Move from Vanguard Target Retirement to Admiral Shares?

[mcharles924]

Hi!

Just realized that I have enough funds in my Rollover IRA Vanguard account to move from a Target Retirement Account (currently at 100% allocation) to a selection of Admiral Shares to save on fees.

2 questions.

1: Anyone see any pitfalls of this change?
2: Do folks have suggestions of funds and percent allocation that may be similar to how I was allocated before? I am happy to set and it and forget with quarterly adjustments.

Thanks!

[RWD]

The Vanguard Target Retirement funds are designed to shift the asset allocation over time (from equities to bonds). If you want to keep doing that you will have to do it yourself.

Without knowing what specific Target Retirement fund you are using it is impossible to tell you what would be a similar allocation. Each one is different based on how far it is from the target retirement date. The good news is you can look at the fund on Vanguard's site and it tells you exactly what underlying funds it is using. For example, in the 2045 Target Retirement fund (VTIVX) under "portfolio composition" you can see that it is currently comprised of 55.4% Vanguard Total Stock Market Index Fund Investor Shares, 34.4% Vanguard Total International Stock Index Fund Investor Shares, 7.0% Vanguard Total Bond Market II Index Fund Investor Shares, and 3.2% Vanguard Total International Bond Index Fund Investor Shares.

[MDM]

See http://forum.mrmoneymustache.com/investor-alley/wealthmentbetterfront-nail-in-the-coffin-article/.

Although the thread title and first several posts may not seem relevant, about half way down the Vanguard funds are discussed in some detail.