Any Target Date Funds better than Vanguard?

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simplesauce
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Any Target Date Funds better than Vanguard?

Post by simplesauce » Sat Dec 23, 2017 9:47 am

My issues with Vanguard Target Date Funds are:

-Too aggressive - I prefer at minimum 25% bonds at any age.
-Too much international - 40% intl equities, 30% intl bonds.
-Not based on risk tolerance: If you choose a Vanguard TDF based on risk tolerance alone, Vanguard assumes you are closer to retirement. So the glide path of that fund will move into more bonds very quickly.

Those are my main concerns. Are there any other fund companies that have no-nonsense, low-cost TDFs like Vanguard does?

Can I find one with less international? My risk tolerance does not sit comfortable with 40% international. This adds too much currency risk, political instability risk, investor protection risk, and other concerns raised by Jack Bogle.

By the way, I have embraced Target Date Funds because my biggest enemy in investing is myself (Thank you Mike Piper for writing about this.) So a TDF will keep me on track. That said, I would like to find one that meets my risk tolerance.
Thank you!

livesoft
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Re: Any Target Date Funds better than Vanguard?

Post by livesoft » Sat Dec 23, 2017 10:06 am

No. Vanguard is the best at these.

You can roll your own with combinations of the LifeStrategy funds and the Balanced fund. Or even the "Three-fund."

So if the Target Date funds have flaws you don't like, it is very trivial to avoid them.
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Re: Any Target Date Funds better than Vanguard?

Post by dharrythomas » Sat Dec 23, 2017 10:33 am

The TSP might be better, if you have access. For the same date find you get lower expenses, lowere stock percentage, and less international. Like livesoft, I don't think there is another commerical firm that is anywhere near as good.

simplesauce
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Re: Any Target Date Funds better than Vanguard?

Post by simplesauce » Sat Dec 23, 2017 10:40 am

livesoft wrote:
Sat Dec 23, 2017 10:06 am
No. Vanguard is the best at these.

You can roll your own with combinations of the LifeStrategy funds and the Balanced fund. Or even the "Three-fund."

So if the Target Date funds have flaws you don't like, it is very trivial to avoid them.
Do you think my concerns are worth it? When I listen to Bogle speak, he is very adamant about no more than 20% international. The TDFs have double that. He makes some interesting cases in his Common Sense on Mutual Funds book. Do you think international stocks are still a new “exotic” investment and we should give more caution to putting our money in countries we don’t understand? Can we trust these foreign markets? Do they have investor protections like the US does? Is currency a real risk? Always respect your posts; would love your thoughts.

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Re: Any Target Date Funds better than Vanguard?

Post by livesoft » Sat Dec 23, 2017 10:49 am

No, as with almost all behavioral issues, I don't think those concerns are worth it.

Currency risk works both ways. It worked for owning foreign funds in 2017 quite nicely.

About half my equities are in international funds and have been for many years. Maybe I don't really care because I travel overseas every year and I used to work overseas.
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dbr
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Re: Any Target Date Funds better than Vanguard?

Post by dbr » Sat Dec 23, 2017 10:54 am

simplesauce wrote:
Sat Dec 23, 2017 9:47 am
My issues with Vanguard Target Date Funds are:

-Too aggressive - I prefer at minimum 25% bonds at any age.
-Too much international - 40% intl equities, 30% intl bonds.
-Not based on risk tolerance: If you choose a Vanguard TDF based on risk tolerance alone, Vanguard assumes you are closer to retirement. So the glide path of that fund will move into more bonds very quickly.
If these things bother you, then don't invest in target date funds. What is suggesting that you should? Perhaps they are the only funds available in a 401k or something?

There are good reasons the three (four) fund approach is recommended.

I also agree that target date funds tend to be a more rather than less complicated answer for most investors and have issues such as the above. An additional issue is that one should not have a TD fund in a taxable account. The one single advantage I can see for some investors is that if the TD fund is the only fund they have and they want the glide path, then the investor does not have to manage rebalancing and reallocating. It is also true that there are all sorts of balanced funds that are more flexible in choice of asset allocation and avoid an unwanted glide path.

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Re: Any Target Date Funds better than Vanguard?

Post by nisiprius » Sat Dec 23, 2017 11:23 am

If you are not happy with a cake mix, it is probably better, and not all that difficult, to make your cake from scratch rather than searching for the perfect mix.

That is, if you don't like Vanguard's target date funds as they are, and you aren't happy with what you'd get by choosing one with a retirement date ten or fifteen years earlier than your actual data, or the result of using 80% target date plus 20% Total Bond, or the result of using one of the four LifeStrategy funds and switching from one to the next every ten years or so... then just invest in the components of the the Target Date fund and adjust to taste. Notice that despite the exquisitely minute year-to-year microadjustments in each Target fund, Vanguard think that four sizes are enough to provide a reasonable fit for all risk tolerances in the LifeStrategy funds. That is, it isn't necessary to adjust the allocations very often--not even every five years.

I, too, feel that Vanguard Target Retirement Funds have a higher stock allocation than I like, and a higher international allocation than I like. And you are correct that if you try to obtain a more conservative stock allocation by choosing an earlier retirement date, you are sliding the slide slope to the left when you wanted to push it down, and they are not the same.

In a paper on Solving the Target Date Fund Benchmarking Conundrum, Morningstar published this chart. The colored lines are their benchmark glide slopes, and the blue lines are the actual glide slopes of actual mutual funds. Unfortunately they don't tell us which are which! Notice that the universe of available target-date mutual funds pretty well crayons in the outline formed by their "conservative" and "aggressive" benchmarks.

Image

In another Morningstar paper, a very interesting one, Bait and Switch: Glide Path Instability, Morningstar complains about the way in which target-fund providers keep changing their glide slopes, and singles out Vanguard as an example. They present this chart. This shows, basically, how Vanguard changed the glide slopes of its funds between 2006 and 2007, goosing up the stock allocations just in time for the crash.

Image

Superimposing these by eye as best I can, and considering that the first chart was published in 2010 (so assuming retirement at 65, a "2060" fund = age 15), I get this...

Image

If I've done the alignment properly, then it looks to me as if before 2006, they were among the most conservative target-date funds, and after the 2006 change, they are now close to Morningstar's "moderate" curve but a bit on the conservative side... and that there do seem to be a few competitor's funds with more conservative allocations, but we can't tell which they are.
Last edited by nisiprius on Sat Dec 23, 2017 1:36 pm, edited 2 times in total.
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Watty
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Re: Any Target Date Funds better than Vanguard?

Post by Watty » Sat Dec 23, 2017 11:47 am

simplesauce wrote:
Sat Dec 23, 2017 9:47 am
-Too aggressive - I prefer at minimum 25% bonds at any age.
-Too much international - 40% intl equities, 30% intl bonds.
-Not based on risk tolerance: If you choose a Vanguard TDF based on risk tolerance alone, Vanguard assumes you are closer to retirement. So the glide path of that fund will move into more bonds very quickly.
A third alternative to using a three fund portfolio or a different date target date fund would be to buy one additional fund that would change the overall asset allocation.

For example you could put 90% of your portfolio in the 2050 fund and 10% into a total bond mutual fund. That would make your overall portfolio less aggressive, reduce the percentage in international, and keep a similar glidepath.

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Re: Any Target Date Funds better than Vanguard?

Post by simplesauce » Sat Dec 23, 2017 11:53 am

Watty wrote:
Sat Dec 23, 2017 11:47 am
simplesauce wrote:
Sat Dec 23, 2017 9:47 am
-Too aggressive - I prefer at minimum 25% bonds at any age.
-Too much international - 40% intl equities, 30% intl bonds.
-Not based on risk tolerance: If you choose a Vanguard TDF based on risk tolerance alone, Vanguard assumes you are closer to retirement. So the glide path of that fund will move into more bonds very quickly.
A third alternative to using a three fund portfolio or a different date target date fund would be to buy one additional fund that would change the overall asset allocation.

For example you could put 90% of your portfolio in the 2050 fund and 10% into a total bond mutual fund. That would make your overall portfolio less aggressive, reduce the percentage in international, and keep a similar glidepath.
This is probably the route I will take. Can you explain the math on how I can figure the new asset allocation if I did this?

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Re: Any Target Date Funds better than Vanguard?

Post by dbr » Sat Dec 23, 2017 11:55 am

My view is that buying a target date fund amounts to taking investing advice from a mutual fund company, which in my view is one of first absolute no-nos of investing.

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Watty
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Re: Any Target Date Funds better than Vanguard?

Post by Watty » Sat Dec 23, 2017 12:34 pm

simplesauce wrote:
Sat Dec 23, 2017 11:53 am
Watty wrote:
Sat Dec 23, 2017 11:47 am
simplesauce wrote:
Sat Dec 23, 2017 9:47 am
-Too aggressive - I prefer at minimum 25% bonds at any age.
-Too much international - 40% intl equities, 30% intl bonds.
-Not based on risk tolerance: If you choose a Vanguard TDF based on risk tolerance alone, Vanguard assumes you are closer to retirement. So the glide path of that fund will move into more bonds very quickly.
A third alternative to using a three fund portfolio or a different date target date fund would be to buy one additional fund that would change the overall asset allocation.

For example you could put 90% of your portfolio in the 2050 fund and 10% into a total bond mutual fund. That would make your overall portfolio less aggressive, reduce the percentage in international, and keep a similar glidepath.
This is probably the route I will take. Can you explain the math on how I can figure the new asset allocation if I did this?
I would just make a simple spreadsheet where you multiply the investment dollars by the fund asset allocation to get the dollars in each asset class then calculate the overall percentage. If you don't know how to use a spreadsheet this would be doable with pencil and paper.

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Re: Any Target Date Funds better than Vanguard?

Post by goblue100 » Sat Dec 23, 2017 1:04 pm

simplesauce wrote:
Sat Dec 23, 2017 9:47 am
Those are my main concerns. Are there any other fund companies that have no-nonsense, low-cost TDFs like Vanguard does?

Can I find one with less international? My risk tolerance does not sit comfortable with 40% international. This adds too much currency risk, political instability risk, investor protection risk, and other concerns raised by Jack Bogle.

By the way, I have embraced Target Date Funds because my biggest enemy in investing is myself (Thank you Mike Piper for writing about this.) So a TDF will keep me on track. That said, I would like to find one that meets my risk tolerance.
Thank you!
I don't think you will find a Target date anywhere close to what you have outlined, with 25% bonds and ~20% international. If you want to blend your own, 55% VFIFX(TD 2050), 25% VTI (total US stock), and 20% BND (us Bonds) gives you a portfolio of:
54% US stock
19% International stock
21.4% Us Bond
3.6% International bond
2% cash, other

It should still glide more conservative as you get closer to retirement.
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Re: Any Target Date Funds better than Vanguard?

Post by willthrill81 » Sat Dec 23, 2017 1:17 pm

Another option for you would be to use Vanguard's Wellington or Wellesley funds. They are roughly 65/35 and 35/65 allocated to stocks and bonds, respectively, and neither have significant international holdings. For the last 25 years, Wellington has had returns nearly identical to that of S&P 500 index funds but with lower drawdowns.
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Re: Any Target Date Funds better than Vanguard?

Post by whodidntante » Sat Dec 23, 2017 1:20 pm

When you buy a target date fund it's a decision to let someone else decide what asset allocation would be appropriate for the target date. Vanguard and other companies have changed their strategy along the way, for example, Vanguard increased international, and Fidelity added commodity exposure. You could find they change their strategy once again, or multiple times in the future.

If you're not OK with someone else making the decision today and in the future, I suggest you use a target date fund as a reference point, and buy the assets you want, taking it upon yourself to periodically rebalance. Two people cannot be in control. A written IPS may be helpful to counteract your tendencies.

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Re: Any Target Date Funds better than Vanguard?

Post by retiredjg » Sat Dec 23, 2017 1:25 pm

simplesauce wrote:
Sat Dec 23, 2017 9:47 am
-Too aggressive - I prefer at minimum 25% bonds at any age.
-Too much international - 40% intl equities, 30% intl bonds.
-Not based on risk tolerance: If you choose a Vanguard TDF based on risk tolerance alone, Vanguard assumes you are closer to retirement. So the glide path of that fund will move into more bonds very quickly.
The first and third issues are solved simply by choosing the fund that matches your desired stock to bond ratio. You do not have to choose the fund that has a certain date in the name. Pick the fund that suits you.

The second issue is much tougher. To find one with less in international, you might have to pay higher expense ratios or pay a transaction fee or maybe some other things I have not thought of.

But willthrill81 brings up a very good idea - maybe you could mix a target date fund (or LifeStrategy) with Wellington or Wellesley, both of which have much lower allocations to international. This would solve your desire to have all-in-one funds and lower the international allocation of your overall portfolio at the same time.

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Re: Any Target Date Funds better than Vanguard?

Post by retiredjg » Sat Dec 23, 2017 1:32 pm

I did a quick check of one of the new Schwab Index Target Funds and found it has a lower allocation to international - roughly 25% to 28% (depending on which chart you look at). If you can buy anything you want, this could be an option for you.

Here's the one I looked at.

https://www.schwab.com/public/schwab/in ... ol%3DSWYEX

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Re: Any Target Date Funds better than Vanguard?

Post by nedsaid » Sat Dec 23, 2017 1:52 pm

Yes, one of the problems with "stay the course" funds like Target Date and Target Risk funds is that the fund sponsors tinker with asset mixes and glide paths. Vanguard has been one of the worst offenders and I am sure this causes Jack Bogle a bit of heartburn as he observes the company he founded.

Nisiprius documents this well with his charts and I also like that he picked up on my "bake your own" theme that I have often sounded here. I like the idea of using Target Date and Target Risk funds as model portfolios. You can customize to your own preferences.

My bark is worse than my bite. I am very enthusiastic about International investing, you would think I have high International weightings, last I checked my International allocations were 29% for stocks and 7% for bonds. I use certain funds as a template, I have the opposite problem from the original poster, I want higher allocations to International than what my fund company recommends.

I have said for years, that the maximum diversification benefit for International Stock allocation is about 30% of an equity portfolio. Vanguard recommends 40%, Merriman recommends 50%. I think anything between 20% and 50% is just fine.
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Re: Any Target Date Funds better than Vanguard?

Post by texasdiver » Sat Dec 23, 2017 2:03 pm

Vanguard's target date funds are incredibly simple and easy to replicate in your own portfolio should you prefer a different ratio of equities to fixed or foreign to domestic. They are composed of just four funds.

Contrast that to say T. Rowe Price's target retirement funds. For example, their target retirement 2030 fund is a ridiculous blend of 15 mostly actively manged equity funds and 5 actively manged bond funds. No one who spends more than 5 minutes on this site would recommend that kind of grab bag 20-fund portfolio on its own.

That said, I have access to the TSP target funds and agree they are probably better. After managing my TSP in multiple funds for years have finally just dumped it all into a target date fund. What makes the TSP better than Vanguard target date funds (IMO) is two things. First, the access to the G-fund which is unique to the TSP, and second, the fee structure which doesn't penalize account holders for choosing target date funds. Because Vanguard doesn't provide the opportunity to do Admiral Shares in Target Date funds the fee structure is slightly higher and it makes them less desirable for high value accounts.

As for the foreign vs domestic allocation. It worked out good for Vanguard this year. Who knows. When you up your foreign percentage you are getting more Samsung vs Apple and more Toyota vs Ford. They are all mostly familiar giant multi-nationals in both indexes. It's not like you are buying obscure Congolese mining stocks or something. I figure the Vanguard folks have spent a whole lot more time thinking about this than I ever will.

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Re: Any Target Date Funds better than Vanguard?

Post by KSActuary » Sat Dec 23, 2017 9:34 pm

American Funds target date series is pretty good but you should remember that most, if not all, TDF funds are actively managed so certain allocations will change over time.

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Re: Any Target Date Funds better than Vanguard?

Post by Taylor Larimore » Sat Dec 23, 2017 9:53 pm

dbr wrote:
Sat Dec 23, 2017 11:55 am
My view is that buying a target date fund amounts to taking investing advice from a mutual fund company, which in my view is one of first absolute no-nos of investing.
dbr:

Care to explain why it is "absolute no-nos" to take advice from salaried experts at a mutual fund company?

Thank you and Happy Holiday!
Taylor
"Simplicity is the master key to financial success." -- Jack Bogle

dbr
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Re: Any Target Date Funds better than Vanguard?

Post by dbr » Sat Dec 23, 2017 10:00 pm

Taylor Larimore wrote:
Sat Dec 23, 2017 9:53 pm
dbr wrote:
Sat Dec 23, 2017 11:55 am
My view is that buying a target date fund amounts to taking investing advice from a mutual fund company, which in my view is one of first absolute no-nos of investing.
dbr:

Care to explain why it is "absolute no-nos" to take advice from salaried experts at a mutual fund company?

Thank you and Happy Holiday!
Taylor
Sure. Conflict of interest.

Secondly, in investing expertise is suspect, to say the least.

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Taylor Larimore
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Re: Any Target Date Funds better than Vanguard?

Post by Taylor Larimore » Sat Dec 23, 2017 10:10 pm

dbr wrote:
Sat Dec 23, 2017 10:00 pm
Taylor Larimore wrote:
Sat Dec 23, 2017 9:53 pm
dbr wrote:
Sat Dec 23, 2017 11:55 am
My view is that buying a target date fund amounts to taking investing advice from a mutual fund company, which in my view is one of first absolute no-nos of investing.
dbr:

Care to explain why it is "absolute no-nos" to take advice from salaried experts at a mutual fund company?

Thank you and Happy Holiday!
Taylor

Sure. Conflict of interest.

Secondly, in investing expertise is suspect, to say the least.
dbr:

Thank you for your reply. Inasmuch as you won't take Vanguard "expert" advice, what do you think is a better source?

Best wishes.
Taylor
"Simplicity is the master key to financial success." -- Jack Bogle

pingo
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Re: Any Target Date Funds better than Vanguard?

Post by pingo » Sat Dec 23, 2017 10:54 pm

Disclosure: We use Vanguard Target Date Funds and we're comfortable with their allocations in terms of stocks and international exposure. We are not adverse to Vanguard's adjustments and we do not dismiss them as frivolous or foolish.
simplesauce wrote:
Sat Dec 23, 2017 10:40 am
When I listen to Bogle speak, he is very adamant about no more than 20% international. [...] Can we trust these foreign markets? Do they have investor protections like the US does?
Most of Vanguard's Total International Stock Index Fund is in solid, stable countries like England, France, Germany, Japan...developed markets where protections may be as strong as in the U.S.

But read the irony: for years Mr. Bogle's "no more than 20% international" has included that they be split evenly between developed markets and EMERGING MARKETS, which do not necessarily have the investor protections of which you speak. In other words, 10% developed and 10% emerging markets creates more EM exposure than a Vanguard Target Retirement Fund.
simplesauce wrote:
Sat Dec 23, 2017 10:40 am
He makes some interesting cases in his Common Sense on Mutual Funds book.
In Common Sense on Mutual funds, he makes a beautiful, philosophical case against international investing. John Bogle has never had the risk tolerance for international investing. He didn't last long in international markets the one time that I'm aware he included them in his portfolio. His faith, confidence and pride remain in his beloved America. He feels no need to look beyond his own borders. Nothing wrong with it.
simplesauce wrote:
Sat Dec 23, 2017 10:40 am
Do you think international stocks are still a new “exotic” investment and we should give more caution to putting our money in countries we don’t understand?
William Bernstein's The Four Pillars of Investing handles the issue of risk vs. reward in safe countries vs. risky countries quite well.


But really, there's nothing wrong with it as long you are sufficiently confident in your asset allocation to stay the course when stocks go haywire and when they disappoint. Whatever stocks you choose, they will go haywire and they will disappoint.
Last edited by pingo on Thu Dec 28, 2017 2:09 pm, edited 4 times in total.

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Re: Any Target Date Funds better than Vanguard?

Post by Dead Man Walking » Sun Dec 24, 2017 3:25 am

I'm not sure that any target date funds are better or worse than Vanguard's. What bothers me about these funds is that whoever provides them can change the asset allocation when they determine a different allocation will be better for the investor. For example, are international bonds advantageous? I have read varying opinions on their value. Furthermore, Vanguard is notorious for changing the indices tracked by the index funds that they offer. I believe that this is a subtle form of active management. I actually prefer some indices other than those that Vanguard has chosen. An example would be their choice of small cap indices. I prefer S&P small cap indices. My preferences may be my form of active management. Vanguard's allocation for target date funds may prove to be excellent for investors; however, I have little faith in "experts" from any quarter of the investment community - including Larry Swedroe, Jack Bogle, Bernstein, etc. I do believe in Bogle's philosophy that costs matter!

DMW

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Re: Any Target Date Funds better than Vanguard?

Post by dbr » Sun Dec 24, 2017 9:11 am

Taylor Larimore wrote:
Sat Dec 23, 2017 10:10 pm
dbr wrote:
Sat Dec 23, 2017 10:00 pm
Taylor Larimore wrote:
Sat Dec 23, 2017 9:53 pm
dbr wrote:
Sat Dec 23, 2017 11:55 am
My view is that buying a target date fund amounts to taking investing advice from a mutual fund company, which in my view is one of first absolute no-nos of investing.
dbr:

Care to explain why it is "absolute no-nos" to take advice from salaried experts at a mutual fund company?

Thank you and Happy Holiday!
Taylor

Sure. Conflict of interest.

Secondly, in investing expertise is suspect, to say the least.
dbr:

Thank you for your reply. Inasmuch as you won't take Vanguard "expert" advice, what do you think is a better source?

Best wishes.
Taylor
1. In the final analysis individual financial planning and investing is the responsibility of the individual.
2. There are many sources of information on financial planning and investing from authors of books, papers, and blogs. These sources vary from astute and disinterested individuals to snake oil salesmen and crackpots. The individual has to sort out the wheat from the chaff. Academic sources can be helpful for perspective.
3. I think this forum does a pretty good job of helping, especially with the Wiki and reading references added. However the individual still has to critically assess the credibility of the discussion here and sort the wheat from chaff compared to what might be read and discussed elsewhere.
4. It is not impossible for good financial planning and investing advice to come from friends and family. It is notorious that these sources can also be the worst possible sources full of bad thinking and disinformation, but I think that is exaggerated. I learned a lot from my father and mother. I first heard the name Vanguard from a co-worker. That lead to doing research leading to the old Diehards Forum morphing to this forum.
5. Ironically employer retirement plans may actually be a valid source of good advice, subject to critical thinking. I learned a lot from the plan materials for my employer 401k plan, but it was also good luck to have a good plan. Looking at known plans like the Federal Government TSP might illustrate models for what should be attempted. It is a fair observation that this category should also be in the no-no on principal, but I would not go that far.
6. It is actually possible to hire competent and ethical advice. The exercise requires critical analysis with the Catch 22 that to select competent advice takes enough know-how to formulate one's own advice, but I would not entirely discard this route.
7. I will even back down to the extent that sometimes "experts" at mutual fund companies publish worthwhile information on the subject. There have been some Vanguard white papers that are quite good. However, those papers have to be taken in a critical context of background before the investor can be sure.

PS Here is a discussion just starting that is germane to this discussion: viewtopic.php?f=10&t=235553&p=3680320#p3680320

PPS I would further add that I bet the combined resources of people posting on this forum are more expert at individual investor financial planning and investing than the combined resources of all the experts at Vanguard. You can also include in the group indirectly here Mr. Bogle himself who is no longer employed at Vanguard and doesn't publish advice coming from Vanguard but who does inform the conversation on this Forum.

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Re: Any Target Date Funds better than Vanguard?

Post by nedsaid » Sun Dec 24, 2017 10:23 am

Taylor Larimore wrote:
Sat Dec 23, 2017 10:10 pm
dbr wrote:
Sat Dec 23, 2017 10:00 pm
Taylor Larimore wrote:
Sat Dec 23, 2017 9:53 pm
dbr wrote:
Sat Dec 23, 2017 11:55 am
My view is that buying a target date fund amounts to taking investing advice from a mutual fund company, which in my view is one of first absolute no-nos of investing.
dbr:

Care to explain why it is "absolute no-nos" to take advice from salaried experts at a mutual fund company?

Thank you and Happy Holiday!
Taylor

Sure. Conflict of interest.

Secondly, in investing expertise is suspect, to say the least.
dbr:

Thank you for your reply. Inasmuch as you won't take Vanguard "expert" advice, what do you think is a better source?

Best wishes.
Taylor
Taylor, I have advised investors to take a careful look at Target Date and Target Risk funds even though they have their flaws. These funds are vastly superior to what most amateur investors would come up with on their own. Also, I would say that the experts at mutual fund companies know a lot more than most individual investors.

There are conflicts of interest all around us, including the nice lady at the grocery store offering free samples. It is called capitalism and we shouldn't be shocked when people are trying to sell us stuff. Vanguard is trying to sell us stuff too, and thought their advice isn't 100% conflict free, it is as good as it gets. A Vanguard financial advisor isn't going to recommend that you take your accounts over to T. Rowe Price, he or she wants you do eat Vanguard's cooking and not someone else's.

Get the opinions of the experts, take into consideration possible conflicts of interest, and use your own judgment.
A fool and his money are good for business.

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Re: Any Target Date Funds better than Vanguard?

Post by dbr » Sun Dec 24, 2017 10:31 am

Reports seem to be fairly much in agreement that Vanguard PAS does not recommend target date funds but rather a four fund portfolio of US and OUS stocks and bonds. So what is the "expert" opinion?

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Re: Any Target Date Funds better than Vanguard?

Post by nedsaid » Sun Dec 24, 2017 10:49 am

dbr wrote:
Sun Dec 24, 2017 10:31 am
Reports seem to be fairly much in agreement that Vanguard PAS does not recommend target date funds but rather a four fund portfolio of US and OUS stocks and bonds. So what is the "expert" opinion?
I suppose one reason for the mostly "cookie cutter" advise is legal liability. The advisors don't want to deviate very far from Vanguard's standard recommendations. One reason I recommend Vanguard investors needing guidance take a look first at Vanguard LifeStrategy or Target Date Retirement funds. You will get a very similar portfolio minus the 0.30% advisory fee.

The thing is, to make advisory services work, you need certain economies of scale. If the advisor had to reinvent the wheel for each client with a complex and customized portfolio, it would be expensive for both the firm and the client. Most everyone has a formula that they work with.
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Re: Any Target Date Funds better than Vanguard?

Post by dbr » Sun Dec 24, 2017 10:55 am

nedsaid wrote:
Sun Dec 24, 2017 10:49 am
dbr wrote:
Sun Dec 24, 2017 10:31 am
Reports seem to be fairly much in agreement that Vanguard PAS does not recommend target date funds but rather a four fund portfolio of US and OUS stocks and bonds. So what is the "expert" opinion?
I suppose one reason for the mostly "cookie cutter" advise is legal liability. The advisors don't want to deviate very far from Vanguard's standard recommendations. One reason I recommend Vanguard investors needing guidance take a look first at Vanguard LifeStrategy or Target Date Retirement funds. You will get a very similar portfolio minus the 0.30% advisory fee.

The thing is, to make advisory services work, you need certain economies of scale. If the advisor had to reinvent the wheel for each client with a complex and customized portfolio, it would be expensive for both the firm and the client. Most everyone has a formula that they work with.
So you are saying you are more confident in your "expert" advice than you are in Vanguard as an "expert" advisor. I guess that kind of makes my point. In particular it points out an example of conflict of interest in action. The investor has to pay 0.30% to get a service that prioritizes economy of scale, cost, and liability concerns over "for each client" for an advisory service that is supposed to be "Personal" Advisory Service.

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Re: Any Target Date Funds better than Vanguard?

Post by nisiprius » Sun Dec 24, 2017 10:59 am

...Can you explain the math on how I can figure the new asset allocation if I did this?...
The key to such things (combining asset allocations etc.) is to convert everything to actual numbers of dollars, then do whatever additions and subtractions you want to make, then convert back to percentages. In your case, we can actually assume any portfolio size, so I will assume $100,000. You didn't give your age or the target date fund you'd be using; I'll use 2040.

We go to the Vanguard website and look at the "Portfolio & Management" tab under Target Retirement 2040 and we see:

1 Vanguard Total Stock Market Index Fund Investor Shares 52.1%
2 Vanguard Total International Stock Index Fund Investor Shares 34.2%
3 Vanguard Total Bond Market II Index Fund Investor Shares 9.6%
4 Vanguard Total International Bond Index Fund Investor Shares 4.1%

If we wanted to put 80% of our money into this fund and 20% into Total Bond, we would have:

$80,000 x the above percentages =

1 Vanguard Total Stock Market Index Fund Investor Shares $41,680
2 Vanguard Total International Stock Index Fund Investor Shares $27.360
3 Vanguard Total Bond Market II Index Fund Investor Shares $7,380
4 Vanguard Total International Bond Index Fund Investor Shares $3,280

Now we add $20,000 in Total Bond to get

1 Vanguard Total Stock Market Index Fund Investor Shares $41,680
2 Vanguard Total International Stock Index Fund Investor Shares $27.360
3 Vanguard Total Bond Market II Index Fund Investor Shares $27,380
4 Vanguard Total International Bond Index Fund Investor Shares $3,280

And our final allocation is

1 Vanguard Total Stock Market Index Fund Investor Shares 41.68%
2 Vanguard Total International Stock Index Fund Investor Shares 27.36%
3 Vanguard Total Bond Market II Index Fund Investor Shares 27.38%
4 Vanguard Total International Bond Index Fund Investor Shares 3.28%

Doing it the other way around is a little trickier. Let's say our goal is for the total bond allocation, U.S. and international to be exactly 25%. That means the stock allocation will be 75%. That means we want $75,000 in stocks.

In the target-date fund, the stock allocation is 52.1% + 34.2% = 86.3% stocks. We want $75,000 in stocks, so we need $75,000 / 86.3% = $86,906.14 worth of the fund to give us $86,906.14 x 86.3% = $75,000. So we need to add $100,000 - 86,906.14 = $13,095.86 in bonds, possibly all Total Bond.

And if you run through the above calculations, assuming $86,904.14 in the 2040 fund plus $13,095.86 in Total Bond you will get:

1 Vanguard Total Stock Market Index Fund Investor Shares 45.28%
2 Vanguard Total International Stock Index Fund Investor Shares 29.72%
3 Vanguard Total Bond Market II Index Fund Investor Shares 21.44%
4 Vanguard Total International Bond Index Fund Investor Shares 3.56%

and indeed 21.44% + 3.56% = 25%.
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Re: Any Target Date Funds better than Vanguard?

Post by nedsaid » Mon Dec 25, 2017 1:12 pm

dbr wrote:
Sun Dec 24, 2017 10:55 am
nedsaid wrote:
Sun Dec 24, 2017 10:49 am
dbr wrote:
Sun Dec 24, 2017 10:31 am
Reports seem to be fairly much in agreement that Vanguard PAS does not recommend target date funds but rather a four fund portfolio of US and OUS stocks and bonds. So what is the "expert" opinion?
I suppose one reason for the mostly "cookie cutter" advise is legal liability. The advisors don't want to deviate very far from Vanguard's standard recommendations. One reason I recommend Vanguard investors needing guidance take a look first at Vanguard LifeStrategy or Target Date Retirement funds. You will get a very similar portfolio minus the 0.30% advisory fee.

The thing is, to make advisory services work, you need certain economies of scale. If the advisor had to reinvent the wheel for each client with a complex and customized portfolio, it would be expensive for both the firm and the client. Most everyone has a formula that they work with.
So you are saying you are more confident in your "expert" advice than you are in Vanguard as an "expert" advisor. I guess that kind of makes my point. In particular it points out an example of conflict of interest in action. The investor has to pay 0.30% to get a service that prioritizes economy of scale, cost, and liability concerns over "for each client" for an advisory service that is supposed to be "Personal" Advisory Service.
What I am saying is listen to the experts, look at the available information, and make up your own mind. I recommend that investors write an Investment Policy Statement, so that they can solidify their own thinking and beliefs, developing their own investment philosophy. As you learn more, you can modify your IPS. Develop strong convictions so that one doesn't totally change the portfolio with every compelling investment book.

I have often advised investors to use Target Date Retirement or Target Risk funds as a model portfolio for their own investments. You can make changes from there. For example, if Vanguard recommends International as 40% of a stock portfolio and you are more comfortable with 30%, you are free to choose 30%. In addition, you can access Vanguard's white papers to see their reasons behind their asset allocation choices.

Let's say your Target Retirement date is 2031 and you pick the Vanguard 2030 Target Date Retirement fund. If you think the asset mix is too aggressive, you can maybe pick the 2025 fund instead.

Vanguard isn't perfect, but at least their model portfolios and white papers give you a starting point. If you are not confident in your investment knowledge and abilities, you could just pick a Vanguard Target Date Retirement fund or a LifeStrategy fund. If you are really clueless and want a live person to help you, the Vanguard Advisory Service might well be worth the 0.30% management fee. I often have said that investment advisors can act much like training wheels on a bicycle. As you learn more and become more confident, you can take the training wheels off.

Vanguard's experts are fallible human beings. Target Date Retirement and Target Risk funds have their flaws as Nisiprius pointed out above. But Vanguard's experts are not idiots. Whatever conflict of interest that they have are relatively minor compared to competitors. Maybe the optimal US/International Mix for stock allocation is 70% US and 30% International and not the 60% US and 40% International that Vanguard recommends, but we won't know that until 10 or 15 years from now.

The point is that you have to start somewhere, you have to trust someone as a trusted source of information and advice. Otherwise, this would be the "stuff the cash in your mattress" forum as we would all be so skeptical that we would never invest money. Common threads would be "Don't trust your Bank" or "Don't trust your Mutual Fund Company" or "John Bogle was wrong about something or other." Shoot, we could be so skeptical that we wouldn't trust John Bogle either.

As far as the advisory business, I will just say that there are certain realities to the business. It is an imperfect business that abounds with flaws. But a lot of that is because of the foibles of human behavior and human nature. Ditto for the investment business. It is what it is. There are firms and advisors that are better than others. Pick the best you can with the best available information and that is about all we can do. Nothing is perfect.
A fool and his money are good for business.

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Re: Any Target Date Funds better than Vanguard?

Post by stemikger » Tue Dec 26, 2017 8:21 am

As far as Target Date Funds, Vanguard seems to keep it simple. Other fund families seem to slice and dice them to death and put everything in them but the kitchen sink. However, I don't like the way Vanguard has changed these over the years. Because of that, I don't think they are a good one fund solution. What is the point if trying to have an easy and simple investing life when the firm keeps changing course.

John Bogle has said in the Boglehead conference video this year that one approach which he likes is all investors at all ages could simply hold a 60/40 balanced index fund for life. You don't have to worry about holding international or anything changing on you. You don't even have to worry about rebalancing. As Jack says investing doesn't get much better than that.
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Re: Any Target Date Funds better than Vanguard?

Post by gvsucavie03 » Tue Dec 26, 2017 8:36 am

stemikger wrote:
Tue Dec 26, 2017 8:21 am
As far as Target Date Funds, Vanguard seems to keep it simple. Other fund families seem to slice and dice them to death and put everything in them but the kitchen sink. However, I don't like the way Vanguard has changed these over the years. Because of that, I don't think they are a good one fund solution. What is the point if trying to have an easy and simple investing life when the firm keeps changing course.

John Bogle has said in the Boglehead conference video this year that one approach which he likes is all investors at all ages could simply hold a 60/40 balanced index fund for life. You don't have to worry about holding international or anything changing on you. You don't even have to worry about rebalancing. As Jack says investing doesn't get much better than that.
Jack also watched the hayday of the post-WWII era back when international was irrelevant due to the booming US economy. The world has changed dramatically since then. I think there is some bias he holds towards US-only.

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Re: Any Target Date Funds better than Vanguard?

Post by stemikger » Tue Dec 26, 2017 9:03 am

gvsucavie03 wrote:
Tue Dec 26, 2017 8:36 am
stemikger wrote:
Tue Dec 26, 2017 8:21 am
As far as Target Date Funds, Vanguard seems to keep it simple. Other fund families seem to slice and dice them to death and put everything in them but the kitchen sink. However, I don't like the way Vanguard has changed these over the years. Because of that, I don't think they are a good one fund solution. What is the point if trying to have an easy and simple investing life when the firm keeps changing course.

John Bogle has said in the Boglehead conference video this year that one approach which he likes is all investors at all ages could simply hold a 60/40 balanced index fund for life. You don't have to worry about holding international or anything changing on you. You don't even have to worry about rebalancing. As Jack says investing doesn't get much better than that.
Jack also watched the hayday of the post-WWII era back when international was irrelevant due to the booming US economy. The world has changed dramatically since then. I think there is some bias he holds towards US-only.
I disagree. Jack is not naive, the man has 65 years of experience and IMHO is the smartest man in the investing world. Even at his age, his intellect is amazing.

Jack does not make decisions willy nilly, his chapter in Common Sense on Mutual Funds is well thought out and makes more sense than any argument I have read for needing to add it.

He also knows international may do better in the future, but that is not the reason to hold it either. I feel comfortable with the mutlinationals in the S&P and/or the Total Stock Market Index getting indirect international exposure.

So far holding the Vanguard Institutional Index Fund has served me well the past 20 plus years.
Choose Simplicity ~ Stay the Course!! ~ Press on Regardless!!!

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Re: Any Target Date Funds better than Vanguard?

Post by Miriam2 » Tue Dec 26, 2017 12:03 pm

Vanguard Target Date funds are superb for millions of investors who don't know the difference between a bond and a stock or the S&P 500 and International, or for those millions of millennials (like my kids :mrgreen: ) who are far more interested in finding a spouse than investing and rebalancing.

If they just keep adding money to their low cost target date fund regularly, their fund will rebalance over time and they will do well, indeed far better than those workers who fail to invest regularly, who only sign up for inappropriate high fee sector funds, or who place their money in local bank savings accounts or CDs.

I think this is the real value of Vanguard Target Date funds. At this point, these investors are not looking for fund perfection.

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Re: Any Target Date Funds better than Vanguard?

Post by pingo » Tue Dec 26, 2017 1:25 pm

Agreed.

When one wants to have a diversified portfolio and to have an experienced portfolio management team make ongoing investment decisions, a Target Retirement Fund fits the bill.

As long as the portfolio manager isn't fleecing the investor, i.e. is low cost, and not involved in churning assets or hyper-active management, it can be a worthy option.

I bet everyone here has revisited asset allocation decisions more than once. Vanguard is no different. Vanguard continues to make responsible investment decisions for those portfolios.

For the OP, it sounds like the following one-stop balanced fund options might be more appropriate:

Vanguard Wellington (VWENX) --> International = currently 19% of stocks, currently.
Dodge & Cox Balanced Fund (DODBX) --> International = 11% of stocks, currently.
Last edited by pingo on Tue Dec 26, 2017 11:28 pm, edited 3 times in total.

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Re: Any Target Date Funds better than Vanguard?

Post by 123 » Tue Dec 26, 2017 1:43 pm

I don't have any Target Date Funds but I recently converted some of our holding from a 3 fund mix to Vanguard Life Strategy Moderate Growth since the allocation fits us. I'm seeing how comfortable I am with it. While these fund-of-funds provide diversification I've come to believe that a significant, but perhaps unstated, reason for going to the 4 fund component model at Vanguard was to provide more stability to the fund. Sure stability can be seen as just another term for risk reduction but it also does something else. A diversified fund may be more stable (less risky) over time and as a consequence fund owners are less likely to abandon it if is has fewer "down" days, over time, then other funds.
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Re: Any Target Date Funds better than Vanguard?

Post by Agggm » Tue Dec 26, 2017 1:57 pm

simplesauce wrote:
Sat Dec 23, 2017 9:47 am
My issues with Vanguard Target Date Funds are:

-Too aggressive - I prefer at minimum 25% bonds at any age.
-Too much international - 40% intl equities, 30% intl bonds.
-Not based on risk tolerance: If you choose a Vanguard TDF based on risk tolerance alone, Vanguard assumes you are closer to retirement. So the glide path of that fund will move into more bonds very quickly.

Those are my main concerns. Are there any other fund companies that have no-nonsense, low-cost TDFs like Vanguard does?

Can I find one with less international? My risk tolerance does not sit comfortable with 40% international. This adds too much currency risk, political instability risk, investor protection risk, and other concerns raised by Jack Bogle.

By the way, I have embraced Target Date Funds because my biggest enemy in investing is myself (Thank you Mike Piper for writing about this.) So a TDF will keep me on track. That said, I would like to find one that meets my risk tolerance.
Thank you!
Charles Schwab has competitive TDFs.

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Re: Any Target Date Funds better than Vanguard?

Post by Taylor Larimore » Tue Dec 26, 2017 2:01 pm

Dead Man Walking wrote:
I'm not sure that any target date funds are better or worse than Vanguard's. What bothers me about these funds is that whoever provides them can change the asset allocation when they determine a different allocation will be better for the investor.
What would you suggest a company do when they determine a different allocation will be better? Do nothing?
I have little faith in "experts" from any quarter of the investment community - including Larry Swedroe, Jack Bogle, Bernstein, etc.
If you don't use the advice of "experts," whose advice to you use?

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Re: Any Target Date Funds better than Vanguard?

Post by MnD » Tue Dec 26, 2017 2:16 pm

Tilting to bonds and US equity sure looks like rear-view mirror investing to me.
What worked great for the last 10 years for US equity and last 25 years for bonds is unlikely to be the successful path going forward.

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Re: Any Target Date Funds better than Vanguard?

Post by Taylor Larimore » Tue Dec 26, 2017 2:43 pm

By the way, I have embraced Target Date Funds because my biggest enemy in investing is myself (Thank you Mike Piper for writing about this.) So a TDF will keep me on track. That said, I would like to find one that meets my risk tolerance.
Simplesauce:

Knowledgeable investors select Target Fund based on their stock/bond ratio--not their target date.

Vanguard offers 12 Target Date Funds to meet the "risk tolerance" of most investors. If you are unsure of what is the best stock/bond ratio for you, use this Vanguard Questionnaire:

https://personal.vanguard.com/us/FundsI ... unds/tools

Best wishes.
Taylor
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Re: Any Target Date Funds better than Vanguard?

Post by Dead Man Walking » Tue Dec 26, 2017 10:29 pm

Taylor Larimore wrote:
Tue Dec 26, 2017 2:01 pm
Dead Man Walking wrote:
I'm not sure that any target date funds are better or worse than Vanguard's. What bothers me about these funds is that whoever provides them can change the asset allocation when they determine a different allocation will be better for the investor.
What would you suggest a company do when they determine a different allocation will be better? Do nothing?
One example that bothered me was Vanguard's choice to include international bonds in target date funds and Life Strategy Funds. Some experts don't think that they add value; others think that they are risky given the current interest rate environment - zero or negative rates in some developed economies. I speculate that Vanguard may be yield chasing in the emerging markets. This may be a good marketing maneuver as Vanguard globalizes.
I have little faith in "experts" from any quarter of the investment community - including Larry Swedroe, Jack Bogle, Bernstein, etc.
If you don't use the advice of "experts," whose advice to you use?

I stated that I have little faith, which is different than no faith. I am a firm believer in Jack Bogle's principle that costs matter and somewhat in his age in bonds philosophy. Bogle's view about international equities is somewhat conservative when compared to Bill Sharpe's. When ideas diverge, I believe that the truth lies somewhere in the middle. The total return of my bond portfolio would have been greater had I followed your advice rather than Swedroe's.

May the new year bring you peace and prosperity!
DMW

Happy Holiday!
Taylor

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Re: Any Target Date Funds better than Vanguard?

Post by pingo » Wed Dec 27, 2017 12:37 am

Vanguard may arguably have oversold the past performance diversification benefit of international bonds, but it's not as oversold as the "questionable benefit" arguments on our forum concerning those bonds.

The first order of diversification comes from stocks vs. bonds.

Beyond that level of diversification, the rest may be just as oversold. Total Stock vs. S&P 500. U.S. vs. International. Total International vs. Developed Markets. Factors vs. Cap-weighted. Total Bond vs. Treasuries. Intermediate-term vs. Short-term. Nominal vs. Inflation-protected. Passive vs. Active.

International bonds are one way to diversify to the nth degree. Not essential, but neither is most of what we do to diversify.
Last edited by pingo on Thu Dec 28, 2017 2:12 pm, edited 10 times in total.

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Re: Any Target Date Funds better than Vanguard?

Post by rgs92 » Wed Dec 27, 2017 12:41 am

Is there any theoretical reason that a target fund would be preferable to VBIAX (Vang. Balanced Index - Admiral)?
I know there is no age-related adjustment, but since the Trinity study (and Firecalc) don't do this, why should anyone do this?
Just curious. Thanks.

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Re: Any Target Date Funds better than Vanguard?

Post by dbr » Wed Dec 27, 2017 9:28 am

rgs92 wrote:
Wed Dec 27, 2017 12:41 am
Is there any theoretical reason that a target fund would be preferable to VBIAX (Vang. Balanced Index - Admiral)?
I know there is no age-related adjustment, but since the Trinity study (and Firecalc) don't do this, why should anyone do this?
Just curious. Thanks.
The Trinity study was specifically about withdrawing money. While FireCalc can be run for years not yet retired it is also mainly about demonstrating the outcome during withdrawal. The simple truth about all the withdrawal studies is that there is no incentive to increase bonds with age while in withdrawal. In fact you can demonstrate some examples where increasing stocks with age is beneficial. Norstad published that years ago and so have other people. It is also true that setting bond allocation too high can be very harmful to retirement prospects, but not so much for setting stock allocation too high. I think Trinity and FireCalc don't mess with what the asset allocation is because Trinity would have had to put together more data and present more charts while getting sidetracked from the main point. FireCalc would need more complicated programing to set up an asset allocation glide path. I'm not sure which of the retirement models actually allows a glide path to be taken into account, if any do.

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Re: Any Target Date Funds better than Vanguard?

Post by willthrill81 » Wed Dec 27, 2017 5:24 pm

dbr wrote:
Wed Dec 27, 2017 9:28 am
rgs92 wrote:
Wed Dec 27, 2017 12:41 am
Is there any theoretical reason that a target fund would be preferable to VBIAX (Vang. Balanced Index - Admiral)?
I know there is no age-related adjustment, but since the Trinity study (and Firecalc) don't do this, why should anyone do this?
Just curious. Thanks.
The Trinity study was specifically about withdrawing money. While FireCalc can be run for years not yet retired it is also mainly about demonstrating the outcome during withdrawal. The simple truth about all the withdrawal studies is that there is no incentive to increase bonds with age while in withdrawal. In fact you can demonstrate some examples where increasing stocks with age is beneficial. Norstad published that years ago and so have other people. It is also true that setting bond allocation too high can be very harmful to retirement prospects, but not so much for setting stock allocation too high. I think Trinity and FireCalc don't mess with what the asset allocation is because Trinity would have had to put together more data and present more charts while getting sidetracked from the main point. FireCalc would need more complicated programing to set up an asset allocation glide path. I'm not sure which of the retirement models actually allows a glide path to be taken into account, if any do.
Michael Kitces has done work in this area that is definitely worth investigating as well.
Yet recent research shows that despite the contrary nature of the strategy – allowing equity exposure to increase during retirement when conventional wisdom suggests it should decline as clients age – it turns out that a “rising equity glidepath” actually does improve retirement outcomes! If market returns are bad in the early years, a rising equity glidepath ensures that clients will dollar cost average into markets at cheaper and cheaper valuations; and if markets are good… well, clients won’t have a lot to worry about in retirement anyway (except perhaps how much excess money will be left over at the end of their life).
https://www.kitces.com/blog/should-equi ... ly-better/

This makes good sense to me. Historically, the primary cause of a questionable or failed retirement spending scenario has been poor equity returns for the first 10-15 years of a 30 year retirement. A reverse glidepath in retirement would presumably offset the impact of this event if it did occur. I think that a significant variable in this strategy is the equity allocation at the beginning of one's retirement; if this number is too low, low bond returns such as those that exist now could really hold a retirees' portfolio down.

It would indeed be very useful for there to be user friendly software available to model the historic impact of changing AA across time. I suspect that the ideal glidepath in terms of maximum likelihood of retirement success would be close to 80-100% equities until around 10-15 years from planned retirement age, a 30-50% equity allocation at retirement, and then rising back to around 70% equities at the halfway point of the planned retirement period.

However, a real problem I see with backtesting in this area is the current combination of very low real returns in bonds combined with high U.S. stock valuations, something that hasn't really happened before. Partly for this reason, Larry Swedroe has actually argued that in the current environment of high valuations, one should actually increase one's stock exposure beyond what was historically prudent due to stocks' lower anticipated returns.
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Re: Any Target Date Funds better than Vanguard?

Post by abuss368 » Wed Dec 27, 2017 9:54 pm

simplesauce wrote:
Sat Dec 23, 2017 9:47 am
My issues with Vanguard Target Date Funds are:

-Too aggressive - I prefer at minimum 25% bonds at any age.
-Too much international - 40% intl equities, 30% intl bonds.
-Not based on risk tolerance: If you choose a Vanguard TDF based on risk tolerance alone, Vanguard assumes you are closer to retirement. So the glide path of that fund will move into more bonds very quickly.

Those are my main concerns. Are there any other fund companies that have no-nonsense, low-cost TDFs like Vanguard does?

Can I find one with less international? My risk tolerance does not sit comfortable with 40% international. This adds too much currency risk, political instability risk, investor protection risk, and other concerns raised by Jack Bogle.

By the way, I have embraced Target Date Funds because my biggest enemy in investing is myself (Thank you Mike Piper for writing about this.) So a TDF will keep me on track. That said, I would like to find one that meets my risk tolerance.
Thank you!
I would recommend that a Target fund be selected based on the underlying allocation to stocks and bonds - not the year. Vanguard's funds are very low cost and diversified with thousands of stocks and bonds. They are difficult to beat.
John C. Bogle: "You simply do not need to put your money into 8 different mutual funds!" | | Disclosure: Three Fund Portfolio + U.S. & International REITs

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