5 Passive Investing Strategies You Can Set and Forget

Ever wish you could build wealth without checking the markets every day, making risky stock picks, or spending hours analyzing financial news?

You can.

Passive investing is one of the most effective ways to grow your money while doing… almost nothing. The best part? It works whether you’re starting with $100 or $10,000, and it fits perfectly into a busy lifestyle.

In this guide, we’ll break down five proven passive investing strategies that require minimal effort but can deliver long-term results. Whether you’re saving for retirement, financial freedom, or just want your money working for you while you sleep — these are the tools and strategies to know.

Let’s dive in.

🧠 What Is Passive Investing?

Passive investing means putting your money into assets that grow over time without constant buying, selling, or adjustment. It contrasts with active investing, where you’re trying to beat the market by picking stocks or timing trades.

Passive strategies typically:

• Require fewer decisions

• Involve lower fees

• Follow broad market trends

• Use tools like ETFs, index funds, and automation

The idea is simple: set it, forget it, and let compounding do its magic.

📈 1. Total Market ETF Investing

Strategy Summary: Buy a low-cost ETF that tracks the entire stock market.

This is one of the simplest and most powerful strategies for beginners and experienced investors alike. You invest in a Total Market ETF — a single fund that holds thousands of U.S. companies.

Top ETFs for this:

• VTI (Vanguard Total Stock Market)

• ITOT (iShares Core Total U.S. Market)

• SCHB (Schwab U.S. Broad Market ETF)

These funds automatically adjust to include new companies as the economy changes, giving you diversification, simplicity, and performance with just one click.

How to do it:

1. Open a brokerage account (e.g., Fidelity, SoFi, Schwab)

2. Buy fractional shares of VTI or similar

3. Set up automatic monthly contributions

4. Don’t touch it — let it grow

Pros:

• Super low fees (around 0.03%–0.05%)

• Built-in diversification

• No stock picking needed

Best for: Long-term investors who want to match overall market growth

💰 2. Dividend Growth Strategy

Strategy Summary: Invest in ETFs or stocks that consistently pay dividends and grow them over time.

This strategy builds passive income, not just growth. You’re investing in companies that reward shareholders with cash payouts — and you can reinvest those dividends to grow faster.

Top ETFs for this:

• SCHD (Schwab U.S. Dividend Equity)

• VIG (Vanguard Dividend Appreciation)

• DGRO (iShares Core Dividend Growth)

Dividend ETFs focus on companies with strong balance sheets, steady cash flow, and long histories of raising dividends.

How to do it:

1. Choose a dividend-focused ETF

2. Turn on “dividend reinvestment”

3. Contribute monthly — even small amounts add up

4. Watch your income grow over time

Pros:

• Passive income stream

• Less volatile than growth stocks

• Great for retirement income planning

Best for: Investors seeking stability and recurring cash flow

🤖 3. Robo-Advisor Portfolios

Strategy Summary: Use an automated investment platform that builds and manages a diversified portfolio for you.

Robo-advisors are perfect for people who don’t want to research or manage anything manually. You simply answer a few questions about your goals, risk tolerance, and timeline — and the app does the rest.

Top Robo-Advisor platforms:

• Betterment

• Wealthfront

• SoFi Automated Investing

These platforms automatically invest your money into a mix of ETFs (stocks and bonds), rebalance your portfolio, and even reinvest dividends.

How to do it:

1. Sign up and complete your risk profile

2. Link your bank account

3. Deposit $50–$100+

4. Turn on recurring contributions

Pros:

• Fully automated

• Tailored to your goals

• Includes tax-loss harvesting (on some platforms)

Best for: Beginners or busy people who want professional-level investing without hiring an advisor

🏁 4. Target-Date Retirement Funds

Strategy Summary: Invest in a single fund that automatically adjusts based on your retirement year.

A target-date fund is like a “set it and forget it” retirement plan in a box. If you plan to retire around 2050, you’d buy a 2050 Target Date Fund. It starts with more stocks for growth, and over time shifts toward bonds for stability.

Top funds for this:

• Vanguard Target Retirement Funds

• Fidelity Freedom Index Funds

• T. Rowe Price Retirement Funds

All you do is pick the fund with your expected retirement year in the name. Everything else is automatic.

How to do it:

1. Open a retirement account (IRA, Roth IRA, 401k)

2. Search for your year-based fund (e.g., 2060)

3. Buy into it regularly

4. Reap the benefits in retirement

Pros:

• No rebalancing needed

• Great for hands-off savers

• Adjusts risk for you over time

Best for: Long-term retirement investors who don’t want to micromanage

🏢 5. REIT Index Investing (Real Estate)

Strategy Summary: Invest in Real Estate Investment Trust ETFs to earn income from properties — without being a landlord.

REITs let you invest in commercial, residential, and industrial properties — and receive a share of the rental income.

Top REIT ETFs:

• VNQ (Vanguard Real Estate ETF)

• SCHH (Schwab U.S. REIT ETF)

• REET (iShares Global REIT)

REITs must pay out 90% of their profits to investors, which makes them powerful income assets.

How to do it:

1. Open a brokerage account

2. Buy shares of VNQ, SCHH, or REET

3. Reinvest dividends or take them as income

Pros:

• High dividend yield (often 3–5% annually)

• Real estate exposure without buying property

• Monthly or quarterly income

Best for: Income-focused investors and real estate lovers who want low hassle

🔄 How to Automate Any Passive Strategy

To make your investments truly hands-off:

1. Turn on Auto-Deposits
   → Most brokers let you set a weekly/monthly transfer

2. Enable Auto-Investing or Recurring Buys
   → Automatically invest funds when they arrive

3. Use DRIP (Dividend Reinvestment Plans)
   → Reinvest dividends into more shares

4. Schedule a Monthly Check-In
   → Just to glance at your progress (not to micromanage)

🧾 Real-Life Example: Sarah’s $200/Month Plan

Sarah is a busy teacher with no time for active investing. She sets up the following:

• $100/month to VTI

• $50/month to SCHD (dividends)

• $50/month to VNQ (REIT income)

She automates the contributions in her Roth IRA and enables dividend reinvestment. After 5 years, her portfolio has grown significantly — and she hasn’t made a single manual trade.

That’s passive investing done right.

📎 Download: Passive Investing Strategy Planner (PDF)

This printable helps you:

• Choose your passive strategy

• Set financial goals

• Track monthly contributions and values

• Stay consistent with long-term plans

📎 Download the Passive Investing Strategy Planner (PDF)