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ETFs for long term hold Hi, Beginner trying to get into investing in my early 30s. Lots of opinions about investing in the public domain and it's overwhelming. I'm someone looking to invest long term and not day trade or flip individual stocks short term. Hence I figured out ETFs would be the way to go. But what ETFs should I buy? S&P ETFs and if so which ones? What should I avoid? Can I diversify my investment by looking at REITs? If so which REITs to buy and avoid? Any other advice is welcome. It would also be great if you could expand a little on acronyms if you use one, as I'm not familiar with these, and why you think that's the way to go. Thanks.
Start with one fund: VTI or VOO
Both track the largest U.S. companies at rock-bottom fees (0.03% annually). VTI (Vanguard Total Stock Market) is slightly broader—it includes mid-sized and smaller companies on top of the S&P 500, giving you the entire U.S. market in one fund. VOO (Vanguard S&P 500) tracks just the 500 largest companies. Either works beautifully for a 30-year hold.
Avoid SPY—it tracks the same S&P 500 as VOO but charges 3x the fee (0.095% vs 0.03%). Over decades, that difference compounds significantly.
Once you're comfortable, you can add smaller positions (10-20% of your portfolio) for specific goals:
SCHD (Schwab U.S. Dividend Equity, 0.06% fee): Focuses on 100 high-dividend companies. Provides income and tends to be more stable during downturns. Good if you want a "value" tilt or eventual income.
VNQ (Vanguard Real Estate, 0.13% fee): Invests in REITs (Real Estate Investment Trusts)—companies that own income-producing properties like apartments, offices, and malls. Behaves differently than stocks, so it can smooth out volatility. But it's a sector bet, not a broad market play.
QQQ (Invesco Nasdaq-100, 0.18% fee): Tracks the 100 largest non-financial companies on the Nasdaq—heavily tech-focused (Apple, Microsoft, NVIDIA, etc.). Historically higher growth but much more volatile. Only add this if you're comfortable with bigger swings.
Leveraged ETFs (anything with "2X" or "3X" in the name like TQQQ, SOXL): These amplify daily moves and are designed for short-term trading, not long-term holding. They decay over time due to how they're structured.
Niche/Thematic ETFs: Funds betting on a single trend (AI, cannabis, space exploration) are speculative. Stick to broad market exposure as your foundation.
Ultra-Simple (Recommended):
Balanced Growth + Income:
Growth-Focused:
Bottom line: Start with VTI or VOO. Add SCHD or VNQ later if you want income or real estate exposure. Avoid leveraged funds and keep it simple—boring wins over 30 years.
This response may contain financial commentary based on historical data and does not constitute investment advice. Past performance is not indicative of future results. Please consult a qualified financial advisor before making investment decisions.
what fraction of the income should I target to keep investing each month, once I start?
Target 15-20% of your gross income as a starting point.
This is a common benchmark that balances building wealth with maintaining flexibility for living expenses and emergencies. If you're just starting out, even 10% is solid—the key is consistency, not perfection.
Priority order:
Adjust based on your situation:
Pay yourself first. Set up automatic transfers the day after your paycheck hits—treat investing like a non-negotiable bill. Most people who wait to "invest what's left over" end up investing nothing.
Start where you can sustain it, then increase gradually. A 30-year-old investing 15% consistently will vastly outperform someone who invests 30% for two years and then quits.
Thanks a lot. Is there any choice on the brokerage I should be using? I have E*TRADE account and wondering if that is the best to use or is it irrelevant?
E*TRADE is perfectly fine. For buying and holding ETFs like VTI or VOO, the brokerage doesn't matter much—all major platforms (E*TRADE, Fidelity, Vanguard, Schwab) offer commission-free ETF trades now.
E*TRADE pros:
Potential alternatives (not necessary to switch):
Stay with E*TRADE. Switching brokerages is a hassle, and the differences are marginal for a buy-and-hold strategy. The most important factors are:
Don't overthink the platform—focus on getting money invested regularly. The brokerage choice matters far less than starting now and staying consistent for 30 years.