The 10 best growth and income mutual funds in 2026
If you’re looking for mutual funds that balance growth with income, you’ll want to take a look at this list. These mutual funds combine income stability with moderate growth potential and are highly rated by investment research company Morningstar as the top 10 income funds.
| Fund name | Ticker symbol | Morningstar rating | Adjusted Expense Ratio | SEC 30-day yield | Annual return (3-year trailing) |
|---|---|---|---|---|---|
| American Funds Conservative Growth & Income | RINFX | Gold | 0.35% | 3.82% | 10.59% |
| Vanguard Wellesley Fund | VWINX | Silver | 0.23% | 3.66% | 7.39% |
| T. Rowe Price Retirement Balanced | TRRIX | Silver | 0.49% | 3.09% | 10.62% |
| American Funds Retirement Income Port-Conservative | RQRPX | Silver | 0.35% | 3.32% | 8.76% |
| American Funds Tax Aware Conservative Growth & Income | TXIFX | Silver | 0.43% | 2.35% | 11.41% |
| Nuveen Lifecycle Index Retirement Income | TRILX | Silver | 0.10% | 2.83% | 10.13% |
| Vanguard LifeStrategy Conservative Growth | VSCGX | Silver | 0.12% | 3.22% | 9.99% |
| T. Rowe Price Spectrum Conservative Allocation | PRSIX | Silver | 0.67% | 3.62% | 9.91% |
| Vanguard Tax-Managed Balanced | VTMFX | Silver | 0.09% | 2.23% | 11.98% |
| MFS Conservative Allocation | MACIX | Bronze | 0.58% | 3.24% | 8.47% |
Numbers are as of Nov. 20, 2025
American Funds Conservative Growth & Income (RINFX)
Strategy: The fund aims to provide income and long-term growth. Holdings are of other American Funds funds that focus on generating income from investments with significant exposure to dividend-paying stocks. The fund also has exposure to international and emerging markets.
3-Year Annual Returns (trailing): 10.59%
SEC 30-day yield: 3.82%
Adjusted expense ratio: 0.35%
Allocation mix: 49.11% stocks, 45.27% bonds, 4.79% cash, 0.41% not classified or other.
Minimum investment: $250
Vanguard Wellesley Fund (VWINX)
Strategy: The fund seeks undervalued dividend stocks that have experienced a temporary setback but have strong fundamentals. There’s emphasis on finding stocks that can grow their dividend over time. The fund also focuses on investment-grade bonds, corporate credit, taxable municipal bonds, Treasuries, and agency securities.
3-Year Annual Returns (trailing): 7.39%
SEC 30-day yield: 3.66%
Adjusted expense ratio: 0.23%
Allocation mix: 35% equities, 65% fixed income
Initial investment: $3,000
T. Rowe Price Retirement Balanced (TRRIX)
Strategy: The fund is designed for people already in retirement who look for both income and appreciation. The fund aims to reduce market risk and lower volatility while producing income. For example, the strategy includes nearly 20% in U.S. Treasury Inflation-Protected Securities (TIPS), which is designed to protect retirees' assets from inflation.
3-Year Annual Returns (trailing): 10.62%
SEC 30-day yield: 3.09%
Adjusted expense ratio: 0.49%
Allocation mix: 40.5% stocks, 55.6% bonds
Minimum investment: $2,500
American Funds Retirement Income Port - Conservative (RQRPX)
Strategy: The fund is designed to support retirees for 20 years in retirement while maintaining 80% of the principal. It has strong underlying funds and a research-based approach. The strategy also has defensive positions that help it perform well in down markets.
3-Year Annual Returns (trailing): 8.76%
SEC 30-day yield: 3.32%
Adjusted expense ratio: 0.35%
Allocation mix: 40% equities, 60% income
Minimum investment: $250
American Funds Tax Aware Conservative Growth & Income (TXIFX)
Strategy: The underlying funds in the American Funds Tax Aware Conservative Growth and Income mutual fund are chosen for tax efficiency, including ETFs that can provide in-kind redemptions and don’t need to pay out capital gains. Also, lower-yield equity funds lessen the tax burden from dividends. The fixed-income portfolio also includes municipal bond funds for tax-exempt income.
3-Year Annual Returns (trailing): 11.41%
SEC 30-day yield: 2.35%
Adjusted expense ratio: 0.43%
Allocation mix: 50% income, 50% equity
Minimum investment: $250
Nuveen Lifecycle Index Retirement Income (TRILX)
Strategy: The mutual fund comprises other funds with a primary focus on generating income and a secondary goal of capital appreciation. The fund has more U.S. securities on both the bond and equity sides. The equities side also has a slight tilt toward large-cap equities. The bonds in the fund have a higher-than-average rating of AA.
3-Year Annual Returns (trailing): 10.13%
SEC 30-day yield: 2.83%
Adjusted expense ratio: 0.10%
Allocation mix: 60% bonds, 40% equities. Of those, 39.4% fixed income, 26.3% U.S. equity, 14.2% international equity, 10.0% short-term fixed income, 9.9% inflation-protected assets, 0.2% short-term investments
Minimum investment: $N/A
Vanguard LifeStrategy Conservative Growth (VSCGX)
Strategy: The fund uses low-cost index funds for broad exposure to global stocks and bonds. Funds used include Vanguard Total Stock Market Index, Vanguard Total International Stock Index, Vanguard Total Bond Market II Index and Vanguard Total International Bond Index II.
3-Year Annual Returns (trailing): 9.99%
SEC 30-day yield: 3.22%
Adjusted expense ratio: 0.12%
Allocation mix: 60% bonds, 40% stocks. Of this, funds aim for a mix of 60% U.S. equities and 40% non-U.S. equities. Bonds are a mix of 70% U.S. funds and 30% non-U.S. funds.
Initial investment: $3,000
T. Rowe Price Spectrum Conservative Allocation (PRSIX)
Strategy: Primary emphasis is on income, with secondary emphasis on capital appreciation. The portfolio is diversified across stocks, bonds, money market securities, cash reserves, and alternative investments. Over 350 analysts are dedicated to the fund's underlying research.
3-Year Annual Returns (trailing): 9.91%
SEC 30-day yield: 3.62%
Adjusted expense ratio: 0.67%
Allocation mix: 50% in bonds, money market securities, and cash reserves, 40% stocks, 10% alternative investment.
Initial investment: $2,500
Vanguard Tax-Managed Balanced (VTMFX)
Strategy: The fund leans away from dividend stocks and toward tax-loss harvesting. It maintains a balance of stocks and bonds with tax-advantaged strategies.
3-Year Annual Returns (trailing): 11.98%
SEC 30-day yield: 2.23%
Adjusted expense ratio: .09%
Allocation mix: 50% stocks, 50% bonds
Initial investment: $10,000
MFS Conservative Allocation (MACIX)
Strategy: 23 underlying funds are diversified across geography, market cap, and risk profile. There are both domestic and international funds, large-, mid-, and small-cap funds, and value and growth funds.
3-Year Annual Returns (trailing): 8.47%
SEC 30-day yield: 3.24%
Adjusted expense ratio: 0.58%
Allocation mix: 79% equity, 21% fixed income
Minimum investment: $0
How much more income can balanced funds provide?
Balanced funds can provide more income than funds with a higher percentage of stocks. They often have a higher percentage of bonds and stocks that pay dividends, which produce more income distributions.
Funds with higher income do come at the expense of a higher percentage of growth stocks, which means your overall portfolio won’t have the same growth if you had a higher percentage of stocks.
Growth and income mutual funds: What about total returns?
It’s also possible that a good portfolio that’s balanced with income and growth can also deliver great returns.
The mutual funds listed in this article, for example, have annual returns ranging between 7% and 11%.
It’s important to keep in mind that nothing can replace expert guidance.
High returns aren’t the only metric to look at when deciding on a fund, and for advice for your specific situation, you’ll need to consult an expert advisor.
How to pick the right growth and income mutual fund for you
With thousands of options, it’s difficult to know which mutual funds are suitable for your needs. It’s also hard to determine how well the mutual fund will perform for you.
Some things to look for that may help you evaluate a fund:
Allocation: Where your money is invested may make a difference in how the portfolio performs. Different mutual funds use different strategies to generate income and growth, with varying allocations to US and non-US equities, cash, fixed income, and other investments.
Yield: The amount paid per share of a mutual fund from income-producing investments in the portfolio, such as bonds, dividend-paying stocks, and emerging-market debt. Higher is better, but a good look at the fund is in order to determine whether that number is sustainable.
Adjusted expense ratio: The adjusted expense ratio takes into account all fees so you’re able to make an apples-to-apples comparison among mutual funds.
Risk: You may want to review the risk score produced by Morningstar, which categorizes funds as conservative, moderate, aggressive, very aggressive, and extreme.
Rating: It’s helpful to look at how independent research providers, such as Morningstar, rate a mutual fund. There’s no replacement for expertise.
Bottom line
Growth-and-income mutual funds offer a balanced approach for investors seeking both income now and growth potential.
Professional guidance can help you find the right strategy and funds to help accomplish your financial goals.
Unbiased can match you with a financial advisor to get you on the right track and answer all your questions.