Most of our model portfolios contain US total market funds like XUU, which captures something like VOO and QQQ but also incorporates small caps in the portfolio.
While VOO and QQQ focus on the largest companies on the indexes, XUU has a much wider scope. This wider scope hasn't led to larger outperformance over the last while just due to the runup in Mag 7 stocks. However, the fund would likely not be as volatile in the event those major tech companies go through a correction. It would still be volatile don't get me wrong, but not AS bad as it is a bit more diversified.
15 years to retirement is quite a long time. It is a long enough time to have even weathered the longest stretches of poor market returns (think post dot-com bubble), so in that regard I think total return is best. In fact, I think total return is best for those even closer to retirement. How they can mitigate risk is through proper asset allocation, not necessarily dividends or "income". Dividends are nothing more than a single basket of returns in a broader based retirement portfolio.
Posted by Anonymous