Tips for choosing funds

Consider a Target Retirement Fund

A single Target Retirement Fund provides diversification and is designed to keep your assets invested appropriately for someone in your stage of life, up to and including your retirement years.

Investments in Target Retirement Funds are subject to the risks of their underlying funds. The year in the fund name refers to the approximate year (the target date) when an investor in the fund would retire and leave the workforce. The fund will gradually shift its emphasis from more aggressive investments to more conservative ones based on its target date. The Income Fund has a fixed investment allocation and is designed for investors who are already retired. An investment in a Target Retirement Fund is not guaranteed at any time, including on or after the target date.

Consider choosing the fund with the date that’s closest to the year when you expect to retire. If you are already retired, consider choosing Vanguard Target Retirement Income Fund. This fund seeks to provide current income and some capital appreciation to retirees.

Whenever you invest, there’s a chance you could lose the money. Even though Target Retirement Funds simplify the investment process, they still require some monitoring to ensure that your portfolio is in line with your current situation. Each Target Retirement Fund invests in several broadly diversified Vanguard funds. Diversifying means having different types of investments. It doesn’t guarantee you’ll make a profit or that you won’t lose money.

Look for low costs

If you’re choosing your own mix of funds, remember that costs have a substantial impact on long-term net returns. Fund costs are subtracted, dollar for dollar, from investment returns. The lower your costs, the more of your investment returns you can keep. One measure of a fund’s cost to own is its expense ratio.

Consider an index fund

An index fund aims to track the performance of a certain index such as the Standard & Poor’s 500 Index. Index funds generally have lower expense ratios than actively managed funds because they don’t employ costly fund managers or analysts.

Personal Online Advisor

Your plan offers an online investment advisory service called Personal Online Advisor, powered by Edelman Financial Engines.

Personal Online Advisor was developed by Nobel Prize-winning economist William F. Sharpe and a team of leading software and finance experts. It forecasts your chances of meeting your investment goals and offers unbiased, personalized, and ongoing fund recommendations to help you meet those goals. It also offers suggestions to help keep you on track.

This service is part of your plan’s features and is offered at no cost to you. Case Western Reserve University has paid the subscription fee. When you sign up for the service, all your Case Western Reserve University Retirement plan information will be loaded into your account.

Vanguard Managed Account Program (VMAP™), also powered by Edelman Financial Engines—Professional retirement plan account management. VMAP also gives you access to a service called Income+. Income+ helps you set up monthly payments from your plan account to provide you with a steady flow of income in retirement.

If you enroll in VMAP, your account will be charged an annual management fee, calculated as follows:

• 0.4% of your balance per year for the first $100,000 in your account.
• 0.3% of your balance per year for the next $150,000 in your account.
• 0.2% of your balance per year for the next $250,000 in your account.
• 0.1% of your balance per year for amounts of more than $500,000 in your account.

The minimum annual management fee is $60.

You must be registered for online account access to use Personal Online Advisor. To access this service, log in to your account at vanguard.com/retirementplans. (If you have multiple accounts at Vanguard, you may need to select Employer plans after you log in.)

If you’re not registered for online access, sign up now. Go to vanguard.com/retirementplans and select Sign up for online access.

Before you invest, get the details. Consider the fund’s objective, risks, charges, and expenses. The fund’s prospectus (or summary prospectus, if available) will tell you these important facts and more. So read it carefully. Call Vanguard at 800-523-1188 to get one. Or you can find one at vanguard.com.

The Vanguard Group has partnered with Financial Engines Advisors L.L.C. (FEA) to provide subadvisory services to the Vanguard Managed Account Program and Personal Online Advisor. FEA is an independent, federally registered investment advisor that does not sell investments or receive commission for the investments it recommends with respect to the services which it is engaged in as subadvisor for Vanguard Advisers, Inc. (VAI). Advice is provided by Vanguard Advisers, Inc. (VAI), a federally registered investment advisor and an affiliate of The Vanguard Group, Inc. (Vanguard). Vanguard is owned by the Vanguard funds, which are distributed by Vanguard Marketing Corporation, a registered broker-dealer affiliated with VAI and Vanguard. Neither Vanguard, FEA, nor their respective affiliates guarantee future results. Vanguard will use your information in accordance with Vanguard’s Privacy Policy.

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