2026 US Fund Fee Study

Morningstar

Zachary Evens, Brendan McCann

Research

42 Pages

Morningstar finds that US mutual fund and ETF investors continued paying lower fees in 2025, extending a two decade decline in fund costs. The study shows investor flows remain heavily tilted toward cheaper funds, while active ETFs, alternatives, and complex new launches are reshaping fee competition.

Key Takeaways

Investor Costs Fell: Morningstar estimates investors saved nearly USD 6.8 billion as average paid fees dropped to 0.32% in 2025 overall.
Passive Fees Fell: Passive fund asset weighted fees declined 5.4% to 0.10%, while active fund fees fell 2.7% overall in 2025.
Cheap Funds Won: Cheapest quintile funds took in USD 694 billion, while the remaining 80% had USD 244 billion of outflows.
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