Issue No. 21September 2012
Investing Snapshot: New Target Date VT Vantagepoint Milestone Fund
ICMA-RC is pleased to introduce the addition of the VT Vantagepoint Milestone 2050 Fund1, 2 (the "VT Milestone 2050 Fund" or the "Fund"), which will be added to the series of VT Vantagepoint Milestone Funds ("VT Milestone Funds") on or about Dec. 21, 2012.
The Fund extends the range of the existing target date VT Milestone Funds to include a fund with a retirement time horizon of approximately 40 years, which may be appropriate for a plan's youngest participants. It invests in a combination of other underlying Vantagepoint Funds using an asset allocation strategy designed for investors who expect to begin making gradual withdrawals from the Fund, typically at or after retirement (assumed to occur at age 60), in or around the year 2050.
With the availability of the VT Milestone 2050 Fund in December, we plan to implement the following changes, as applicable, in retirement plan(s) that offer the series of VT Milestone Funds:
- we will add the Fund or fund(s) needed to complete the series in your plan's lineup; and
- for participants currently defaulting to the VT Vantagepoint Milestone 2040 Fund1,2 or the VT Vantagepoint Milestone 2045 Fund (the "VT Milestone 2045 Fund”),1, 2but for whom the VT Milestone 2045 Fund or VT Milestone 2050 Fund, respectively, would be a more age-appropriate default option, we will:
- direct future contributions to the appropriate VT Milestone Fund, and
- transfer existing balances to the appropriate VT Milestone Fund.
You do not have to take any action for the changes to occur in your applicable plan(s). Communications were mailed this September to applicable plan sponsors, with instructions on how to notify us by Oct. 31, 2012, if they do not want to have these fund changes occur in their plan(s).
Prior to implementing the changes, a letter will be mailed to applicable participants and they will have the opportunity to select alternative fund(s) of their choice from their plan's current lineup. If you would like additional information, please select the "Contact Us" option for our Plan Sponsor Services team, which is available on each page within EZLink.
1 The expense ratio for a "fund of funds" includes acquired fund fees and expenses, which are expenses incurred indirectly by the fund through its ownership in other mutual funds.
2 The fund is not a complete solution for all of your retirement savings needs. An investment in the fund includes the risk of loss, including near, at or after the target date of the fund. There is no guarantee that the fund will provide adequate income at and through an investor’s retirement. Selecting the fund does not guarantee that you will have adequate savings for retirement.