As you plan for retirement, choosing the right mutual funds is one of the most crucial steps. Fidelity Investments, a leader in the financial services industry, offers a wide array of mutual funds designed to cater to different retirement needs. These funds are ideal for retirement accounts such as IRAs, 401(k)s, and other investment portfolios.
Fidelity's mutual funds are well-regarded for their strong performance, low fees, and wide range of investment strategies. In this guide, we'll review the best Fidelity mutual funds for retirement in 2025, examining their historical performance, fees, and suitability for various retirement goals.
Why Choose Fidelity Mutual Funds?
Fidelity has long been a trusted name in the financial industry, known for offering a robust selection of mutual funds. Here’s why they stand out:
Low Fees: Fidelity is famous for its low expense ratios, meaning investors pay less in fees, allowing more of their money to grow over time.
Diversification: Fidelity offers a variety of funds, including equity, fixed income, and target-date funds, which allow you to tailor your retirement portfolio.
Strong Performance: Many of Fidelity’s funds have consistently outperformed their benchmarks over the years, offering robust long-term returns.
Expert Management: Fidelity funds are managed by experienced portfolio managers who use data-driven strategies to generate optimal returns.
Top Fidelity Mutual Funds for Retirement in 2025
1. Fidelity 500 Index Fund (FXAIX)
Expense Ratio: 0.015%
Objective: To provide investment results that correspond to the total return performance of the S&P 500 Index.
Why It’s Great for Retirement:
The Fidelity 500 Index Fund is one of the most popular options for retirement accounts because it tracks the S&P 500, which represents large-cap U.S. stocks. This makes it a low-cost, passive investment option for those looking to grow their retirement savings steadily over time.
Historical Performance:
Over the past 10 years, the fund has returned an average of 14.23% annually, closely mirroring the S&P 500’s average.
Expert Tip:
"The 500 Index Fund is an excellent option for retirement because it provides exposure to the U.S. economy’s largest companies, which have historically shown long-term growth. Its low expense ratio ensures that investors keep more of their returns." – Brian R., CFP®
Best for: Investors looking for broad market exposure with a low-cost, passive approach.
2. Fidelity Contrafund (FCNTX)
Expense Ratio: 0.85%
Objective: To seek capital appreciation by investing in stocks of companies that appear to be undervalued.
Why It’s Great for Retirement:
The Fidelity Contrafund is actively managed, focusing on undervalued growth stocks. The fund typically invests in large-cap U.S. companies with strong earnings growth potential. While it has a higher expense ratio than passive funds like FXAIX, it offers the potential for greater returns, especially in a growing economy.
Historical Performance:
Over the last 10 years, the fund has averaged an annual return of 15.9%.
Expert Insight:
"The Contrafund is suitable for retirees who want to balance growth and risk in their portfolios. It’s more volatile than an index fund but offers the potential for higher returns. If you’re younger and have a longer time horizon, it can be a great addition." – Sophia T., CFA
Best for: Investors seeking active management and willing to tolerate higher volatility for potential growth.
->Fidelity Contrafund Reviewed
3. Fidelity Total Market Index Fund (FSKAX)
Expense Ratio: 0.015%
Objective: To provide investment results that correspond to the total return of a broad range of U.S. stocks.
Why It’s Great for Retirement:
The Fidelity Total Market Index Fund offers exposure to the entire U.S. stock market, including small, mid, and large-cap stocks. This makes it an excellent choice for long-term retirement growth, providing investors with broader diversification than the S&P 500.
Historical Performance:
Over the past decade, FSKAX has delivered an average annual return of 13.5%.
Expert Tip:
"FSKAX is a great core holding for retirement portfolios because it includes all sectors and company sizes. The diversification helps minimize risk while providing exposure to U.S. growth." – John M., Portfolio Manager
Best for: Investors who want total market exposure and broad diversification.
4. Fidelity Growth Company Fund (FDGRX)
Expense Ratio: 0.85%
Objective: To seek capital appreciation by investing in growth stocks, with a focus on innovative companies.
Why It’s Great for Retirement:
The Fidelity Growth Company Fund focuses on high-growth, innovative companies, often in technology and other high-growth sectors. If you're comfortable with some volatility and have a longer investment horizon, FDGRX can provide substantial returns.
Historical Performance:
Over the last 10 years, FDGRX has returned 18.0% annually, outpacing many other growth funds.
Expert Insight:
"For younger investors, FDGRX can be a fantastic choice for retirement. It leans into high-growth sectors that could drive substantial gains over the long term. However, it’s not for those near retirement who need less volatility." – Emily K., Investment Strategist
Best for: Aggressive growth investors willing to take on more risk.
5. Fidelity International Index Fund (FSPSX)
Expense Ratio: 0.035%
Objective: To track the performance of the MSCI EAFE Index, which includes large- and mid-cap stocks from developed countries outside of North America.
Why It’s Great for Retirement:
For those looking to diversify outside of the U.S., the Fidelity International Index Fund provides exposure to global markets, including Europe, Asia, and the Pacific. It’s an excellent way to ensure your retirement portfolio is not overly reliant on U.S. stocks.
Historical Performance:
The fund has averaged 6.0% annual returns over the past 10 years, offering moderate growth with international exposure.
Expert Tip:
"A healthy allocation to international stocks can protect you from downturns in the U.S. economy. FSPSX provides low-cost, diversified exposure to developed markets around the world." – David L., Global Markets Expert
Best for: Investors looking to diversify into international markets and reduce home-country bias.
6. Fidelity Target Retirement Funds (Various Ticker Symbols)
Expense Ratio: 0.07% - 0.75%
Objective: These target-date funds automatically adjust the allocation of stocks and bonds as you approach retirement.
Why It’s Great for Retirement:
For those who prefer a hands-off approach, Fidelity’s Target Retirement Funds provide a one-stop investment solution that gradually becomes more conservative as the target retirement date approaches.
Historical Performance:
Performance varies by target date, but these funds have generally outperformed their benchmarks.
Expert Insight:
For individuals who want a low-maintenance retirement solution, Fidelity’s Target Retirement Funds are a fantastic option. They automatically adjust over time, ensuring that your portfolio becomes more conservative as you near retirement." – Jennifer A., Retirement Planner
Best for: Investors looking for a hands-off, automated solution for retirement planning.
Fidelity Mutual Funds Comparison Chart
| Fund Name | Expense Ratio | 10-Year Average Return | Objective | Best For |
|---|---|---|---|---|
| Fidelity 500 Index Fund (FXAIX) | 0.015% | 14.23% | Tracking the S&P 500 for broad U.S. stock market exposure | Passive investors seeking broad exposure |
| Fidelity Contrafund (FCNTX) | 0.85% | 15.9% | Actively managed, focusing on undervalued growth stocks | Growth-seeking investors with risk tolerance |
| Fidelity Total Market Index Fund (FSKAX) | 0.015% | 13.5% | Tracking the entire U.S. stock market | Investors seeking full market diversification |
| Fidelity Growth Company Fund (FDGRX) | 0.85% | 18.0% | Focus on high-growth, innovative companies | Aggressive investors with long-term horizons |
| Fidelity International Index Fund (FSPSX) | 0.035% | 6.0% | Exposure to international markets outside North America | Investors looking for global diversification |
| Fidelity Target Retirement Funds | 0.07% - 0.75% | Varies by target date | Automatically adjusting allocation as retirement nears | Hands-off investors wanting automatic adjustment |
Popular Q&A
1. What are the best Fidelity funds for a conservative retirement portfolio?
For a conservative approach, consider Fidelity 500 Index Fund (FXAIX) or Fidelity Target Retirement Funds. These options offer stability and diversification, with the Target Retirement Funds adjusting risk as you near retirement.
2. Which Fidelity fund is best for long-term growth?
The Fidelity Contrafund (FCNTX) and Fidelity Growth Company Fund (FDGRX) are excellent choices for long-term growth, as they focus on growth stocks and innovation.
3. Can I invest in international markets with Fidelity?
Yes, Fidelity International Index Fund (FSPSX) provides exposure to large and mid-cap stocks in developed markets outside of the U.S., helping you diversify globally.
4. How do Fidelity Target Retirement Funds work?
These funds automatically adjust their asset allocation from more aggressive to more conservative as the target retirement date approaches, making them ideal for hands-off investors.
Conclusion
Fidelity offers some of the best mutual funds for retirement in 2025, providing options for every risk tolerance and investment strategy. Whether you're looking for low-cost index funds, actively managed growth funds, or international exposure, there is a Fidelity fund that fits your needs.
Remember to consider your retirement timeline, risk tolerance, and desired level of involvement when selecting a fund. For most investors, a diversified approach combining several different funds might provide the most balanced path to a secure retirement.
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