Planning for retirement is something we all need to do if we want to enjoy life after work. Saving money is just one part of the plan—investing it wisely is the key to growing your retirement fund. One of the best ways to do this is by using an IRA, or Individual Retirement Account. IRAs give you tax advantages while helping your money grow over time.
In 2025, many investors are looking for IRA funds that offer strong returns, low fees, and smart diversification. Picking the right IRA fund now can make a big difference later. You don’t have to be an expert to start; all it takes is knowing which funds are the best fit for your financial goals.
This guide will walk you through three of the top IRA funds to consider this year: the Fidelity 500 Index Fund (FXAIX), the Vanguard Total Stock Market Index Fund (VTSAX), and the Schwab International Index Fund (SWISX). We’ll also cover smart investment strategies, risk levels, and how to build a strong and safe retirement portfolio.
A Closer Look at the Top IRA Funds
1. Fidelity 500 Index Fund (FXAIX): Safe and Steady Growth
FXAIX is a fund that mirrors the S&P 500 index. It includes the biggest 500 companies in the U.S., like Apple, Amazon, and Microsoft. This fund is a favorite among investors who want dependable growth without too much risk.
- Low fees: Only 0.015% is taken out in costs.
- Strong returns: About 13.5% per year over the past decade.
- Lower risk: Big companies tend to be more stable, which helps avoid big drops in value.
2. Vanguard Total Stock Market Index Fund (VTSAX): Wide Market Reach
VTSAX covers more than 3,500 U.S. companies, including big, medium, and small ones. It’s great for investors who want to take part in the whole U.S. economy—not just the top 500 firms.
- Expense ratio: A low 0.04%.
- Average returns: Around 12.8% yearly.
- Growth potential: Small and mid-sized businesses can grow fast and offer more return over time.
3. Schwab International Index Fund (SWISX): A Global Edge
If you want to spread your investments across different parts of the world, SWISX is a great option. It includes companies from Europe, Canada, Japan, and other developed countries.
- Low cost: 0.06% expense ratio.
- Returns: About 8.2% on average per year.
- Diversification: Helps protect your money when the U.S. market isn’t doing well.
Easy Investment Strategies That Work
Making the right fund choices is just the beginning. How you invest is just as important.
Regular Investing with Dollar-Cost Averaging (DCA)
This means putting in a fixed amount of money regularly (like monthly), no matter what the market is doing. Sometimes you’ll buy when prices are low, sometimes high—but over time, this helps lower your average cost.
Spreading Out Your Investments
Instead of putting all your money in one type of fund, mix it up:
- Stock index funds for strong long-term growth.
- Bonds or REITs for regular income and lower risk.
- International funds to avoid depending only on the U.S. market.
Rebalance Every Year
Over time, some parts of your portfolio will grow faster than others. Once a year, review your investments and adjust them so that they match your goals. This keeps your risk under control.
Putting Together a Strong IRA Plan
A smart IRA plan includes different kinds of investments that work together to grow your money safely over time.
- Start with FXAIX if you want steady growth.
- Add VTSAX to reach more parts of the U.S. economy.
- Include SWISX for global variety and extra protection.
Keep adding money regularly, rebalance your portfolio once a year, and stick to your plan. These simple steps can help you retire with peace of mind and enough money to enjoy your future.