The Absolute Best Vanguard Funds You Need in Your Portfolio Today

Are you looking to build a rock-solid investment portfolio without drowning in choices? As someone who’s spent years analyzing the market, I can tell you that Vanguard funds consistently stand out from the crowd. Founded by investing legend John Bogle Vanguard has revolutionized investing with their low-cost no-nonsense approach.

I’ve researched the most impressive Vanguard funds that deserve your attention in 2025. Whether you’re just starting out or looking to optimize your existing portfolio these powerhouse funds deserve serious consideration.

Why Vanguard Funds Deserve Your Attention

Before diving into specific funds, let me explain why Vanguard is worth your investment dollars:

• Low costs: Vanguard pioneered the low-fee revolution, with expense ratios often 80-90% lower than industry averages
• Long-term philosophy: Their research consistently shows that staying the course is crucial for investment success
• Impressive track record: Many of their funds carry Morningstar gold ratings and five-star designations
• Investor-owned structure: As an investor, you’re actually a partial owner of Vanguard itself

In a March 2025 research article titled “Why to focus on long-term market results,” Vanguard demonstrated that a balanced 60/40 portfolio was negative about one-third of the time over one-month periods, but that dropped to less than 1% over five years. The practical takeaway? Time itself helps absorb market volatility.

The Top 5 Vanguard Funds Worth Buying

Based on performance, fees, and long-term potential, here are the five Vanguard funds that deserve a place in almost any portfolio:

1. Vanguard Total Stock Market Index Fund Admiral Shares (VTSAX)

Expense ratio: 0.04%

VTSAX gives you exposure to the entire US stock market in one simple package. As investment advisor Henry Yoshida puts it, this fund covers everything “from the ‘Magnificent Seven’ down to thousands of publicly traded small- and mid-cap stocks that could become the next Nvidia of the future.”

With over 3,500 stocks across all market capitalizations, VTSAX follows Bogle’s philosophy to “buy the haystack” rather than search for needles. For investors who want maximum diversification with minimal effort, this fund is hard to beat.

If the $3,000 minimum investment is a hurdle, you can get the same exposure through the ETF version (VTI) with no minimum and a slightly lower 0.03% expense ratio.

2. Vanguard 500 Index Fund Admiral Shares (VFIAX)

Expense ratio: 0.04%

“The S&P 500 index should be a staple of every investor’s portfolio,” says Yoshida. And the numbers back this up – according to S&P Global’s June 2025 SPIVA Scorecard, a whopping 88.3% of all large-cap mutual funds underperformed the S&P 500 over the past 15 years.

VFIAX simply tracks the S&P 500 at a rock-bottom cost. This approach gives you ownership in America’s 500 largest companies, which historically have delivered exceptional long-term returns despite short-term volatility.

Like VTSAX, this fund also has an ETF equivalent (VOO) with a 0.03% expense ratio for those who prefer that structure or need to avoid the $3,000 minimum investment.

3. Vanguard Wellington Fund Investor Shares (VWELX)

Expense ratio: 0.25%

Launched in 1929, VWELX has truly “seen it all” as Brian Miller, senior investment director at Vanguard, points out. This fund has weathered “the Great Depression, World War II, the intense bear market of the 1970s, the global financial crisis, and the COVID-19 pandemic, just to name a few.”

Unlike the previous two index funds, VWELX is actively managed with approximately 65% in stocks and 35% in bonds. The stock portion focuses on a concentrated mix of large- and mid-cap stocks, often in undervalued sectors, with an emphasis on quality and dividend yield. The bond portion primarily consists of intermediate-term, investment-grade corporate debt.

For investors who want some active management with a moderately aggressive allocation, VWELX has delivered impressive results over decades.

4. Vanguard Balanced Index Fund Admiral Shares (VBIAX)

Expense ratio: 0.07%

For investors who find the volatility of 100% stock portfolios difficult to stomach, VBIAX offers a simpler solution. This fund follows the classic 60/40 model, with just over half of assets in U.S. equities and the remainder in a broad portfolio of U.S. investment-grade bonds.

With this balanced approach, VBIAX has delivered a respectable 9.7% annualized return over the past decade. It’s worth noting that even balanced funds can experience losses, as happened in 2022 when both stocks and bonds declined together.

The real advantage here is simplicity – the fund handles asset allocation and rebalancing automatically, saving you time and removing emotion from the equation.

5. Vanguard Target Retirement 2060 Fund (VTTSX)

Expense ratio: 0.08%

For those who prefer a truly hands-off approach, VTTSX offers a complete portfolio solution that automatically adjusts over time. “Simply pick the target date closest to when you plan to retire, and the fund allocates your assets to a low-cost mix of stocks and bonds that gradually gets more conservative as you approach retirement,” explains Miller.

Unlike VBIAX, which maintains a static 60/40 allocation, VTTSX starts more aggressive (currently around 90% stocks) and will gradually shift toward a more conservative mix as 2060 approaches. It also includes international stocks and bonds, providing true global diversification.

This “set it and forget it” approach makes target-date funds ideal for retirement accounts, especially for investors who prefer not to manage their own asset allocation.

Honorable Mentions

While these didn’t make my top 5, they deserve consideration depending on your specific needs:

Vanguard Dividend Growth Fund (VDIGX)

Expense ratio: 0.22%

For income-focused investors, VDIGX offers an actively managed approach that targets companies with sustainable dividend growth potential. With just 45 stocks, this concentrated portfolio has returned an impressive 11.5% annualized over the past 10 years.

Vanguard Wellesley Income Fund Investor Shares (VWINX)

Expense ratio: 0.23%

If capital preservation and current income are priorities, VWINX flips the Wellington model with roughly 40% in equities and 60% in fixed income. This conservative approach still delivered solid returns with significantly less volatility than the broader market.

Building Your Portfolio with Vanguard Funds

When constructing your portfolio, consider these principles:

1. Start with core funds – VTSAX or VFIAX should form the foundation of most portfolios
2. Add bonds for stability – VBIAX or VWELX can provide balanced exposure in one fund
3. Consider your time horizon – Target date funds adjust automatically based on when you’ll need the money
4. Mind the minimums – Most Admiral shares require $3,000 minimums, but ETF versions have no minimums
5. Keep it simple – You don’t need dozens of funds; 2-5 well-chosen funds can provide excellent diversification

I personally keep most of my retirement money in VTSAX because I love its broad diversification, low cost, and tax efficiency. As I get older, I’ll probably shift some to VBIAX or VWELX to reduce volatility.

The Power of Staying the Course

One of Vanguard’s most valuable contributions isn’t their funds but their research on investor behavior. Their data consistently shows that investors who resist the urge to sell during market downturns achieve better results.

Vanguard’s research examined rolling return data since 1976 and found that while both stocks and bonds occasionally posted short-term losses simultaneously, there was never a three-year period where both asset classes were negative. This highlights why a long-term perspective is so crucial.

The Bottom Line

Vanguard offers some of the best funds in the industry for long-term investors. By focusing on their top offerings – VTSAX, VFIAX, VWELX, VBIAX, and target-date funds like VTTSX – you can build a diversified, low-cost portfolio that stands the test of time.

Remember, successful investing isn’t about finding the next hot stock or timing the market. It’s about creating a solid plan with quality funds and sticking with it through market cycles. With these Vanguard funds, you’ve got the building blocks to do just that.

So what are you waiting for? Whether you’re just starting out or looking to optimize your existing investments, these Vanguard funds offer a compelling mix of performance, low costs, and peace of mind.

Have you invested in any of these funds already? I’d love to hear about your experience in the comments!

Several Vanguard funds hold a 5-star rating from Morningstar, including the Vanguard 500 Index Admiral (VFIAX), Vanguard High-Yield Tax-Exempt Admiral (VWALX), and Vanguard Wellington Admiral (VWENX).

Warren Buffett recommends that most investors buy a low-cost S&P 500 index fund and specifically suggests the Vanguard S&P 500 ETF (VOO).