An easy way to start earning dividends

Welcome back to another edition of "Rolling in Dough" Newsletter, where we serve up the simplest ways to save more, spend less, and build wealth with regular insights, behavioral science hacks, and tiny tips to do today. I hope to make your financial journey a little fun, simple, and totally doable, where ever you are on your wealth journey.

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What It Is

VIG, Vanguard Dividend Appreciation ETF, is a fund that holds U.S. companies with a long history of paying dividends and raising them consistently.

To be included, companies generally must have increased what they pay shareholders for at least 10 years in a row.

This requirement quietly filters out weaker businesses and favors companies that tend to be profitable, stable, and disciplined with their money.

Instead of choosing individual dividend stocks yourself, VIG packages many of them into one investment you can buy and hold like a single stock.

$VIG ( ▲ 0.59% ) 

Why People Use It

VIG is often used as a simple starting point for dividend investing.

Rather than chasing the highest dividend today, it focuses on companies that have shown they can keep paying and gradually increase those payments over time. For many people, that feels more realistic and sustainable.

It gives you a way to:

• start earning dividends without picking individual stocks

• see how dividend income shows up in your account

• build the habit of owning income-producing investments early

Because it’s spread across many companies and industries, it also reduces the risk that comes with relying on a single stock for income.

What the Income Looks Like

As of late 2025, VIG has paid about $3.50 to $3.60 per share over the past year, which works out to roughly a 1.6% annual yield, depending on the price.

That’s not meant to replace your income. Instead, it provides:

• regular quarterly payments

• income that has historically grown over time

• a steady stream of cash that can be reinvested or used elsewhere

Many people reinvest those dividends automatically, letting them buy more shares over time without extra effort.

How This Fits Into a Bigger Picture

For beginners, VIG can be a low-pressure way to get exposure to dividends without feeling overwhelmed.

For people who are already investing, it often works as a foundation layer, something that adds balance next to growth-focused investments like broader market funds.

It’s not usually the only thing someone owns. It’s the part that quietly does its job while other investments may fluctuate more.

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A Few Things Worth Keeping in Mind

VIG isn’t perfect for every situation, and that’s okay.

While it is an easy way to get started with dividends, and hold multiple dividend stocks at once:

The dividend is modest, not high. If someone is looking for maximum income right now, this may feel underwhelming.

Because it focuses on established companies, it can also lag during periods when fast-growing stocks dominate the market. That’s the trade-off for prioritizing consistency and reliability.

And if you hold it in a regular brokerage account, the dividends are taxable, which matters depending on where you invest.

Understanding these trade-offs helps set the right expectations.

👋  TO GO BITES: The Wrap Up

VIG is a straightforward way to start earning dividends, built around companies that have shown a pattern of paying and increasing those dividends over time.

For beginners, it removes the pressure of stock picking. For experienced investors, it can serve as a steady foundation alongside growth-focused investments.

As always, this isn’t personal investment advice. Everyone’s situation is different, and what makes sense depends on your goals, timeline, and comfort level. Talking things through with a financial professional can help put options like this into context.

But if you’re looking for a simple, low-maintenance way to introduce dividends into your portfolio, this is one option many people consider.

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