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Schwab Equity Index Funds

Schwab Small-Cap Index Fund

Supplement dated August 9, 2013 to the

Prospectus dated February 28, 2013



This supplement provides new and additional information beyond that contained in

the Prospectus and should be read in conjunction with the Prospectus.

Effective immediately, the “Fund Fees and Expenses” section of the Schwab Small-Cap Index Fund’s prospectus is hereby deleted in its entirety and replaced with the following:

Fund Fees and Expenses

This table describes the fees and expenses you may pay if you buy and hold shares of the fund.


Shareholder fees (fees paid directly from your investment)

Redemption fee (as a % of the amount sold or exchanged within 30 days of purchase)



Annual fund operating expenses (expenses that you pay each year as a % of the value of your investment)

Management fees


Distribution (12b-1) fees


Other expenses


Acquired fund fees and expenses (“AFFE”)1





Total annual fund operating expenses


Less expense reduction





Total annual fund operating expenses (including AFFE) after expense reduction1,2







The total fund operating expenses in the fee table may differ from the expense ratios in the fund’s “Financial highlights” because the financial highlights include only the fund’s direct operating expenses and do not include AFFE, which reflect the estimated amount of fees and expenses incurred indirectly by the fund through its investments in other investment companies, including business development companies (“BDCs”), during its prior fiscal year. Expenses of BDCs and other investment companies are not direct costs paid by fund shareholders and have no impact on costs associated with fund operations. The expenses are also not used to calculate the fund’s net asset value.


The investment adviser and its affiliates have agreed to limit the total annual fund operating expenses (excluding interest, taxes and certain non-routine expenses) of the fund to 0.17% for so long as the investment adviser serves as the adviser to the fund. This agreement may only be amended or terminated with the approval of the fund’s Board of Trustees. This agreement is limited to the fund’s direct operating expenses and does not apply to AFFE.



This example is intended to help you compare the cost of investing in the fund with the cost of investing in other mutual funds. The example assumes that you invest $10,000 in the fund for the time periods indicated and then redeem all of your shares at the end of those time periods. The example also assumes that your investment has a 5% return each year and that the fund’s operating expenses remain the same. The figures are based on total annual fund operating expenses (including AFFE) after expense reduction. The expenses would be the same whether you stayed in the fund or sold your shares at the end of each period. Your actual costs may be higher or lower.


Expenses on a $10,000 investment


1 year   3 years   5 years   10 years
$26   $80   $141   $318



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