Vanguard funds offer an enviable cost advantage
The average Vanguard mutual fund and ETF (exchange-traded fund) expense ratio is 82% less than the industry average.*
You don't get a bill explaining how much of your savings went toward paying fund expenses, because those costs are paid directly out of each fund's returns.
Vanguard was built differently to make sure we stay focused on keeping your costs low.
Amount you can save at Vanguard:
Compare Vanguard with the industry average and see how expense ratios affect your bottom line
This hypothetical illustration assumes a 6% return for all examples. Rate is not guaranteed. If the rate of return were altered, results would vary from those shown. The final balance shown is after costs. This example doesn't represent any particular investment and doesn't account for inflation. There may be other material differences between investment products that must be considered prior to investing.
All averages are asset-weighted. Industry averages exclude Vanguard. Sources: Vanguard and Morningstar, Inc., as of December 31, 2021.
Expense ratios affect your bottom line
This chart shows the potential impact Vanguard's low-cost funds can have on your savings over time compared with the industry average expense ratio. Your savings have the potential to grow even more when you're invested for longer periods of time.
All examples assume an initial investment of $1,000,000 earning 6% each year.
At Vanguard you could save $65,936 over 10 years based on Vanguard's average expense ratio of 0.09%, which results in a cost of $15,147 in this scenario, compared with the industry average expense ratio of 0.49%, which results in a cost of $81,083.
Over 20 years, you could save $229,818 based on costs of $54,024 at Vanguard compared with $283,842 at the industry average. Stay invested for 30 years and you could save $600,838 based on costs of $144,510 at Vanguard compared with $745,348 at the industry average.
Other ways we keep your costs low
There are no trading commissions when you buy and sell Vanguard low-cost mutual funds or ETFs.**
For more information about Vanguard mutual funds and ETFs, visit Vanguard mutual fund prospectuses or Vanguard ETF prospectuses to obtain a prospectus or, if available, a summary prospectus. Investment objectives, risks, charges, expenses, and other important information are contained in the prospectus; read and consider it carefully before investing.
*Vanguard average expense ratio: 0.09%. Industry average expense ratio: 0.49%. All averages are asset-weighted. Industry averages exclude Vanguard. Sources: Vanguard and Morningstar, Inc., as of December 31, 2021.
**Trading limits, fund expenses, and minimum investments may apply. See the Vanguard Brokerage Services commission and fee schedules for limits.
†There are no fees if you're 1) a brokerage client who signs up to receive statements and other important documents electronically or holds more than $5 million in Vanguard Qualifying Assets (refer to our Commission and Fee Schedules for other exclusions), or 2) a mutual fund-only account holder with more than $5 million in Vanguard Qualifying Assets. Otherwise, a $25 fee is charged annually for all Vanguard Brokerage Accounts and for each individual Vanguard mutual fund holding within a mutual fund-only account.
You must buy and sell Vanguard ETF Shares through Vanguard Brokerage Services (we offer them commission-free) or through another broker (which may charge commissions). See the Vanguard Brokerage Services commission and fee schedules for limits. Vanguard ETF Shares aren't redeemable directly with the issuing fund other than in very large aggregations worth millions of dollars. ETFs are subject to market volatility. When buying or selling an ETF, you'll pay or receive the current market price, which may be more or less than net asset value.
All investing is subject to risk, including the possible loss of the money you invest. Diversification does not ensure a profit or protect against a loss.
Costs are just one of the many factors that can impact returns.