Choosing allocation within Vanguard Roth 401K

Investing
#1

Hello Jeremy,

I’ve been digging into details of my existing investments as I’m learning from you! I have a Roth 401K that I’m contributing to get my full employer match. Then I am about to open a Roth IRA to put the max $6000/yr into. I’m 40yrs old, no debt (except a mortgage), income $105K.

However, I wanted to ensure that my 401K was investing appropriately. Vanguard automatically determined that Vanguard Target Retirement 2045 Inv (VTIVX) was appropriate when I set up the account. But, I cannot see what this fund is actually invested in. It also seems that I don’t have any options to change to another fund.

Should I trust that this working in my best interest? Or should I press Vanguard to share the details and allow me to make changes if I chose to?

Thank you!
Maria

#2

I wouldn’t put my 401k into a TDF at your age, do you want 10% of your money growing in bonds at around 2% a year?

Many companies offer some of Vanguard’s Institutional funds, see if you can get into VIIIX, it’s got an expense ratio of only .02% and it’s averaged 15% for the last 10 years, basically the same as the index it follows, the S&P 500.

The TDF you mentioned has only averaged 10.95% for the same time period, due at least in part to the cash and bonds it holds. It also has an expense ratio of .15%, which is about 7 times as much as VIIIX

VTIVX is, like most TDFs, invested in other funds. You can find them listed on this page Vanguard Mutual Fund Profile | Vanguard