The average annual 10-year return for the Vanguard Target Retirement 2035 Fund is 6.71% (before taxes). When considering the impact of taxes on distributions and the sale of fund shares, the average annual 10-year return is 6.06%.
Target-date funds like the Vanguard Target Retirement 2035 Fund are designed to simplify investing for retirement by providing a diversified portfolio that automatically adjusts its asset allocation over time. As the target retirement date approaches, the fund typically shifts from a more aggressive allocation of stocks to a more conservative allocation of bonds, aiming to reduce risk.
Understanding Fund Returns
When evaluating fund performance, it's important to consider both pre-tax and after-tax returns, as taxes can significantly impact your actual earnings.
- Pre-Tax Return: This reflects the fund's performance before any taxes are deducted from distributions (like dividends and capital gains) or from the sale of fund shares. It's often the most commonly quoted return.
- After-Tax Return (on distributions and sale of fund shares): This provides a more realistic picture of the return an investor might experience by accounting for the taxes paid on income distributions and capital gains realized when fund shares are sold.
Here's a summary of the performance metrics for the Vanguard Target Retirement 2035 Fund, alongside a relevant category average:
| Return Type | 1 Year | 10 Years |
|---|---|---|
| Vanguard Target Retirement 2035 Fund (Pre-Tax) | 23.84% | 6.71% |
| Target-Date 2035 Category Average (Pre-Tax) | 22.66% | 5.93% |
| Vanguard Target Retirement 2035 Fund (After-Tax on Distributions and Sale of Shares) | 14.87% | 6.06% |
For more detailed information and the latest performance data for the Vanguard Target Retirement 2035 Fund (VTTHX), you can typically find it on investment platform websites. For example, a detailed summary is available through Fidelity Investments.
