Morningstar Portfolios, A Laser Beam On Your Returns

Last Updated on July 8, 2020

Morningstar is a giant within portfolios and portfolios analysis. They display a pure mastery of asset allocation, and it shows in their high returns. There are a lot of portfolios! Here you will find asset allocation as well as performance for the many portfolios Morningstar has created.

The article covers the Lifetime Allocation Indexes (target-date funds), and it includes the Morningstar savings portfolios.

Morningstar Portfolios, A Laser Beam On Your Returns

What is Morningstar?

Morningstar is an investment research company. The offer anaylysis of mutual funds, ETF, and stocks. The also provide rating ratings data, and portfolio tools. In recent years they have begun to rate companies on a socially responsible investing scale. You can read more on that in our article Socially Responsible Investing (ESG) Portfolios On Portfolio Einstein.

Morningstar offers a fantastic set of tools to examine a fund or ETF called the X-ray. It shows many metrics about a fund or ETF. For example, it shows which stocks are in an ETF. It also shows the value or growth tilt of a fund or ETF.

I use it almost every day!

I did a mini-tutorial on this tool. To see it in action please see the article What Is The Best ETF And Mutual Fund?

What is special about Morningstar portfolios?

There are 2 sets of portfolios in this article:

• The Lifetime Allocation Indexes (target-date funds)
• The Morningstar savings portfolios.

The Lifetime Allocation Indexes (target-date funds)

The Morningstar®Lifetime Allocation Indexes are Morningstar’s target-date retirement portfolios. There are a lot of them as Morningstar has an aggressive, moderate and conservative fund for each target-date. This means that for their 2030 target date they have 3 portfolios (aggressive, moderate and conservative). For their 2040 target-date fund, they have 3 portfolio allocation (aggressive, moderate and conservative).

No one other target-date fund provider offers this and it does seem overly complex and confusing. I think it negates much of the simplicity normally associated with target-date retirement funds. In addition, the portfolios have a lot of asset classes. In fact, they have the most number of asset classes of all the target-date portfolios on portfolioeinstein.com. The Goldman Sachs target date portfolios come close. The Morningstar Lifetime Allocation Indexes even have exposure to commodities.

However, with that said – they do very well as can be seen in our comparison of target-date funds here: What Is The Best Target Date Fund?

The robo advisor Ellevest has teamed up with Morninstar and their portfolios share a resemlabne to the Morninstar portfolios. See our post on Ellevest in our article Robo Advisor Ellevest, Are These Women Only High Complex Portfolios Worth It?

The Morningstar savings portfolios

These portfolios have been constructed by Christine Benz who is a  director of personal finance at Morningstar. She has put together the portfolios to help you save for retirement.

In addition, she has also built portfolios for a 3-bucket approach when you already are in retirement. Those portfolios are not suited here but you can find them here. Christine Benz is the author of two wonderful books that come highly recommended.

The first book is Morningstar 30-Minute Money Solutions: A Step-by-Step Guide to Managing Your Finances and the second is Morningstar Guide to Mutual Funds: Five-Star Strategies for Success.

Here is Christine Benz talking about getting your finances in order

Performance of the Morningstar portfolios

Building the portfolio(s)

Below you can see the asset allocations for the portfolio(s). You can also see if the portfolio(s) has a socially responsible investing (ESG) variant portfolio. You can read more about socially responsible investing (ESG) investment portfolios in this post.
To build the portfolio(s) yourself, go to our best in class ETF page to see which ETF you should choose for a particular asset class. There you can also see which socially responsible investing ESG ETFs you should select.

Asset Allocation of the Morningstar portfolios

Please note: The ETFs in parenthesis are our own suggested funds to use to proxy as the asset class. They are not recommendations by Morningstar!

Morningstar Aggressive Retirement Saver Portfolio                       

• 50.00%  US Total Stock Market (VTI)
• 10.00%  US Small Cap Value (VIOV)
• 30.00%  International Developed Blend (VEA)
• 5.00%    Emerging Markets (VWO)
• 5.00%    Total US Bond Market (BND)

Morningstar Moderate Retirement Saver Portfolio                        

• 47.00%  US Total Stock Market (VTI)
• 8.00%    US Small Cap Value (VIOV)
• 20.00%  International Developed Blend (VEA)
• 5.00%    Emerging Markets (VWO)
• 20.00%  Total US Bond Market (BND)

Morningstar Conservative Retirement Saver Portfolio                  

• 33.00%  US Total Stock Market (VTI)
• 5.00%    US Small Cap Value (VIOV)
• 10.00%  International Developed Blend      (VEA)
• 4.00%    Emerging Markets (VWO)
• 30.00%  Total US Bond Market (BND)
• 7.00%    Short-Term Investment-Grade (VCSH)
• 11.00%  TIPS (VTIP)

Morningstar Lifetime Allocation Index Aggressive, 2030                               

• 11.52%  US Large Cap Value (VTV)
• 10.00%  US Large Cap (VV)
• 8.79%    US Large Cap Growth (VUG)
• 4.94%    US Mid Cap Value  (JKI)
• 4.29%    US Mid Cap (IJH)
• 3.77%    US Mid Cap Growth (IJK)
• 3.10%    US Small Cap Value (VIOV)
• 2.69%    US Small Cap (VIOO)
• 2.37%    US Small Cap Growth (IJT)
• 2.68%    REITs (VNQ)
• 21.27%  International Developed Blend (VEA)
• 7.24%    Emerging Markets (VWO)
• 10.03%  Total US Bond Market (BND)
• 0.45%    Cash (money market fund) (BIL)
• 2.45%    Commodities (DBC / GSG)
• 2.12%    TIPS (VTIP)

Morningstar Lifetime Allocation Index Aggressive, 2040                               

• 12.13%  US Large Cap Value (VTV)
• 10.54%  US Large Cap (VV)
• 9.26%    US Large Cap Growth (VUG)
• 5.20%    US Mid Cap Value (JKI)
• 4.52%    US Mid Cap (IJH)
• 3.97%    US Mid Cap Growth (IJK)
• 3.81%    US Small Cap Value (VIOV)
• 3.31%    US Small Cap (VIOO)
• 2.91%    US Small Cap Growth (IJT)
• 2.93%    REITs (VNQ)
• 25.26%  International Developed Blend (VEA)
• 9.54%    Emerging Markets (VWO)
• 3.00%    Total US Bond Market (BND)
• 0.05%    Cash (money market fund) (BIL)
• 2.62%    Commodities (DBC / GSG)
• 0.25%    TIPS (VTIP)

Morningstar Lifetime Allocation Index Aggressive, 2050                               

• 11.34%  US Large Cap Value (VTV)
• 9.85%    US Large Cap (VV)
• 8.66%    US Large Cap Growth (VUG)
• 4.86%    US Mid Cap Value (JKI)
• 4.22%    US Mid Cap (IJH)
• 3.71%    US Mid Cap Growth (IJK)
• 4.10%    US Small Cap Value (VIOV)
• 3.56%    US Small Cap (VIOO)
• 3.13%    US Small Cap Growth (IJT)
• 3.18%    REITs (VNQ)
• 26.55%  International Developed Blend (VEA)
• 11.06%  Emerging Markets (VWO)
• 2.40%    Total US Bond Market (BND)
• 2.78%    Commodities (DBC / GSG)

Morningstar Lifetime Allocation Index Aggressive, 2060                               

• 10.45%  US Large Cap Value         (VTV)
• 9.08%    US Large Cap      (VV)
• 7.98%    US Large Cap Growth     (VUG)
• 4.48%    US Mid Cap Value            (JKI)
• 3.89%    US Mid Cap         (IJH)
• 3.42%    US Mid Cap Growth        (IJK)
• 4.30%    US Small Cap Value         (VIOV)
• 3.73%    US Small Cap      (VIOO)
• 3.28%    US Small Cap Growth     (IJT)
• 3.43%    REITs     (VNQ)
• 27.45%  International Developed Blend      (VEA)
• 12.56%  Emerging Markets           (VWO)
• 2.35%    Total US Bond Market    (BND)
• 2.95%    Commodities     (DBC / GSG)

Morningstar Lifetime Allocation Index Aggressive, Income                         

• 7.45%    US Large Cap Value         (VTV)
• 6.47%    US Large Cap      (VV)
• 5.68%    US Large Cap Growth     (VUG)
• 3.19%    US Mid Cap Value            (JKI)
• 2.77%    US Mid Cap         (IJH)
• 2.44%    US Mid Cap Growth        (IJK)
• 1.18%    US Small Cap Value         (VIOV)
• 1.03%    US Small Cap      (VIOO)
• 0.90%    US Small Cap Growth     (IJT)
• 2.00%    REITs     (VNQ)
• 9.68%    International Developed Blend      (VEA)
• 2.42%    Emerging Markets           (VWO)
• 23.27%  Total US Bond Market    (BND)
• 4.28%    Cash (money market fund)          (BIL)
• 2.00%    Commodities     (DBC / GSG)
• 19.96%  TIPS       (VTIP)

Morningstar Lifetime Allocation Index Conservative, 2030                          

• 6.13%    US Large Cap Value         (VTV)
• 5.32%    US Large Cap      (VV)
• 4.68%    US Large Cap Growth     (VUG)
• 2.63%    US Mid Cap Value            (JKI)
• 2.28%    US Mid Cap         (IJH)
• 2.00%    US Mid Cap Growth        (IJK)
• 1.65%    US Small Cap Value         (VIOV)
• 1.43%    US Small Cap      (VIOO)
• 1.26%    US Small Cap Growth     (IJT)
• 2.18%    REITs     (VNQ)
• 10.87%  International Developed Blend      (VEA)
• 3.70%    Emerging Markets           (VWO)
• 36.52%  Total US Bond Market    (BND)
• 1.64%    Cash (money market fund)          (BIL)
• 2.00%    Commodities     (DBC / GSG)
• 7.71%    TIPS       (VTIP)

Morningstar Lifetime Allocation Index Conservative, 2040                          

• 8.66%    US Large Cap Value         (VTV)
• 7.52%    US Large Cap      (VV)
• 6.61%    US Large Cap Growth     (VUG)
• 3.71%    US Mid Cap Value            (JKI)
• 3.22%    US Mid Cap         (IJH)
• 2.83%    US Mid Cap Growth        (IJK)
• 2.72%    US Small Cap Value         (VIOV)
• 2.36%    US Small Cap      (VIOO)
• 2.07%    US Small Cap Growth     (IJT)
• 2.43%    REITs     (VNQ)
• 17.11%  International Developed Blend      (VEA)
• 6.46%    Emerging Markets           (VWO)
• 24.39%  Total US Bond Market    (BND)
• 0.41%    Cash (money market fund)          (BIL)
• 2.00%    Commodities     (DBC / GSG)
• 2.00%    TIPS       (VTIP)

Morningstar Lifetime Allocation Index Conservative, 2050                          

• 9.89%    US Large Cap Value         (VTV)
• 8.59%    US Large Cap      (VV)
• 7.55%    US Large Cap Growth     (VUG)
• 4.24%    US Mid Cap Value            (JKI)
• 3.68%    US Mid Cap         (IJH)
• 3.24%    US Mid Cap Growth        (IJK)
• 3.57%    US Small Cap Value         (VIOV)
• 3.10%    US Small Cap      (VIOO)
• 2.73%    US Small Cap Growth     (IJT)
• 2.68%    REITs     (VNQ)
• 21.71%  International Developed Blend      (VEA)
• 9.04%    Emerging Markets           (VWO)
• 14.53%  Total US Bond Market    (BND)
• 2.00%    Commodities     (DBC / GSG)

Morningstar Lifetime Allocation Index Conservative, 2060                          

• 9.54%    US Large Cap Value         (VTV)
• 8.28%    US Large Cap      (VV)
• 7.28%    US Large Cap Growth     (VUG)
• 4.09%    US Mid Cap Value            (JKI)
• 3.55%    US Mid Cap         (IJH)
• 3.12%    US Mid Cap Growth        (IJK)
• 3.92%    US Small Cap Value         (VIOV)
• 3.41%    US Small Cap      (VIOO)
• 2.99%    US Small Cap Growth     (IJT)
• 2.93%    REITs     (VNQ)
• 23.17%  International Developed Blend      (VEA)
• 10.61%  Emerging Markets           (VWO)
• 11.89%  Total US Bond Market    (BND)
• 2.00%    Commodities     (DBC / GSG)

Morningstar Lifetime Allocation Index Conservative, Income                    

• 3.29%    US Large Cap Value         (VTV)
• 2.86%    US Large Cap      (VV)
• 2.51%    US Large Cap Growth     (VUG)
• 1.41%    US Mid Cap Value            (JKI)
• 1.23%    US Mid Cap         (IJH)
• 1.08%    US Mid Cap Growth        (IJK)
• 0.52%    US Small Cap Value         (VIOV)
• 0.45%    US Small Cap      (VIOO)
• 0.40%    US Small Cap Growth     (IJT)
• 1.50%    REITs     (VNQ)
• 4.28%    International Developed Blend      (VEA)
• 1.07%    Emerging Markets           (VWO)
• 34.50%  Total US Bond Market    (BND)
• 6.35%    Cash (money market fund)          (BIL)
• 2.00%    Commodities     (DBC / GSG)
• 29.58%  TIPS       (VTIP)

Morningstar Lifetime Allocation Index Moderate, 2030                 

• 9.10%    US Large Cap Value         (VTV)
• 7.90%    US Large Cap      (VV)
• 6.94%    US Large Cap Growth     (VUG)
• 3.90%    US Mid Cap Value            (JKI)
• 3.39%    US Mid Cap         (IJH)
• 2.97%    US Mid Cap Growth        (IJK)
• 2.45%    US Small Cap Value         (VIOV)
• 2.13%    US Small Cap      (VIOO)
• 1.87%    US Small Cap Growth     (IJT)
• 2.68%    REITs     (VNQ)
• 16.47%  International Developed Blend      (VEA)
• 5.61%    Emerging Markets           (VWO)
• 22.03%  Total US Bond Market    (BND)
• 0.98%    Cash (money market fund)          (BIL)
• 2.45%    Commodities     (DBC / GSG)
• 4.65%    TIPS       (VTIP)

Morningstar Lifetime Allocation Index Moderate, 2040                 

• 11.03%  US Large Cap Value         (VTV)
• 9.58%    US Large Cap      (VV)
• 8.42%    US Large Cap Growth     (VUG)
• 4.73%    US Mid Cap Value            (JKI)
• 4.10%    US Mid Cap         (IJH)
• 3.61%    US Mid Cap Growth        (IJK)
• 3.46%    US Small Cap Value         (VIOV)
• 3.01%    US Small Cap      (VIOO)
• 2.64%    US Small Cap Growth     (IJT)
• 2.93%    REITs     (VNQ)
• 22.38%  International Developed Blend      (VEA)
• 8.45%    Emerging Markets           (VWO)
• 10.00%  Total US Bond Market    (BND)
• 0.16%    Cash (money market fund)          (BIL)
• 2.62%    Commodities     (DBC / GSG)
• 0.82%    TIPS       (VTIP)

Morningstar Lifetime Allocation Index Moderate, 2050                 

• 10.92%  US Large Cap Value         (VTV)
• 9.49%    US Large Cap      (VV)
• 8.34%    US Large Cap Growth     (VUG)
• 4.68%    US Mid Cap Value            (JKI)
• 4.07%    US Mid Cap         (IJH)
• 3.57%    US Mid Cap Growth        (IJK)
• 3.95%    US Small Cap Value         (VIOV)
• 3.43%    US Small Cap      (VIOO)
• 3.01%    US Small Cap Growth     (IJT)
• 3.18%    REITs     (VNQ)
• 24.76%  International Developed Blend      (VEA)
• 10.31%  Emerging Markets           (VWO)
• 6.18%    Total US Bond Market    (BND)
• 0.00%    Cash (money market fund)          (BIL)
• 2.78%    Commodities     (DBC / GSG)

Morningstar Lifetime Allocation Index Moderate, 2060                 

• 10.16%  US Large Cap Value         (VTV)
• 8.83%    US Large Cap      (VV)
• 7.76%    US Large Cap Growth     (VUG)
• 4.36%    US Mid Cap Value            (JKI)
• 3.78%    US Mid Cap         (IJH)
• 3.32%    US Mid Cap Growth        (IJK)
• 4.18%    US Small Cap Value         (VIOV)
• 3.63%    US Small Cap      (VIOO)
• 3.19%    US Small Cap Growth     (IJT)
• 3.43%    REITs     (VNQ)
• 25.67%  International Developed Blend      (VEA)
• 11.75%  Emerging Markets           (VWO)
• 5.62%    Total US Bond Market    (BND)
• 0.00%    Cash (money market fund)          (BIL)
• 2.95%    Commodities     (DBC / GSG)

Morningstar Lifetime Allocation Index Moderate, Income                           

• 5.44%    US Large Cap Value         (VTV)
• 4.72%    US Large Cap      (VV)
• 4.15%    US Large Cap Growth     (VUG)
• 2.33%    US Mid Cap Value            (JKI)
• 2.02%    US Mid Cap         (IJH)
• 1.78%    US Mid Cap Growth        (IJK)
• 0.86%    US Small Cap Value         (VIOV)
• 0.75%    US Small Cap      (VIOO)
• 0.66%    US Small Cap Growth     (IJT)
• 2.00%    REITs     (VNQ)
• 7.07%    International Developed Blend      (VEA)
• 1.77%    Emerging Markets           (VWO)
• 28.74%  Total US Bond Market    (BND)
• 5.28%    Cash (money market fund)          (BIL)
• 2.00%    Commodities     (DBC / GSG)
• 24.63%  TIPS       (VTIP)

How we select the right ETFs

There are a lot of ETFs out there. Most of them can be discarded because:

• They are too expensive
• They hold too few assets and are therefore too illiquid
• They do not meet the criteria for representing the asset class they are supposed to mirror.

We have carefully selected an ETF for each asset class that the portfolios on portfolioeinstein.com use. If you want to read more about our selection process and see what we consider the best ETFs please visit our article What Is The Best ETF?

If you are a European investor you need to buy European ETFs. We list 47 best ETFs in our article What Are The Best ETFs For European Investors? (Here Is 47).

As of 2020 we also track socially responsible investing ESG portfolios. Socially responsible investing (ESG) portfolios prioritize investing that puts an emphasis on environmental, social and corporate governance issues.

You can find the socially responsible investing ESG ETFs in the same article.

Here is a discussion of the Morninstar retirement portfolios

Morningstar resources

The Morningstar website

The https://www.morningstar.com/articles/archive/467/us-videos.html Morninstar video archive – great for keeping up with investment news!

Morningstar also has a youtube channel.

Morningstar has a podcast, and you can find it on all podcast outlets

Suggestions for your next steps

Finding the correct portfolio is hard. Maintaining your portfolio is also daunting. If you are still in doubt about which portfolio to choose, we suggest you read our article How To Invest Money: 5 Simple Steps That Work For Anyone

If you have already committed to a portfolio – good for you! If you need help maintaining the portfolio you will find our rebalance worksheet useful. Rebalancing your portfolio lowers your risk and may even provide higher returns in the long run.

You can find the rebalance worksheet in our article Here Is The Most Easy To Use Portfolio Rebalance Tool

Now it’s your turn!

Which portfolio do you use?

After having read up on the Morningstar portfolios, what do you think is right about them?

I encourage you to find other wonderful right here on portfolioeinstein.com.

If you have suggestions for new portfolios, be sure to add them in comments or reach out to me.

I would love to hear from you!