Best ETFs to Buy for the Long Term: A Beginner-Friendly Guide
The core building blocks of a low-cost portfolio, from total market and S&P 500 ETFs to bonds and dividend funds, plus three sample portfolios.
Key takeaways
- A strong long-term portfolio can be built from two to four broad, low-cost ETFs.
- Core stock and bond ETFs from large providers cost as little as 0.02% to 0.06% per year.
- Choose ETFs by what they track, cost, size and liquidity, not by last year's performance.
- Thematic, leveraged and high-fee ETFs can play a small role at most; they are not portfolio foundations.
There are thousands of exchange-traded funds, but most long-term investors need only a handful. The "best" ETF is not the one that rose most last year; it is the one that gives you broad diversification at a very low cost and that you are comfortable holding for decades. If you are new to the concept, read What is an ETF? first.
Please note
The funds below are well-known examples to illustrate each category, not personal recommendations. Fees and yields are approximate as of September 2026 and can change.
Core ETFs for US stocks
| ETF | Ticker | What it holds | Expense ratio |
|---|---|---|---|
| Vanguard Total Stock Market ETF | VTI | Entire US market, about 3,500+ stocks of all sizes | 0.03% |
| Vanguard S&P 500 ETF | VOO | About 500 large US companies | 0.03% |
| iShares Core S&P 500 ETF | IVV | About 500 large US companies | 0.03% |
| SPDR Portfolio S&P 500 ETF | SPYM | About 500 large US companies | 0.02% |
| Invesco Nasdaq 100 ETF | QQQM | 100 large non-financial Nasdaq companies, tech-heavy | 0.15% |
A total market ETF or an S&P 500 ETF is the most common core holding. They behave very similarly, because large companies dominate both. Learn the differences in VTI vs VOO and how to use them in how to invest in the S&P 500.
Nasdaq 100 funds are more concentrated in technology and have been more volatile. They can complement a core holding but overlap heavily with the largest S&P 500 stocks.
International stock ETFs
US companies make up roughly 60% to 65% of the global stock market's value. Owning international stocks spreads your risk across other economies and currencies.
- Vanguard Total International Stock ETF (VXUS), expense ratio 0.05%: thousands of companies in developed and emerging markets outside the US.
- Total world ETFs combine US and international stocks in a single fund, for investors who want one-fund simplicity.
Foreign investments add currency risk, explained in our guide to exchange rates.
Bond ETFs
Bonds reduce the ups and downs of a stock portfolio and provide income. With 10-year US Treasury yields around 5.3% at the end of September 2026, bonds pay considerably more than they did a few years ago.
- Vanguard Total Bond Market ETF (BND), expense ratio 0.03%: a broad mix of US government and investment-grade corporate bonds.
- Short-term Treasury ETFs hold bonds maturing within a few years and fluctuate less when interest rates change.
- Treasury inflation-protected securities (TIPS) ETFs adjust for inflation.
Remember that bond prices fall when interest rates rise. Longer-term bonds react more strongly. Our guide to high-yield and income investments explains these trade-offs.
Dividend ETFs
| ETF | Ticker | Approach | Approx. yield (Sept. 2026) |
|---|---|---|---|
| Schwab U.S. Dividend Equity ETF | SCHD | Quality dividend payers with long track records; expense ratio 0.06% | 3.2% |
| Vanguard High Dividend Yield ETF | VYM | Broad basket of higher-yielding US stocks | 2.3% |
| JPMorgan Equity Premium Income ETF | JEPI | Defensive stocks plus option income (covered calls) | ≈ 7.9% |
Dividend ETFs suit investors who value regular income. Higher yields often come with trade-offs, such as less growth or, for option-income funds, capped upside in strong markets. Read dividend investing explained for details.
How to choose the right ETF
- What does it track? Broad indexes beat narrow themes for a core holding.
- What does it cost? For broad stock and bond ETFs, expense ratios below 0.10% are widely available.
- How big and liquid is it? Larger funds tend to have narrow bid-ask spreads and low risk of closure.
- How well does it track its index? Check the tracking difference over several years.
- Does it overlap with what you already own? An S&P 500 ETF plus a total market ETF plus a Nasdaq 100 ETF means owning the same large companies three times.
- How is it taxed? In taxable accounts, consider dividend levels and fund structure.
Three sample ETF portfolios
| Portfolio | US stocks | International stocks | Bonds | Example funds |
|---|---|---|---|---|
| Growth | 60% | 30% | 10% | VTI / VXUS / BND |
| Balanced | 40% | 20% | 40% | VTI / VXUS / BND |
| Conservative | 25% | 15% | 60% | VTI / VXUS / BND |
This "three-fund portfolio" approach is popular because it is cheap, diversified and easy to rebalance. With the funds shown, the average annual cost is well under 0.05%. A target-date fund does the same job automatically, at a slightly higher fee.
What the costs mean
On a $100,000 portfolio, an average expense ratio of 0.04% costs about $40 a year. An actively managed fund portfolio at 1% would cost about $1,000 a year, every year, and that money no longer compounds for you.
ETFs to treat with caution
- Leveraged and inverse ETFs aim for two or three times the daily return, or the opposite. Over longer periods they can lose value even when the market rises.
- Thematic ETFs (for example AI, robotics or clean energy) are often launched after a theme becomes popular, charge higher fees and can fall sharply. See our guide to AI stocks and AI ETFs.
- Very high-yield ETFs can pay out more than they earn, eroding your capital over time.
- Small, illiquid ETFs may trade with wide spreads or close unexpectedly.
ETF investing for beginners: getting started
- Open a tax-advantaged account (401(k), IRA) or a brokerage account.
- Pick one to three core ETFs that match your target allocation.
- Invest a fixed amount every month and reinvest dividends.
- Rebalance once a year.
More on the first steps in how to start investing.
Frequently asked questions
What is the best ETF for beginners?
A broad, low-cost stock market ETF, such as a total US market or S&P 500 fund, or a single target-date fund, is a common starting point.
How many ETFs should I own?
For most investors, two to four broad ETFs are enough. More funds often add overlap and complexity, not diversification.
What are the best dividend ETFs?
Popular choices include funds focused on quality dividend growers and broad high-dividend funds. Compare yield, dividend growth, holdings and costs, and remember that the highest yield is not always the best choice.
Are ETFs safe?
ETFs are regulated and hold assets separately from the provider, but they carry the risks of what they own. A stock ETF can fall as much as the stock market.
Should I buy ETFs or mutual funds?
Both can be excellent. ETFs trade all day and are often more tax-efficient; mutual funds make automatic investing in exact dollar amounts easy. See ETF vs mutual fund.
