iShares ETF Has A ‘Set And Forget’ Investment For Retirees You Don’t Need To Overthink

Core Insights - The iShares Core S&P Total U.S. Stock Market ETF (ITOT) provides a comprehensive exposure to the U.S. equity market with a low expense ratio of 0.03% annually, making it suitable for retirement investing without the need for constant decision-making [1][2]. Investment Strategy - ITOT tracks approximately 3,000 U.S. stocks across various market capitalizations, ensuring automatic diversification across sectors and company sizes, which is beneficial for retirees [2][3]. - The fund's sector allocation includes 33% in information technology and 11% in financials, with significant holdings in major companies like NVIDIA (7.3%), Apple (6%), and Microsoft (5.7%) [3]. Performance Metrics - ITOT has delivered a total return of approximately 285% over the past decade, effectively turning an initial investment of $10,000 into about $38,500, with an annualized return in the mid-teens [5]. - The fund has maintained a dividend yield of around 1%, with distributions growing at an annual rate of 6% to 7% [4][7]. Market Resilience - ITOT has demonstrated resilience during market disruptions, including the COVID-19 crash in 2020 and the bear market in 2022, where it fell roughly 34% before rebounding [6]. Considerations for Retirees - The effectiveness of ITOT for retirees depends on their equity allocation and time horizon, as different age groups with varying equity exposure will experience different outcomes [8].