businesses operating across technology, healthcare, financial services, consumer products, industrials, communication services, and many other areas of the US economy.

I think this is particularly valuable for Australian investors. The ASX has some excellent companies, but our market is heavily influenced by financial and resources businesses. The US market gives investors much greater exposure to areas such as software, semiconductors, digital advertising, medical technology, and global consumer brands.

Many of the companies inside the S&P 500 also generate revenue around the world.

So while the IVV ETF invests in US-listed companies, the underlying businesses can have customers spread across North America, Europe, Asia, and other major markets.

That gives investors exposure to far more than the US economy alone.

The index can evolve over time

Another reason I like the IVV ETF is that ASX investors do not have to predict which companies will dominate the next decade.

The S&P 500 index changes as corporate America changes.

Companies that grow can become increasingly important within the index, while businesses that lose relevance can eventually become smaller holdings or leave the index entirely. For example, today Nvidia is highly important, whereas 50 years ago it was IBM.

I think that is a powerful feature for a long-term investor.

Twenty years from now, some of today's leading businesses may still be enormous. Others may have been overtaken by companies that are only beginning their growth stories today.

An investor in the IVV ETF does not need to identify those winners in advance.

They can simply continue owning a large collection of leading US businesses as the market develops.

It keeps investing simple

The IVV ETF also suits ASX investors who do not want to spend their spare time reading annual reports and comparing individual companies.

Buying individual shares can be rewarding, but it requires research and comes with the possibility of getting a company-specific decision badly wrong.

With the IVV ETF, one investment spreads money across hundreds of businesses.

That can make it easier to keep contributing through strong markets, weak markets, recessions, and whatever else happens over a long investing career.

For me, this simplicity is one of the fund's biggest strengths.

A sensible investment strategy that someone can stick with for decades can be far more powerful than a clever strategy they abandon after a difficult year.

There are still risks

The IVV ETF is diversified across hundreds of companies, but it is not immune from large falls.

US shares can become expensive, recessions can hurt corporate earnings, and the index can experience lengthy periods of weak performance.

The largest US companies also account for a meaningful share of the S&P 500 index, so the fund can become quite concentrated at the top.

Australian investors also have currency exposure because the IVV ETF is not hedged back to the Australian dollar. Movements in the Australian dollar against the US dollar can therefore influence returns.

Nevertheless, I would be comfortable accepting those risks with a long enough timeframe.

Foolish takeaway

I think the IVV ETF offers one of the simplest ways for ASX investors to participate in the long-term growth of major global businesses.

There will inevitably be periods when US shares fall out of favour, and I would expect plenty of volatility over the years.

But if I wanted an investment I could keep adding to and potentially hold for decades, the IVV ETF would be high on my list.

The post Why I think the IVV ETF is a strong buy for ASX investors appeared first on The Motley Fool Australia.

The good news is that investors do not need to make a big call on one company to improve their portfolio.

ASX exchange traded funds (ETFs) can provide exposure to dozens, hundreds, or even thousands of shares in a single trade.

With that in mind, here are three ASX ETFs that could be worth considering next month.

iShares S&P 500 ETF (ASX: IVV)

The iShares S&P 500 ETF could be a great starting point for many Australian investors.

This fund tracks Wall Street's famous S&P 500 Index, which is home to many of the largest listed companies in the United States.

That means investors can gain exposure to businesses involved in cloud computing, artificial intelligence, healthcare, payments, consumer brands, industrial products, financial services, and entertainment.

One of the strengths of this ETF is that it does not rely on a single theme. The US market has a deep collection of companies that sell into global markets, reinvest heavily, and have long records of adapting as the economy changes.

For Aussie investors, this can be a simple way to look beyond the local share market and own a slice of some of the world's most important businesses.

Betashares Asia Technology Tigers ETF (ASX: ASIA)

Another ASX ETF to look at in September is the Betashares Asia Technology Tigers ETF.

This fund offers exposure to large Asian technology companies across areas such as semiconductors, ecommerce, digital payments, online entertainment, gaming, and internet platforms.

This could be an attractive part of the market because Asia is not just a manufacturing base or a consumer region. It is also home to technology companies that are deeply involved in how the digital economy is built and used.

There are risks. Regulation, geopolitics, currencies, and market sentiment can all create volatility. But for investors wanting technology exposure outside the United States, this ETF offers a focused way to get it.

Betashares Global Robotics and Artificial Intelligence ETF (ASX: RBTZ)

A final ASX ETF for investors to consider is the Betashares Global Robotics and Artificial Intelligence ETF.

This fund is aimed at companies involved in robotics, automation, artificial intelligence, drones, and related technologies.

What I like about this area is that it is not just about software on a screen. Robotics and automation can change how factories operate, how warehouses move goods, how hospitals handle work, how farms lift productivity, and how logistics networks become more efficient. That gives the ETF exposure to a long-term shift in the real economy.

It will almost certainly not be a smooth ride. The theme can attract excitement, and valuations can move around quickly. But over the long term, machines doing more work in more places could be a powerful investment trend.

The post 3 amazing ASX ETFs for Aussie investors in September appeared first on The Motley Fool Australia.

However, some investors might not be aware the Aussie market is heavily weighted towards big banks and mining companies.

In reality, the S&P/ASX 200 Index (ASX: XJO) is one of the most concentrated developed-market indices on the planet.

According to VanEck, the top 5 securities account for roughly 32% of the ASX 200 Index. 

This means that many investors might be overexposed to the performance of these blue-chip stocks without realising. 

Why international ETFs make sense

A key point to remember is that diversifying internationally doesn't necessarily mean abandoning the ASX. 

An Australian investor can retain domestic exposure while using ASX-listed international ETFs to broaden their portfolio.

This can transform a portfolio that is heavily dependent on Australian banks and miners into one with much broader exposure to the global economy.

Sectors like technology and healthcare are underrepresented here in Australia. 

By targeting international ASX ETFs, Aussie investors can gain exposure to these underrepresented markets. 

In short, the more concentrated the home market, the greater the potential benefit from looking beyond it. 

For Australian investors, international ASX ETFs can complement domestic holdings by diversifying sectors, companies, economies, and sources of growth.

With that in mind, here are three international funds that can provide instant geographic diversification. 

Vanguard MSCI Index International Shares ETF (ASX: VGS)

This is one of the most popular internationally focused ASX ETFs. 

It complements an Australian-dominated portfolio as it includes 1,300 companies from 23 developed countries, excluding Australia. 

The fund offers greater access to sectors such as technology and health care that aren't as well represented in the Australian share market.

In the last 5 years, it has risen more than 54%, vastly outpacing the ASX 200. 

iShares S&P 500 ETF (ASX: IVV)

Another popular fund focused on overseas equities is this ASX ETF from iShares. 

The fund aims to provide investors with the performance of the S&P 500 Index (SP: .INX), before fees and expenses. 

The index is designed to measure the performance of large capitalisation US equities.

Its high growth profile is heavily weighted towards technology companies, including Nvidia and Apple. 

In the last 5 years, it has increased by an impressive 70%. 

BetaShares Nasdaq 100 ETF (ASX: NDQ)

For investors looking for a more highly concentrated US exposure, this fund is an ideal candidate. 

It aims to track the performance of the NASDAQ-100 Index (NASDAQ: NDX) (before fees and expenses). 

The NASDAQ-100 comprises 100 of the largest non-financial companies listed on the Nasdaq market, and includes many companies that are at the forefront of the new economy.

In the last 5 years, it's enjoyed a rise of roughly 75%. 

The post Why every Aussie investor should own one of these ASX ETFs appeared first on The Motley Fool Australia.

That's exactly what the iShares S&P 500 ETF (ASX: IVV) seems to be offering investors right now.

This ETF and index fund is indeed a simple one. It holds the largest 500 companies listed on the American markets, weighted by market capitalisation. In this way, it can be thought of as an American equivalent to the uber-popular Vanguard Australian Shares Index ETF (ASX: VAS).

Buying the world's best stocks with this ASX ETF

But instead of investing in the likes of Commonwealth Bank of Australia (ASX: CBA) and Telstra Group Ltd (ASX: TLS), IVV is far more impressive in terms of scope and scale. The ASX is home to some fine companies. But very few are heavyweights beyond our shores. Not so with IVV. This ASX ETF literally contains dozens, if not hundreds, of companies that sell goods and services right around the world.

These companies include many names you might be familiar with. General Motors, Coca-Cola, Deere & Co, PepsiCo, Walmart, Procter & Gamble, Netflix, Colgate-Palmolive, IBM, Mastercard, Texas Instruments, Costco… the list goes on. And we haven't even got to this ASX ETE's heavyweights. Like most US-based index funds, the iShares S&P 500 ETF is dominated by tech stocks. Its top holdings are also the most powerful companies in the world right now. They include NVIDIA, Apple, Amazon, Microsoft, Alphabet, and Tesla.

It's these companies that investors largely have to thank for IVV's incredible performance over the past decade. As we mentioned earlier, this ASXE TF has delivered a 15% return every year for the past ten years. Specifically, it is 15.72% per annum over the ten years to 31 July 2026.

That's real wealth-building stuff. Helped in no small part by IVV's minuscule management fee of 0.04% per annum. That's $4 a year for every $10,000 invested.

So is IVV a no-brainer buy?

Given that the US is home to the vast majority of the world's best companies, I think it is prudent for most ASX investors to have some exposure to US stocks in their portfolios. They are just a cut above what the ASX has to offer, at least in my view. IVV is a great way to get that US exposure. It is a simple, cheap ETF that provides a lot of diversification. What more could one want?

Saying that, I do think investors need to temper their expectations, though. I would be shocked if the iShares S&P 500 ETF kept returning 15% per annum over the coming ten years. Many of its holdings have reached critical mass, and, at multi-trillion-dollar valuations, will find it difficult to keep growing at the rates they have enjoyed in the past.

Saying that, there is plenty of innovation still happening within IVV's portfolio. Either way, I think this ASX ETF is indeed a no-brainer buy for any ASX investor with a long time horizon.

The post 15% for 10 years: Is this ASX ETF a no-brainer buy? appeared first on The Motley Fool Australia.

For people already getting $40,000 per year in passive income, I reckon receiving an additional $40,000 per year would also be very welcome.

So, what would it take to unlock that river of dividends via superannuation? That's what I'll look at in this article.

Superannuation could be the best place to invest for passive income these days following taxation changes to trusts, residential property and capital gains tax.

Owning dividend-paying investments in superannuation means investors won't lose as much of the return to tax as they would if the investment was in their own name. During the accumulation phase, superannuation has a lower tax rate for income than full-time working individuals, while in retirement the tax rate for income could be 0% for many retirees, depending on the size of their superannuation balance.

With that in mind, I think superannuation is an excellent place to unlock $40,000 per year.

Generating $40,000 of annual passive income

It'll take a sizeable sum to unlock tens of thousands of dollars of dividends each year.

There's no single dollar target required because it really depends on what sorts of investments Aussies choose and the dividend yield that comes with that.

For example, if an investor had all of their money in iShares S&P 500 ETF (ASX: IVV), you'd have a dividend yield of around 1%. With a dividend yield of 1%, someone would need a $4 million portfolio to make $40,000 per year in passive income.

The IVV ETF is not the choice I'd make for passive income, though it does have other benefits.

Instead, I'd focus on building a portfolio with a dividend yield of at least 4%, if not more.

With a 4% dividend yield, an investor could generate the desired passive income from a $1 million portfolio.

If an Australian's portfolio had a 5% dividend yield, they would only need $800,000 for that income.

With a 6.5% dividend yield, an Australian's portfolio goal would be close to $615,000.

As you can see, the higher the dividend yield, the smaller the portfolio needs to be to achieve the income target.

But, higher dividend yields may be riskier and/or deliver less capital growth for investors.

So, the choices investors make could greatly influence how reliable that passive income is. Not every investment with a high dividend yield may sustain its dividends over the longer term.

ASX dividend shares I'd consider for superannuation

If Australians are willing to accept a lower dividend yield, then it's hard to look past Washington H. Soul Pattinson and Co. Ltd (ASX: SOL). That's an investment conglomerate that owns a diversified portfolio of defensive assets, enabling it to pay a reliable and growing dividend. Its payout has grown every year since 1998, though the grossed-up dividend yield is only 3.3%, including franking credits, at the time of writing.

But, there are plenty of businesses with higher dividend yields that I think are compelling.

For example, Centuria Industrial REIT (ASX: CIP) and Dexus Industria REIT (ASX: DXI) are both real estate investment trusts (REITs) with dividend yields of between 5% and 7%. They provide exposure to industrial property, which is benefiting from compelling rental tailwinds.

I also like portfolio investments that can provide diversification and good dividend yields for superannuation investors.

Some of my favourite portfolio-based investments that come to mind include MFF Capital Investments Ltd (ASX: MFF), WCM Quality Global Growth Fund (ASX: WCMQ), WCM Global Growth Ltd (ASX: WQG), Future Generation Australia Ltd (ASX: FGX), Future Generation Global Ltd (ASX: FGG) and L1 Long Short Fund Ltd (ASX: LSF). All of these names have a track record of increasing payouts to shareholders, with dividend yields between 4% and 7%.

There are a number of other attractive ASX shares to consider, in my view, for passive income.

The post How much is needed in superannuation to target a $40,000 annual passive income? appeared first on The Motley Fool Australia.

However, there is no universal superannuation target.

Whether you need $2 million depends mainly on when you retire, how much you plan to spend and whether the Age Pension will eventually support your income.

The superannuation maths, worked backwards

Start with the income, not the balance.

Consider a couple retiring at 60 and funding a 30-year retirement entirely from their own capital. Assuming annual returns of 6% after fees and tax, inflation of 3% and no remaining balance after 30 years, an income of $80,000 a year in today's dollars requires approximately $1.6 million.

Lifting the desired income to $100,000 increases the starting balance to almost $2 million. If annual returns rise to 7% under the same assumptions, the required balance falls to around $1.75 million.

That is where the $2 million figure becomes relevant. It is approximately what an early-retiring couple needs to fund a six-figure lifestyle without relying on the Age Pension.

Change the retirement age, spending target or return assumption and the number changes with it.

Why ASFA's benchmark is much lower

The Association of Superannuation Funds of Australia estimates that a comfortable retirement currently costs $55,923 a year for a single homeowner and $78,566 for a couple.

ASFA estimates the corresponding superannuation balances at $630,000 and $730,000 respectively. However, those figures assume retirement at 67, home ownership and access to a part Age Pension over time.

That makes them very different from a couple retiring at 60 and funding everything independently.

The maximum Age Pension is currently worth approximately $31,223 a year for a single retiree and $47,070 combined for a couple. However, it is means-tested. A homeowner couple retiring with $730,000 in assessable assets would generally receive only a part pension, with the entitlement potentially increasing as their assets are drawn down.

At a simple 4% withdrawal rate, replacing the maximum couple pension would require almost $1.2 million of additional capital. That is not precisely how ASFA models retirement, but it illustrates why its recommended balance is so much lower than a fully self-funded target.

The important question is not which benchmark is correct. It is which set of assumptions resembles your household.

Where investors can close the gap

For investors with substantial super balances, contributions are only part of the equation. Returns earned on the existing portfolio can become increasingly influential during the final decade of work.

The Australian share market has historically generated average annual returns of around 9% over long periods, including dividends. Past performance does not guarantee future returns, but it demonstrates how compounding can accelerate as the balance grows.

For example, $600,000 earning a 5% annual return after inflation would grow to approximately $977,000 in today's dollars over 10 years, without further contributions. If another $15,000 reaches the account each year, the balance could grow to around $1.17 million in today's dollars.

The final decade before retirement is not necessarily when growth stops mattering. It can be when compounding has the largest pool of capital to work on.

Broad-market exchange-traded funds such as the Vanguard Australian Shares Index ETF (ASX: VAS) and iShares S&P 500 ETF (ASX: IVV) can provide diversified exposure to Australian and international shares.

Australian shares may also generate franking credits, although the benefit received depends on the super fund, account structure and individual tax circumstances.

Shares alone are not a complete retirement plan. Fees, diversification, liquidity and the order in which returns occur all matter. A sharp market fall during the first years of retirement can cause substantially more damage than the same decline earlier in life, making portfolio construction and the drawdown plan just as important as the target balance.

Foolish takeaway

A $2 million superannuation balance is a reasonable target for one particular scenario: a couple retiring early, wanting around $100,000 a year in today's dollars and planning without the Age Pension.

That is not every Australian household.

For people retiring later with a paid-off home and some Age Pension eligibility, ASFA's modelling suggests a comfortable retirement may remain achievable with considerably less than $1 million.

The number that matters is not the one attracting headlines. It is the capital required to fund your desired spending from your chosen retirement date, under realistic assumptions about inflation, returns and the Age Pension.

For some households, that may be $2 million. For many others, it will be substantially less.

The post Is $2 million really the new superannuation target? appeared first on The Motley Fool Australia.

That's the cheeky catch with ETF investing: more tickers don't necessarily mean more diversification.

Are your ETFs secretly doing the same thing?

It's surprisingly easy to build an ASX ETF portfolio that looks diversified on paper but is anything but.

Investors might own Betashares Australia 200 ETF (ASX: A200), for example, alongside another Australian broad-market ETF like iShares Core S&P/ASX 200 ETF (ASX: IOZ) without realising just how much their holdings overlap.

The same problem is arguably even more obvious in US-focused ETFs. An investor might own iShares S&P 500 ETF (ASX: IVV) alongside a Nasdaq-focused ETF such as Betashares Nasdaq 100 ETF (ASX: NDQ).

At first glance, these look like different investments. But there's plenty of crossover, particularly among the US technology giants that dominate both indices. That means investors could be doubling down on the same companies without necessarily realising it.

When doubling up can make sense

There are, however, legitimate reasons to hold overlapping ASX ETFs.

Capital gains tax can be a big one. An investor sitting on a substantial unrealised gain may not want to sell an older ETF simply to switch into a cheaper or more suitable alternative.

Instead, they could leave the existing holding untouched and direct future contributions towards their preferred ETF. That's a perfectly reasonable strategy, depending on an investor's circumstances.

The problem arises when investors keep buying overlapping ETFs simply because each one sounds like a useful addition.

Keep the ETF core simple

One way to think about ETFs is to treat them as core portfolio holdings.

That doesn't mean investors can only own a handful of funds. But the core should ideally be straightforward enough that you know exactly what you're buying.

For example, an investor might have one ASX ETF providing exposure to Australian shares, another covering the S&P 500 and another providing broader international exposure.

Satellite investments can then be added around those core holdings, potentially covering areas such as bonds, fixed interest or specialised sectors.

The important thing is knowing what each ETF actually adds.

The diversification illusion

The danger of ETF overlap isn't just paying extra fees. It can also create a false sense of diversification.

You might own five or six ASX ETFs and feel wonderfully diversified, only to discover that many of them hold the same mega-cap companies.

That concentration can become painfully obvious when markets turn bearish and several supposedly different ETFs fall together.

For investors, the lesson is simple: don't count ETFs. Count the underlying exposures. A smaller portfolio of complementary ETFs can provide better diversification than a sprawling collection of funds that all own the same stocks.

After all, the goal isn't to collect ETFs. It's to build a portfolio that actually does what you think it does.

The post Too many ASX ETFs? You could be paying twice for the same shares appeared first on The Motley Fool Australia.

But what if you don't like buying individual stocks?

Well, exchange traded funds (ETFs) could be the answer. They make life easier by allowing you to buy large groups of shares in one go.

With that in mind, here are five ASX ETFs that Australian investors could consider for a balanced portfolio.

iShares S&P 500 ETF (ASX: IVV)

The iShares S&P 500 ETF could be a strong holding.

It gives investors exposure to 500 of the largest listed companies in the United States, across sectors such as technology, healthcare, financials, consumer goods, industrials, and communications.

The fund is not just a bet on the US economy. Many of the companies in the S&P 500 make money all over the world.

That means investors can access a broad collection of global businesses through one ASX trade.

Betashares Asia Technology Tigers ETF (ASX: ASIA)

The Betashares Asia Technology Tigers ETF offers exposure to technology.

This fund focuses on major Asian technology companies, including businesses linked to semiconductors, hardware, ecommerce, gaming, and digital platforms.

Asia is playing an important role in both building the digital economy and serving large consumer markets.

It is a higher-risk ETF because it is concentrated in one region and one sector, but that focus also gives it strong long-term growth potential.

Betashares Global Robotics and Artificial Intelligence ETF (ASX: RBTZ)

The Betashares Global Robotics and Artificial Intelligence ETF gives investors exposure to companies involved in robotics, automation, artificial intelligence, drones, unmanned vehicles, and related technologies.

This is a fund focused on technology moving into the physical world.

Factories, hospitals, warehouses, farms, and logistics networks are all looking for ways to become more efficient and automated.

That gives this ASX ETF a clear long-term theme, though investors should expect volatility along the way.

Global X FANG+ ETF (ASX: FANG)

The Global X FANG+ ETF is a more concentrated way to gain exposure to global mega-cap technology and growth shares.

The fund holds a small group of major companies that are heavily involved in areas such as artificial intelligence, cloud computing, digital advertising, ecommerce, electric vehicles, social media, and streaming.

This concentration means it can move sharply in both directions.

But it can also give a portfolio targeted exposure to some of the most influential companies in the world.

Betashares Global Cash Flow Kings ETF (ASX: CFLO)

Finally, the Betashares Global Cash Flow Kings ETF brings a different angle to a portfolio.

It focuses on global companies that generate strong free cash flow.

That can be attractive because cash gives businesses options. They can reinvest, pay dividends, buy back shares, reduce debt, or deal with tougher trading conditions.

As a result, this fund could add quality and financial discipline alongside the more growth-focused ETFs above.

The post 5 amazing ASX ETFs for Australian investors in August appeared first on The Motley Fool Australia.

If you have $500 available, it could be worth considering one of these ASX exchange traded funds (ETFs).

Each gives investors a different way to put money to work without having to pick individual shares.

iShares S&P 500 ETF (ASX: IVV)

The iShares S&P 500 ETF could be a strong option for investors wanting broad exposure to the United States.

This fund tracks the S&P 500 Index, which includes many of the largest listed companies in America.

That includes many of the biggest and best companies in the world, such as Apple (NASDAQ: AAPL) and Nvidia (NASDAQ: NVDA).

Vanguard MSCI Index International Shares ETF (ASX: VGS)

Another ASX ETF to consider is the Vanguard MSCI Index International Shares ETF. It could be worth a look if you want even broader global exposure.

This fund invests across developed markets, including the United States, Europe, Japan, Canada, and other major economies.

This can make it a good starting point for investors who want a simple global share portfolio without having to decide which overseas market will perform best.

Vanguard Australian Shares Index ETF (ASX: VAS)

The Vanguard Australian Shares Index ETF keeps things closer to home.

This fund gives investors exposure to a broad basket of Australian shares. This includes the banks, miners, healthcare companies, and retailers you hear about in the news or encounter in everyday life.

It is worth noting that the local market is not as diversified as global markets, but it still includes plenty of large, profitable businesses. This fund offers a simple way to own a slice of 300 of them.

Betashares Nasdaq 100 ETF (ASX: NDQ)

A fourth ASX ETF to consider is the hugely popular Betashares Nasdaq 100 ETF.

It is a higher-growth option. It invests in 100 of the largest non-financial companies listed on the Nasdaq exchange.

These companies are linked to areas such as artificial intelligence, cloud computing, chips, software, digital advertising, streaming, ecommerce, and consumer technology.

This fund can be volatile, so it may not suit everyone. But investors with a long-term view could find it attractive because it offers exposure to some of the world's most influential growth companies.

Betashares Asia Technology Tigers ETF (ASX: ASIA)

Finally, the Betashares Asia Technology Tigers ETF could be a good option for investors wanting technology exposure outside the United States.

This fund invests in major Asian technology companies across areas such as semiconductors, hardware, ecommerce, gaming, and digital platforms.

It is a more concentrated option, so investors should expect ups and downs.

But if you want your $500 invested in a focused long-term technology theme, this ASX ETF could be worth a closer look.

The post 5 amazing ASX ETFs to buy with $500 appeared first on The Motley Fool Australia.

Other investors may be looking to allocate savings to shares or ASX ETFs for the first time. 

If you fall into either basket, there are several ways to build lifetime wealth. 

Here at The Motley Fool, we advocate for a long-term, diversified portfolio.

ASX ETFs offer a simple and effective way to achieve this in just one or two trades. 

The magic of compounding 

One of the core reasons we advocate for long-term investing is the impact of compounding returns.

A simple way to think about compounding is that your money earns returns, and then those returns earn returns too.

For example, if you invest $10,000 in an ASX ETF and it earns an average 10% per year with all dividends reinvested:

• After 10 years: $25,900
• After 20 years: $67,300
• After 30 years: $174,500
• After 40 years: $452,600

You only invested $10,000, but by staying invested and reinvesting your returns, compounding does the heavy lifting over time. 

While this is just a hypothetical example, there are ASX ETFs that have brought annualised returns around this mark. 

This is why long-term investing in ASX ETFs can build significant wealth.

Here are three examples that are built for the long-term. 

BetaShares Australia 200 ETF (ASX: A200)

As the name suggests, this fund from Betashares provides exposure to the S&P/ASX 200 Index (ASX: XJO). 

The ASX 200 is an index that tracks the 200 largest companies listed on the Australian market. 

It represents around 80% of the total value of the Australian share market, making it a good snapshot of how the Australian economy and share market are performing.

Over the last five years, it has brought an annualised return of almost 8% according to Betashares. 

This kind of fund can be a great starting point for an Aussie investor trying to capture the broader Australian market. 

iShares S&P 500 ETF (ASX: IVV)

Turning our attention to the US market, this iShares fund applies the same concept to the largest US stocks. 

It tracks the S&P 500 Index (SP: .INX), which is 500 of the largest publicly traded companies in the United States.

Over the last five years, it has brought an annualised return of over 13%. 

Vanguard MSCI Index International Shares ETF (ASX: VGS)

Another great set and forget option is this fund from Vanguard. 

One of the most popular ASX ETFs, it invests in over 1,000 companies from around 23 countries, including the U.S., Japan, the U.K., Canada, France, and Switzerland.

It is a great way to diversify your portfolio in just one trade. 

Over the last five years, it has returned over 10% per annum. 

The post 3 ASX ETFs to buy in FY27 and hold for life  appeared first on The Motley Fool Australia.

Rather than choosing a single company, investors can use ETFs to spread their money across markets, sectors, and long-term themes in one trade.

With that in mind, here are five ASX ETFs that could be worth considering in August.

iShares S&P 500 ETF (ASX: IVV)

The iShares S&P 500 ETF could be a strong option for broad global exposure.

This fund gives investors access to 500 of the largest companies listed in the United States, covering technology, healthcare, financials, consumer goods, industrials, and more.

The strength of the S&P 500 is that it captures many of the companies already shaping the global economy. These businesses sell software, medicines, devices, advertising, cloud services, payments, and consumer products around the world.

As a result, this ASX ETF could work well as a core holding.

Betashares Global Robotics and Artificial Intelligence ETF (ASX: RBTZ)

Another ASX ETF to look at is the Betashares Global Robotics and Artificial Intelligence ETF. It offers something more targeted.

The fund gives investors exposure to companies involved in robotics, automation, artificial intelligence, drones, unmanned vehicles, and related technologies.

This is technology with a physical edge. It is about machines, sensors, automation systems, and intelligent equipment moving into factories, hospitals, warehouses, logistics networks, and other real-world settings.

The fund will likely be volatile, but the long-term theme is hard to ignore. It was recently recommended by the team at Betashares.

Betashares Global Cybersecurity ETF (ASX: HACK)

Another ASX ETF to consider is the Betashares Global Cybersecurity ETF.

As its name implies, this fund invests in companies helping protect networks, cloud systems, devices, data, payments, and digital identities.

Cybersecurity has become a permanent cost of doing business. As companies use more cloud software, artificial intelligence tools, online payments, and connected systems, the need for protection keeps increasing.

This fund gives investors exposure to that growing spend without needing to pick one cybersecurity winner.

VanEck Morningstar Wide Moat ETF (ASX: MOAT)

The VanEck Morningstar Wide Moat ETF takes a different approach to the others.

It looks for US companies that are believed to have both sustainable competitive advantages and attractive valuations.

Competitive advantages can include strong brands, cost advantages, valuable intellectual property, network effects, or loyal customers.

This ASX ETF could appeal to investors who want US exposure, but with a quality and valuation filter rather than a simple market-cap approach.

Betashares Australian Quality ETF (ASX: AQLT)

Finally, the Betashares Australian Quality ETF could be a good way to invest in the local market.

It invests in Australian shares with quality characteristics, such as stronger profitability, lower debt, and more stable earnings.

This gives investors a different way to approach the local market, rather than simply buying the biggest banks, miners, and retailers.

It was also recently recommended by the team at Betashares.

The post 5 excellent ASX ETFs to buy with $5,000 in August appeared first on The Motley Fool Australia.

The good news? You don't need to be wealthy to help your children build long-term financial security. Here are three simple money moves that could make a meaningful difference.

1. Start investing early

Time is one of the most powerful forces in investing. The earlier money is invested, the longer it has to benefit from compound returns.

For example, if parents invested $50 a week from the day their child was born, and those investments generated an average annual return of 8%, the portfolio could grow to around $95,000 by the time the child turns 18. That's despite total contributions of less than $47,000, with the rest coming from the power of compounding.

Many Australian parents choose low-cost, diversified exchange-traded funds (ETFs) like Vanguard Australian Shares Index ETF (ASX: VAS) or iShares S&P 500 ETF (ASX: IVV) as a simple way to build long-term wealth for their kids. However, it's important to consider the tax and ownership implications before investing on behalf of your child.

Rather than trying to pick the next market winner, the biggest advantage is simply giving investments enough time to grow. Building a diversified ASX portfolio early could provide children with a meaningful financial head start before they even enter adulthood.

2. Teach them to invest, not just save

Saving money is an important life skill, but investing in an ASX portfolio is what helps build long-term wealth.

As your children get older, involve them in conversations about how businesses make money, why share prices move, and how dividends work. Showing them the value of owning quality companies can help them develop healthy financial habits from an early age.

Many successful investors started with small portfolios that taught them lessons far more valuable than the dollar amount invested.

3. Invest in their earning potential

One of the best financial investments isn't found on the share market at all.

Supporting your children's education, skills, and interests can generate returns for decades through higher earning potential and greater career opportunities. Whether it's tutoring, coding classes, music lessons, or helping fund university or vocational training, investing in human capital can pay dividends throughout their lives.

A higher income also gives them greater capacity to save and build their own ASX portfolio in the future.

Foolish takeaway

Parents don't need a huge fortune to give their children a financial head start. Starting early with investing in an ASX portfolio, teaching the principles of long-term wealth creation, and investing in their education and skills can all have a lasting impact.

The greatest gift may not be money itself, but the knowledge and habits that help your children build wealth long after they've left home.

The post 3 money moves to help your kids build an ASX portfolio for life appeared first on The Motley Fool Australia.

The right mix of dependable dividend stocks and diversified ETFs can help grow wealth, generate passive income, and reduce portfolio risk along the way. Here are five investments that could help fast-track your journey to financial freedom.

APA Group (ASX: APA)

Every retirement portfolio needs a reliable income engine. APA Group owns thousands of kilometres of gas pipelines and energy infrastructure across Australia, generating relatively stable cash flow through long-term contracts.

That dependable income has made APA a favourite among dividend investors for years. While higher interest rates and regulation remain risks, demand for critical energy infrastructure isn't disappearing anytime soon.

Wesfarmers Ltd (ASX: WES)

Wesfarmers has quietly become one of the ASX's great long-term wealth creators, a great retirement investment.

Best known for Bunnings and Kmart, the company also owns businesses across chemicals, healthcare, and industrials, giving investors exposure to several sectors through one stock.

Its disciplined approach to capital allocation, consistent earnings growth, and fully franked dividends have rewarded patient shareholders for decades.

Transurban Group (ASX: TCL)

Infrastructure can provide welcome stability in a retirement portfolio when markets become volatile.

Transurban owns and operates major toll roads across Australia and North America, benefiting from growing populations, increasing traffic volumes, and inflation-linked revenue.

Although higher borrowing costs can weigh on infrastructure valuations, the company's long-life assets continue generating predictable cash flows that suit long-term investors.

SPDR S&P/ASX 200 ETF (ASX: STW)

Not everyone wants to pick individual shares.

STW ETF gives investors instant exposure to Australia's largest listed companies through a single investment.

Banks, miners, healthcare businesses, retailers, and industrial companies all sit inside the portfolio, providing broad diversification while keeping fees relatively low.

It's a simple way to participate in the long-term growth of the Australian sharemarket.

iShares S&P 500 ETF (ASX: IVV)

Australia represents only a small slice of the global economy.

IVV ETF provides exposure to 500 of America's largest companies, including many of the world's leading technology, healthcare, financial, and consumer businesses.

Adding international shares can diversify a portfolio while tapping into industries that barely exist on the ASX.

Vanguard MSCI Index International Shares ETF (ASX: VGS)

For even broader global diversification, VGS ETF offers exposure to more than 1,300 companies across developed markets.

The ETF invests across the United States, Europe, Japan, and other major economies, reducing reliance on any single market.

For investors with decades until retirement, that global exposure can become a powerful driver of long-term compounding.

Foolish takeaway

There's no magic formula for early retirement.

But consistently investing in high-quality ASX shares and diversified ETFs, reinvesting dividends, and giving compounding time to work can dramatically improve your chances of reaching financial independence sooner than expected.

The post Chasing early retirement? These ASX shares and ETFs could help appeared first on The Motley Fool Australia.

It's not one of the biggest ASX ETFs on the ASX like Vanguard Australian Shares Index ETF (ASX: VAS) or iShares S&P 500 ETF (ASX: IVV). But, the WCMQ ETF offers a combination of great characteristics that could make it more appealing than both the VAS ETF and the IVV ETF.

High-quality portfolio making great returns

I believe that higher-quality businesses will outperform average companies over the long-term.

The WCMQ ETF aims to invest in a portfolio of between 20 to 40 stocks that are high-quality global companies primarily in the high-growth consumer, technology and healthcare sectors.

The WCM investment team want to own businesses that have improving economic moats, or strengthening competitive advantages.

Companies that are becoming steadily stronger with their market position gives them much more scope to grow earnings in future years.

Additionally, the WCM team have come up with a way to judge whether businesses have a corporate culture that supports the improvement of its economic moat – these are the types of stocks they're looking for.

The investment strategy is clearly working well because the ASX ETF's portfolio has delivered strong returns.

The WCMQ ETF has returned an average of 16.2% per year since inception in August 2018 and 25.1% per year over the past three years. Of course, past performance is not a guarantee of future returns.

Global diversification

This is not a US portfolio – the fund targets shares from the global share market. So, this ASX ETF can provide more diversification than both the VAS ETF and the IVV ETF.

At the end of June 2026, 57% of the portfolio was invested in the Americas (not just the US), 20% was invested in European shares, 19% was invested in Asia Pacific shares and 4% was invested in 'other'.

For investors wanting to diversify away from Australian-based assets, this could be a great choice.

Good dividend yield

For me, one of the most appealing elements of this ASX ETF is how it targets a 5% distribution yield, which is far higher than many other international share-focused ASX ETFs such as the IVV ETF.

With its track record of delivering double-digit net returns, that's strong enough for the ASX ETF to deliver a good yield in the short term, capital growth and payout growth over time.

For me, that's a great combination of returns and something I'll be happy to own for the long-term.

The post This is the ASX ETF I'd buy in August! appeared first on The Motley Fool Australia.

After all, Warren Buffett once suggested that investors should be greedy when others are fearful.

Of course, a 1% decline over one trading day, and a 3% drop over a month, is not exactly a huge fall. But, it's not that often that the IVV ETF falls by 1% or more on a single day.

I'll run through some of my thoughts on the appeal of the IVV ETF.

Don't completely ignore the AI question

There is extensive market commentary about AI and data centres. I normally don't write about these aspects when considering the IVV ETF and there's so much coverage of those elements already. You'd need a crystal ball to truly know how those two factors are going to play out.

The most optimistic and pessimistic viewpoints about AI and data centres are probably too strong.

But, there are some important questions that I can't see clear answers to yet.

How would economies realistically operate if AI is successful as hoped by its strongest advocates?

How will these AI businesses generate enough revenue/profit to justify their valuations?

Are businesses depreciating their capital expenditure at the right rate? Or will rapid advancement mean there will be big impairments in a few years? Depreciating AI spending over three years or six years can make a big difference to a company's profit.

There are vast sums being invested in AI-related businesses, with hefty valuations attached to US tech companies and bullish assumptions about the future, so investors shouldn't totally ignore AI considerations when looking at the IVV ETF.

It is possible to overpay for an asset, even an exchange-traded fund (ETF). Overpaying can lead to low or negative long-term returns for that particular investment.

Why the IVV ETF could be a buy

The positives of the iShares S&P 500 ETF still exist.

It still has very low annual management fees of 0.04%.

The fund still gives access to 500 great businesses, with those holdings giving an evolving exposure to how the US (and global) economy is changing. Many of the world's strongest businesses are listed in the US, with incredibly powerful brands, operating leverage on a global scale, impressive balance sheets and the ability to invest heavily for future earnings growth.

We can buy the IVV ETF for a cheaper price than it was a few weeks ago.

Plenty of investors may use it as a regular dollar cost average (DCA) investment strategy, through the highs and lows. I wouldn't advise against that. But I think it could be wise to ensure diversification by regularly investing in other markets too, such as the ASX or Europe.

Reasons to look elsewhere

There's no doubt the IVV ETF has been a great investment and may continue to do so.

But the portfolio is becoming increasingly reliant on a few large tech businesses, with a rapidly increasing focus on AI. It's becoming less diversified, in my view.

Will all the spending on AI be worthwhile? Meta Platforms Inc's (NASDAQ: META) spending on its Metaverse has seemingly wasted many billions of dollars. I'm feeling cautious about the US share market.

ETF investing makes investing very easy for most people, but it shouldn't mean we invest in something no matter what if it's no longer appealing, in my view. Investors need to decide if this is still a good investment.

Long-term holders of the IVV ETF have done very well, but for investors seeking returns, it may be wise to diversify their holdings across different assets.

The post Is this the right time to invest in the iShares S&P 500 ETF (IVV)? appeared first on The Motley Fool Australia.

Instead of researching and buying individual companies, one investment can provide exposure to dozens, hundreds, or even thousands of shares.

That said, here are five ASX ETFs I think are worth considering in August if you are starting out.

Betashares Australia 200 ETF (ASX: A200)

The A200 ETF provides exposure to 200 of the largest companies listed on the Australian share market.

This includes businesses from banking, mining, healthcare, retail, telecommunications, and other major industries.

I think it offers beginners a straightforward way to invest in Australian shares without needing to decide which individual companies will perform best.

The fund also pays distributions, although both the income and unit price can rise or fall over time.

Betashares Global Shares ETF (ASX: BGBL)

Australia represents only a small part of the global share market.

The BGBL ETF allows investors to spread their money across more than 1,000 companies from developed countries outside Australia, including the United States, Japan, and major European markets.

This gives beginners access to industries that are less prominent on the ASX, particularly global technology, healthcare, consumer brands, and industrial businesses.

I think the Betashares Global Shares ETF is a simple option for someone who wants broad international exposure rather than trying to select individual overseas shares.

Vanguard Diversified High Growth Index ETF (ASX: VDHG)

The VDHG ETF is designed for investors who want several types of investments bundled together.

The fund holds Australian shares, international shares, emerging market shares, and smaller companies. It also keeps a modest allocation to defensive investments such as bonds.

Vanguard manages the mix and regularly brings it back towards its target allocations.

I think that removes several decisions that can overwhelm a beginner. Investors still need to accept share market volatility, but they do not have to choose and manage several different funds themselves.

iShares S&P 500 ETF (ASX: IVV)

The IVV ETF follows the S&P 500 Index, which contains 500 leading US companies.

These businesses operate across technology, healthcare, financial services, consumer products, communications, and many other parts of the economy.

The fund can give beginners exposure to companies such as Apple, Microsoft, and NVIDIA through one ASX investment.

I think the strength and adaptability of major US businesses make the iShares S&P 500 ETF an attractive long-term option, although currency movements will affect returns for Australian investors.

Betashares Nasdaq 100 ETF (ASX: NDQ)

The NDQ ETF invests in 100 of the largest non-financial companies listed on the Nasdaq.

It has significant exposure to technology and businesses benefiting from cloud computing, artificial intelligence, semiconductors, software, and digital services.

I think the Betashares Nasdaq 100 ETF could suit beginners seeking stronger growth potential who are comfortable with larger price swings.

The NDQ ETF is more concentrated than a broad global fund, so I would expect greater volatility when technology shares fall out of favour. Its higher growth potential comes with more risk.

Foolish takeaway

There is no single ETF that will suit every beginner. The A200 ETF offers broad Australian exposure, while the BGBL and IVV ETFs provide different routes into international markets. The VDHG ETF handles much of the diversification work within one investment, while the NDQ ETF provides a more growth-focused choice.

I think the best starting point is the fund an investor understands and feels comfortable holding.

Each of these ETFs offers a simple way to begin investing in August, but I think beginners should consider their goals, time horizon, and tolerance for volatility before buying.

The post 5 top ASX ETFs for beginner investors in August appeared first on The Motley Fool Australia.

The answer is that it depends on your circumstances.

But there are useful benchmarks to work from and retiring at 60 rather than 67 is a key priority for many Australians.

What the superannuation benchmarks say

The Association of Superannuation Funds of Australia publishes a quarterly Retirement Standard.

For the March quarter of 2026, the Retirement Standard estimates a comfortable lifestyle needs a lump sum of $630,000 for a single person and $730,000 for a couple.

A comfortable standard covers private health insurance, a reasonable car, household goods and holidays.

Those figures assume you own your home outright and retire at 67, living to roughly 85.

ASFA also assumes a part Age Pension does some of the heavy lifting once assets fall below the relevant thresholds, which means the published figures already build in government support that an early retiree will not receive for years.

Why retiring at 60 changes the superannuation maths

Preservation age is now 60 for everyone born on or after 1 July 1964.

As a result, 60 is the earliest most people can access their superannuation, and only once they have actually retired.

The Age Pension, by contrast, does not begin until 67.

That leaves a seven-year window funded entirely from your own savings.

You also give up seven years of contributions and compounding.

A rough illustration helps here: seven extra years of drawing roughly $56,000 annually adds close to $400,000 in nominal terms.

Investment returns over that period reduce the shortfall, though not to zero.

On that basis, a single person retiring at 60 might reasonably target somewhere between $900,000 and $1 million.

A couple would be looking at meaningfully more again.

These are illustrations rather than forecasts, and individual circumstances vary enormously depending on home ownership, health costs, investment returns and whether any income continues in early retirement.

Where that money might be invested

A 60-year-old still has a long investment horizon.

The money may need to last 25 years or more.

That argues against shifting everything into cash on day one, though holding the first year or two of spending in something stable protects you from being forced to sell shares into a falling market.

To provide a few examples of return-generating long-term investments, the iShares S&P 500 ETF (ASX: IVV) provides exposure to large American companies.

Likewise, the Vanguard Diversified High Growth Index ETF (ASX: VDHG) bundles Australian and global shares into a single holding.

For investors looking for domestic income and returns, Commonwealth Bank of Australia (ASX: CBA) should remain a core position in many portfolios thanks to its fully franked dividends.

Franking credits are particularly valuable inside superannuation, where the tax rate is low in accumulation and nil in pension phase, meaning excess credits can be refunded rather than offsetting tax owed.

Foolish takeaway

The gap between the Retirement Standard benchmark and reality is wide for most Australians.

Median balances for those aged 60 to 64 sit well below these targets, and averages flatter the picture because a handful of very large accounts drag the mean upwards.

However, that does not make retiring at 60 impossible.

It usually means the plan needs savings outside superannuation as well, to bridge the years before the Age Pension arrives.

The post How much superannuation do I need to retire comfortably at 60? appeared first on The Motley Fool Australia.

The real difference appears when those purchases continue for years, and the returns start earning returns of their own.

So, what could that monthly habit eventually become?

Building towards a 9% return

For this example, I will assume the portfolio earns an average return of 9% per annum, with dividends reinvested.

That figure is not guaranteed. Share market returns can vary significantly from year to year, and investors will experience falls along the way.

Still, I think 9% is a reasonable long-term target for a portfolio built around diversified exchange-traded funds (ETFs) and quality ASX shares.

I would consider making a broad fund such as the iShares S&P 500 ETF (ASX: IVV) a core holding. It gives investors access to hundreds of major US companies across technology, healthcare, financial services, consumer goods, and industrials.

The Vanguard Diversified High Growth Index ETF (ASX: VDHG) could provide an even broader foundation by spreading money across Australian shares, international markets, emerging economies, and a smaller allocation to defensive assets.

Investors comfortable with greater volatility could add the Betashares Nasdaq 100 ETF (ASX: NDQ), which places more weight on companies benefiting from artificial intelligence, cloud computing, semiconductors, software, and digital commerce.

Which ASX shares could help?

I would also consider selected ASX shares capable of growing earnings over many years.

Breville Group Ltd (ASX: BRG) has room to expand its premium appliance brands across international markets, while Goodman Group (ASX: GMG) is building data centre infrastructure in locations where land and power are difficult to secure.

Nextdc Ltd (ASX: NXT) offers another route into rising demand for computing capacity. Its facilities support cloud services, artificial intelligence, cybersecurity, and the increasing volume of data moving through the economy.

Cochlear Ltd (ASX: COH) could add healthcare exposure through a business serving people with hearing loss, while BHP Group Ltd (ASX: BHP) provides access to iron ore, copper, potash, dividends, and the resources required for global development.

I would not expect every holding to return exactly 9%. The aim would be for the portfolio as a whole to reach that average over time.

What could the portfolio become?

With $500 invested at the end of every month and an average annual return of 9%, the portfolio could grow to approximately $95,000 after 10 years.

After 20 years, it could reach around $320,000.

The effect of compounding becomes much clearer from there. After 30 years, the balance could rise to approximately $860,000.

Continuing for 40 years could produce around $2.1 million, while 50 years could take the portfolio to roughly $5.1 million!

These estimates assume monthly compounding and exclude brokerage, fees, and tax.

The later figures look so much larger because the portfolio eventually contributes far more growth than the monthly deposits. Time allows each earlier investment to keep compounding while new money continues entering the market.

Foolish takeaway

Investing $500 a month in ASX shares could create a substantial portfolio, but the biggest results require patience.

I would build around diversified ETFs, add quality companies with clear growth opportunities, reinvest the income, and continue buying through both strong and weak markets.

The first decade may feel gradual. But over longer periods, compounding can completely change the outcome.

At an average return of 9%, a regular $500 investment could eventually grow into several million dollars.

The post What could $500 a month in ASX shares actually turn into? appeared first on The Motley Fool Australia.

You don't need to pick individual winners, nor do you need to time the market.

ASX investors can simply buy a basket of shares in a single trade.

Here are three ASX ETFs that make long-term investing genuinely easy.

Why ASX ETFs suit long-term investors

ASX ETFs give you instant diversification, as one fund unit can hold hundreds or even thousands of companies.

If one business stumbles, the others help cushion the blow.

ETFs are also, generally speaking, cheap to own. Many of the most popular funds charge a fraction of what an active manager would.

For investors, lower fees mean more of the return stays in your pocket.

And they trade on the ASX just like any share: investors can buy or sell ETFs during market hours with a few clicks.

Here are three ASX-listed ETFs that take the guesswork out of investing.

Vanguard Australian Shares ETF (VAS)

The Vanguard Australian Shares Index ETF (ASX: VAS) is the largest ETF on the ASX.

It tracks the S&P/ASX 300 Index, meaning that one trade gives you exposure to the top 300 Australian companies.

Investors instantly get the big banks, the major miners, and many more of the companies that make the ASX what it is.

Vanguard charges a management fee of just 0.07% per year.

VAS also pays regular quarterly distributions, which come primarily from franked Aussie dividends.

For a low-cost core holding, VAS is tough to beat.

iShares S&P 500 ETF (IVV)

As opposed to VAS, the iShares S&P 500 ETF (ASX: IVV) opens the door to the United States for ASX investors.

The ETF tracks the 500 largest US-listed companies, including companies like Apple Inc (NASDAQ: AAPL), Microsoft Corp (NASDAQ: MSFT), and Nvidia Corp (NASDAQ: NVDA).

So why invest in the US rather than in Australia? Well, the S&P 500 has delivered an average annual return of around 10% over the very long term.

True to form, in 2025, IVV gave Australian investors a total return of 10.13%.

However, IVV also introduces new risks, including foreign exchange risk. Currency moves between US and Australian dollars can lift or lower those returns in any given year.

But as a long-term US holding, IVV is a firm favourite, and like VAS, also carries a very low management fee of 0.04%.

Vanguard MSCI Index International Shares ETF (VGS)

The Vanguard MSCI Index International Shares ETF (ASX: VGS) casts the net even wider.

This ETF holds shares across 22 developed markets, including the US, Japan, the UK, and Europe.

In 2025, VGS delivered a total return of 13.34%, comprising 9.81% in capital growth and a 3.53% distribution yield.

The fund charges 0.18% per year.

Unlike the other two ETFs, investors in VGS benefit from international diversification, which reduces volatility and should, in theory, increase risk-adjusted returns.

For broad international diversification, VGS is a standout.

Foolish takeaway for ASX ETFs

These three ASX ETFs cover Australia, the US, and the wider world.

Together, they form a simple, low-cost foundation for a long-term portfolio.

Investors can hold all three, or start with just one, keeping in mind that VGS and IVV overlap heavily on US shares.

Past returns are also never a guarantee of future performance.

But for hands-off investors, these ASX ETFs make building wealth about as easy as it gets.

The post 3 ASX ETFs that make long-term investing easy appeared first on The Motley Fool Australia.