Vanguard Lifecycle Funds
The Vanguard Lifecycle Funds are intended to be used as part of a person’s retirement investment strategy. This strategy changes over time and starts with an aggressive investment approach in the beginning when retirement is far away. As the retirement age approaches, the investment strategy becomes more conservative.
The reason for the creation of this type of fund is to assist those investors that actually do not know what they are doing when it is related to investments. In the beginning of this cycle, the fund should be heavily into stocks and mutual funds in the large growth sectors. As the age of retirement approaches, the switch to bonds and Vanguard funds that invest in bonds should make up a majority of a person’s portfolio. The reason being is with less risk, the money is safer as with bonds.
When a person has only a few years until retirement, the risk has to be minimal. If they lose too much on a risky investment, then their retirement could be postponed or never occur.
The Vanguard Investment Company had two different approaches. These are the Target Retirement and Life strategy. There are 15 different funds in this asset class that can help balance out your portfolio. Each one takes a minimal investment of $3000. Each of these funds has an acquired fund fees and expenses of 0.24% or less.
The start of the shift to conservative investing is a decade before your planned retirement. This is the path to take if you want little to do with your investment except read the yearly reports. The Vanguard Lifecycle Funds are also very advantageous for those that need to save for their retirement but are not sure how to.
For more reference about investments from Vanguard on this site, please view Vanguard REIT Mutual Funds.
For a resource about ETFs, please view Vanguard ETF which is one our sister site of ETFinvestingblog.com.
Even further resources about mutual funds and other investments from Fidelity on another sister site of ours is mutualfundexplorer.com please view Fidelity Small Cap Value Fund (FCPVX).
We strive to bring you the latest and most accurate data possible from the home sites of the investment institutions we name. Always remember – the bigger the risk, the larger the reward or loss. Invest with caution.