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Planning for retirement

Vanguard Target Retirement 2070 Fund has launched

Vanguard launches 2070 Target Retirement Fund, designed to help the youngest members of the workforce start their retirement savings journey.
6 minute read
June 28, 2022
Planning for retirement
Save for retirement
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Mutual funds

The newest release of the Vanguard Target Retirement Fund series is now available. With the launch of our Target Retirement 2070 Fund, Vanguard is helping to ensure the youngest members of the workforce have access to our industry-leading target-date solution as they begin to save for retirement.1

Target Retirement Funds are a type of “all in one fund” built with a specific retirement year in mind. They’re a smart, easy-to-implement solution for people who plan to retire on or around the year in the fund name, offering a professionally managed, complete portfolio in a single fund that automatically adjusts over time as the target year approaches. They help investors build retirement savings without the need to manually rebalance and adjust their risk profile over time.

Learn more about Target Retirement Funds

Informed by more than 4 decades of investment management expertise and behavioral research, the construction, management, and governance of Vanguard Target Retirement Funds represents Vanguard’s world-class thought leadership and investment capabilities. This family of funds is created in 5-year increments, with the 2070 fund being the newest in the lineup.

Simple and sophisticated

The greatest benefit of a Target Retirement Fund is the simple design: By investing in a single mutual fund, you get a diversified portfolio that you don’t have to rebalance or adjust. These funds are built using Vanguard’s proprietary advice methodology to give you the smartest mix of stocks and bonds at every stage of retirement investing.

“Vanguard’s Target Retirement lineup sets a solid foundation for young investors as they begin their retirement journey by providing a broadly diversified, professionally managed, indexed-based investment portfolio that encourages long-term discipline and seeks to deliver risk-adjusted returns over time,” said John James, managing director and head of Vanguard Institutional Investor Group.

Vanguard’s sophisticated design, methodology, and ongoing focus on total cost of ownership have made us a leader in the target-date industry. You can start investing in these funds for as little as $1,000. And thanks to our low costs, when you invest in a Vanguard Target Retirement Fund, you can keep more of your money working for you. The average Vanguard Target Retirement Fund expense ratio is now 84% less than the industry average.2

How it works

The Vanguard Target Retirement Fund is a “fund of funds,” meaning it’s made up of other mutual funds, which themselves are made up of hundreds or thousands of individual stocks and bonds. It starts out mostly invested in stock funds, which come with higher risk but also the potential for higher returns, suitable for investors who have many years of investing ahead of them and are focused on maximizing growth.

Over time, as the target retirement year gets closer, the fund gradually changes its composition to reduce its exposure to stock funds and increase its weight in bond funds, which are more conservative and income oriented. This gradual shift in the underlying assets as the fund approaches its target year is known as the “glide path.”

A smart choice for long-term savings

Target-date funds have dramatically improved investors’ long-term savings behavior and retirement outcomes.3 On average, Vanguard Target Retirement Funds have performed in the top quartile among their peer groups for 10-year returns.4 Retirement savers invested over $50 billion in our Target Retirement Funds in 2021, the most of any asset manager.5 In 2022, Forbes Advisor named us in their “The Best Target Date Funds for Retirement” list.6

A closer look

The Vanguard Target Retirement 2070 Fund is an “all in one” fund that:

  • Seeks to provide investors planning to retire around 2070 an all-in-one-fund retirement portfolio solution.
  • Has a competitive estimated expense ratio of 0.08%.2
  • Is informed by more than 4 decades of investment management expertise and behavioral research. 
  • Starts with an asset allocation of 90% stocks and 10% bonds, and gradually shifts to 30% stocks and 70% bonds 7 years after retirement.
  • Enables you to get started with just $1,000.

Because they’re mutual funds, Target Retirement Funds may pay dividends and capital gains—meaning clients who receive them in a taxable account will owe taxes for the year in which the distribution was made.

Ownership makes a difference

At Vanguard, you’re more than just an investor—you’re an owner. Our unique, investor-owned structure enables us to return value consistently to millions of investors.7

Since our founding in 1975, we’ve reduced expense ratios and lowered investment minimums for investors more than 2,000 times across asset classes, product types, and strategies. We have a long history of client-centric innovation and constantly evaluate ways to improve outcomes for target-date investors.

Vanguard Target Retirement investors continue to benefit from our ability to generate cost savings through economies of scale.

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1Vanguard and Morningstar, as of September 30, 2021. Vanguard is the largest target-date fund manager in the industry.

2Vanguard Target Retirement Funds average expense ratio as of December 31, 2021: 0.11%. Vanguard Target Retirement Funds expense ratio as of February 14, 2022: 0.08%. Industry average expense ratio for comparable target-date funds as of December 31, 2021: 0.49%. All averages are asset-weighted. Industry average excludes Vanguard. Sources: Vanguard and Morningstar.

3Source: Vanguard, How America Saves 2020.

4Sources: Vanguard and Morningstar, Inc., as of June 30, 2021. Our Target Retirement Funds with a 10-year track record or longer (2055 and earlier vintages in Investor Shares), on average, ranked in the top 25% among peer groups for 10-year returns through mid-2021. Vanguard Target Retirement Income Fund ranked 19% out of 111 peers; 2015 Fund, 57% out of 69; 2020 Fund, 16% out of 97; 2025 Fund, 15% out of 131; 2030 Fund, 21% out of 124; 2035 Fund, 27% out of 126; 2040 Fund, 28% out of 124; 2045 Fund, 18% out of 125; 2050 Fund, 19% out of 122; and 2055 Fund, 28% out of 84. The average ranking among the funds was 24.8%. Only competing funds with a 10-year history were included. Results will vary in other time periods. Note that the competitive performance data shown represent past performance, which is not a guarantee of future results, and that all investments are subject to risks. For the most recent performance, visit www.vanguard.com/performance.

5Morningstar, Target-Date Strategy Landscape, 2022.

6 Forbes AdvisorThe Best Target Date Funds for Retirement, 2022.

7Vanguard is investor-owned, meaning the fund shareholders own the funds, which in turn own Vanguard.

Investments in Target Retirement Funds are subject to the risks of their underlying funds. The year in the fund name refers to the approximate year (the target date) when an investor in the fund would retire and leave the workforce. The fund will gradually shift its emphasis from more aggressive investments to more conservative ones based on its target date. An investment in a Target Retirement Fund is not guaranteed at any time, including on or after the target date.

These fund suggestions are based on an estimated retirement age of approximately 65. Should you choose to retire significantly earlier or later, you may want to consider a fund with an asset allocation more appropriate to your particular situation.

All investing is subject to risk, including the possible loss of the money you invest. Diversification does not ensure a profit or protect against a loss. Investments in bonds are subject to interest rate, credit, and inflation risk. There is no guarantee that any particular asset allocation or mix of funds will meet your investment objectives or provide you with a given level of income.

We recommend that you consult a tax or financial advisor about your individual situation.

For more information about Vanguard mutual funds and ETFs, visit Vanguard mutual fund prospectuses or Vanguard ETF prospectuses to obtain a prospectus or, if available, a summary prospectus. Investment objectives, risks, charges, expenses, and other important information are contained in the prospectus; read and consider it carefully before investing.