The S&P 500 has dropped sharply in April 2026 as Trump tariff escalations rattled markets and sent investors fleeing to cash. If you're watching your portfolio shrink, it's painful — but history says this is exactly when buying index funds has historically paid off most.
This guide ranks the best index funds and ETFs to buy during the April 2026 crash, explains the difference between them, and tells you which is right for your situation.
Why Market Crashes Are Buying Opportunities
Every major market downturn in modern history — the 2008 financial crisis, the 2020 COVID crash, the 2022 rate-hike selloff — was followed by a recovery. Investors who bought index funds at the bottom and held for 5+ years came out significantly ahead.
The April 2026 tariff crash is driven by policy uncertainty, not a fundamental collapse in corporate earnings. That makes it closer to the COVID crash (policy shock, quick recovery) than the 2008 crisis (structural debt implosion). Analysts at major banks are calling for a recovery once trade negotiations stabilize.
Buying a diversified index fund now means you're buying hundreds of companies at a discount — rather than betting on one stock.
The 5 Best Index Funds to Buy Now
1. Vanguard S&P 500 ETF (VOO) — Best Overall
VOO tracks the S&P 500 — 500 of the largest U.S. companies. It's the gold standard of index investing: ultra-low expense ratio (0.03%), massive liquidity, and decades of proven performance.
Who it's for: Anyone who wants simple, broad U.S. market exposure. If you're only buying one fund, buy this one.
Expense ratio: 0.03%
5-year annualized return (pre-crash): 14.2%
Min. investment: 1 share ($450-500 range)
2. Vanguard Total Stock Market ETF (VTI) — Best for Maximum U.S. Coverage
VTI goes beyond the S&P 500 to include mid-cap and small-cap U.S. stocks — roughly 3,700 companies total. During recoveries, small-caps often outperform large-caps, giving VTI a potential edge over VOO after a crash.
Who it's for: Investors who want complete U.S. market exposure, including smaller companies that may rebound faster.
Expense ratio: 0.03% Holdings: ~3,700 U.S. stocks Min. investment: 1 share
3. Vanguard Total International Stock ETF (VXUS) — Best for Global Diversification
VXUS covers nearly 8,000 stocks across developed and emerging markets outside the U.S. With U.S. tariffs hitting domestic companies hard, international stocks in less-affected regions may recover differently — or even benefit.
Who it's for: Investors who already have U.S. exposure and want to diversify globally. Financial advisors often suggest 20-40% international allocation.
Expense ratio: 0.07% Holdings: ~7,800 international stocks
4. iShares Core S&P 500 ETF (IVV) — Best VOO Alternative at Brokers That Don't Offer Vanguard
IVV is essentially identical to VOO — same index, same 0.03% expense ratio — but issued by BlackRock iShares. If your brokerage charges commissions on Vanguard ETFs, IVV is the equivalent solution.
Who it's for: Fidelity, Schwab, or TD Ameritrade users who want S&P 500 exposure without trading fees.
Expense ratio: 0.03%
5. Fidelity ZERO Total Market Index Fund (FZROX) — Best for True Zero-Cost Investing
FZROX has a 0.00% expense ratio — literally free. It tracks the total U.S. market and is only available through Fidelity accounts. For beginners starting small, removing even the smallest annual fee can add up over decades.
Who it's for: Fidelity account holders who want to minimize every cost. The catch: it's not transferable to other brokerages if you switch.
Expense ratio: 0.00% Availability: Fidelity accounts only
- Automatic diversification across hundreds of companies
- Historically markets recover from every crash
- Ultra-low fees compound into massive savings over 30 years
- No stock-picking skill required
- No guarantee of short-term recovery timeline
- Full market exposure means you fall with the market too
- International funds carry currency and geopolitical risk
- Requires patience — 5+ year horizon recommended
VOO vs VTI: Which Should You Buy During a Crash?
This is the most common question. The honest answer: the difference is small over long time horizons.
- VOO is simpler and tracks the most-followed benchmark
- VTI includes small-cap stocks that can outperform during recoveries
- Both have identical 0.03% expense ratios
- Both are from Vanguard — one of the most trusted fund companies in the world
If you're starting from zero: pick either one and stick with it. Switching between them later has no meaningful tax impact in a Roth IRA, but could trigger capital gains in a taxable account.
- 500 large-cap U.S. companies
- Tracks the most-followed benchmark
- Slightly less volatile
- Ideal for conservative long-term investors
- 3,700 U.S. companies of all sizes
- Small-cap boost during recoveries
- Broader diversification
- Ideal for aggressive long-term investors
How to Actually Buy During a Crash
Dollar-cost average, don't try to time the bottom. Nobody knows when the exact bottom is. Investing a fixed amount every week or two — regardless of price — reduces your risk of buying too early while still capturing the recovery.
Use a tax-advantaged account first. If you have contribution room in a Roth IRA (limit: $7,000/year in 2026) or 401(k), invest there before a taxable brokerage. Growth is tax-free in a Roth IRA.
Don't sell what you already have. Selling during a crash locks in losses. The recovery benefits only investors who stay invested.
Keep 3-6 months of expenses in cash first. Don't invest money you might need in the next 12 months. Index funds can stay down for 1-2 years before recovering.
- Vanguard, Fidelity, and Schwab all offer commission-free ETF trading
- You can buy fractional shares of ETFs on most major platforms in 2026
- Roth IRA contributions for 2026: $7,000 ($8,000 if age 50+)
- A 0.03% expense ratio on $10,000 costs just $3/year — far below mutual fund averages
- Historically, the S&P 500 has never failed to recover a new all-time high within 15 years
The Bottom Line
The April 2026 tariff crash is scary — but it's also the kind of event that creates the buying opportunities that long-term investors look back on gratefully. VOO and VTI are the two best index funds to buy right now for most investors. Add VXUS for international diversification if you want full global coverage.
The key is simple: invest what you can afford, in a tax-advantaged account, and don't check the price every day. The investors who panic-sell during crashes are the ones who miss the recovery. Don't be them.
