Your first point is that your wife, if she outlives you, may end up with an asset allocation that is not exactly the same as you wanted. However, asset allocation is not a precise science. A new allocation may be slightly better or slightly worse, and we cannot know in advance which way it will be, because we don't know how the markets will behave. As you say, it's a minor point.EyeDee wrote:.VictoriaF wrote:John Maynard Keynes famously stated, "When my information changes, I alter my conclusions." If a new relevant fund appears, why should not Target-Retirement funds adjust their composition? The strategy set it and forget it works far better than market timing and speculation. Appropriate strategic adjustments work better than set it and forget it.
I have no idea to what extent the new fund is appropriate, but the animosity to it in this thread seems to exceed any possible harm the fund may cause.
Although I believe one can argue the changes made to the Target-Retirement funds were improvements, the problem for some of us on this board is how we wanted to use them.
Even with the prospects of future changes the funds are excellent choices for people who do not want to pay close attention to their investments. I have and continue to recommend them to my friends who do not want to follow their investments closely.
However, there two cases on this board that the constant changing presents a problem. The minor one is the one that most directly affects me. I was trying to include the funds as base funds and add other funds to give me the mix of stocks/bonds, U.S./international, large/small that I wanted. The constant changing makes that difficult - particularly leaves me concerned that if something happened to me and they made major changes, my wife would not have the portfolio I had set up. With the first change I started restricting our use of the funds, with the second my wife said to drop them.
The other bigger problem with their constant changing is that many on this board recommend people pick the funds based upon their stock/bond ratio fitting their needs instead of based upon their age. Vanguard regularly improving the funds works very well for those who buy the funds to have a simple portfolio based upon their age, but for those who buy based upon the recommendations of this board they could very well end up with a portfolio that does not match their goals. Perhaps the better solution is for the board members to stop recommending the funds based upon current settings and instead suggest them or not suggest them based upon their use if they fit ones age and not ones portfolio goals. If someone's goals do not fit the use of the Target Retirement funds based upon ones age, we should perhaps help the person set up their own unique portfolio using other funds and forget about the desire to stay simple if they are not comfortable with Vanguard deciding what their holdings are based upon their age.
Your second point is that the target retirement dates do not correspond to the desired allocations. This is a valid point, but it transcends the topic of this discussion, which is the addition of the international bonds. I agree that one should choose a Target-Retirement fund based on its composition rather than on matching one's retirement year with that listed in the fund name.