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25 Best Mutual Funds in 401(k) Retirement Plans



Have you checked in on your 401(k) plan lately? If you have, you may notice that your retirement savings have swollen in value, inflated by robust gains in the stock market over the past few years.

Yet picking good funds in a 401(k) can go a long way toward helping you reach your savings goals years from now, when it’s time to cash in your workplace retirement plan. Low-cost index funds, which simply track a market benchmark, are a great option if your plan offers them. You can also fare well with target-date funds—blends of stocks and bonds designed to get more conservative over time. These funds are now the default option in many plans, and we highly recommend some. You can see our favorite target-date funds here.


Many plans also offer actively managed funds, and that’s where things get trickier. Choose a good active fund and you can profit handsomely, beating the market benchmarks. Pick poorly and, well, you know how that goes. Had you invested $10,000 a year in Fidelity Growth Company (symbol FDGRX) over the past decade, for instance, you would now have more than $180,000—far more than a fund mirroring Standard & Poor’s 500-stock index. Had you instead chosen American Beacon Large Cap Value (AAGPX), which also invests in large-company stocks, you’d be sitting on just $136,000, trailing the broad market.

The following 25 funds are our top picks for 401(k) retirement savings accounts. Each ranks among the 100 largest funds in 401(k) plans, according to financial consulting firm Brightscope. The lineup includes something for everyone—from funds that invest in large-company U.S. stocks to portfolios packed with high-quality bonds.

These funds may not be available in your 401(k) plan. And many may not be suitable for your personal situation. But each of these funds has its merits, making it a good choice in its respective category.

For more fund ratings and reviews, we also rate the largest funds run by the four biggest fund families in 401(k)s: American Funds, Fidelity, T. Rowe Price and Vanguard.

Fund symbols and returns refer to the most accessible investor share class available. The share classes in your 401(k) may be different (and cheaper). Funds are listed alphabetically by fund family. Returns and data are as of Oct. 31; three- and five-year returns are annualized.


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