Many companies featured on Money advertise with us. Opinions are our own, but compensation and
in-depth research may determine where and how companies appear. Learn more about how we make money.

Money is not a client of any investment adviser featured on this page. The information provided on this page is for educational purposes only and is not intended as investment advice. Money does not offer advisory services.

Hand Holding A Phone With The Vanguard Logo On The Screen
Money; Shutterstock

Vanguard announced this week that it is lowering fees for target-date funds — which happen to be the most popular 401(k) investment funds in America. That’s great news for savers, who can expect to earn even more returns than before.

The investment management firm says it expects to decrease fees for Vanguard Target Retirement Funds (TRF) from an already low 0.12% down to 0.08%. Also known as expense ratios, these fees are charged as a percentage of a fund’s returns.

Critics have been sounding the alarm on high fees that eat away at investors’ retirement savings for years. As a result, expense ratios have been moving in the right direction; the average fee investors paid for target-date funds in 2020 was 0.52%, down from 0.73% five years ago, according to Morningstar’s latest Target-Date Fund Series report.

At 0.08%, Vanguard’s TRF fees would be some of the lowest available.