Vanguard runs the biggest ETF on the market, the Vanguard Australian Shares Index ETF (ASX: VAS).

VAS ETF tracks the S&P/ASX 300 Index (ASX: XKO).

VAS ETF will pay 129.07 cents per unit this time around. This equates to a 1.2% dividend yield.

Dividends for Vanguard ASX ETF investors

Here is a summary of the final distributions that Vanguard will pay investors today.

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The ex-dividend date for these distributions is next Thursday, 1 October.

Vanguard will pay investors on 16 October.

Dividends for Vanguard ASX ETF investors

Here is a summary of the estimated distributions that Vanguard will pay investors next month.

The post Own VAS, VHY, VGS, or other Vanguard ETFs? Here's your next dividend appeared first on The Motley Fool Australia.

At that stage, I think many investors still want growth, but they may also care more about income, diversification, and avoiding unnecessary risk.

That does not mean moving everything into cash. Retirement can last decades, so growth still has a role to play. But I think the balance needs to be more thoughtful.

For investors looking for exchange-traded funds (ETFs), three ASX ETFs stand out to me.

Vanguard Australian Shares High Yield ETF (ASX: VHY)

The first ETF I would consider is the Vanguard Australian Shares High Yield ETF.

As the name suggests, this fund focuses on Australian shares with higher expected dividend yields.

I think that can make it useful for investors in their 60s who want their portfolio to produce income without having to pick every dividend stock themselves.

The ASX has a strong dividend culture. Banks, miners, insurers, infrastructure shares, and other mature businesses often return a meaningful portion of profits to shareholders.

The VHY ETF gives investors a way to access a diversified basket of these income-paying companies.

There are risks. A high yield does not automatically mean a safe yield. Some sectors can be cyclical, and dividends can be cut when earnings fall.

But as part of a broader portfolio, I think the Vanguard Australian Shares High Yield ETF can be a sensible way to generate income from Australian shares while still keeping some exposure to capital growth.

Vanguard Diversified Conservative Index ETF (ASX: VDCO)

The second ETF I would look at is the Vanguard Diversified Conservative Index ETF.

This is a very different type of fund. The VDCO ETF is designed for investors with a lower tolerance for risk. It targets a 70% allocation to income assets and a 30% allocation to growth assets.

That kind of split could make sense for investors in their 60s who want a steadier ride than a share-heavy portfolio may provide.

The ETF invests across a range of underlying funds, giving investors broad diversification across different asset classes. In other words, it is not just about owning Australian shares or global shares. It also includes income assets that can help reduce volatility.

I think that simplicity is appealing. Rather than trying to build a diversified conservative portfolio from scratch, investors can use the VDCO ETF as a ready-made option.

It currently trades with a trailing dividend yield of around 3.5%, which may also appeal to investors looking for income. While this yield is lower than some share-focused income ETFs, the trade-off is a more defensive asset mix.

iShares Global Consumer Staples ETF (ASX: IXI)

The third ETF I would consider in my 60s is the iShares Global Consumer Staples ETF.

This fund provides exposure to global consumer staples companies. I think that is an interesting area for investors nearing retirement because consumer staples businesses tend to sell products people buy in most economic environments. This can include food, drinks, household goods, and personal care products.

These are rarely the most exciting companies on the market. But that is part of the appeal.

During tougher economic periods, consumers may delay buying a new car, renovating a house, or booking a luxury holiday. But they still need groceries, cleaning products, and everyday essentials.

That can give consumer staples companies a more defensive earnings profile.

The IXI ETF also provides global diversification, which is useful for Australian investors. The local market is heavily weighted toward banks and miners, so adding global staples exposure can help broaden a portfolio.

Foolish Takeaway

For investors in their 60s, I think the best ETF portfolio is one that balances income, resilience, and enough growth to keep working over time.

None of these ETFs removes risk completely. But together, I think they could help investors build a portfolio that is more suited to the retirement years than a pure growth strategy.

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The focus usually shifts toward stability, diversification, and a smoother ride over time, while still allowing for some growth to keep up with inflation.

If I were putting together a simple retirement-focused portfolio using exchange-traded funds (ETFs), these are three I would consider.

iShares S&P 500 ETF (ASX: IVV)

Even in retirement, I think it makes sense to have exposure to global growth.

The iShares S&P 500 ETF provides access to 500 of the largest companies in the United States. That includes many of the world's leading businesses across technology, healthcare, and consumer sectors.

The reason I would include it is straightforward. The US market has historically been a strong driver of long-term returns. Holding an ETF like the IVV ETF gives you exposure to that growth without needing to pick individual winners.

It also adds diversification beyond the Australian market, which can be more concentrated.

Vanguard Diversified Conservative Index ETF (ASX: VDCO)

The Vanguard Diversified Conservative Index ETF would form the core of the portfolio.

It is designed as a more conservative, balanced ETF, with a mix of equities and fixed income. That helps reduce volatility compared to a portfolio made up entirely of shares.

This is important in retirement. Having exposure to bonds and defensive assets can help smooth returns and reduce the impact of market downturns.

At the same time, the VDCO ETF still includes equities, which allows for some growth over time.

That balance between income, stability, and modest growth is why I think it fits well in a retirement portfolio.

BetaShares Australian Quality ETF (ASX: AQLT)

The final piece I would add is a focus on quality. The BetaShares Australian Quality ETF focuses on Australian stocks with strong balance sheets, high returns on equity, and more stable earnings.

In my view, that can be particularly useful in a retirement portfolio.

Quality companies tend to be more resilient during difficult periods, which can help reduce downside risk. Many also pay dividends, which can support income.

It also provides exposure to Australian stocks, which can complement the global exposure from the IVV ETF.

Foolish Takeaway

A retirement portfolio does not need to be complicated.

For me, the focus would be on combining global growth, defensive balance, and quality companies.

I think the IVV ETF provides exposure to leading global businesses, the VDCO ETF adds diversification and stability through a balanced approach, and the AQLT ETF brings in a focus on higher-quality Australian companies.

Together, I think they offer a simple way to build a retirement portfolio that can generate income, manage risk, and still grow over time.

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As I've written about before, this approach makes sense for many investors. By using just two or three index funds, you can build a diversified portfolio of passive investments that you can leave in the proverbial bottom drawer without too much worry or effort.

I've long advocated owning more than one exchange-traded fund in this endeavour. After all, just buying an Australian index fund, for example, leaves out some of the world's best companies and exposes one to any potential problems with the Australian economy or the Australian dollar.

By supplementing an ASX index fund with something like the Vanguard MSCI Index International Shares ETF (ASX: VGS) and the iShares MSCI EAFE ETF (ASX: IVE), you can mitigate these risks while broadening your portfolio's horizons significantly. You'll also get exposure to some of the world's best companies, which, sadly, lie outside the ASX. I'm talking about the likes of Apple, Microsoft, Coca-Cola, and Amazon.

But perhaps ASX investors who value simplicity can get by with just one ETF after all.

They can do so by buying something like the Vanguard Diversified Growth Index ETF (ASX: VDGR).

An all-in-one ASX ETF?

This ETF gets around our diversification problem by actually investing in multiple underlying ETFs within its portfolio. It's a 'buy one, get several free' arrangement.

Yes, this Vanguard ETF holds several underlying stakes in other Vanguard ETFs within it. These cover Australian shares, international shares from advanced economies (both currency hedged and unhedged), shares from emerging markets, small-cap shares, and government and corporate bonds.

By following this approach, VDGR offers inherent diversification and portfolio balance up front, with the only step required from the investor being to actually buy the units.

The Vanguard Diversified Growth Index ETF is just one of the funds in Vanguard's offering, though. Investors who might prefer a more conservative approach, with more bonds and cash and fewer shares, might want to check out the Vanguard Diversified Conservative Index ETF (ASX: VDCO).

In contrast, younger investors with a higher risk appetite might prefer the Vanguard Diversified High Growth Index ETF (ASX: VDHG). This fund has far less exposure to bonds and cash and opts instead for a larger allocation to shares.

For passive investors, one of these funds might be the only investment you need to buy.

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For example, investors can access the Australian share market through the Vanguard Australian Shares Index ETF (ASX: VAS), which tracks the 300 shares listed on the S&P/ASX 300 Index. To gain exposure to the global share market, they can invest in the Vanguard MSCI Index International Shares ETF (ASX: VGS).

However, some Aussies may be cautious about investing in the share market because of the share price volatility that can occur. What if there was an ASX ETF that could give some access to the share market but with less risky exposure?

Vanguard offers the Vanguard Diversified Conservative Index ETF (ASX: VDCO), which may be just what nervous Aussie investors are looking for.

Defensively positioned

Some readers may already have heard of Vanguard Diversified High Growth Index ETF (ASX: VDHG), which is primarily invested in growth assets.

The more conservative VDCO ETF invests in the same sort of asset groups but with very different percentages.

Its target for growth assets is:

• 12% weighting to Australian shares
• 8.5% weighting to international shares
• 5.5% weighting to International shares (hedged)
• 2% weighting to international small companies
• 2% weighting to emerging market shares.

Altogether, the VDCO ETF has a total target weighting of approximately 30% to growth assets.

The rest of the portfolio is invested in defensive/income assets that can deliver appealing income levels with less volatility.

These are the current weightings for the conservative assets:

• 42% weighting to international fixed interest (hedged)
• 18% weighting to Australian fixed interest
• 10% weighting to cash.

Between them, these defensive positions have a total target position of 70%.

Low fees for a diversified portfolio

The cost of ASX ETFs is normally an important factor in returns, so I'll make a quick mention of the annual fee of this fund.

Considering the high level of diversification in this portfolio, I think the VDCO ETF's annual management fee of 0.27% is very reasonable.

Conservative returns

This ASX ETF is designed to lower risk, but that also means it may produce lower rewards over the long term.

The ETF was constructed in November 2017 and has experienced a low interest rate environment during that time, reducing the returns from its defensive assets. It also suffered from the bond sell-off in 2022 amid the rising interest rate environment. Since its inception in November 2017, this ASX ETF has only returned an average of 3.76% per annum.

But there are other options for cautious Aussies.

Another diversified Vanguard ETF called Vanguard Diversified Balanced Index ETF (ASX: VDBA) provides a 50/50 split between growth assets and income/defensive assets. Since its inception in November 2017, the VDBA has returned an average of 5.5% per annum.

Of course, a third option would be for investors to mix and match how much in defensive ASX ETFs they want to own themselves. Two ETF options include Vanguard Australian Fixed Interest Index ETF (ASX: VAF) and Vanguard Global Aggregate Bond Index (Hedged) ETF (ASX: VBND), which are local and global funds.

While the VDCO ETF is the most invested in bonds, it hasn't performed well in recent years, and its setup didn't protect investors from capital declines during 2022. As a relatively young investor, I'm more drawn to investing in shares for the long term because of the stronger return and compounding potential.

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