VALLEY FORGE, PA — Vanguard this week announced the largest annual expense ratio reduction in its nearly 50-year history. A total of 168 mutual fund and ETF share classes across 87 funds will see reduced expense ratios, collectively saving investors more than $350 million in 2025.
“Jack Bogle founded Vanguard in 1975 with a simple purpose—to design an investor-owned company that would serve a single constituency, our clients,” said Salim Ramji, Vanguard’s CEO. “We’re proud to build on Vanguard’s legacy of lowering the costs of investing, enabling investors to keep more of their returns, with those savings compounding over time.”
Vanguard’s consistent focus on lowering costs has long been a driving force behind its performance. Over the past decade, 84% of Vanguard’s funds have outperformed their peer group averages, powered by both index and actively managed products that feature some of the lowest expense ratios in the industry.
Fixed Income Expertise at Competitive Costs
Vanguard’s Fixed Income Group continues to set benchmarks for cost efficiency, with actively managed bond funds and ETFs offering a weighted-average expense ratio of 0.10%—far below the industry average of 0.53%. According to Greg Davis, Vanguard’s President and Chief Investment Officer, “Our low costs allow portfolio managers to add value by taking investment risks strategically, without the hurdle of high fees.”
Davis also emphasized the critical role fixed income investments will play moving forward. “We expect bond yields to remain at more attractive levels, providing inflation-adjusted income and reinforcing bonds’ role as a stabilizing force in portfolios,” he said.
Broader Impacts on Investor Portfolios
The reductions impact all asset classes—U.S. equity, international equity, bond, and money market funds—expanding Vanguard’s value proposition for investors globally. Long recognized as a disruptor in the investment field, Vanguard has lowered costs over 2,000 times since its founding, staying true to its mission of creating value for clients rather than extracting it.
Looking ahead, Vanguard’s industry leadership and dedication to cost efficiency are poised to enhance long-term returns for investors. By continuing to shape a landscape where low costs dominate, the firm strengthens its role as a steadfast advocate for investor success.
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