Top Index Funds and ETFs to Buy on Vanguard or Fidelity in 2026
Index funds and ETFs are the most effective way for everyday Americans to build wealth in the stock market. They offer instant diversification, rock-bottom fees, and historically strong returns. Here are the best options available at Vanguard, Fidelity, and Charles Schwab " — ranked by category.
What Are Index Funds and ETFs?
An index fund tracks a specific market index (like the S&P 500) by holding all " — or a representative sample " — of the stocks in that index. An ETF (Exchange-Traded Fund) works the same way but trades like a stock throughout the day. For most buy-and-hold investors, there's no meaningful difference between the two " — the expense ratio (annual fee) matters more than whether it's structured as a fund or ETF.
Best US Stock Market Index Funds
| Fund | Tracks | Expense Ratio | Minimum |
|---|---|---|---|
| VTI (Vanguard Total Stock Market ETF) | Entire US stock market (~4,000 stocks) | 0.03% | $1 (fractional) |
| VTSAX (Vanguard Total Stock Market Index) | Entire US stock market | 0.04% | $3,000 |
| FXAIX (Fidelity 500 Index Fund) | S&P 500 | 0.015% | $0 |
| FSKAX (Fidelity Total Market Index) | Entire US stock market | 0.015% | $0 |
| SWTSX (Schwab Total Stock Market Index) | Entire US stock market | 0.03% | $0 |
Best International Stock Index Funds
| Fund | Tracks | Expense Ratio | Minimum |
|---|---|---|---|
| VXUS (Vanguard Total International Stock ETF) | International stocks (ex-US) | 0.07% | $1 |
| FTIHX (Fidelity Total International Index) | International stocks (ex-US) | 0.06% | $0 |
| SCHF (Schwab International Equity ETF) | Developed international markets | 0.06% | $1 |
Best Bond Index Funds
| Fund | Tracks | Expense Ratio | Best For |
|---|---|---|---|
| BND (Vanguard Total Bond Market ETF) | US investment-grade bonds | 0.03% | Core bond holding |
| FXNAX (Fidelity US Bond Index) | US investment-grade bonds | 0.025% | Conservative investors |
| SCHZ (Schwab US Aggregate Bond ETF) | US investment-grade bonds | 0.03% | Income generation |
Why Fees Matter More Than You Think
A seemingly small difference in expense ratios has a massive impact over decades:
| Fee | $10,000 Invested for 30 Years (8% return) | Cost |
|---|---|---|
| 0.03% (VTI) | $99,972 | $30 |
| 0.10% | $99,392 | $610 |
| 0.50% | $95,060 | $4,940 |
| 1.00% | $88,362 | $11,638 |
| 1.50% | $80,268 | $19,732 |
A 1% fee difference on $10,000 costs you nearly $12,000 over 30 years. On a $100,000 portfolio, that difference is nearly $120,000. Always choose the lowest-cost option available.
Target-Date Funds: The Set-It-and-Forget-It Option
If you don't want to build your own portfolio, target-date funds do the work for you. You pick a fund matching your expected retirement year, and the fund automatically adjusts your stock-to-bond ratio as you age:
- Vanguard Target Retirement 2055 (VFFVX): For people retiring around 2055. Expense ratio: 0.08%.
- Fidelity Freedom Index 2050 (FIHFX): For people retiring around 2050. Expense ratio: 0.12%.
- Schwab Target 2050 Index (SWYJX): For people retiring around 2050. Expense ratio: 0.08%.