WASHINGTON — Federal regulators on Wednesday proposed new disclosure rules for target-date retirement funds that would require sponsors to spell out how they are investing the money and to warn about risks.

WASHINGTON — Federal regulators on Wednesday proposed new disclosure rules for target-date retirement funds that would require sponsors to spell out how they are investing the money and to warn about risks.

The Securities and Exchange Commission voted, 5-0, to propose that marketing materials for target-date funds include how investments are being allocated among stocks, bonds, cash and such.

The proposed rules could be formally adopted sometime after a 60-day public comment period, possibly with changes.

Target-date funds, also called lifecycle funds, are pegged to a person's expected retirement year. They are an increasingly popular way to invest in 401(k) accounts and are appealing because of their "set-it-and-forget-it" approach. Usually named for the year the investor expects to retire, the funds now command a total of about $270 billion in assets.

The funds allocate investments among various types of assets, shifting to a more conservative mix as the target date for retirement approaches. The shift is called the fund's "glide path."

The funds drew criticism in the market meltdown of 2008 for wide variations in their returns, and excessive risks and high fees for some funds.

More than 40 companies offer target-date funds. The funds' complexities are so great that comparison tools from financial analysis companies are geared toward advisers and retirement plan administrators, not individual investors. It's difficult to make comparisons because of the wide variation in asset mixes.

Under the SEC proposal, target-date funds' marketing materials, whether electronic or in print, would have to include a prominent table, chart or graph showing the allocations among the various assets over the life of the fund. A statement would have to explain that the asset allocation changes over time.

The marketing materials also would have to include a statement telling prospective investors that they should consider their financial situation and tolerance for risk before going into a fund, and that it is possible to lose money investing in the fund, including at and after the target date.

"It's clear that investors need more information than just the date in a fund's name," SEC Chairman Mary Schapiro said before the vote.

The government has designated the funds as a qualified "default" investment option. That means employers are protected from liability when they invest a worker's contributions in a target-date fund if the worker hasn't chosen otherwise.

"It's not true that this is a good default investment," said Richard Michaud, president and chief investment officer of Boston's New Frontier Advisors and a critic of target-date funds.

Michaud said the SEC's proposed disclosure rules are helpful. However, the agency also should make clear "that these funds are a pretty risky bet on a long-term market," he said in a telephone interview.

Michaud calls "a dangerous myth" the idea that an investor's level of risk should be based on age, since stocks are shown to outperform bonds around three-quarters of the time over the long run. Factors more relevant than age are the investor's financial and personal situations and tolerance for risk, he says.

Target-date funds came under criticism during the market meltdown of 2008 and in its aftermath. Among 31 funds with a 2010 target date, the average loss in 2008 was nearly 25 percent. Returns for those funds varied widely: from minus 3.6 percent to minus 41 percent. Some had half or more of the assets allocated to stocks, only two years from the retirement target.

The funds have mostly recovered their losses since then. However, returns have continued to range widely, according to the SEC, from 7 percent to 31 percent last year for 2010 target funds — with an average return of around 22 percent.

A Senate investigation raised the question of whether some funds charged unreasonable fees and carried excessive risk. Several major fund companies have made changes in response to the criticism, cutting fees for their target date funds and making asset mixes more conservative sooner.

Among the largest providers of target-date funds are Fidelity Investments, Vanguard Group and Principal Financial Group.