Investing for your retirement
Vanguard Target Retirement Funds aim to help you successfully invest for your retirement. There are nine funds to choose from and you can select the particular fund that matches how many years you have left until retirement. The fund managers shift asset allocation to less equities and more bonds, so the risk lessens as you get closer to retirement.
TRFs, also called target date funds, are all about retirement. You select the fund with the date closest to the year you expect to retire. You invest lump sums or regularly over your working life, with the objective of accumulating enough assets to fund your retirement.
How do TRFs allocate assets
Vanguard's TRF changes to ensure an investor has the appropriate mix of asset at each stage of the investment’s lifecycle. As investors move towards retirement, the portfolio’s risk reduces. This changing asset mix is predetermined and is known as the glide path.
When a person starts saving for retirement early in their career, their long-term investment horizon allows them to take on significant risk. At this stage, the TRF portfolio has a large exposure to equities. In the years leading up to retirement, equities are scaled back in favour of lower risk bond investments.
Helping make retirement simple
A Target Retirement Fund takes the complexity out of retirement by allowing you to focus on what you can control – how much to save and when you want to retire. You select your provisional retirement date, based on your date of birth; you decide how much you want to save and then you leave the rest to experienced investment professionals.
Choose your Target Retirement Fund: