3 Set-and-Forget ETFs to Build a Low‑Maintenance Retirement Income

Build a low-maintenance retirement income using three set-and-forget ETFs. Learn how dividend, total-market and bond ETFs can deliver steady, passive income.

Building a retirement portfolio that produces steady income without constant monitoring is the goal for many savers. A “set-and-forget” approach—selecting a small number of diversified ETFs that generate income and growth—can simplify retirement planning while helping to withstand market ups and downs.

What makes an ETF suitable for a set-and-forget retirement portfolio? Look for low expense ratios, broad diversification, predictable income streams, and solid long-term track records. Combining equity ETFs for growth and dividend income with bond ETFs for stability can create a balanced portfolio that delivers passive income through market cycles.

1) Dividend-focused equity ETF: Dividend ETFs concentrate on companies that pay reliable dividends, offering a steady stream of cash flow ideal for retirees. Examples include large-cap dividend aristocrat or high-quality dividend ETFs. These funds emphasize yield and shareholder-friendly companies, providing both income and potential for modest capital appreciation. Dividend ETFs are an essential building block for retirement income because they convert a portion of equity returns into cash distributions.

2) Total-market or large-cap core ETF: A broad-market ETF—such as an S&P 500 or total-market fund—adds growth potential and diversification to a retirement portfolio. Core ETFs typically have very low fees and track a wide swath of the market, allowing retirees to capture long-term economic growth with minimal maintenance. While not always high-yielding, they help preserve purchasing power and reduce concentration risk when combined with income-producing funds.

3) Aggregate bond or intermediate-term bond ETF: Bond ETFs provide income and lower volatility compared with equities. An aggregate bond ETF or intermediate-term government/corporate bond fund can cushion a portfolio during market downturns and supply consistent interest payments. Including bond ETFs in a retirement allocation helps smooth returns and preserve capital—key goals for income-focused investors.

Putting it together: A simple set-and-forget retirement portfolio might blend a dividend ETF, a total-market ETF, and a bond ETF in proportions aligned with your risk tolerance. Use automatic dividend reinvestment while working, then switch to distributions in retirement. Rebalance annually and review allocations if your goals or risk profile change.

No investment is risk-free; past performance doesn’t guarantee future results. Consider consulting a licensed financial advisor to tailor a set-and-forget ETF strategy to your retirement needs.

Back