Investing in index funds is one of the easiest and most effective ways to build wealth over time. Fidelity offers some of the best low-cost index funds that can help you fast-track your path to financial freedom by growing your net worth. Whether you’re a beginner or an experienced investor, these funds provide diversification, stability, and strong long-term returns.
If you’re looking for the best Fidelity index funds to invest in 2025, here are four solid options:
1. Fidelity 500 Index Fund (FXAIX)
The Fidelity 500 Index Fund (FXAIX) is a top choice for investors who want exposure to the largest companies in the U.S. This fund tracks the S&P 500 Index, which includes 500 of the biggest publicly traded companies across various industries, such as technology, healthcare, and financial services.
Key Features of FXAIX:
- Expense Ratio: 0.015% (one of the lowest in the industry)
- Holdings: Apple, Microsoft, Amazon, Nvidia, and other major U.S. companies
- Dividend Yield: 1.42%
- Historical Performance: Over the past 10 years, a $10,000 investment in FXAIX would have grown to nearly $35,000
Pros:
✔️ Low cost with strong historical returns
✔️ Ideal for long-term, buy-and-hold investors
✔️ Provides broad exposure to the U.S. stock market
Cons:
❌ Excludes small and mid-cap stocks, which may offer higher growth potential
❌ Performance is tied to the ups and downs of the U.S. stock market
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2. Fidelity Total Market Index Fund (FSKAX)
The Fidelity Total Market Index Fund (FSKAX) is another excellent option that provides exposure to the entire U.S. stock market. Unlike FXAIX, which focuses only on large-cap stocks, FSKAX includes over 3,000 companies, covering small, mid, and large-cap stocks.
Key Features of FSKAX:
- Expense Ratio: 0.015%
- Holdings: Includes large companies like Apple and Google, as well as smaller emerging businesses
- Dividend Yield: 1.40%
- Historical Performance: A $10,000 investment in FSKAX 10 years ago would be worth around $33,000 today
Pros:
✔️ Covers the entire U.S. stock market, from small startups to large corporations
✔️ Offers more diversification than FXAIX
✔️ Ideal for long-term investors looking for broad market exposure
Cons:
❌ More volatile than an S&P 500 index fund due to small and mid-cap stocks
❌ Returns may be slightly lower than FXAIX during certain market conditions
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3. Fidelity Total International Index Fund (FTIHX)
For investors looking to diversify beyond the U.S., the Fidelity Total International Index Fund (FTIHX) is a great option. This fund tracks international markets, including both developed (Europe, Japan, Australia) and emerging markets (China, Brazil, India).
Key Features of FTIHX:
- Expense Ratio: 0.06%
- Holdings: Over 5,000 international companies
- Dividend Yield: 3.18%
- Historical Performance: A $10,000 investment in FTIHX since its inception (8 years ago) would have grown to $17,500
Pros:
✔️ Provides exposure to global markets outside the U.S.
✔️ Reduces reliance on the U.S. economy
✔️ Includes emerging markets with high growth potential
Cons:
❌ International markets can be more volatile
❌ Returns have been lower than U.S. index funds in recent years
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4. Fidelity Freedom Index Funds (Target Date Funds)
For investors looking for a hands-off approach, Fidelity Freedom Index Funds are an excellent choice. These are target-date retirement funds that automatically adjust their asset allocation based on your expected retirement year.
How Fidelity Freedom Funds Work:
- If you’re planning to retire in 2055, you would invest in Fidelity Freedom Index 2055 Fund (FDEWX)
- The fund starts with higher stock exposure for growth and gradually shifts to more conservative assets like bonds as retirement nears
- Includes U.S. stocks, international stocks, and bonds for broad diversification
Key Features:
- Expense Ratio: 0.12%
- Automatic portfolio rebalancing to match your retirement timeline
- Designed for long-term growth and income preservation
Pros:
✔️ Completely automated investing – no need to rebalance your portfolio manually
✔️ Diversified exposure to U.S. and international stocks and bonds
✔️ Ideal for retirement planning
Cons:
❌ Not suitable for short-term investors
❌ Less control over individual holdings
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- Best High-Yield Savings Accounts for 2025
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Which Fidelity Index Fund is Right for You?
Fund Best For Expense Ratio Key Feature FXAIX (S&P 500 Index Fund) Investors who want exposure to large-cap U.S. stocks with high historical returns. 0.015% Tracks the S&P 500, great for long-term growth. FSKAX (Total Market Index Fund) Investors who want full U.S. stock market exposure, including small- and mid-cap stocks. 0.015% Holds 3,000+ stocks for broader diversification. FTIHX (Total International Index Fund) Investors looking for international diversification beyond U.S. stocks. 0.06% Includes developed and emerging market stocks. Fidelity Freedom Index Funds Investors planning for retirement who prefer a hands-off, auto-adjusting strategy. 0.12% Automatically shifts asset allocation based on retirement year.
Final Thoughts: The Best Fidelity Index Funds for 2025
If you’re looking for long-term wealth-building strategies, these four Fidelity index funds offer some of the best investment options for 2025.
✅ For high-growth potential – Choose FXAIX or FSKAX for exposure to U.S. stocks.
✅ For global diversification – FTIHX is an excellent option.
✅ For hands-off retirement investing – Consider Fidelity Freedom Index Funds.All of these funds come with low expense ratios and strong historical returns, making them ideal for passive investors who want to build wealth over time.
📢 Which Fidelity index fund are you considering for your portfolio in 2025? Let me know in the comments! 🚀
