VYM, Vanguard High Dividend Yield ETF
Vanguard · Expense Ratio: 0.06% · Dividend · 9bp below the Dividend category average of 0.15%
Key Facts
| Ticker | VYM |
| Full Name | Vanguard High Dividend Yield ETF |
| Provider | Vanguard |
| Expense Ratio | 0.06% |
| Category | Dividend |
| Assets Under Management | $60B |
| Inception Year | 2006 (20 years ago) |
| Number of Holdings | 500 |
| Dividend Yield | ~2.7% (high) |
| Top Holdings | JPM, XOM, JNJ, BAC |
What Is VYM?
VYM, managed by Vanguard, launched in 2006, is a major ETF with deep liquidity and tight bid-ask spreads in the Dividend category. Dividend-focused ETF investing in companies with consistent and growing dividend payouts. With $60B in assets under management, it benefits from deep institutional liquidity and tight bid-ask spreads.
VYM in a FIRE Portfolio
With its focus on dividend-paying stocks, this fund can generate retirement income for FIRE investors, reducing the need to sell holdings during market downturns.
At a ~2.7% yield, a $1M position in VYM would generate approximately $27,000/year in dividend income. For FIRE investors, dividend income reduces the need to sell holdings during market downturns, a strategy known as "living off dividends."
Cost Analysis: How VYM's 0.06% Fee Affects Your FIRE Timeline
At 0.06%, VYM is very cost-effective. Annual fees on a $100K investment: $60. Over 30 years, the fee drag shaves approximately 0.4% off your total returns. For a $1M FIRE portfolio, that's about $6,000 in cumulative fees — noticeable but reasonable for most investors.
Dividend Income Potential
With a high dividend yield of approximately 2.7%, here's what VYM could generate in annual income at different portfolio sizes:
| Portfolio Value | Annual Dividend Income | Monthly Income |
|---|---|---|
| $100,000 | $2,700/year | $225/month |
| $250,000 | $6,750/year | $563/month |
| $500,000 | $13,500/year | $1,125/month |
| $1,000,000 | $27,000/year | $2,250/month |
Frequently Asked Questions About VYM
What is the expense ratio for VYM?
VYM has an expense ratio of 0.06%. This is very cost-effective, on a $100K portfolio, annual fees are $60. 9bp below the dividend category average of 0.15%.
Is VYM good for a FIRE portfolio?
With its focus on dividend-paying stocks, this fund can generate retirement income for FIRE investors, reducing the need to sell holdings during market downturns. Its 0.06% expense ratio is very cost-effective for the Dividend category.
How does the 0.06% fee affect long-term returns?
At 0.06%, you'll pay $60/year per $100K invested. Over 30 years, fees reduce total returns by approximately 0.4%. Use the embedded calculator below to model the exact impact on your specific portfolio.
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