Long-term investments with robust potential for growth and dividends.

When it comes to building wealth through the ASX, 2024 offers some exceptional opportunities, especially for investors in their 40s—or at any stage of life! The Australian share market continues to be a compelling avenue for both capital appreciation and dividend income.

Amid high interest rates and rising living costs, diversification is more important than ever. Strategic investments can help navigate uncertainties while providing a solid foundation for long-term financial growth.

Here are two standout investments I believe are worth holding for decades to come:

Vanguard MSCI Index International Shares ETF (ASX: VGS)

This exchange-traded fund (ETF) offers a straightforward way to gain exposure to over 1,300 global companies, spanning markets in the United States, Japan, the UK, Canada, and more. For Australian investors, it’s a powerful tool for diversification.

Key Features of VGS:

• Broad Sector Exposure:
  With a 25% allocation to the high-growth information technology sector, VGS opens doors to industries where Australian investors traditionally lack opportunities. Other significant allocations include financials (15.4%), healthcare (11.4%), and industrials (11.1%).

• Leading Holdings:
  The ETF’s portfolio includes global giants such as Apple, Microsoft, Amazon, Nvidia, Alphabet, and Meta Platforms, giving investors access to some of the world’s most innovative companies.

• Low Management Fee:
  At just 0.18% annually, the fee is a small price to pay for the convenience of global diversification and the fund’s historical performance.

Performance Highlights:

Since its inception in 2014, VGS has delivered an impressive average annual return of 13.1%, with a portfolio return on equity (ROE) of 19.4%. While its current dividend yield of 1.7% may seem modest, the focus on capital growth makes it a worthy addition to a long-term portfolio.

Washington H. Soul Pattinson and Co. Ltd (ASX: SOL)

Soul Patts is a venerable name in the ASX landscape, with over 120 years of investment expertise. This conglomerate distinguishes itself by holding a diversified portfolio that spans listed shares, private businesses, and unlisted assets.

Why Consider Soul Patts?

1. Diverse Investments:
   The company’s portfolio includes assets in telecommunications, building products, property, financial services, agriculture, and even swimming schools. Its reach extends beyond the typical sectors, offering an added layer of resilience.

2. Defensive Strategy:
   Soul Patts prioritizes investments in cash-flow-resilient businesses, ensuring consistent earnings and reliable dividend payouts. This defensive focus makes it particularly appealing during uncertain economic times.

Dividend Consistency:

Since 2000, Soul Patts has increased its ordinary dividend every year, a testament to its reliability. Its current grossed-up dividend yield of 4% (including franking credits) is an attractive feature for income-focused investors.