Warren Buffett Recommends This Vanguard Fund for All Investors. If You Invest $300 Monthly, Here’s What History Says It Will Be Worth in 20 Years.

Warren Buffett is known for one key strength: his ability to pick fantastic stocks. Thanks to this, he led Berkshire Hathaway to six decades of market-beating performance, and his proven market knowledge has prompted investors to listen closely to his advice.

Today, Buffett no longer leads Berkshire Hathaway’s investing decisions. He handed over the CEO position to Greg Abel at the start of the year and recently stepped down from the position of chairman. However, Buffett is now chairman emeritus and remains on the board of directors — and Berkshire Hathaway says the billionaire “will continue to offer his valued judgment and perspective.”

So Buffett still is involved in the investing world, and in recent times has even shared his thoughts publicly on the market. Meanwhile, investors also may refer back to some of Buffett’s earlier statements for guidance as he has stuck with his investment principles throughout his career.

And this leads me to a valuable piece of advice for any investor. Buffett recommends the following Vanguard fund for all investors — and he’s even invested in it himself. Now, if you put $300 a month into this asset, here’s what history says it will be worth in 20 years.

Warren Buffett’s investment strategy

First, let’s talk a bit about Buffett’s investing strategy. As mentioned, he’s a stock-picking expert, having chosen many winning companies over the years, and Buffett doesn’t buy stocks for a quick gain. Instead, he aims to uncover future winners while they are trading at reasonable prices, then he picks them up and holds on for the long term. This technique has clearly been a winning one.

But on top of this, Buffett has also invested in a particular type of fund, which brings me to his recommendation for all investors. Buffett has in the past owned shares of the Vanguard S&P 500 ETF (VOO -0.43%), a fund that tracks the performance of the S&P 500. And in a letter to shareholders back in 2013, the billionaire said it was a fund he would encourage any investor to buy. Why? Because it offers investors instant exposure to all of the companies driving the U.S. economy.

The investor’s goal should be to “own a cross-section of businesses that in aggregate are bound to do well,” Buffett wrote. “A low-cost S&P 500 index fund will achieve this goal.” Further highlighting his belief in this investment, Buffett said that, upon his death, his instructions call for a trustee to put most of his cash into such a fund to benefit his wife.

Here’s how you can benefit from Buffett’s advice

So, how can you best apply this Buffett advice to your own investing strategy? Stock picking, of course, should be central to your plan, as it allows you to greatly benefit from the growth of quality companies. If you add a position in the Vanguard S&P 500 exchange-traded fund, you may add an element of safety and long-term growth you can count on to your portfolio. This is because the S&P 500 has delivered an average annual return of 10% over time.

And if you invest regularly in this fund, you may benefit from the magic of compounding. Let’s consider the example I mentioned above. If you make an initial investment of $3,000 in the fund and then invest $300 monthly for 20 years, considering the 10% average annual return, the value of your investment may reach more than $220,000. And if you have the ability to keep this monthly investment going over a period of 35 years, your investment may top $1 million.

A one-time purchase of the Vanguard S&P 500 ETF may be a smart move for all investors, according to Warren Buffett. And the math shows that monthly investing in this fund could supercharge your performance and potentially even result in millions.