Best Retirement Index Funds by Broker
Why Index Funds Win Long-Term
Over any 15-year period, 90%+ of actively managed funds underperform their benchmark index. The reason: fees. A 1% management fee compounds into a 26% reduction in your ending portfolio value over 30 years. Index funds charge 0.03–0.10%.
Fidelity ZERO Index Funds
0% expense ratio — literally the cheapest funds on earth
Fidelity's ZERO funds charge no expense ratio whatsoever. FZROX (total market) and FZILX (international) are only available at Fidelity, but give you the cheapest path to broad diversification.
✅ Pros
- Absolutely zero expense ratio
- Cover US and international markets
- $1 minimum investment
- Available in IRA and 401k at Fidelity
❌ Cons
- Fidelity-only — can't transfer in-kind if you switch
- No ETF version — mutual fund only
Vanguard Three-Fund Portfolio
VTSAX + VTIAX + VBTLX — the classic retirement mix
The original three-fund portfolio. VTSAX (total US market, 0.04%) + VTIAX (international, 0.11%) + VBTLX (total bond, 0.05%). Available at Vanguard and most 401k plans.
✅ Pros
- Industry-standard, widely available
- Vanguard client-owned structure (lower costs)
- Available as ETFs (VTI/VXUS/BND) for $1 min
- Excellent track record
❌ Cons
- $3,000 minimum per mutual fund
- ETF versions available for lower minimums
Schwab Three-Fund Portfolio
SWTSX + SWISX + SWAGX — excellent for Schwab accounts
Schwab's index funds match Vanguard's costs with no minimums. SWTSX (US total market, 0.03%) pairs with SWISX (international, 0.06%) and SWAGX (bonds, 0.04%).
✅ Pros
- $0 minimum — start with any amount
- Matches Vanguard on cost
- Available in many employer 401k plans
❌ Cons
- Less brand recognition than Vanguard
- Some funds not available outside Schwab
| Fund | Ticker | Expense Ratio | Asset Class | Broker |
|---|---|---|---|---|
| Fidelity Total Market | FZROX | 0.00% | US Stocks | Fidelity only |
| Fidelity International | FZILX | 0.00% | Intl Stocks | Fidelity only |
| Vanguard Total Market | VTSAX/VTI | 0.04%/0.03% | US Stocks | Most brokers |
| Vanguard International | VTIAX/VXUS | 0.11%/0.07% | Intl Stocks | Most brokers |
| Schwab Total Market | SWTSX | 0.03% | US Stocks | Schwab/many 401k |
The Target Date Alternative
If picking funds feels overwhelming, your 401k likely offers Target Date funds (e.g., Vanguard Target Retirement 2055). These automatically adjust stocks/bonds ratio as you age. Choose your approximate retirement year. It's not optimal but it's better than doing nothing.
Calculate your retirement nest egg
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