Best S&P 500 Funds for 2026 | Credential Index

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5 Best S&P 500 Index Funds

Fund	Ticker	Total Assets*	Expense Ratio
Fidelity 500 Index	(FXAIX)	$832.2 billion	0.015%
Fidelity Flex 500 Index	(FDFIX)	$9.2 billion	0.000%
Schwab S&P 500 Index Fund	(SWPPX)	$145.4 billion	0.020%
Vanguard 500 Index Admiral Fund	(VFIAX)	$1.6 trillion	0.040%
T. Rowe Price Equity Index 500	(PREIX)	$40.3 billion	0.190%

*Total assets according to Morningstar’s data, as of June 2, 2026.

Fidelity 500 Index (FXAIX)

Total Assets

$832.2 billion

Expense Ratio

0.015%

Minimum Investment

$832.2 billion

0.015%

Editor’s Take

Why We Like It

Fidelity’s FXAIX provides diversified exposure to 500 of the largest U.S. companies, making it a core holding for those seeking to mirror the performance of the overall U.S. stock market. The fund aims to invest “at least 80% of the fund’s assets in common stocks included in the S&P 500 index.” The theory is that it delivers a return close to that of the index.

Another plus—FXAIX’s expense ratio is lower than that of many comparable S&P 500 exchange traded funds (ETFs), making it cost-effective.

What We Don’t Like

Not all major brokerage firms offer Fidelity funds like FXAIX.

Who It’s Best For

It’s ideal for investors looking for a passive investment option without the need to trade frequently.

Fidelity Flex 500 Index (FDFIX)

Total Assets

$9.2 billion

Expense Ratio

0.00%

Minimum Investment

$9.2 billion

0.00%

Editor’s Take

Why We Like It

You might think there’s no way to beat the rock-bottom fees of Fidelity’s previously mentioned fund. But Fidelity goes a step further, offering an S&P 500 index fund that charges investors absolutely nothing.

The catch? You need to be an active Fidelity Investments account holder to invest. For many investors, that’s hardly a dealbreaker—especially with Fidelity managing $18 trillion in assets, including managed assets of $7.1 trillion.
What We Don’t Like

The fund is only available to Fidelity customers who are enrolled in “certain fee-based accounts and advisory programs.” FDFIX is included in robo-advisory service Fidelity Go’s portfolio construction. Fidelity Go constructs portfolios using a range of Fidelity Flex mutual funds.

Who It’s Best For

It’s best for a “set it and forget it” approach with minimal expenditure.

Schwab S&P 500 Index (SWPPX)

Total Assets

$145.4 billion

Expense Ratio

0.02%

Minimum Investment

$145.4 billion

0.02%

Editor’s Take

Why We Like It

SWPPX is a good example of an affordable alternative to Fidelity. This Schwab fund is benchmarked to the same index of large domestic stocks—the S&P 500—with no investment minimum. It boasts a low expense ratio of 0.02%. That works out to be $2 annually per $10,000 invested, so the fees are a minimal drag on returns.

Another plus: You don’t need a Schwab account to invest in SWPPX. While the fund is managed by Schwab and accessible through a Schwab account, other brokerages offer access to the fund.

What We Don’t Like

The drawbacks for SWPPX are the cons of investing in any other S&P 500 index fund. Your investment is going to skew heavily toward the performance of large-cap tech companies like Apple, Amazon, Microsoft and Nvidia. That’s because the S&P 500 is weighted toward those companies.

Who It’s Best For

It’s great for beginners with limited capital and is an excellent choice for long-term investors who want exposure to the U.S. stock market’s largest companies.

Vanguard 500 Index Admiral (VFIAX)

Total Assets

$1.6 trillion

Expense Ratio

0.04%

Minimum Investment

$3,000

$1.6 trillion

0.04%

$3,000

Editor’s Take

Why We Like It

VFIAX was the industry’s first index fund for retail investors. With Vanguard, you can expect the fund to deliver with what it says on the label. VFIAX offers instant diversification to some of the largest U.S. companies. According to its product summary, “The fund offers exposure to 500 of the largest U.S. companies, which span many different industries and account for about three-fourths of the U.S. stock market’s value.”

What We Don’t Like

You need at least $3,000 to invest in the S&P 500 index fund. If you’re a Vanguard account holder with less money in your account, Vanguard’s exchange-traded fund equivalent, Vanguard S&P 500 ETF (VOO), might be a better alternative. You can buy a share of VOO for as little as $1 because of Vanguard’s fractional share program.

Who It’s Best For

It’s great for passive investors who prioritize low fees and brand reputation; after all, Vanguard was the first to mint the idea of a passive index fund.

T. Rowe Price Equity Index 500 (PREIX)

Total Assets

$40.3 billion

Expense Ratio

0.19%

Minimum Investment

$2,500

$40.3 billion

0.19%

$2,500

Editor’s Take

Why We Like It

T. Rowe Price has a solid reputation for good stewardship and customer service. The fund invests a minimum of 80% of net assets in stocks tied to the S&P 500, using a replication strategy. In other words, the fund attempts to maintain a proportion of each stock relative to its weight in the chosen benchmark index.

What We Don’t Like

The main downside is the cost. For a passive index fund, the expense ratio is relatively high. While 0.18% is low, it’s higher than competitors like Vanguard’s VFIAX at 0.04% or Fidelity’s FXAIX at 0.015%.

It may seem like you have to fork over $2,500 as a minimum for the fund. But that is for brokerage accounts, and expense waivers may apply. Plus, if this fund is for an IRA account, the minimum is much less at $1,000.

Who It’s Best For

While T. Rowe Price’s index funds, in general, are not the cheapest out there, you can be confident that your investment is with a reputable fund management company.

Methodology

Our selection prioritizes both scale and cost efficiency, with each index fund meeting the following criteria:

Morningstar rating. A fund rated four stars by Morningstar is generally considered a good investment because it has delivered strong risk-adjusted returns compared to similar funds.
AUM. At least $5 billion in assets under management. A higher AUM generally signals greater fund popularity.
Expense ratio. An expense ratio of 0.18% or lower.
Minimum investment. A low minimum investment, capped at $3,000.
Low tracking error. We measured how closely each fund’s annualized return matched that of the S&P 500 index. A lower tracking error indicates better alignment with the index.

These criteria can help you identify S&P 500 index funds that are passively managed, have low fees and closely follow the benchmark index. All of these funds are overseen by a reputable fund manager with a strong track record.

How To Choose an S&P 500 Index Fund

There are plenty of S&P 500 index funds on the market, so it’s essential to use key criteria to choose the right one for your portfolio. Consider the following factors:

Expense ratio. Since index funds are passively managed (they are run by algorithms rather than by relatively expensive fund managers), their expense ratios—the annual fees you pay to maintain the fund—should be low. Because S&P 500 index funds tend to deliver very similar performance, even small differences in fees can significantly impact your returns over time.
Minimum investment. Different funds require different minimum investments. Make sure the fund you choose aligns with the amount you have available to invest initially, and that you can continue to add to it on a schedule that fits your budget.
Dividend yield. One benefit of investing in large-cap companies is the potential for dividend income. Comparing dividend yields across funds can help you identify opportunities for enhanced returns.
Inception date. If you prefer a fund with a proven track record, look at its inception date. Vanguard’s 500 Index Fund (VFIAX), for instance, dates back to August 1976. A longer history can give you insights into how the fund has performed through various market cycles.

You typically only need one S&P 500 index fund in your portfolio. Since the returns of these funds are usually within a few percentage points of each other, holding more than one rarely adds value.

How To Invest in the S&P 500

There are many ways to invest in the S&P 500. But the first step is understanding how the index works and how it aligns with your overall financial goals.

When looking at investing in S&P 500 funds, whether exchange-traded or mutual funds, it is always a good idea to begin with what your overall goals are and what kind of risk you are willing to tolerate. Investors have many options to choose from, ranging from funds that replicate the S&P 500 all the way down to specific subsector funds.

– Bob Welch, senior vice president at Wealth Enhancement Group. Over 15 years of experience in financial services.

Here are a few steps to follow if you’ve decided that investing in an S&P 500 fund is right for you.

1. Open an investment account.

To get started, you’ll need an account with a financial institution. This could be a standard brokerage account, a retirement account like an IRA, or your employer-sponsored 401(k).

2. Define your investment approach.

Decide how you want to gain exposure to the S&P 500. Most investors choose low-cost index funds or exchange-traded funds that mirror the performance of the index.

3. Place your investments.

Once you’ve chosen your strategy, use your investment account to execute your trades. You’ll need to specify the number of shares or the amount you’d like to invest in.

4. Monitor and adjust as needed.

Track your investments over time and review your portfolio periodically. While the S&P 500 provides broad market exposure, it’s important to ensure your overall portfolio remains balanced and aligned with your risk tolerance.

Frequently Asked Questions (FAQs)

What are S&P 500 index funds?

S&P 500 index funds are investment instruments for mirroring the performance of the S&P 500 with a low-cost fund. The S&P 500 is one of the most commonly cited stock indexes in the U.S. It serves as a key benchmark and tracks 500 of the nation’s largest publicly traded companies.

The first passive index fund launched was the Vanguard 500 Index Fund under legendary investor John C. “Jack” Bogle in the mid-1970s. The concept behind it was to revolutionize investing and make investing more broadly accessible to everyday investors.

What are the risks associated with investing in S&P 500 index funds?

The main risk with index funds is that the benchmark might start to trend downward. Because it’s a passive tracker fund, you should expect your investment to follow suit. “A (passive index) fund will indiscriminately sell its underlying positions in an indiscriminate fashion. It will always be beholden to its prospectus,” Welch from Wealth Enhancement Group says.

What’s the difference between index funds and ETFs?

S&P 500 index funds and ETFs are very similar. The best choice for your portfolio boils down to account type, cost and minimum investment requirements.

“If you want flexibility, ETFs will make more sense because you can trade them during the day. If you’re just setting up automatic retirement contributions, a mutual fund is probably fine. For most long-term investors, the difference is small,” says Aaron Cirksena, founder and CEO of MDRN Capital, a Maryland-based retirement planning firm.

ETFs trade like stocks throughout the day and often have lower fees and buy-in amounts, but fractional share availability can be limited.

Index funds, on the other hand, are commonly found in 401(k) plans. Overall, both options provide a low-cost, diversified way to invest in large-cap U.S. stocks without picking individual companies.