Once again, Vanguard is lowering the cost of investing. Effective February 1, 2025, the firm reduced fees on 168 share classes across 87 funds. The fee reductions are expected to save investors more than $350 million this year alone.¹

Why investment costs matter

Vanguard Founder John C. Bogle explained why investment costs matter this way:

In investing, realize that you get what you don’t pay for. Whatever future returns the markets are generous enough to deliver, few investors will succeed in capturing 100% of those returns, simply because of the high costs of investing—all those commissions, management fees, investment expenses, yes, even taxes—so pare them to the bone.²

May 1 will mark Vanguard’s 50^th anniversary. All along, we have emphasized the importance of limiting the cost of investing. Lower costs leave more money in investors’ funds and raise their potential returns. Indeed, across the industry, lower-cost funds have historically outperformed higher-cost funds on a net-of-expenses basis.³

Our low-cost approach just got lower. Starting today, we’re implementing the largest fee cut in our history. This will help our clients save over $350 million this year and speaks to what our founder, Jack Bogle, set out to do, which was to create an investment company designed… pic.twitter.com/S0AjRJY8tO

— Vanguard (@Vanguard_Group) February 3, 2025

Lower-cost portfolios tend to outperform higher-cost ones

At Vanguard, we believe our funds’ impressive long-term performance owes much to their low costs. For the 10 years ended December 31, 2024, 84% of our funds outpaced the average results of competing funds. The performance of our actively managed fixed income funds has been especially strong: 91% of our active bond funds and 100% of our money market funds have outpaced their peers’ average results.⁴

Source: Vanguard