VUG Calculator — Dividend Growth & Value Projection

What VUG actually tracks

The Vanguard Growth ETF (VUG) follows the CRSP US Large Cap Growth Index — the growth half of the large-cap U.S. market, sorted by factors like earnings and sales growth, price-to-book, and price-to-earnings. CRSP splits the large-cap universe into a value sleeve and a growth sleeve, and VUG owns only the growth side, so it is not a whole-market fund at all: it deliberately concentrates in the names screening as fastest-growing, which today skews heavily toward mega-cap technology and consumer platforms. With roughly $231 billion in assets it is the largest large-cap growth index ETF on the market, and at a 0.03% expense ratio it is one of the cheapest ways to own that factor tilt. There is no dividend screen anywhere in the construction — the payout is simply whatever those growth companies happen to distribute.

Why the yield is the lowest in this cluster

VUG's ~0.4% starting yield is the smallest of any fund on this site — below broad VOO (~1.1%) and even growth-heavy QQQ (~0.5%), and a fraction of a dividend-growth fund like VIG (~1.5%) or SCHD (~3.3%). That is the direct consequence of the growth screen: fast-growing firms tend to retain earnings to reinvest rather than pay them out, so a portfolio built from the growth sleeve is structurally low-yield. If your goal is a check to spend this year, VUG is the wrong tool — a dividend-growth or a covered-call income fund answers that question far better. VUG answers a different question: maximum exposure to the price appreciation of large U.S. growth companies, with the dividend as an afterthought.

How the projection behaves — value, not income

Toggle to Value and VUG's price growth does nearly all the work; toggle to Income and the dividend line barely lifts off the axis because the starting yield is so low. With DRIP switched on, each small quarterly distribution buys a few more shares and those shares grow with the fund, but the reinvested dividend is a rounding error next to the price band. Yield-on-cost — a year's dividends divided by what you originally invested — does drift upward as the per-share payout grows around 4.6% a year, yet it starts from such a low base that it stays modest even over a long hold. The chart reports both value and income as a range rather than a line because the rate of growth is uncertain, and for VUG that uncertainty lives almost entirely in the value band.

The trade-offs worth knowing

VUG's distributions are almost entirely qualified dividends, taxed at long-term capital-gains rates and — because the yield is tiny — carrying an almost negligible annual tax drag in a taxable account. The larger tax event is deferred: most of VUG's return sits in unrealized price appreciation that is only taxed when you sell, which the Account toggle above models by subtracting a capital-gains bill at the horizon in a taxable account while letting a Traditional IRA or Roth compound untaxed. The concentration is the honest risk to weigh against that low fee and low tax drag — a growth-only screen means the fund is heavily tilted toward a handful of the largest technology names, so it can fall harder than a whole-market fund when that cohort corrects. VUG is often paired with a value or dividend fund precisely to blunt that tilt; whether that suits you depends on your horizon and how much single-factor concentration you can hold through a drawdown.

All figures here are illustrative and asOf 2026-05-31; forward price and dividend growth are assumptions, not forecasts. Educational estimates, not investment advice.