Report : Fiduciary Regulatory | May 25, 2023

Fairness in investment choices

Mutual funds and collective investment trusts (CITs) can both be excellent, low-cost options in retirement plans. And while the decision about which option—mutual funds or CITs—is better will depend on each plan’s priorities for its participants, a fundamental point of fairness must be addressed.

Because of differences in tax and securities laws, most 403(b) plans—the typical retirement savings vehicle for workers in public education institutions (K-12 and postsecondary) as well as many private nonprofit hospitals, universities, and other charitable and educational organizations—cannot offer CITs.

Learn why Vanguard supports bipartisan legislation in Congress to permit 403(b) plans to offer collective investment trusts.


  • The Vanguard collective trusts are not mutual funds. They are collective trusts available only to tax-qualified plans and their eligible participants. The collective trust mandates are managed by Vanguard Fiduciary Trust Company, a wholly owned subsidiary of The Vanguard Group, Inc. Investment objectives, risks, charges, expenses, and other important information should be considered carefully before investing.
  • All investing is subject to risk, including the possible loss of the money you invest. Diversification does not ensure a profit or protect against a loss.