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Building wealth isn’t about chasing hot tips or timing the market. It’s about choosing assets that grow steadily over decades, through bull and bear markets. The best long term investments share a few traits: they have strong historical returns, low fees, and the ability to compound. Here are seven that consistently deliver.
1. Low-Cost Index Funds and ETFs
Index funds track a market benchmark like the S&P 500. They’re simple, cheap, and historically return about 10% annually before inflation. A fund like VOO or IVV gives you instant diversification across 500 large US companies.
The key is low fees. Even a 1% fee can eat up decades of growth. ETFs like those in the 7 Best ETFs to Buy for Long-Term Growth and Income offer expense ratios under 0.10%. Over 30 years, that difference can be six figures.
Why They Work
- Diversification – You own hundreds of stocks, reducing single-company risk.
- Automatic rebalancing – The fund adjusts itself.
- Tax efficiency – Index funds trade less, triggering fewer capital gains.
Set up automatic contributions to a total market ETF and let time do the heavy lifting.
2. Dividend Growth Stocks
Companies that consistently raise dividends tend to be profitable and resilient. Think of names like Johnson & Johnson, Coca-Cola, and Procter & Gamble. They’ve increased payouts for decades, even through recessions.
Reinvesting dividends accelerates compounding. A $10,000 investment in a dividend growth fund 20 years ago would be worth far more than the same amount in a non-dividend stock, thanks to reinvested payouts. For specific picks, check out the Top 7 Highest Growth Stocks to Watch Right Now – many also pay dividends.
3. Real Estate (Rental Properties)
Real estate offers two income streams: rental cash flow and property appreciation. Buying a single-family home in a growing suburb can yield 6–8% annual returns when you factor in leverage (mortgage).
You don’t need a million dollars. A 20% down payment on a $150,000 property controls the whole asset. Tenants pay the mortgage, and over time, rents rise with inflation. The Best Automatic Investment Apps Of 2026 now let you invest in real estate with as little as $10 through REITs or fractional ownership.
REITs: Hands-Off Real Estate
Real estate investment trusts (REITs) trade like stocks. They own portfolios of properties and pay out 90% of taxable income as dividends. VNQ, the Vanguard REIT ETF, yields around 4% and has returned 10%+ annually over the long run.
4. Growth Stocks (With a Long Horizon)
High-growth companies like Amazon, Microsoft, and Nvidia can multiply your money over decades. But they’re volatile – expect 30% drops every few years. That’s why a long time frame is non-negotiable.
Rather than picking individual winners, consider a growth ETF like QQQ (Nasdaq-100) or SCHG. They focus on companies with strong earnings momentum. For a curated list, see the Top 7 Highest Growth Stocks to Watch Right Now.
5. Cryptocurrency (Small Allocation)
Bitcoin and Ethereum have outperformed every asset class over the past decade, but they’re speculative. A 1–5% portfolio allocation can boost returns without excessive risk. Bitcoin’s fixed supply makes it a digital store of value, while Ethereum powers smart contracts.
For a deeper dive, read about the Top 7 Crypto Coins to Invest in for 2025: Expert Picks with Real Potential. Stick to major coins, use a hardware wallet, and don’t panic sell during crashes.
6. Bonds and Fixed Income
Bonds are the safety net of a portfolio. They provide steady interest and preserve capital. Long-term investors often use Treasury bonds or investment-grade corporate bonds to reduce volatility. A 60/40 stock/bond mix has historically returned 8–9% with much less drama than all stocks.
I Bonds (Series I savings bonds) are particularly attractive now: they adjust for inflation and are backed by the US government. You can buy up to $10,000 per year per person.
7. Your Own Human Capital (Education and Skills)
The highest-returning investment you can make is in yourself. A certification, degree, or specialized skill can increase your income by tens of thousands per year. That extra money can then fuel all the other investments on this list.
For example, learning data analysis or cloud computing can boost your salary by 20% or more. Over a 40-year career, that’s a massive compounding effect – and it’s tax-free (until you earn).
How to Start
Take an online course, attend a workshop, or get a mentor. Even spending $1,000 on a certification can pay for itself in months. Treat your career like a business: reinvest in its growth.
Diversify across these seven asset classes, keep costs low, and stay disciplined. The best long term investments aren’t exciting – they’re boring, reliable, and they work.
