Even though the stock market is down so far in 2022, there is still good reason to believe that stocks can help you build wealth over time. Indeed, despite the recent drop, the S&P 500 — a broad market index — is still higher today than it was at the beginning of last year. While painful right now, you should expect volatility like that over the course of even a successful long-term investing career. That’s why it’s so important to both invest with a long-term perspective and to make regular investments over time.

One of the most straightforward ways to do that is to make regular investments into a broad market tracking index tracking ETF like the Vanguard Total Stock Market Index ETF (NYSEMKT: VTI). Indeed, if you start investing in this ETF right now, it could make you a millionaire retiree.

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What makes that ETF so investible?

The Vanguard Total Stock Market Index ETF looks to invest in virtually every publicly traded U.S. based company. It isn’t looking to separate the winners from the losers, isn’t looking to prefer one cause over another, and isn’t looking to trounce the market. Instead, it’s simply looking to invest in almost every public company, which allows it to get overall stock market like returns while charging a tiny 0.03% expense ratio.

That low cost, broad spectrum approach to investing means that by buying the ETF, over time, you’re going to get returns that are pretty much in line with the benchmark it tracks. As a result, as long as the market isn’t in permanent decline, making regular investments into the Vanguard Total Stock Market ETF can be a great way for you to build toward that million dollar nest egg.

How long will it take to become a millionaire with this ETF?

Of course, the big question is how long it will take to become a millionaire by investing the Vanguard Total Stock Market Index ETF. The answer to that question depends heavily on how much you invest each time and what rate of return you get along the way. The table below shows how many years it will take, depending on your monthly investments and the annualized rate of return you earn along the way.

Monthly Investment

10% Annual Returns

8% Annual Returns

6% Annual Returns

4% Annual Returns

$2,833.33

13.8

15.2

17.0

19.5

$2,208.33

15.7

17.5

19.8

23.1

$2,000.00

16.5

18.4

21.0

24.6

$1,500.00

18.9

21.3

24.5

29.4

$1,000.00

22.5

25.6

30.0

36.8

$500.00

28.9

33.4

40.1

51.1

The dollar amounts in those top two rows were not picked at random. They’re designed to get you within a penny per month of the investment amount it takes to max the maximum annual contribution to both a 401(k) and an IRA, depending on your age. If you’re age 50 or up, you can contribute $27,000 to a 401(k) in a year, and if you’re under age 50, you can contribute up to $20,500. For an IRA, the limits are $7,000 if you’re 50 or up and $6,000 if you’re under age 50.

As a result, those numbers all represent values that are often reachable within the tax-shelter of standard retirement accounts. So not only can you potentially become a millionaire within the course of a typical career, but you can also probably get there while saving a bit on taxes along the way as well.

And of course, if you want a chance at getting to millionaire faster, you can also sock away money outside of your retirement accounts as well. There is no limit — other than your ability to come up with the cash — to the amount you can invest in a standard brokerage account. While your money won’t be tax advantaged in a standard brokerage account, there are still great reasons to invest in such an account. For instance, there are no age restrictions for taking your money out of standard accounts.

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If that table made one thing clear, though, it’s that the less time you have before you retire, the more you’ll have to sock away each month to reach millionaire status by the time you stop working. That holds true whether your returns are near the market’s historical long-run average of around 10% or whether the future doesn’t end up being quite as bright.

You will never again have more time before you retire than you do today, so get your plan in place now to give yourself the best chance of amassing that $1 million nest egg before for that retirement.

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Chuck Saletta has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Vanguard Total Stock Market ETF. The Motley Fool has a disclosure policy.

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