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A target-date investment fund offers the simplicity of a complete portfolio in a single investment option.

Each target-date investment fund (TDF) is comprised of a portfolio of five broadly diversified Vanguard index funds. As the year in a specific target-date fund’s name draws near, its investment mix becomes more conservative. That way, a single target-date investment is meant to serve you throughout both your career and retirement.

How target-date investments work

The year in the investment name is its target date, the approximate year in which an investor expects to retire and leave the workforce. A target-date investment will hold a higher proportion of stocks the further it is from its target date. To reduce risk as the target date approaches, the investment manager will gradually decrease its stock holdings and increase its bond holdings. Bonds usually have a lower risk of loss, though they also have lower potential gains than stocks. When the investment reaches its target date, you don’t need to take your money out. The gradual move from stocks to bonds simply continues. Target-date investments are designed to keep your money invested appropriately throughout your retirement years.

How to choose a target-date investment

2003 or later
Target retirement 2070 fund
1998 or later
Target retirement 2065 fund
1993 to 1997
Target retirement 2060 fund
1988 – 1992
Target retirement 2055 fund
1983 to 1987
Target retirement 2050 fund
1978 to 1982
Target retirement 2045 fund
1973 to 1977
Target retirement 2040 fund
1968 to 1972
Target retirement 2035 fund
1963 to 1967
Target retirement 2030 fund
1958 to 1962
Target retirement 2025 fund
1953 to 1957
Target retirement 2020 fund
1952 or earlier
Income investment

* Assumes an anticipated retirement age of 65.

You’re never locked into a particular investment. Maybe your tolerance for risk will change. Or you could decide to retire earlier or later. It’s a good idea to check your asset mix regularly to make sure it still matches your goals.

See more videos below:

How to Pick a Target Retirement Fund

What happens on the Target Date

Find Out More about TDFs

Learn more about TDFs. Call us at 1.800.986.6222 to speak to a member of our Service team.

To make changes to your MMBB account, click the “Login” link at the top of this page. Then click "Manage My Retirement Account."

Information provided by The Vanguard Group, Inc. © 2019 All rights reserved. Vanguard Marketing Corporation, Distributor of the Vanguard Funds.


All securities investments risk the loss of capital. Each Target Date Fund invests in U.S. Stocks, International Stocks, U.S. Nominal Bonds, International Nominal Bonds, and Short-term TIPS in different proportions. There is a chance of losing a percentage of your original investment. An investment in the fund could lose money over short or even long periods.

Stock Risk

The stock market can be volatile. Over long periods of time investors with exposure to stocks may enjoy higher returns than other options. However, investors with exposure to stocks can also lose more money than in some other options. Sharp and unpredictable changes in value, either positive or negative, can be especially acute over shorter periods of time.

Bond Risk

One of the main risks with bonds is interest rate risk, resulting in the chance that bond prices overall will decline because of rising interest rates. Because the bond portion of the Target Date Funds are passively managed index funds, returns will reflect the returns of the respective broad bond market. When the bond market rises, the bond portion will rise in tandem. Likewise, when the bond market declines (due to rising interest rates or other factors) the bond portion will decline as well. Investors can expect to receive returns of the respective general bond market, less applicable expenses. Although the bond market is perceived by many to be a more conservative type of investment—and historically, it has been less volatile—that does not mean that one cannot lose value in this fund.

Although all bonds in the bond portion of the Target Date Funds are considered to be “investment grade,” there is associated credit risk—the chance that a bond issuer will fail to pay interest and principal in a timely manner, or that negative perceptions of the issuer’s ability to make such payments will cause the price of that bond to decline.

In addition, the bond portion of the Target Date Funds carries some “call” risk. This refers to the chance that during periods of falling interest rates, issuers of callable bonds may call (repay) securities with higher interest rates before their maturity dates. The bond portion of the Target Date Funds would then lose any price appreciation above the bond’s call price and would be forced to reinvest the unanticipated proceeds at lower interest rates, resulting in a decline in the fund’s income. For mortgage-backed securities, this risk is known as “prepayment risk.” Call/prepayment risk should be low for the fund because it invests mainly in securities that are not callable.

Because the underlying funds in the Target Date Funds are index funds, they have index sampling risk, which is the chance that the securities selected for the respective underlying fund, in the aggregate, will not provide investment performance matching that of the underlying fund’s target index. Index sampling risk for the fund should be low.

If you are uncomfortable with the risks associated with the Target Date Funds, you may want to consider another MMBB investment option.

The information contained herein is for general purpose only. The use of our information should be based on your due diligence and MMBB will not be liable for any success of failure that is directly or indirectly related to the use of the information contained herein. MMBB assumes no responsibility for errors or omissions in the content herein. The information contained herein does not constitute a complete description of our investment services and it does not constitute any tax, legal, financial, or investment advice. In no event shall, MMBB be liable for any special, direct, indirect, consequential, or incidental damages, or any damages whatsoever, whether in action of contract, negligence or tort, arising out of or in connection with the use of the information contained herein.

Below is the performance of the Target Date Funds for varying lengths of time. The longer the time period, the more likely it encompasses varying economic and market conditions.

1. The Target Retirement Funds inception date was January 2, 2020.

Source Account Name YTD 2020 YTD 2021 YTD 2022 YTD 2023
TARGET RETIREMENT INCOME FUND 9.25 4.63 -13.31% 10.20%
TARGET RETIREMENT 2020 FUND 10.96 7.58 -14.75% 11.95%
TARGET RETIREMENT 2025 FUND 12.17 9.26 -16.09% 14.00%
TARGET RETIREMENT 2030 FUND 12.89 10.82 -16.81% 15.48%
TARGET RETIREMENT 2035 FUND 13.55 12.47 -17.17% 16.60%
TARGET RETIREMENT 2040 FUND 14.15 14.04 -17.55% 17.79%
TARGET RETIREMENT 2045 FUND 14.80 15.58 -17.90% 18.94%
TARGET RETIREMENT 2050 FUND 14.93 15.91 -18.02% 19.61%
TARGET RETIREMENT 2055 FUND 15.01 15.84 -17.98% 19.60%
TARGET RETIREMENT 2060 FUND 15.03 15.86 -17.97% 19.62%
TARGET RETIREMENT 2065 FUND 14.84 15.85 -17.94% 19.62%
TARGET RETIREMENT 2070 FUND       19.60%

Past performance is no guarantee of future results. Investment return and principal value will fluctuate so that shares, when redeemed, may be worth more or less than their original cost. Performance is for the stated time period only; performance through the current date may be lower or higher than displayed above due to market fluctuations, manager performance or other reasons.

Fund Price 1 Day YTD 1 Year 3 Year 5 Year 10 Year
Target Retirement Income Fund $11.18 0.45% 2.45% 7.62% -0.19%
Target Retirement 2020 Fund $12.44 0.54% 3.44% 9.24% 0.31%
Target Retirement 2025 Fund $12.27 0.68% 4.69% 11.40% 0.90%
Target Retirement 2030 Fund $12.69 0.72% 5.58% 12.90% 1.46%
Target Retirement 2035 Fund $13.13 0.77% 6.47% 14.27% 2.05%
Target Retirement 2040 Fund $13.56 0.81% 7.24% 15.55% 2.60%
Target Retirement 2045 Fund $13.81 0.84% 8.01% 16.80% 3.15%
Target Retirement 2050 Fund $14.15 0.87% 8.59% 17.67% 3.51%
Target Retirement 2055 Fund $14.19 0.88% 8.59% 17.66% 3.51%
Target Retirement 2060 Fund $14.2 0.87% 8.59% 17.65% 3.53%
Target Retirement 2065 Fund $14.17 0.86% 8.58% 17.67% 3.54%

Total Estimated Annual Expenses

With all MMBB fund offerings, there are no sales charges on purchases, deferred sales charges, short-term or other redemption fees, distribution or 12b-1 fees, dealer commissions or low-balance account service fees.

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