The best index fund for a 401K is one that has an expense ratio that’s below 1%, and preferably one that’s 0.5%. The expense ratio is the fee that gets paid to the brokerage for the maintenance of your investments. This is something you should be looking at as a general rule when looking into how to invest in an index fund, but is even more important when you’re looking to switch your 401K index fund. Fees are always going to be a fact of life when it comes to index funds, but the best index funds are ones that have the lowest possible fees while investing in indexes that have a history of a steady rate of return.
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