Best Mutual Funds for Long-Term Investing

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Mutual funds remain one of the most widely used investment vehicles because they make it easy to diversify across hundreds or even thousands of securities with a single investment. They are commonly used in retirement accounts, taxable brokerage accounts and employer-sponsored plans due to their accessibility and broad market coverage.

The best mutual funds aren’t defined by recent performance alone. Instead, they tend to combine low costs, clear investment objectives and disciplined portfolio construction that holds up across market cycles.

At a Glance: Best Mutual Funds

Fund	Ticker	Primary Exposure	Risk Profile/Use Case	One-Line Reason It Stands Out
Vanguard Total Stock Market Index Fund	VTSAX	U.S. stock market	Medium	Broad exposure in a single fund
Fidelity 500 Index Fund	FXAIX	Large-cap U.S. stocks	Medium	Low-cost S&P 500 tracking
Vanguard Total Bond Market Index Fund	VBTLX	U.S. bonds	Low to medium	Core fixed-income diversification
Fidelity Contrafund	FCNTX	Large-cap growth	Medium to high	Actively managed growth strategy
T. Rowe Price Blue Chip Growth Fund	TRBCX	Growth stocks	Medium to high	Focus on established growth companies
Vanguard Wellington Fund	VWELX	Balanced stocks and bonds	Medium	Long-standing balanced approach

Fund objectives and structures are based on current fund sponsor disclosures.

Why Investors Choose Mutual Funds

Mutual funds pool money from many investors to invest in diversified portfolios of stocks, bonds or other assets. According to the Investment Company Institute, more than half of U.S. households own mutual funds, primarily through retirement accounts.

Mutual funds are especially popular for long-term investing because they support automatic contributions and reinvestment.

What Is a Mutual Fund?

A mutual fund is an investment company that pools shareholder money to buy securities according to a defined strategy. Shares are bought and sold at net asset value once per trading day.

The U.S. Securities and Exchange Commission notes that mutual funds offer diversification and professional management but are still subject to market risk.

Best Mutual Funds To Consider

Vanguard Total Stock Market Index Fund (VTSAX)

VTSAX tracks the total U.S. stock market, including large-, mid- and small-cap companies. Vanguard disclosures highlight its role as a core equity holding for long-term investors. Performance mirrors overall U.S. market trends.

Fidelity 500 Index Fund (FXAIX)

FXAIX tracks the S&P 500 Index and focuses on large-cap U.S. companies. Fidelity reports that its low expense ratio makes it a popular option in retirement accounts. It does not include mid- or small-cap stocks.

Vanguard Total Bond Market Index Fund (VBTLX)

VBTLX invests in U.S. Treasurys, corporate bonds and mortgage-backed securities. According to Vanguard, the fund is often used to balance equity risk. Bond prices remain sensitive to interest-rate changes.

Fidelity Contrafund (FCNTX)

FCNTX is an actively managed fund focused on large-cap growth stocks. Fidelity disclosures note that the fund seeks companies with long-term growth potential. Active management introduces performance variability.

T. Rowe Price Blue Chip Growth Fund (TRBCX)

TRBCX invests in well-established companies with growth characteristics. According to T. Rowe Price, the fund emphasizes earnings growth and competitive positioning. Growth-style volatility can impact returns.

Vanguard Wellington Fund (VWELX)

VWELX is a balanced fund investing in both stocks and bonds. Vanguard notes that its long operating history reflects a disciplined approach to asset allocation. Balanced funds may lag during strong equity markets.

Mutual Funds vs. ETFs

The Investment Company Institute notes that ETFs tend to be more tax-efficient, while mutual funds are often easier to automate for long-term investing.

Risks To Understand Before Investing

All mutual funds are subject to market risk. The SEC cautions that diversification reduces risk but does not eliminate losses.

Actively managed funds may also underperform their benchmarks after fees.

How Mutual Funds Fit Into a Portfolio

Mutual funds are often used as core portfolio holdings, especially in retirement accounts. Vanguard research shows that asset allocation and time horizon play a larger role in outcomes than individual fund selection.

Balanced and target-date funds simplify diversification for long-term investors.

Final Take to GO

The best mutual funds offer clear objectives, diversification and reasonable costs. Index funds like VTSAX provide broad market exposure, while actively managed options like FCNTX aim to outperform at the cost of higher risk.

For most investors, mutual funds are most effective when used as part of a diversified, long-term investment plan.

John Csiszar contributed to the reporting for this article.

Data is accurate as of Jan. 30, 2026, and is subject to change.

This article has been updated with additional reporting since its original publication.

Editorial Note: This content is not provided by any entity covered in this article. Any opinions, analyses, reviews, ratings or recommendations expressed in this article are those of the author alone and have not been reviewed, approved or otherwise endorsed by any entity named in this article.

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