For not only years, but decades, tracking the S&P 500 has been a reliable way to generate significant stock gains. Since the index tracks the best stocks on the U.S. markets, it offers a great low-risk way to ensure you’re positioned for long-term growth.

But what if you invested a lump sum of $25,000 into an exchange-traded fund (ETF) that tracks the S&P 500, such as the SPDR S&P 500 ETF (SPY -0.10%), and simply held on for 25 years? Could that be enough to make you wealthy and allow you to retire comfortably? Let’s take a look.

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How much could your portfolio be worth after 25 years?

A buy-and-hold strategy can be a good way to ensure your portfolio rises in value. Sometimes, just leaving your portfolio alone can be the best thing you can do for your future. The temptation to chase the latest trends or hot stocks can end up doing more harm than good and derail your investment goals and objectives. 

If you have a diverse portfolio or if you are invested in the SPDR S&P 500 ETF, a set-it-and-forget-it approach can be a great one to consider deploying. Over time, your investment should rise in value, though there’s no guarantee stocks will rise or be up when you need the money. The variable that can have the most significant effect on your overall returns is unfortunately the one that is also nearly impossible to predict: your average annual return.

And with the S&P 500 around all-time highs right now, it may be wise to assume that its average returns from here on out may trend a bit lower than its historical average of around 10%. Here’s how a $25,000 investment in the SPDR S&P 500 ETF might look like after a period of 25 years, if the average annual return is between 7% and 9%.

Calculations and table by author.

A $25,000 investment would grow significantly over the years under this scenario, but with potentially below-average returns, you’re not likely to end up with a boatload of money to consider yourself rich, or enough to retire with after 25 years. Your investment might end up growing to more than a couple of hundred thousand dollars and strengthen your overall financial position, but if your goal is to end up wealthy, i.e., having a portfolio worth over $1 million, then this strategy may not be sufficient to get you there.

What you can do if you don’t think you’re on track to hit your goals

If you’re worried you may not reach your investing goals, there are things you can do to try to achieve better results.

Investing more money, even if it’s on a monthly basis, can be a way to slowly pad your portfolio’s balance over time, and allow more money to be compounded over the years. And the more you invest, the quicker that your gains will accumulate.

If that’s not an option, what you may also want to consider is focusing more on growth stocks, rather than simply mirroring the market. By investing in tech stocks or companies with promising growth prospects, you may have better chances of outperforming the market and achieving better-than-average returns.

This can involve more research and be more time-consuming, but it’s an example of where picking individual stocks or simply focusing on ETFs that track growth stocks can be a better option than mirroring the S&P 500. It adds more risk into the equation, but the payoff can be worthwhile in the end.

Regardless of what approach you decide to take, it’s a good idea to revisit your portfolio on a regular basis to see how you’re doing and if you need to recalibrate and adjust your holdings.