Vanguard has made another round of sweeping fee cuts, trimming expense ratios for 84 mutual fund and exchange-traded share classes across 53 funds, amounting to nearly $250 million in fee reductions in 2026.
The cuts come to 25% of Vanguard funds across all asset classes. The move will lower fees on affected funds by an average 27% this year, the asset manager said.
Over the past two years, Vanguard has reduced fees on most of its fund offerings, totaling nearly $600 million in savings for investors, the firm's largest two-year cost reduction. Vanguard said its products across all asset classes and styles now have a 0.06% average expense ratio.
"Vanguard is investor-owned — we have no outside stockholders or private owners profiting from our clients. These fee reductions — set to deliver more than half a billion dollars in savings across 2025 and 2026 — are a clear expression of our purpose and commitment to our clients as owners," Vanguard CEO Salim Ramji said in a statement.
"When investors keep more of what they earn, the benefits compound over the long term, helping our clients achieve their most important financial goals," he said.
The moves comes a year after Vanguard announced the largest expense ratio reduction in the asset manager's history, cutting fees on 168 share classes across 87 mutual and ETFs, which was expected to save investors over $350 million in 2025 alone.
Low fees boost performance for Vanguard funds, the firm said, adding that 84% have outperformed their peer group averages over the past decade.
Vanguard's cost reductions include the firm's U.S. equity 9-box funds, including the Growth ETF (VUG) and Value ETF (VTV), and its other large-, mid-, and small-cap growth, value and blend funds.
Vanguard also cut fees on the FTSE Emerging Markets ETF (VWO) and Vanguard's dividend-focused U.S. equity ETFs, Dividend Appreciation ETF (VIG) and High Dividend Yield ETF (VYM).
"It's reassuring that, despite all the leadership changes and strategic shifts underway, Ramji is delivering on the firm's most mission-critical objective: driving expenses lower," wrote Jeff DeMaso, who edits The Independent Vanguard Adviser newsletter.
While he praised the cuts, he suggested the firm, long known for its low costs, doesn't have much room to cut further.
He credited Vanguard with driving fees lower industrywide.
All the funds in this new round cutting round, however, are index funds, DeMaso said. Also, "we are bumping against the bounds of how low fees can go," he said, noting that fees are falling by 0.02% or less in eight of 10 share classes. The vast majority already had 0.10% or lower expense ratios.
"Lower expenses are a win. But let's be honest: The race to zero has largely been run. And frankly, I suspect many Vanguard investors would happily let Vanguard keep that extra basis point if it meant better technology and service," DeMaso said.
Vanguard, the fund and ETF provider, "continues to deliver solid, low-cost investment vehicles. This is the Vanguard we all fell in love with," he added. Vanguard the brokerage platform "continues to frustrate investors despite repeated claims of investing heavily in technology. Lower fund fees are unequivocally good for shareholders. But they also put pressure on the brokerage platform. Managing that tension is one of Ramji's biggest challenges."
Daniel Sotiroff, senior manager research analyst at Morningstar, noted in a post that Vanguard showed its willingness to advance investors' interests rather than capturing more revenue. The median 0.01% trim won't dramatically move returns but the savings compound and the fee reductions keep pressure on competitors, he wrote.
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