Last updated: June 2026
When every major S&P 500 ETF holds the same 500 companies and delivers virtually identical returns, the expense ratio becomes one of the only meaningful differences left to compare. It looks like a rounding error in any single year — a few dollars here, a few cents there — but compounded over decades, it’s real money. This guide ranks the major S&P 500 ETFs purely by cost, from cheapest to most expensive, and explains what that fee gap actually translates to over a long holding period.
Disclaimer: This article is for informational and educational purposes only and does not constitute financial advice. Past performance does not guarantee future results. Fee differences are only one factor in choosing a fund — liquidity, structure, and tax treatment also matter, and are discussed below alongside cost. Always do your own research and consider speaking with a licensed financial advisor before investing.
Quick ranking: cheapest to most expensive
| Rank | ETF | Expense Ratio | Annual cost per $10,000 | AUM |
|---|---|---|---|---|
| 1 | SPYM (SPDR Portfolio S&P 500 ETF, formerly SPLG) | 0.02% | $2 | ~$95–107B |
| 2 (tie) | VOO (Vanguard S&P 500 ETF) | 0.03% | $3 | ~$1.0–1.5T |
| 2 (tie) | IVV (iShares Core S&P 500 ETF) | 0.03% | $3 | ~$560–686B |
| 4 | SPY (SPDR S&P 500 ETF Trust) | 0.0945% | ~$9.45 | ~$620–712B |
| 5 | RSP (Invesco S&P 500 Equal Weight ETF) | 0.20% | $20 | Large, liquid |
Figures as of mid-2026, sourced from fund issuers and financial data providers. AUM figures shift daily — always check current data before investing.
1. SPYM (formerly SPLG) — The new cheapest S&P 500 ETF on the market
The biggest development in this category recently: SPLG was rebranded to SPYM in 2025, and at a 0.02% expense ratio, it now undercuts every other major S&P 500 ETF, including longtime cost leaders VOO and IVV. According to State Street’s own materials, SPYM charges just 2 basis points — meaning $2 a year on a $10,000 investment.
Key facts (source: State Street, Mezzi, Yahoo Finance):
- Expense ratio: 0.02%
- AUM: roughly $95–107 billion, smaller than VOO or IVV but still substantial
- Holdings: approximately 503 securities, mirroring the S&P 500 closely
- Structure: open-end fund (not a Unit Investment Trust like SPY), meaning dividends are reinvested promptly rather than sitting in cash
- Share price: notably lower than VOO or SPY, which can make it more accessible for investors buying whole shares without fractional-share access
The catch, if there is one, is scale: SPYM’s AUM and trading volume are smaller than VOO’s or IVV’s, meaning somewhat less liquidity. For long-term, buy-and-hold investors who aren’t trading large blocks of shares or relying on deep options markets, this is a minor consideration. For those reasons, financial commentary sites tracking this space have noted SPYM gaining traction specifically among cost-conscious retail investors as a direct, cheaper substitute for SPY.
2 (tie). VOO and IVV — The established low-cost leaders
Vanguard’s VOO and BlackRock/iShares’ IVV have long been the default answer to «cheapest way to own the S&P 500,» and at 0.03% they remain extremely cheap in absolute terms — just $1 more per year on a $10,000 investment than SPYM. Both are open-end funds, both reinvest dividends promptly, and both offer immense liquidity, with VOO recently becoming the first ETF in history to cross $1 trillion in assets under management.
The practical difference between SPYM and VOO/IVV at this point comes down to $1 per $10,000 annually — a gap small enough that most long-term investors won’t notice it in practice. Scale, brand recognition, and existing broker integrations often matter more in the VOO/IVV-vs-SPYM decision than the marginal fee difference itself.
3. SPY — Still the most expensive of the «big four,» and structurally different
SPY charges 0.0945% — more than three times SPYM’s fee and roughly three times VOO/IVV’s fee. On a $10,000 investment, that’s $9.45 a year versus SPYM’s $2, a gap of roughly $7.45 annually. Over a 30-year holding period, fee comparisons published by Financer suggest the cumulative difference between SPYM’s 0.02% and SPY’s 0.0945% on a $100,000 investment can compound to over $15,000 in lost returns.
SPY’s higher fee isn’t pure inefficiency, though — it reflects a different structure and use case entirely. As a Unit Investment Trust, SPY cannot reinvest dividends internally, which adds a small additional drag compared to VOO, IVV, or SPYM beyond the headline fee gap. What SPY offers in exchange is unmatched liquidity and the deepest options market of any S&P 500 ETF — a genuine advantage for active traders, but one that costs long-term, buy-and-hold investors real money for a feature they may never use.
4. RSP — The most expensive S&P 500-adjacent option, for a different reason entirely
The Invesco S&P 500 Equal Weight ETF (RSP) charges 0.20% — roughly 10 times SPYM’s fee and double SPY’s. But RSP isn’t competing on cost; it’s solving a different problem. Rather than weighting the index by market capitalization (which lets the largest 5-10 companies dominate returns), RSP allocates roughly equal weight to all 500 constituent companies, reducing concentration in mega-cap names.
RSP’s higher fee reflects the more complex, frequently-rebalanced index methodology required to maintain equal weighting. It’s included in this ranking not because it competes on price, but because it’s commonly searched alongside the cheaper, cap-weighted options. (If your main reason for looking at RSP is to escape or control your exposure to the massive AI and tech giants dominating the standard S&P 500, you might want to look at how thematic vehicles handle this trend. Check out our strategic guide on whether you should invest in one AI ETF or build a portfolio manually to weigh your options). — and it’s worth understanding that you’re paying specifically for a structurally different exposure, not for the same product at a higher markup.
What the fee gap actually means for your portfolio
It’s worth being honest about scale here. The difference between SPYM’s 0.02% and VOO/IVV’s 0.03% is genuinely trivial for most individual investors — $1 a year on a $10,000 investment. The difference becomes more meaningful once you compare the cheapest options to SPY’s 0.0945%, and more meaningful still at larger account sizes or over multi-decade holding periods, where compounding turns small annual percentages into thousands of dollars in foregone returns.
A useful way to think about it: if you’re choosing between SPYM, VOO, and IVV, the fee difference shouldn’t be the deciding factor — pick based on broker integration, fractional share availability, or simple preference. If you’re choosing between any of those three and SPY, understand that you’re paying a real, ongoing premium for SPY’s superior liquidity and options market access — worth it if you actually use those features, an unnecessary cost if you don’t.
Frequently asked questions
Is SPYM actually better than VOO, or just marginally cheaper? For most long-term investors, the practical difference is negligible — about $1 per year on a $10,000 investment. SPYM is genuinely the lowest-cost option among major S&P 500 ETFs, but VOO and IVV’s larger scale and deeper liquidity may matter more to some investors than the marginal fee savings.
Why did SPLG become SPYM? State Street rebranded SPLG to SPYM in 2025 as part of aligning its SPDR Portfolio lineup naming conventions. According to fund trackers, nothing changed about the fund’s holdings, structure, or strategy — only the ticker and name changed.
Should I switch from SPY to a cheaper fund to save on fees? That depends on your personal tax situation. Selling an existing SPY position to switch to a cheaper alternative can trigger capital gains taxes in a taxable account, which may outweigh the fee savings depending on how large your unrealized gains are. This is worth discussing with a tax professional before acting on it, particularly for long-held positions with substantial embedded gains.
Is the cheapest ETF always the best choice? Not necessarily. Cost matters enormously for long-term, buy-and-hold investors, but liquidity, options market depth, and structural factors (like dividend reinvestment treatment) can matter more for investors with different needs — particularly active traders, who often still prefer SPY despite its higher fee.