Investing in Dividend Growth Stocks Is Easy With This ETF

Are you looking for a solid dividend growth stock but don't know which one to invest in? There's an exchange-traded fund (ETF) that can help you with that. The Vanguard Dividend Growth Fund Investor Shares (NASDAQ:VDIGX) has some of the safest dividend stocks you can buy today.

The fund not only focuses on dividend stocks but on "high-quality companies that have both the ability and the commitment to grow their dividends over time."

This is of key importance to investors because it means that you can earn more over the years, creating an incentive to just buy and hold. While some dividend stocks may only yield a few percentage points, you can earn more on your initial investment as the yield rises.

There are a total of 42 stocks in the fund, including big names such as UnitedHealth Group (NYSE:UNH), Johnson & Johnson (NYSE:JNJ), and Colgate-Palmolive (NYSE:CL). In the case of Johnson & Johnson and Colgate-Palmolive, they are Dividend Kings and have been increasing their dividend payments for more than 50 consecutive years. They currently yield less than 3% which is deceptively low given how much potential there is for their yields to rise.

Rather than picking out these safe dividend growth stocks, the Vanguard Dividend Growth Fund can do the work for income investors. And it does this for a relatively low cost as its expense ratio is just 0.27%. The ETF has fallen 14% this year but that's still better than the S&P 500, which is down around 20%.