Fidelity, Vanguard, Schwab: the lowest-fee S&P 500 funds in 2026

Index investing rests on a single claim: beating the market consistently is hard, so the surest edge an ordinary investor has is paying as little as possible to own it. That claim has never been cheaper to act on. The cheapest S&P 500 index funds now charge so little that the distance between the priciest and the least expensive option reads as a rounding error on a small balance and as real money on a large one. A fund charging 0.03% costs $3 a year on a $10,000 position. A fund charging 0.20% costs $20. Multiply that spread across a growing balance and a few decades of compounding, and cost becomes the most closely examined line on any fund fact sheet.

Investors have so many near-identical choices in 2026 because of a fee war that escalated when Fidelity launched its first zero-expense-ratio index funds in 2018. Vanguard, Schwab, BlackRock $BLK's iShares, and State Street $STT have all driven costs down on their flagship index products in the years since. What each of them sells is the same basic instrument: a portfolio holding the 500 companies in the S&P 500, weighted by market value, with little trading and little discretion involved. Because the underlying holdings barely differ from one provider to the next, the expense ratio does most of the work separating these funds over a long holding period.

Cost is not the only variable. Some of these products are mutual funds that price once a day at net asset value, which suits automatic payroll contributions and workplace retirement plans. Others are exchange-traded funds that trade continuously, can be moved between brokerages without being sold, and tend to pass along fewer taxable capital gains. A few funds marketed as fee-free do not track the S&P 500 at all, but a custom benchmark that resembles it.

The list that follows ranks the lowest-cost S&P 500 trackers available this year by what they charge, with mutual funds and ETFs side by side. It also lays out the structural details that decide which one fits a given account.

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Fidelity 500 Index Fund, ticker FXAIX, charges an expense ratio of 0.015%, which works out to $1.50 a year on a $10,000 position and makes it the least expensive true S&P 500 tracker in mutual fund form. Fidelity has held that price for years, pricing its index lineup to compete head-on with Vanguard and Schwab for retirement money.

The fund carries no minimum investment in standard Fidelity brokerage and retirement accounts, so it is as open to someone making a first paycheck contribution as to someone rolling in a six-figure balance. Index mutual funds once required entry amounts in the thousands of dollars, and dropping that floor was a pricing decision aimed at new savers.

FXAIX tracks the S&P 500 itself. Holdings and sector weights follow the index closely, and what little variance exists comes from cash balances and the cost of running the fund rather than from a manager picking which companies look attractive.

As a mutual fund rather than an exchange-traded fund, FXAIX prices once daily at net asset value after the market closes. An order entered at 11 a.m. and one entered at 3 p.m. receive the identical price. That distinction rarely matters to an investor contributing every two weeks and holding for 30 years. It matters to anyone who wants limit orders, intraday execution, or the ability to transfer the position to another brokerage without selling, since mutual funds do not move cleanly between fund families.

Workplace plans explain much of the fund's size. Fidelity is one of the largest 401(k) recordkeepers in the U.S., and FXAIX sits on a large share of those plan menus as the default large-cap index choice, which has made it a common core holding for American retirement savers who never chose it from a shelf of competitors.

For an investor already holding a Fidelity account who wants the index itself rather than a similar-looking benchmark, there is no cheaper way to own the 500.

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Schwab S&P 500 Index Fund, ticker SWPPX, charges an expense ratio of 0.02% — $2 annually on a $10,000 balance. That sits half a basis point above the cheapest S&P 500 mutual fund available and well under what actively managed large-cap funds charge for exposure to the same set of companies.

The fund has no minimum initial investment. Schwab removed minimums across its index mutual fund lineup, lowering an entry barrier that once kept these products out of reach for someone opening an account with a few hundred dollars. A position can start at any amount and grow through small, repeated contributions.

SWPPX tracks the S&P 500 directly. Its holdings shift when S&P Dow Jones Indices adds or removes a company or adjusts for spin-offs and other corporate actions, not when a manager forms a view on a stock. Turnover stays low as a result. For an investor holding the fund in a taxable brokerage account, that matters: index mutual funds with little trading activity generally pass through smaller capital gains distributions than funds whose managers reshuffle positions throughout the year.

Pricing follows mutual fund mechanics. The fund strikes one net asset value after U.S. markets close, and every order placed during the session fills at that evening's figure rather than at a live quote. There is no limit order, no intraday exit and no bid-ask spread to account for. The format fits an investor contributing on a schedule — automatic transfers, a monthly IRA deposit, payroll contributions into a workplace plan — more than one who wants to trade around market moves.

Schwab has priced its proprietary index products aggressively for years, and SWPPX is the firm's core S&P 500 offering. For anyone who already custodies assets at Schwab, or whose retirement plan menu is built on Schwab funds, it is one of the cheapest routes into the index, and the gap against the handful of funds priced below it comes to about five cents a year per $1,000 invested.

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SPDR Portfolio S&P 500 ETF, ticker SPLG, charges an expense ratio of 0.02%, which puts it among the least expensive exchange-traded funds tracking the index. A $50,000 holding costs $10 a year to own.

State Street $STT runs SPLG inside its Portfolio lineup, a family of funds built to compete with Vanguard and BlackRock $BLK on price rather than on trading volume. SPLG holds the same large-cap U.S. companies that make up the S&P 500, weighted by float-adjusted market value, and updates those holdings as S&P Dow Jones Indices adds and removes names.

Exchange listing is the structural difference from an index mutual fund. SPLG's price moves throughout the trading day rather than being struck once after the close, so an investor can place a limit order, trim part of a position at 11 a.m., or buy at a chosen price instead of accepting the day-end net asset value. None of that flexibility costs extra at this fee level.

Daily trading volume in SPLG is substantial, though it sits far below that of State Street's flagship S&P 500 product, the instrument institutional desks and options traders reach for first. The practical consequence is a slightly wider gap between the bid and the ask during turbulent sessions. An investor buying a few hundred dollars' worth each month will rarely see the difference; a trader moving a large block in a fast market might.

Each SPLG share also represents a much smaller dollar amount than a share of State Street's original S&P 500 fund, which makes whole-share purchases simpler in a small account or an automated monthly contribution.

Portability is the other argument for SPLG. Any brokerage that handles ETFs can hold it, and the shares generally transfer in kind to a new brokerage without being sold first — an easier path than moving a mutual fund tied to a single fund family. Investors who want index exposure at close to the minimum available cost, without locking themselves into one provider's platform, tend to arrive at SPLG for that reason.

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Vanguard S&P 500 ETF, ticker VOO, charges 0.03% a year, or $3 on every $10,000 invested. That sits slightly above the cheapest options on this list, and it buys access to one of the deepest pools of liquidity in any S&P 500 product.

VOO ranks among the largest exchange-traded funds in the world by assets, and that scale has a practical payoff. Heavy daily trading volume keeps bid-ask spreads tight. The price an investor pays to get in or out stays close to the value of the underlying holdings rather than drifting away from it. Shares trade continuously through the session on NYSE Arca. The portfolio holds the index members at their market-value weights, and Vanguard adjusts those weights as S&P Dow Jones Indices runs its quarterly share-count updates and adds or removes companies in between.

The fund's legal structure separates it from most rivals. Vanguard operates VOO as an exchange-traded share class of the same index portfolio that backs its mutual fund shares, a design the firm guarded under patent for years. That patent has expired, and competing asset managers have asked the Securities and Exchange Commission for permission to build similar dual-share-class funds. Running one portfolio behind both share classes can hold down taxable capital gains distributions for everyone who owns it. Dividends from the 500 underlying companies reach shareholders quarterly, after fund expenses come out.

Vanguard's ownership arrangement explains much of the pricing. The firm is owned by its own funds, and those funds are owned by the investors holding shares in them, so no outside shareholders are waiting on a profit margin. That setup is a large part of why Vanguard cut expense ratios for decades and pushed the rest of the industry to match. VOO fits an investor who wants a long-established, heavily traded S&P 500 ETF and is not chasing the absolute lowest fee on the market.

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iShares Core S&P 500 ETF, ticker IVV, charges an expense ratio of 0.03% and is managed by BlackRock $BLK, the world's largest asset manager. On a $10,000 position that comes to $3 a year, a fraction of what an actively managed large-cap fund charges for exposure to the same stocks.

IVV began trading in 2000, making it one of the oldest S&P 500 ETFs still on the market. Its record now spans the dot-com collapse, the 2008 financial crisis and the 2020 pandemic selloff. That age matters less for returns — any fund tracking the benchmark delivers roughly the benchmark — than for trading conditions. Years of accumulated assets and consistent daily volume keep bid-ask spreads narrow, so an investor placing a sizable order is unlikely to push the price against themselves.

The portfolio holds the index constituents at their benchmark weights, so sector concentration reflects the S&P 500 itself rather than a view taken at BlackRock. When information technology dominates the index, it dominates IVV. Nobody at the fund screens or overweights positions. The index committee at S&P Dow Jones Indices decides which companies come in and which go out, and the fund follows.

BlackRock sells IVV as part of its Core range, a set of building-block products priced for long-term portfolios and marketed alongside funds such as the iShares Core S&P Total U.S. Stock Market ETF (ITOT) and the iShares Core MSCI EAFE ETF (IEFA). Investors who want a U.S. large-cap sleeve and international exposure from a single provider often pair them.

Picking between IVV and the other S&P 500 ETFs priced at three basis points rarely turns on fee, since the number is identical. The deciding factors are usually which funds a brokerage trades commission-free, whether an investor wants holdings consolidated under one fund family, and whether an existing advisory model or retirement plan menu already leans on iShares products.

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Vanguard 500 Index Fund Admiral Shares, ticker VFIAX, charges an expense ratio of 0.04% and holds the same portfolio as Vanguard's exchange-traded version, VOO, at a slightly higher annual cost. On a $10,000 balance, that works out to $4 a year.

The fund sets a minimum initial investment of $3,000, which separates it from the no-minimum index mutual funds offered by Fidelity and Schwab. Clearing that threshold buys into Admiral, Vanguard's lower-cost share class. The firm's older Investor share class of the same fund charged more and was largely converted into Admiral and ETF shares as Vanguard consolidated its lineup around cheaper structures.

VFIAX prices once a day, after the market closes, at net asset value. There is no intraday quote to watch and no limit order to place. That rhythm suits an investor making scheduled contributions through a 401(k), an IRA or a recurring bank transfer far better than it suits anyone who wants to move a position during the trading session.

The one-basis-point gap between VFIAX and VOO comes down to share class mechanics rather than any difference in what the fund owns. Both rest on the same pool of S&P 500 stocks, weighted identically. For a long-term holder, the extra cost is a dollar a year per $10,000 invested — small enough that many investors take the mutual fund anyway when a retirement plan cannot trade ETFs, or when they want automatic purchases priced to the exact dollar amount.

Vanguard's 500 Index Fund also carries a longer record than almost anything else in this category. It launched in 1976 as First Index Investment Trust, the first index mutual fund marketed to individual investors in the U.S., and it predates the entire ETF industry by more than 15 years. The Admiral share class arrived in 2000 as a cheaper tier for larger balances.

For investors already holding accounts at Vanguard, VFIAX offers the same index exposure in mutual fund form, chosen for how it fits the account rather than for the lowest number on the fee table.

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At roughly 0.0945%, SPY is the most expensive fund on this list — and still the largest and most heavily traded S&P 500 ETF in the world. That comes to about $9.45 a year on a $10,000 position, roughly triple the cost of the cheapest ETFs tracking the same index.

Its history explains both the scale and the price. State Street $STT launched SPY in January 1993 as the first exchange-traded fund listed in the U.S. The three-decade head start let it build assets, a deep roster of market makers and an options market organized around its ticker. That depth is what the higher fee buys. Block $SQ trades, hedging programs and options positions tied to SPY clear at sizes and spreads newer funds cannot consistently match.

The fund's legal structure is the second reason its fee has not fallen in line with the rest of the category. SPY is organized as a unit investment trust, not an open-end fund, and that form carries constraints its rivals do not face. The trust has to hold all 500 index constituents through full replication. It also cannot reinvest dividends internally between distribution dates, so dividend cash sits idle until it reaches shareholders. That cash drag can leave SPY trailing its benchmark by a slightly wider margin than rivals during a rising market.

Open-end competitors such as VOO, IVV and SPLG operate with more latitude. Combined with competitive pressure, that flexibility has let their sponsors cut fees to a fraction of SPY's.

A buy-and-hold investor making regular contributions to a retirement or taxable account gets nothing additional for the extra cost. The portfolio is the same 500 companies weighted by market capitalization, and the liquidity advantage does not apply to someone buying a few hundred dollars at a time.

The math shifts for active traders. Options strategies are written against SPY specifically, and that contract ecosystem has no equal among competing funds. Institutional desks moving large positions, or anyone who needs the tightest available spread during a volatile session, has a concrete reason to accept the higher expense ratio.

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A fund advertising a 0.00% expense ratio is not automatically the cheapest way to own the S&P 500, because the best-known zero-fee options do not track the S&P 500 at all. Fidelity ZERO Large Cap Index Fund, ticker FNILX, charges no annual expense ratio, but its benchmark is the Fidelity U.S. Large Cap Index, a proprietary measure Fidelity built and maintains in-house.

That is the mechanism behind the zero price tag. The S&P 500 is a licensed product of S&P Dow Jones Indices, and any fund tracking it pays for the right. Building an internal benchmark removes that licensing cost, which is part of how a fund can be offered without a stated annual fee.

The holdings overlap substantially, since both indexes cover large American companies weighted by market value. They are not the same portfolio. The two use different construction rules and different inclusion criteria, so returns can diverge in a given year, sometimes in the fund's favor and sometimes against it.

The distinction matters for anyone whose goal is specifically S&P 500 exposure — an investor matching a stated benchmark, comparing results against the index quoted in daily market coverage, or holding a position meant to mirror a mandate written around the S&P 500. A close substitute may deliver similar results over time, but it answers to a different rulebook.

Portability is a second consideration. Fidelity's ZERO funds are available only through Fidelity accounts and cannot be transferred in kind to another brokerage. Leaving Fidelity generally means selling the position, with whatever tax consequences follow in a taxable account.

None of this disqualifies the ZERO lineup. An investor who wants broad, low-cost exposure to large U.S. companies and has no attachment to a particular index can reasonably hold a fund with no stated expense ratio. An investor who wants the S&P 500 as S&P Dow Jones Indices defines it should stay with the genuine trackers, starting with Fidelity 500 Index Fund at 0.015%. A fund's stated benchmark, not its name or its fee, is what settles the question.

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A basis point equals 0.01%, so the distance between an expense ratio of 0.015% and one of 0.20% is 18.5 basis points — a gap that reads as a rounding error on a fact sheet and works as a steady drag on returns across a multi-decade holding period.

In dollars: a fund charging 0.015% takes $1.50 a year from a $10,000 position. A fund charging 0.20% takes $20 from the same balance. Neither figure registers on its own, which is why fee differences are easy to skip past.

What matters is how the charge is applied. An expense ratio comes out of the fund's assets every year, not just out of new contributions, and it is subtracted before the return investors see is reported. As a balance grows through market gains and additional deposits, the dollar amount handed over grows with it. Money taken in year one also stops compounding, so each annual deduction reduces every year that follows.

Hold two funds tracking the same 500 companies with the same gross return before costs, and the cheaper one keeps more of that return invested. That arithmetic — not stock picking, not market timing — sits behind the industry's long shift toward lower-priced products.

None of this makes a fund charging 0.09% the wrong choice. Some investors hold pricier S&P 500 vehicles for reasons unrelated to cost, including deep options markets and the ability to move very large positions without pushing the price around. Cost is one variable among several, and it settles the question only when the others are equal.

For an investor without such a reason, picking the cheaper of two funds tracking the identical index carries no offsetting trade-off, because the holdings and the expected pre-fee returns match either way.

One practical note for comparison shopping: read the expense ratio in the fund's prospectus or fact sheet rather than in promotional material. That disclosed figure is the annual cost shareholders pay, stated as a percentage of assets, so converting it to dollars at your own balance size makes the comparison concrete.