Beat the softened cream cheese in a large bowl using a hand mixer on medium speed for 2 minutes until perfectly smooth.
Add the powdered sugar and vanilla extract, beating for another minute until well combined. Scrape the sides of the bowl.
Fold the thawed whipped topping into the cream cheese mixture gently using a silicone spatula to keep the mixture airy.
Add the drained pineapple chunks, mandarin oranges, sliced strawberries, marshmallows, and shredded coconut into the bowl.
Stir very gently to coat all the fruit in the dressing. Cover the bowl tightly and chill in the refrigerator for at least 1 hour before serving.
