Vanguard offers several different life-cycle funds: the five original STAR funds, which include STAR and the four STAR LifeStrategy funds, plus 11 so-called Target Retirement funds.

Diversified Equity (VDEQX), a fund of equity funds, could also fit into this category, but it's truly an equity-only offering with no logical connection to these other life-cycle funds.

All of these life-cycle funds are "funds of funds," meaning they are funds that invest in other mutual funds, and, except for the original STAR, are all invested predominately in index funds.

Only the three most conservative Target Retirement funds, Target Retirement 2005 (VTOVX), Target Retirement 2010 (VTENX) and Target Retirement 2015 (VTXVX), currently use the actively managed Inflation-Protected Securities (VIPSX).

Although within something less than 10 years, we can expect to see Target Retirement 2020 (VTWNX) and Target Retirement 2025 (VTTVX) begin to allocate some assets to the inflation fund as well.

Don't Fall Into the "Set It and Forget It" Trap

It turns out that investors in retirement plans such as 401(k)s have increasingly been sinking their money into targeted-maturity funds rather than fixed-allocation funds.

These are people who don't want to think about their investments at all — who really do just want to "put it away and forget about it." Obviously, if you simply tell someone to pick the fund whose date most closely matches their expected year of retirement, you've made things ultra simple.

This is lowest-common-denominator investing — and Vanguard loves it! For one thing, it's attractive to folks who just aren't interested in their investments. And once those investments are made, they stick. All fund companies like "sticky" assets.