October 26


Best Mutual Funds for Retirement

By Mac McLean

October 26, 2020

Mutual funds are an excellent tool to consider when it comes to your retirement investments.

They provide a more significant growth potential than you’d see if you invested your money in an annuity or a savings account. And, because they often involve a mixture of stocks and bonds, they’re less susceptible to changing market conditions than an investment portfolio that only contains one or the other.

At this point, you’re probably wondering, “What are the best mutual funds for my retirement?”

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Top Mutual Funds

Here’s a quick list top mutual funds you might choose for a retirement savings plan we’ve gathered after reading similar articles on websites operated by U.S. and World Report and Kiplinger’s Personal Finance magazine.

  • Vanguard 500 Index Fund Admiral (VFIAX) – The Vanguard 500 Index Fund Admiral ranked at the top of Kiplinger and U.S. News’ lists because of its minuscule expense ratio, the diversity of its portfolio, and the overall yield its generated over the past ten years.
  • Fidelity Advisor Equity Growth Fund (EPGAX) – Unlike the Vanguard 500, which is tethered to the S&P 500, the Fidelity Advisor Equity Growth Fund offers investors a more diverse portfolio that steps away from large cap stocks. It does carry a slightly higher expense ratio, though, which is why it took second place on U.S. News’ list and did not make Kiplinger’s list at all.
  • Vanguard U.S. Growth Fund Investor (VWUSX) – The Vanguard U.S. Growth Fund Investor took second place among Kiplinger’s top funds for retirement. The magazine’s staff liked this fund, which did not rank on U.S. News’ list, because its saturation of technology stocks has resulted in significant gains over the past decade. However, they warn this oversaturation could pose a risk should the market for technology companies like Apple, Microsoft, and Tesla crumble.

Kiplinger and U.S. News continue to differ on their top picks for mutual funds you should consider for your retirement or other long-term savings goals the further you get down each list.  

The Vanguard Balanced Index Fund (VBIAX), the Pimco Income Fund (PIMIX), and the Fidelity Simplicity RMD Fund (FIRNX) round out U.S. News’ top five. Meanwhile, Kiplinger’s top five also features the Fidelity Strategic Dividend and Income Fund (FSDIX), the Parnassus Mid-Cap Fund (PARMX), and the Wasatch Micro Cap Fund Investor (WMICX).

The differences between these two lists shed light on the sheer diversity people may encounter when trying to find the best mutual fund to help them reach their retirement or other long-term savings goals. Even the Vanguard 500 Index Fund – which was the only mutual fund to make both U.S. News’ and Kiplinger’s lists —  has a few disadvantages that keep it from being a universal best buy.


In the end, it’s also important to note that you are the person who’s choosing the mutual fund where you want to invest the money you have saved to meet your retirement goals. Only you can make this decision based on your desired rate of return and the risks you are willing to take to reach that goal.

Signing up for a free retirement planning workshop from PlanningCommunities.org is one of the best ways to start this process because it will give you a chance to learn more about what you’ll need for retirement and the tools that can get you there.

The knowledge you’ll gain from one of these workshop should help you figure out which mutual fund is the best pick based on your needs and not based on what the editors of two competing financial publications think you might like.

Mac McLean

About the author

Based out of Bend, Oregon, Mac McLean is a freelance writer who covers older adults and the issues affecting their daily lives. He currently writes for this website, the AARP Bulletin, and Waste Alert. He and his wife are riding out the pandemic with their 12-year-old English Springer Spaniel mix in a 200-square-foot guest house on a 2.2-acre farm surrounded by chickens, cows, pigs, and a donkey that simply will not shut up.

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