Is an index fund an ETF?

An index fund is a fund that tracks an index. It can be structured as a mutual fund or an ETF. 'Index ETF' means an ETF that tracks an index. Both exist.

Which has lower fees?

Both can have very low fees (under 0.1%). Compare specific funds. Vanguard's S&P 500 ETF (VOO) and mutual fund (VFIAX) have nearly identical expense ratios.

Should I switch from mutual funds to ETFs?

Often unnecessary. If you have a low-cost index mutual fund, switching may trigger taxes (in taxable accounts). Stay put unless you have a good reason to change.

Index Funds vs. ETFs: Which is Better? | Investors Lab

Similarities

Both index funds and index ETFs track a market index (e.g., S&P 500). Both offer diversification and low costs. The difference is structure and trading.

Key Differences

Trading: ETFs trade like stocks (intraday). Index mutual funds trade once per day at the closing NAV.

Minimums: ETFs need 1 share (or fractional). Many index mutual funds have $1,000–$3,000 minimums (though some are $0).

Expense ratios: Both can be very low (under 0.1%). Vanguard's S&P 500 ETF and mutual fund are nearly identical in cost.

Tax efficiency: ETFs are often more tax-efficient in taxable accounts due to the "in-kind" redemption mechanism.

Which to Choose?

Taxable account: ETFs often have a slight tax edge. Either works.
401(k) or IRA: You're limited to the plan's menu. Use whatever low-cost index option is available.
Automatic investing: Some brokers make it easier to auto-invest in mutual funds (exact dollar amounts). ETFs may require manual purchases.

Bottom line: For most investors, the difference is small. Pick the lowest-cost, broadly diversified option you have access to.