How to Invest $35,000 for Long-Term Financial Security

These two Vanguard ETFs could turn a $35,000 windfall into serious wealth over the years.

Tony Dong, MSc, CETF®

Tony turned a series of 2017 marijuana stock losses into a freelance career advocating for ETF investing. He currently holds a Master’s in Risk Management from Columbia University and is a Certified ETF Advisor (CETF®). Tony is the founder of ETF Portfolio Blueprint (etfportfolioblueprint.com) and the Lead ETF Analyst for ETF Central, a partnership between Trackinsight and the NYSE. His analysis has also been featured in publications like Kiplinger, 24/7 Wall St., U.S. News & World Report, TheStreet, and Benzinga. Tony also provides independent content and marketing consulting services to various Canadian and U.S. ETF issuers. His editorial opinions for The Motley Fool remain independent and objective.

Published June 25, 2025 10:00 am EDT

A very famous finance academic, Jeremy Siegel, once wrote a book called Stocks for the Long Run. His core argument? Over long periods, stocks have consistently outperformed other asset classes like bonds or cash, even after accounting for volatility. The reason is simple: stocks represent ownership in real businesses that grow and produce profits over time.

So, if you’ve come into a $35,000 windfall and resisted the urge to blow it on a luxury car or tropical getaway, you’re already halfway there. The next step is letting compound growth do its thing, especially if you still have room in a registered account like a Tax-Free Savings Account (TFSA) or Registered Retirement Savings Plan (RRSP).

Here’s how I’d invest $35,000 for long-term financial security as a Canadian.

Hourglass and stock price chart — Source: Getty Images

Put $20,000 in the S&P 500

The S&P 500 is a stock index made up of the 500 largest publicly traded companies in the United States. It’s a market-cap-weighted index, which means larger companies take up more space in the portfolio, and underperformers eventually fall out. The index is self-cleansing and efficient, as the best companies naturally rise to the top.

You can easily replicate this exposure through an exchange-traded fund (ETF) like Vanguard S&P 500 Index ETF (TSX:VFV), one of Canada’s most popular U.S. equity ETFs. It tracks the S&P 500 for a rock-bottom 0.09% management expense ratio (MER).

On a $20,000 investment, that’s just $18 a year in fees. The S&P 500 is also extremely hard to beat. Over the past 15 years, 88% of U.S. large-cap mutual funds underperformed the index, according to S&P’s SPIVA report. That tells you all you need to know: just own the index.

Put $15,000 in Canadian stocks

We don’t want to go 100% U.S. stocks. That exposes you to currency risk and a 15% withholding tax on dividends inside a TFSA, which reduces your income.

A more balanced approach is to put the remaining $15,000 in Canadian stocks that pay dividends with no tax drag in registered accounts and reduce your reliance on foreign markets.

A great ETF for this is Vanguard FTSE Canada Index ETF (TSX:VCE), which covers nearly the entire Canadian market and does it for just 0.06% MER. That’s $9 annually on a $15,000 investment.

As a bonus, VCE offers a 2.77% dividend yield, most of which is made up of eligible Canadian dividends. And in a TFSA or RRSP, you can let those dividends grow tax-free or tax-deferred.

The Foolish takeaway

This simple two-ETF portfolio gives you exposure to the biggest stocks in North America, split between U.S. and Canadian markets. Your portfolio would be diversified, low-cost, and positioned for long-term growth, all without needing to pick a single stock or time the market.