1. Vanguard Managed Payout Fund (VPGDX)
It is by far the largest retirement income fund and has the most aggressive asset allocation with about 65% of its assets in stocks. It uses 10 underlying Vanguard funds, aims for a 4% annual payout and requires a minimum investment of $25,000. It avoids sharp falls in monthly payouts by dipping into principal if the income generated by the portfolio falls. Its annual expense is 0.34%.
2. Schwab Monthly Income Funds
It offers 3 different funds, each one offers a different target payout rate, and even that rate will vary depending on the current interest rate environment, and all allocate assets among 5 in-house Schwab funds.
- Moderate Payout (SWJRX): strives for an annual payout of up to 3%, with 46% of assets in stocks. Annual expense ratio 0.65%.
- Enhanced Payout (SWKRX): strives for an annual payout of up to 4%, with 32% of assets in stocks. Annual expense ratio 0.56%.
- Maximum Payout (SWLRX): strives for an annual payout of up to 5%, with 18% of assets in stocks. Annual expense ratio 0.46%.