Best S&P 500 ETFs in 2026: Low Fees & Top Picks Compared

An S&P 500 ETF is an investment fund that tracks the 500 largest U.S. companies. Think of it as buying a tiny piece of Apple, Microsoft, Amazon, and 497 other top companies with one simple purchase.

The S&P 500 represents about 80% of the total U.S. stock market value, with an aggregate market cap exceeding $61 trillion as of late 2025. These funds give you instant access to America's biggest winners without having to pick individual stocks by yourself.

Choosing the right S&P 500 ETF can save you thousands in fees over decades of investing. This guide compares the best S&P 500 ETFs available on the market in 2026, including the newest low-cost contender.

Four ETFs dominate the S&P 500 space: VOO, IVV, SPY, and SPYM. While they all track the same 500 companies, they differ in costs, structure, and features that matter for your wallet. Warren Buffett himself has repeatedly recommended low-cost S&P 500 index funds over actively managed alternatives. All the key details are in the comparison table below:

This is the most common question investors ask, and the answer depends on what type of investor you are.

VOO vs SPY comes down to fees versus liquidity. VOO charges 0.03% while SPY charges 0.0945%. On a $100,000 investment, that's the difference between $30 and $94.50 per year. Over 30 years with compound growth, SPY's higher fee could cost you more than $10,000 in lost returns. SPY's advantage is its massive trading volume and tight bid-ask spreads, which matter for active traders making frequent large trades.

VOO vs IVV is nearly a coin flip. Both charge 0.03%, both track the S&P 500 with minimal tracking error, and both reinvest dividends efficiently. VOO is slightly larger ($873 billion vs $754 billion in AUM), but IVV has been around longer (since 2000 vs 2010). Pick whichever your broker offers at the lowest total cost.

SPYM (formerly SPLG) is the dark horse. At just 0.02%, it undercuts every competitor on fees. The fund is smaller at $107 billion, but that's still enormous by any standard. For pure buy-and-hold investors focused on minimizing costs, SPYM deserves serious consideration.

For most long-term investors, any of these four will deliver nearly identical returns. The real enemy isn't picking the "wrong" ETF. It's not investing at all.

S&P 500 ETFs offer superior tax efficiency compared to traditional investment options, helping you keep more of your returns.

ETFs use a unique "in-kind redemption" process that minimizes taxable events. When large investors want to sell, they exchange ETF shares directly for the underlying stocks rather than forcing the fund to sell securities. This structure prevents unwanted capital gains distributions that could trigger tax bills.

This tax efficiency compounds over decades of investing. Every dollar you don't pay in unnecessary taxes stays invested and continues growing, potentially adding thousands to your long-term wealth.

The math is clear: SPYM wins on pure cost with its 0.02% expense ratio, while VOO and IVV are close behind at 0.03%. SPY works for active traders but costs more over time. Choosing just one of these ETFs gives you everything you need.

The S&P 500 delivered a 16.4% return in 2025 and has averaged roughly 10% annually over the past century. That kind of long-term performance is hard to beat with stock picking. Start today with whatever amount you can afford.

Consistency and low costs matter more than perfect timing. Even $50 monthly grows into serious money over decades thanks to compound growth. The best time to start investing was 20 years ago. The second best time is now.

When you're ready, Financer can help you compare the best investment platforms for your S&P 500 ETF purchase. Compare all options for no cost, no sign-up, and 100% transparency.