Which Vangaurd Fund should I use for a Roth IRA?

Question

I am 26 and want to retire at age 60. I have read about the Vangaurd target retirement funds 2040 and 2045 but I am not sure which one to use since I want to retire at 60.

Answer 1

I'd go with the 2045 if this is the style of fund that you want, just because it will be aggressive for slightly longer than the 2040.  My risk tolerance would be high for that period of time, and going too conservative too early could cut your gains over the long run.  Still, 5 years isnt a huge deal in these funds, so you cant go real wrong with either.

Answer 2

I agree with the poster who says neither and suggest Vanguard Global.  In theory, the retirement funds seem like the way to invest, but I really don't think they are the best choice out there.  Also check out moneyrec.com and ask your question there, too.  Great site dedicated to investment questions.

Best of Luck!

Grace

Answer 3

If I were you, I would use neither.  Instead since you are still young, put your Roth IRA into Vanguard Global Equity Fund.  The target date funds are too concentrated in domestic index funds.  You can always re-allocate in 15 years time.

Answer 4

Just use the fund closest to your anticipated retirement year.

Answer 5

At your young age I'd invest in a stock fund rather than one of the bond funds. They have funds pegged to Nasdaq or the S&P. Between now and your retirement stocks are bound to outperform bonds.