8 Best Vanguard Funds to Invest In for Retirees

4. Vanguard High Dividend Yield Index Fund Admiral Shares (NASDAQ:VHYAX)

5-Year Share Price Performance as of February 18: 43.12%

The Vanguard High Dividend Yield Index Fund Admiral Shares (NASDAQ:VHYAX) offers wide exposure to U.S. companies that routinely generate higher-than-average dividends. In addition to conventional stock market risks, the fund’s concentration on slower-growing, higher-yielding firms may result in a lower overall return during a big bull market. However, pre-retirees can profit from an all-equity portfolio’s long-term growth potential, which is boosted by dividend reinvestment. Meanwhile, retirees may enjoy the dividend income stream as well as some much-needed capital appreciation to keep up with inflation throughout their retirement years.

Walmart Inc. (NYSE:WMT), the world’s largest brick-and-mortar retailer, is one of the top holdings in VHYAX. The company operates an amazing 100,000 outlets worldwide, leveraging its financial strength to maintain competitive and consistent profits in a typically low-margin industry.

In the first nine months of 2024, Walmart Inc. (NYSE:WMT) earned $22.9 billion in operational cash flow. Its free cash flow increased by $1.9 billion to $6.2 billion throughout this time. This financial position allowed the company to increase dividends for 51 years in a row. As of February 18, the retailer delivered a dividend of $0.21, at a yield of 0.81%.