Plan Investing: Vanguard Auto-Balanced Funds Info

Chicago Blower Corporation Profit Sharing and 401(k) Plans

The set of Vanguard Auto-Balanced Funds mutual funds is actually composed of two sets of Vanguard Funds which you can read about directly from Vanguard's website at the following links:

• Vanguard Target Retirement Funds: This is the link to Vanguard's proprietary description of one of its families of "All-in-One" funds. These Target Retirement Funds are a set of individual funds that are broadly diversified within themselves and that gradually become more conservative as your year of retirement approaches, reducing risk automatically. This web page helps you decide which one of these funds may be right for your Plan portfolio.
• Vanguard LifeStrategy®: Funds: Vanguard's proprietary description of another of its family of "All-in-One" funds. Each of the four LifeStrategy® Funds maintain its growth- or income-oriented asset mix; you never have to rebalance to keep your strategy on track. Additionally, each fund is broadly diversified within itself. This web page helps you decide which one of these funds may be right for your Plan portfolio.

Each fund of these two sets of Vanguard All-in-One funds are automatically and regularly (generally each quarter) re-balanced to its strategic allocation of the Vanguard indexed funds that comprise its portfolio. The general strategic process employed and the actual Vanguard Funds comprising each of these Vanguard product lines are as follows:

• Vanguard Target Retirement Funds The current 11 funds comprising this product line are set up to simulate a "Glide Path" to retirement. That is, the funds with the most distant dates (eg. 2045 thru 2065) are structured with the most aggressive allocation to stocks - almost 90% exposure. Those with closer-in dates (eg. 2020 and 2025) adhere to more conservative allocations; stock exposure is in the 70% area for these two funds. The 2020 and 2025 variants currently (as of 3/31/2024) host 40% and 56% respectively in stocks.

  As a Target Retirement fund moves through its initial 20 years of existence, the "Glide Path" is relatively flat with stock exposures remaining around 90%. Thereafter over the succeeding 20 years, reductions in stock exposures occur slowly and steadily over time running on average about 1.5% increasing to about 3% annually.

  The Vanguard Target Retirement Funds have been selected by the Plans' Trustees as the Plans' Department of Labor (DoL) compliant Qualified Default Investment Alternative (QDIA.) The DoL requires QDIA's to be described in an annually-updated official notice available here as an Acrobat .pdf. Operating expense ratios for the Vanguard Target Retirement Funds are fixed by Vanguard at 0.08% annually.

• Vanguard LifeStrategy®: Funds: The 4 funds representing this product line are automatically re-balanced each quarter by Vanguard to maintain a relatively narrow band of asset allocation appropriate to the risk/return profiles described by their names. The second Table below depicts asset allocations in these Funds as of March 31, 2024. More timely data is available in the Quarterly Fund Fact Sheets accessible in the first Table below. Operating expense ratios for all the LifeStrategy® Funds range from 0.11% to 0.14% annually. The Vanguard Funds composing the LifeStrategy® Funds are:

  • Short-Term Inflation Protected Securities Index (Bond) Fund
  • Total Bond Market II Index Fund
  • Total International Bond II Index Fund
  • Total Stock Market Index Plus Fund
  • Total International Stock Index Fund

Current Prospectus, the most recent Fund Financial Reports, and Fund Fact Sheets, all published by Vanguard Funds, should be downloaded and reviewed before making any investment.

Morningstar© Mutual Funds "Quick-Take" independently published reports for each fund are also available with a click!

To aid you in understanding the actual risk/return profiles associate with each of the Vanguard Auto-Balanced funds available through the Plans, we have detailed each fund’s recent (3/31/2022) allocation to major asset classes of money markets, bonds, and stocks in the Table below. It is particularly important to note that even the close-in Target Retirement variants maintain significant allocations to stocks and can therefore result in relatively volatile performance in years very close to the portfolios target maturity. Remember, only you (or your professional financial advisor) can determine the mix appropriate to your investing objectives.