There is a cost for an investment company to operate a mutual funds and ETFs. It includes the manager’s fees, administrative costs, compliance, trading costs, 12b-1 fees (sales fee for the company who sold you the fund) and advertising. The expense ratio is a percentage that directly lowers the return to a fund’s investors. If a fund’s assets grew 10% during a particular year and the expense ratio is 1%, the investor would receive a 9% return on their investment. If the fund lost 5% during a year and had a 1% expense, the investor would lose 6%.

lowest expense ratio mutual funds ETF

The expense ratio is a very critical number when comparing investments.  Some investments types will have a higher expense ratio others are just too expensive.  Here are the ETFs and Mutual Funds with the lowest expense ratios.

ETFs (Exchange Traded Funds)

NameTickerAnnual Report Gross Expense Ratio
Schwab US TIPS ETF™SCHP0.07
Schwab US Mid-Cap ETF™SCHM0.07
Schwab US Large-Cap Value ETF™SCHV0.07
Schwab US Large-Cap Growth ETF™SCHG0.07
Schwab US REIT ETF™SCHH0.07
Schwab US Dividend Equity ETF™SCHD0.07
iShares Core S&P Total US Stock MktITOT0.07
iShares Core S&P 500IVV0.07
Vanguard Total Bond Market ETFBND0.07
Vanguard Total Stock Market ETFVTI0.05
Schwab US Aggregate Bond ETF™SCHZ0.05
Vanguard S&P 500 ETFVOO0.05
Schwab US Large-Cap ETF™SCHX0.04
Schwab US Broad Market ETF™SCHB0.04

Mutual Funds

Our search for mutual funds only included A shares.  There are different share classes, some depend on the type of compensation the person who sold you the fund is getting (this may not affect you if you use no load funds or have a fee only financial planner) and the amount you invest.  Some companies, like Vanguard, offer a lower expense if you invest a certain amount (for example $10,000).  We are just looking at A shares.

NameTickerAnnual Report Gross Expense Ratio
Vanguard Short-Term Investment-Grade InvVFSTX0.2
Vanguard High Dividend Yield Index InvVHDYX0.18
Vanguard Total Stock Mkt Idx InvVTSMX0.17
Vanguard 500 Index InvVFINX0.17
Vanguard MA Tax-Exempt InvVMATX0.16
Vanguard OH Long-Term Tax-ExemptVOHIX0.16
SEI S&P 500 Index A (SIIT)SPINX0.11
Fidelity Spartan® Total Market Idx InvFSTMX0.1
Vanguard Total Bond Market II Idx InvVTBIX0.1
Fidelity Spartan® Extended Mkt Index InvFSEMX0.1
Fidelity Spartan® 500 Index InvFUSEX0.1

I appreciate any feedback for our AIO Financial blog. Please contact me if you have any comments, questions, and suggestions. You can comment here or contact me through Facebook, Twitter, email (bill@aiofinancial.com), or call 520-325-0769.

Get a free Socially Responsible Investment Guide

Sri ebook cover portrait 150

Learn about making an impact with your investments without sacrificing returns.

AIO Financial, 520-325-0769

Powered by ConvertKit
Share This

Share This

Share this post with your friends!