Top 10 Best Index Funds for Long-Term Investors in 2026

VOO tracks the 500 largest US companies by market cap, approximately 80 percent of total US market value. Expense ratio 0.03 percent. It is the largest ETF in the world by assets under management at over 600 billion dollars as of 2026. Warren Buffett has instructed his estate be invested 90 percent in VOO. The S&P 500 has returned an average of 10.2 percent annually since 1957 including dividends. Best for investors who want maximum simplicity and liquidity.

URTH tracks the MSCI World Index covering 23 developed market countries and approximately 1600 companies. It adds international diversification at roughly 70 percent US, 10 percent Japan, 5 percent UK, with the rest across Europe and Pacific markets. Expense ratio 0.24 percent. From 2000 to 2009 the MSCI World outperformed the S&P 500, and there are multi-decade periods where diversified international exposure provides superior returns. Morningstar five-star rated.

FZROX is the only major broad market index fund with a 0.00 percent expense ratio. Fidelity launched Zero funds in 2018. The catch is it tracks a proprietary Fidelity index meaning it can only be held at Fidelity and cannot be transferred to other brokers without selling. Performance tracks VTI within 0.01 percent over 5 years. Best for investors committed to Fidelity who want to maximize returns by eliminating all fees.

BND holds over 10000 US investment-grade bonds including Treasuries, corporate bonds, and mortgage-backed securities. Expense ratio 0.03 percent. It is the cornerstone of the classic 60/40 portfolio strategy generating approximately 8.7 percent average annual returns over 50 years with lower volatility than 100 percent equity portfolios. During the 2022 rate hike cycle BND fell 13 percent. Best for investors within 10 to 15 years of retirement who need to reduce sequence-of-returns risk.

VWO provides exposure to the fastest-growing economies including China, India, Brazil, Taiwan, and South Korea, collectively home to 85 percent of global population. Expense ratio 0.08 percent. India weight in the index has grown from 8 to 22 percent since 2020. The IMF projects emerging markets will account for 65 percent of global GDP growth through 2030. A 10 to 15 percent allocation is commonly recommended to capture this growth. Best for patient investors with 15 plus year horizons who can tolerate higher volatility.

SCHD tracks 100 US dividend stocks screened for consecutive dividend payments, cash flow to debt ratio, return on equity, and dividend yield. Expense ratio 0.06 percent. It has outperformed the S&P 500 in risk-adjusted terms since inception in 2011, with a Sharpe ratio of 0.87 versus 0.76 for VOO. Current yield as of 2026 is approximately 3.5 percent versus the S&P 500 average of 1.3 percent. SCHD dividends are qualified and tax-efficient. Best for investors seeking income combined with long-term growth.

USRT holds REITs across residential, commercial, healthcare, and industrial properties. Expense ratio 0.08 percent. REITs are legally required to distribute 90 percent of taxable income as dividends, making USRT yield approximately 3.8 percent in 2026. Real estate historically provides returns between bonds and equities with low correlation to both, making it an effective portfolio diversifier. REIT dividends are typically ordinary income making this more suitable for tax-advantaged accounts.

VXUS holds over 7600 stocks from developed and emerging markets outside the United States. Expense ratio 0.07 percent. Together VTI plus VXUS at roughly 60/40 allocation mirrors the global market capitalization weight. US companies now trade at P/E multiples 30 to 50 percent above equivalent companies in developed European and Asian markets. Valuation mean reversion would favor VXUS holders. Best for investors who want to own the world rather than one country.

Target Date Funds are the most hands-off long-term investment product ever created. Vanguard Target Retirement series automatically holds a globally diversified mix of stocks and bonds shifting from aggressive to conservative as retirement approaches. Expense ratio 0.08 percent. Morningstar Gold rated. The automatic rebalancing removes behavioral errors costing average investors 1 to 2 percent per year through market timing. Best for anyone who wants to invest once and never touch it again.

VOO tracks the 500 largest US companies by market cap, approximately 80 percent of total US market value. Expense ratio 0.03 percent. It is the largest ETF in the world by assets under management at over 600 billion dollars as of 2026. Warren Buffett has instructed his estate be invested 90 percent in VOO. The S&P 500 has returned an average of 10.2 percent annually since 1957 including dividends. Best for investors who want maximum simplicity and liquidity.

URTH tracks the MSCI World Index covering 23 developed market countries and approximately 1600 companies. It adds international diversification at roughly 70 percent US, 10 percent Japan, 5 percent UK, with the rest across Europe and Pacific markets. Expense ratio 0.24 percent. From 2000 to 2009 the MSCI World outperformed the S&P 500, and there are multi-decade periods where diversified international exposure provides superior returns. Morningstar five-star rated.

FZROX is the only major broad market index fund with a 0.00 percent expense ratio. Fidelity launched Zero funds in 2018. The catch is it tracks a proprietary Fidelity index meaning it can only be held at Fidelity and cannot be transferred to other brokers without selling. Performance tracks VTI within 0.01 percent over 5 years. Best for investors committed to Fidelity who want to maximize returns by eliminating all fees.

BND holds over 10000 US investment-grade bonds including Treasuries, corporate bonds, and mortgage-backed securities. Expense ratio 0.03 percent. It is the cornerstone of the classic 60/40 portfolio strategy generating approximately 8.7 percent average annual returns over 50 years with lower volatility than 100 percent equity portfolios. During the 2022 rate hike cycle BND fell 13 percent. Best for investors within 10 to 15 years of retirement who need to reduce sequence-of-returns risk.

VWO provides exposure to the fastest-growing economies including China, India, Brazil, Taiwan, and South Korea, collectively home to 85 percent of global population. Expense ratio 0.08 percent. India weight in the index has grown from 8 to 22 percent since 2020. The IMF projects emerging markets will account for 65 percent of global GDP growth through 2030. A 10 to 15 percent allocation is commonly recommended to capture this growth. Best for patient investors with 15 plus year horizons who can tolerate higher volatility.

SCHD tracks 100 US dividend stocks screened for consecutive dividend payments, cash flow to debt ratio, return on equity, and dividend yield. Expense ratio 0.06 percent. It has outperformed the S&P 500 in risk-adjusted terms since inception in 2011, with a Sharpe ratio of 0.87 versus 0.76 for VOO. Current yield as of 2026 is approximately 3.5 percent versus the S&P 500 average of 1.3 percent. SCHD dividends are qualified and tax-efficient. Best for investors seeking income combined with long-term growth.

USRT holds REITs across residential, commercial, healthcare, and industrial properties. Expense ratio 0.08 percent. REITs are legally required to distribute 90 percent of taxable income as dividends, making USRT yield approximately 3.8 percent in 2026. Real estate historically provides returns between bonds and equities with low correlation to both, making it an effective portfolio diversifier. REIT dividends are typically ordinary income making this more suitable for tax-advantaged accounts.

VXUS holds over 7600 stocks from developed and emerging markets outside the United States. Expense ratio 0.07 percent. Together VTI plus VXUS at roughly 60/40 allocation mirrors the global market capitalization weight. US companies now trade at P/E multiples 30 to 50 percent above equivalent companies in developed European and Asian markets. Valuation mean reversion would favor VXUS holders. Best for investors who want to own the world rather than one country.

Target Date Funds are the most hands-off long-term investment product ever created. Vanguard Target Retirement series automatically holds a globally diversified mix of stocks and bonds shifting from aggressive to conservative as retirement approaches. Expense ratio 0.08 percent. Morningstar Gold rated. The automatic rebalancing removes behavioral errors costing average investors 1 to 2 percent per year through market timing. Best for anyone who wants to invest once and never touch it again.