A modest sum of two hundred dollars each month holds within it the seeds of untold wealth, a hidden treasure gradually unearthed across the expanse of one’s working existence. Through the strategy of dollar-cost averaging, navigating the ebbs and flows of the stock market becomes a breeze, an inevitable cycle of peaks and troughs no longer a cause for concern.

One must grasp with certainty the inescapable truth that the market will, at some juncture, stumble. Nevertheless, tethered to the long-term fabric of economic growth, it will, more often than not, soar. Those who steadfastly persist in acquiring shares of burgeoning enterprises shall bear witness to the prosperous cultivation of riches.

Witness how a mere two hundred dollars monthly can metamorphose into a million-dollar treasure trove.

The Art of Selecting Premier Companies

The renowned Vanguard S&P 500 ETF (NYSEMKT: VOO) parallels the underlying performance of the illustrious S&P 500 index, a favored cornerstone of the market. This exchange-traded fund instantly furnishes investors with far-reaching diversification, a gateway to the finest entities globally—a vessel many a retirement saver will find as the lodestar for expanding their fortunes.

The fund presently nestles within 504 portfolios, with the top decile constituting a substantial 35% stake. Six of these illustrious entities are key members of the vaunted “Magnificent Seven,” a coterie of tech stalwarts exhibiting prodigious growth potential rivaled by few. The commendable performance of this elite cohort has been instrumental in propelling the index skyward by a noteworthy 18% over the past year.

For neophyte investors, this ETF epitomizes the pith of wealth accumulation. The corporate constituents within this fund have, over the last lustrum, burgeoned their earnings by a remarkable 17.5% annually, effectively twinning the fund’s worth over the same span.

Should the fund regress to its historical average annual growth rate of approximately 10%, dating back to the annals of 1957, a regular investment of $200 per month would burgeon into a stately $1 million after a judicious 38-year horizon.

Blessed with a meager expense ratio of a paltry 0.03%, this Vanguard ETF requires from investors a trifling $0.30 for every $1,000 invested. Furthermore, with a parsimonious minimum investment of a mere $1, it extends an invitation to all, regardless of means, to partake in the bounties of the stock market.

The Allure of Growth Stocks

Amidst investors, divided are opinions on the benefits of dollar-cost averaging in an index fund. Some might covet the supplemental allure of growth stocks. Selecting stocks with outperformance potential vis-a-vis the S&P 500 can drastically amplify one’s returns.

Should one contemplate allocating, for instance, $1,000 in monthly savings, a prudent path entails apportioning at least half into an index fund. With the residual sum, incrementally investing in a cadre of distinguished growth stocks can magnify the cumulative returns.

As an exemplar, a modest $100 monthly investment in Amazon (NASDAQ: AMZN) since the dawn of 2010 would presently burgeon to $100,000. A corresponding investment in Microsoft (NASDAQ: MSFT) would blossom to $129,000, dividends inclusive, whilst Netflix (NASDAQ: NFLX) would stand at an impressive $178,000.

In stark contrast, a monthly $100 allocation to Vanguard S&P 500 ETF would culminate in a modest $45,000. Numerous investors strive to forecast opportune moments to purchase a growth stock only to desist from further investments post-initial procurement. Opting instead to gauge the prolonged prosperity of select companies and consistently amassing shares over time obviates concerns tied to market volatility or stock valuation.

Publicly available figures present a rosy picture of tech behemoths Amazon, Microsoft, and Netflix from a decade past.