Can Buying the Vanguard S&P 500 ETF Make You a Millionaire?

Buying an exchange-traded fund (ETF) that tracks an index like the S&P 500 can be a great way to build long-term wealth, and this strategy is endorsed by some of the world’s top investors, including Warren Buffett. The Vanguard S&P 500 ETF (VOO -0.05%) is one of the most popular funds on the market because of its super low cost, and it could certainly make you a millionaire with regular contributions and the right time horizon.

Below, I’ll break down the components of the Vanguard S&P 500 ETF and run through some possible pathways to the million-dollar club for regular investors.

A diversified index with healthy exposure to high-growth trends

The S&P 500 might be the best American stock market index for building long-term wealth. It’s home to 500 companies from 11 different sectors of the economy, and it has a strict entry criteria to ensure that only the highest-quality names make the cut. For example, companies need to have a market capitalization of at least $20.5 billion to qualify for inclusion, and the sum of their earnings (profits) must be positive over the most recent 12-month period.

By comparison, the Dow Jones Industrial Average holds a narrow portfolio of just 30 stocks, and the Nasdaq Composite is dominated by stocks in the tech and tech-adjacent industries.

The Vanguard S&P 500 ETF tracks the performance of the S&P 500 by holding the same stocks and maintaining similar weightings. Below is a breakdown of the 11 sectors in the ETF, including their weightings (the percentage of the fund’s value which they represent) and some of the most notable stocks within them:

Data source: Vanguard. Sector weightings are accurate as of May 31, 2025, and are subject to change.

The reason the information technology sector has such a dominant weighting is because Nvidia, Microsoft, and Apple are the three largest companies in the world, with a combined market capitalization of $10.5 trillion. The S&P 500 (and by extension, the Vanguard ETF) is weighted by market cap, which means the largest companies in the index have a higher influence over its performance than the smallest.

Artificial intelligence (AI) has been a big driver of value for companies in the information technology sector over the last couple of years, but a growing number of companies in non-technology industries are also rapidly adopting it. They include Amazon, Tesla, Alphabet, Meta, Netflix, and Uber, which are using AI to supercharge their legacy businesses.

Simply put, the Vanguard S&P 500 ETF offers investors a high amount of exposure to the booming AI revolution, but with a very healthy splash of diversification thanks to sectors like financials, healthcare, industrials, and consumer staples, where companies are far less reliant on the technology.

Can the Vanguard S&P 500 ETF make you a millionaire?

The S&P 500 has delivered a compound annual return of 10.4% since it was established in 1957 (assuming all dividends were reinvested). It’s important for investors to buy an S&P 500 ETF with low fees in order to unlock as much of that return as possible.

The Vanguard S&P 500 ETF has an incredibly low expense ratio of 0.03%, meaning an investment of $10,000 would incur an annual fee of just $3. Vanguard says the average fee charged by comparable funds in the industry is a whopping 25 times higher at 0.75%, which can dent investors’ returns over the long run.

Based on a compound annual return of 10.4%, here’s how long it would take investors to achieve millionaire status from three different starting positions (assuming no additional contributions):

Data source: Calculations by author.

But don’t worry, investors who aren’t sitting on a large pile of idle cash can still reach the millionaire’s club with small but consistent contributions (these calculations assume a starting balance of zero):

Data source: Calculations by author.

It’s important to remember that past performance isn’t a good indicator of future results. However, a track record spanning almost seven decades inspires a lot of confidence, which is why S&P 500 index funds are so popular among regular investors and professionals alike. Plus, the S&P 500 is rebalanced once per quarter (four times per year), meaning a special committee removes companies that no longer fit its criteria and replaces them with more suitable candidates.

Maintaining exposure only to the highest-quality companies is a big reason the S&P 500 has maintained such strong returns over the long run. Moreover, as I highlighted earlier, the index has a high degree of exposure to high-growth segments of the economy like AI, which could supercharge its future returns.

Therefore, yes, buying the Vanguard S&P 500 ETF can make you a millionaire if you take a disciplined approach to investing and remain focused on the long term.

John Mackey, former CEO of Whole Foods Market, an Amazon subsidiary, is a member of The Motley Fool’s board of directors. JPMorgan Chase is an advertising partner of Motley Fool Money. Suzanne Frey, an executive at Alphabet, is a member of The Motley Fool’s board of directors. Randi Zuckerberg, a former director of market development and spokeswoman for Facebook and sister to Meta Platforms CEO Mark Zuckerberg, is a member of The Motley Fool’s board of directors. Anthony Di Pizio has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends AbbVie, Alphabet, Amazon, American Tower, Apple, Berkshire Hathaway, Chevron, Constellation Energy, Costco Wholesale, Equinix, JPMorgan Chase, Meta Platforms, Microsoft, Netflix, NextEra Energy, Nike, Nvidia, Simon Property Group, Tesla, Uber Technologies, Vanguard S&P 500 ETF, Visa, and Walmart. The Motley Fool recommends Dominion Energy, Johnson & Johnson, and Sherwin-Williams and recommends the following options: long January 2026 $180 calls on American Tower, long January 2026 $395 calls on Microsoft, short January 2026 $185 calls on American Tower, and short January 2026 $405 calls on Microsoft. The Motley Fool has a disclosure policy.