Should you buy SCHD for dividends or VOO for total growth? Here is the data-driven answer for every investor type.
10.3%
VOO 10-year annualized return
3.5%
SCHD current dividend yield
1.3%
VOO current dividend yield
All data as of February 2026
| Metric | SCHD | VYM | VOO | VTI |
|---|---|---|---|---|
| Expense Ratio | 0.06% | 0.06% | 0.03% | 0.03% |
| Dividend Yield | 3.5% | 2.8% | 1.3% | 1.3% |
| Holdings | ~100 | ~500 | ~500 | ~4,000 |
| 10-Year Total Return | 218% | 176% | 267% | 258% |
| Strategy | Quality dividends | High yield | S&P 500 | Total market |
| Max Drawdown (5yr) | -18% | -17% | -24% | -25% |
Dividends reinvested, as of February 2026
VOO (S&P 500)
$367,000
10.3% annualized
SCHD (Dividend)
$318,600
12.3% annualized
Key insight: Index funds (VOO/VTI) have beaten dividend ETFs on total return over the past decade, driven primarily by mega-cap tech growth (Apple, NVIDIA, Microsoft). However, dividend ETFs experienced significantly smaller drawdowns during market corrections, which matters for investors who need stability or who spend their dividends.
SCHD (3.5% yield)
$17,500/yr
$1,458/month -- growing 12% annually
VYM (2.8% yield)
$14,000/yr
$1,167/month -- growing 6% annually
VOO (1.3% yield)
$6,500/yr
$542/month -- growing 7% annually
If you need income to pay bills, the difference is dramatic. SCHD generates nearly 3x more cash flow than VOO. For retirees withdrawing 4%, dividend ETFs produce enough income without selling shares, while index fund investors must sell shares to generate the same cash.
Best in: Roth IRA (tax-free growth on high dividends)
Best in: Taxable brokerage (defer taxes longer)
Tax Strategy Summary:
In a taxable account, VOO/VTI are more tax-efficient because you control when gains are realized. In a Roth IRA, SCHD/VYM are ideal because all those high dividends grow completely tax-free. In a traditional IRA or 401(k), choose based on performance -- taxes are deferred regardless.