# EDGAR Filing Document

**Accession Number:** 0000918266
**File Stem:** 0001193125-23-058094
**Filing Date:** 2023-3
**Character Count:** 689180
**Document Hash:** effa8f55b13d74751b112be6ae3e7da3
**Contains OCR:** False
**Source Format:** 

## Filing Content

## Filing Summary
**0001193125-23-058094.hdr.sgml**: 20230302

**ACCESSION NUMBER**: 0001193125-23-058094

**CONFORMED SUBMISSION TYPE**: N-CSR

**PUBLIC DOCUMENT COUNT**: 44

**CONFORMED PERIOD OF REPORT**: 20221231

**FILED AS OF DATE**: 20230302

**DATE AS OF CHANGE**: 20230302

**EFFECTIVENESS DATE**: 20230302

**FILER**: 

**COMPANY DATA:**
- **COMPANY CONFORMED NAME:** SCHWAB ANNUITY PORTFOLIOS
- **CENTRAL INDEX KEY:** 0000918266
- **IRS NUMBER:** 000000000
- **STATE OF INCORPORATION:** MA
- **FISCAL YEAR END:** 1231

**FILING VALUES:**
- **FORM TYPE:** N-CSR
- **SEC ACT:** 1940 Act
- **SEC FILE NUMBER:** 811-08314
- **FILM NUMBER:** 23698711

**BUSINESS ADDRESS:**
- **STREET 1:** 211 MAIN STREET
- **CITY:** SAN FRANCISCO
- **STATE:** CA
- **ZIP:** 94105
- **BUSINESS PHONE:** 1-415-667-7000

**MAIL ADDRESS:**
- **STREET 1:** 211 MAIN STREET
- **CITY:** SAN FRANCISCO
- **STATE:** CA
- **ZIP:** 94105

## Series and Classes Contracts Data

### Schwab Government Money Market Portfolio (Series ID: S000006545)

| Class ID   | Class Name                               | Ticker Symbol   |
|:---|:---|:---|
| C000017880 | Schwab Government Money Market Portfolio | SWPXX           |

### Schwab S&P 500 Index Portfolio (Series ID: S000006547)

| Class ID   | Class Name                     | Ticker Symbol   |
|:---|:---|:---|
| C000017882 | Schwab S&P 500 Index Portfolio | SWP1Z           |

### Schwab VIT Balanced Portfolio (Series ID: S000036326)

| Class ID   | Class Name                    | Ticker Symbol   |
|:---|:---|:---|
| C000111125 | Schwab VIT Balanced Portfolio | SWB1Z           |

### Schwab VIT Balanced with Growth Portfolio (Series ID: S000036327)

| Class ID   | Class Name                                | Ticker Symbol   |
|:---|:---|:---|
| C000111126 | Schwab VIT Balanced with Growth Portfolio | SWC1Z           |

### Schwab VIT Growth Portfolio (Series ID: S000036328)

| Class ID   | Class Name                  | Ticker Symbol   |
|:---|:---|:---|
| C000111127 | Schwab VIT Growth Portfolio | SWG1Z           |

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**UNITED STATES** 

**SECURITIES AND EXCHANGE COMMISSION** 

**Washington, D.C. 20549** 

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**FORM N-CSR** 

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**CERTIFIED SHAREHOLDER REPORT OF REGISTERED** 

**MANAGEMENT INVESTMENT COMPANIES** 

**Investment Company Act file number: 811-08314** 

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## Schwab Annuity Portfolios
**(Exact name of registrant as specified in charter)** 

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**211 Main Street, San Francisco, California 94105** 

**(Address of principal executive offices) (Zip code)** 

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**Jonathan de St. Paer** 

**Schwab Annuity Portfolios** 

**211 Main Street, San Francisco, California 94105** 

**(Name and address of agent for service)** 

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**Registrant's telephone number, including area code: (415) 636-7000** 

**Date of fiscal year end: December 31** 

**Date of reporting period: December 31, 2022** 

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**Item 1: Report(s) to Shareholders.** 

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![(CHARLES SCHWAB ASSET MANAGMENT LOGO)](g110430img3369132c1.jpg)

**Annual Report** \| December 31, 2022

Schwab Government Money Market Portfolio

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**Proxy Voting Policies, Procedures and Results**

A description of the proxy voting policies and procedures used to determine how to vote proxies on behalf of the funds is available without charge, upon request, by visiting the Schwab Fund's website at www.schwabassetmanagement.com/schwabfunds_prospectus, the SEC's website at www.sec.gov, or by contacting Schwab Funds at 1-877-824-5615.

Information regarding how a fund voted proxies relating to portfolio securities during the most recent twelve-month period ended June 30 is available, without charge, by visiting Schwab's website at www.schwabassetmanagement.com/schwabfunds_prospectus or the SEC's website at www.sec.gov.

**Investment Adviser:** Charles Schwab Investment Management, Inc., dba Schwab Asset Management<sup>TM</sup>

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Schwab Government Money Market Portfolio

Portfolio Management

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;

---

| | |
|:---|:---|
| ![](g110430img09a4feda2.jpg)<br>| &nbsp;&nbsp;&nbsp;&nbsp; **Linda Klingman,** Managing Director and Head of Money Market Strategies for Schwab Asset Management, <br> leads the portfolio management teams for taxable and tax-exempt Schwab Money Funds, and has overall <br> responsibility for all aspects of the management of the fund. Prior to joining Schwab in 1990, she was a senior <br> money market trader with AIM Management, Inc. for five years. She has managed money market funds since <br> &nbsp;&nbsp;&nbsp;&nbsp;1988.<br>|

---

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;

---

| | |
|:---|:---|
| ![](g110430img6b7419463.jpg)<br>| &nbsp;&nbsp;&nbsp;&nbsp; **Lynn Paschen,** Senior Portfolio Manager for Schwab Asset Management, is responsible for the day-to-day <br> co-management of the fund. Prior to joining Schwab in 2011, Ms. Paschen held a number of positions at <br> American Century Investments. She was most recently a portfolio manager and, from 2000 to 2003, worked <br> as a fixed-income trader. She has managed money market funds since 2003.<br>|

---

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;

---

| | |
|:---|:---|
| ![](g110430img61542ada4.jpg)<br>| &nbsp;&nbsp;&nbsp;&nbsp; **Nicole Perret-Gentil,** Portfolio Manager for Schwab Asset Management, is responsible for the day-to-day <br> co-management of the fund. Prior to joining Schwab in 2016, Ms. Perret-Gentil worked at Freddie Mac for <br> 15 years, most recently as a senior portfolio manager where she managed and executed trades for a <br> fixed-income strategy. Prior to that role, she served as a portfolio manager performing fixed-income analysis, a <br> senior research analyst for investor and dealer relations, a senior securities operations analyst in loan and <br> securities operations, and a lead mortgage securities operations specialist. She also worked at Merrill Lynch <br> for a year as a senior specialist in fixed-income global banking and investments.<br>|

---

Schwab Government Money Market Portfolio \| Annual Report**2**

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Schwab Government Money Market Portfolio

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**The Schwab Government Money Market Portfolio's** (the fund) goal is to seek the highest current income consistent with stability of capital and liquidity. To pursue its goal, the fund invests in U.S. government securities such as U.S. Treasury bills and notes, other obligations that are issued by the U.S. government, its agencies, or instrumentalities, repurchase agreements that are collateralized fully by cash and/or U.S. government securities, and obligations that are issued by private issuers that are guaranteed as to principal or interest by the U.S. government, its agencies, or instrumentalities. The fund will invest at least 99.5% of its total assets in cash, U.S. government securities and/or repurchase agreements that are collateralized fully by cash and/or U.S. government securities; under normal circumstances, at least 80% of the fund's net assets (including, for this purpose, any borrowings for investment purposes) will be invested in U.S. government securities, including repurchase agreements that are collateralized fully by U.S. government securities. For more information concerning the fund's investment objective, strategy, and risks, please see the fund's prospectus.

**Market Highlights.** During the 12-month reporting period ended December 31, 2022, interest rates rose as a result of persistently high inflation stemming from a tight labor market, supply chain constraints, and high energy prices in the wake of the COVID-19 pandemic and the war in Ukraine. After maintaining the federal funds rate in a range of 0.00% to 0.25% through mid-March, the U.S. Federal Reserve (Fed) shifted its stance as inflation continued to rise and indicators of economic activity and employment continued to strengthen. After issuing successively stronger signals that interest rates could begin to rise sooner in 2022 than previously anticipated, the Fed increased the federal funds rate seven times by the end of the year to end the reporting period in a range of 4.25% to 4.50%. In addition, the Fed's bond-buying program, which had begun to scale back in November 2021, was ended altogether in early March 2022. In June, the Fed also began to reduce the $9 trillion in assets it holds on its balance sheet.

Given expectations of further rate hikes into 2023, along with persistently high—albeit declining in the second half of the year—inflation, longer-term bond and equity markets weakened, with the S&P 500<sup>®</sup> Index and Bloomberg US Aggregate Bond Index posting their worst calendar year returns in more than a decade. Yields on short-term money market securities increased and demand remained high. At the same time, supply of U.S. Treasuries declined as the U.S. Treasury's borrowing needs decreased. As a result, high demand for the Fed's Overnight Reverse Repurchase Agreement facility drove usage to an all-time high.

Monetary policy around the world varied as central banks responded to the rapidly changing conditions. Over the reporting period, the European Central Bank raised its interest rate four times and the Bank of England raised its key official bank rate eight times. In contrast, the Bank of Japan continued to uphold its short-term interest rate target of -0.1%, unchanged since 2016, but in late December unexpectedly announced that it would widen the band around the yield target of its 10-year government bond, which pushed the yen higher and effectively marked the end of an extended period in which Japan was the only major developed country to resist raising rates.

**Performance, Positioning, and Strategies.** Throughout the reporting period, the fund's investment adviser remained focused on liquidity and stability of capital as market conditions evolved, and on continuing a rigorous credit review process and ongoing monitoring for all issuers and regions in which the fund invests. In anticipation of the Fed's short-term interest rate increases early in the reporting period, followed by the Fed's subsequent actions, the fund's weighted average maturity (WAM) was shortened, beginning the reporting period at 37 days and ending it at 21 days.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;

**Portfolio Composition By Effective Maturity % of Investments**<sup>1</sup> <br>

![](g110430imge40e8e675.jpg)

**Portfolio Composition by Security Type % of Investments**<sup>3</sup> <br>

![](g110430imgd0193e516.jpg)

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;

**Statistics**

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| | |
|:---|:---|
| **Weighted Average Maturity**<sup>2</sup> | 21 Days |

---

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;

Management views and portfolio holdings may have changed since the report date.

<sup>1</sup>

Maturity shown is the date the security matures, the date the interest rate on those securities is reset, or the date those securities can be redeemed through demand.

<sup>2</sup>

Money funds must maintain a dollar-weighted average maturity of no longer than 60 days and cannot invest in any security whose effective maturity is longer than 397 days (approximately 13 months).

<sup>3</sup>

The percentage may differ from the Portfolio Holdings because the above calculation is based on a percentage of total investments, whereas the calculation in the Portfolio Holdings is based on a percentage of net assets.

<sup>4</sup>

Includes the fund's position in money market mutual funds registered under the Investment Company Act of 1940, as amended.

<sup>5</sup>

Less than 0.05%

**3**Schwab Government Money Market Portfolio \| Annual Report

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Schwab Government Money Market Portfolio

Performance and Fund Facts as of December 31, 2022

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**The performance data quoted represents past performance. Past performance does not guarantee future results. Current performance may be lower or higher than performance data quoted. To obtain more current performance information, please visit www.schwabassetmanagement.com/schwabfunds_prospectus.** 

**Seven-Day Average Yield Trend for Previous 12 Months**

![](g110430lg7d_2m44.jpg)

**Seven-Day Yields**<sup>1</sup>

The seven-day yield is the income generated by the fund's holdings minus the fund's operating expenses. The seven-day yields are calculated using standard SEC formulas. The effective yield includes the effect of reinvesting daily dividends. Please remember that money market fund yields fluctuate.

---

| | |
|:---|:---|
|  | **Schwab Government Money Market Portfolio** |
| Ticker Symbol | SWPXX |
| **Seven-Day Yield (with waivers)**<sup>2</sup> <br>| 3.92% |
| **Seven-Day Yield (without waivers)**<sup>2</sup> <br>| 3.92% |
| **Seven-Day Effective Yield (with waivers)**<sup>2</sup> <br>| 4.00% |

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;

**You could lose money by investing in the fund. Although the fund seeks to preserve the value of your investment at $1.00 per share, it cannot guarantee it will do so. An investment in the fund is not insured or guaranteed by the Federal Deposit Insurance Corporation or any other government agency. The fund's sponsor has no legal obligation to provide financial support to the fund, and you should not expect that the sponsor will provide financial support to the fund at any time.**

<sup>1</sup>

Fund yields do not reflect the additional fees and expenses imposed by the insurance company under the variable insurance product contract. If those contract fees and expenses were included, the yields would be less than those shown. Please refer to the variable insurance product prospectus for a complete listing of these expenses.

<sup>2</sup>

The Seven-Day Yield (with waivers) is the average income paid out over the previous seven days assuming interest income is not reinvested and it reflects the effect of any applicable waivers. Absent such waivers, the fund's yield would have been lower. The Seven-Day Yield (without waivers) is the yield without the effect of any applicable waivers. The Seven-Day Effective Yield is the yield with waivers assuming that all interest income is reinvested in additional shares of the fund. For additional details, see financial note 4.

Schwab Government Money Market Portfolio \| Annual Report**4**

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Schwab Government Money Market Portfolio

Fund Expenses (Unaudited)

**Examples for a $1,000 Investment**

As a fund shareholder, you may incur two types of costs: (1) transaction costs; and (2) ongoing costs, including management fees, transfer agent fees, and other fund expenses.

The expense examples below are intended to help you understand your ongoing cost (in dollars) of investing in the fund and to compare this cost with the ongoing cost of investing in other mutual funds. These examples are based on an investment of $1,000 invested for six months beginning July 1, 2022 and held through December 31, 2022.

**The Actual Return** line in the table below provides information about actual account values and actual expenses. You may use this information, together with the amount you invested, to estimate the expenses that you paid over the period. To do so, simply divide your account value by $1,000 (for example, an $8,600 account value ÷ $1,000 = 8.6), then multiply the result by the number given for the fund under the heading entitled "Expenses Paid During Period."

**The Hypothetical Return** line in the table below provides information about hypothetical account values and hypothetical expenses based on the fund's actual expense ratio and an assumed return of 5% per year before expenses. Because the return used is not an actual return, it may not be used to estimate the actual ending account value or expenses you paid for the period.

You may use this information to compare the ongoing costs of investing in the fund and other funds. To do so, compare this 5% hypothetical example with the 5% hypothetical examples that appear in the shareholder reports of the other funds.

Please note that the expenses shown in the table are meant to highlight your ongoing costs only, and do not reflect any transactional costs. Therefore, the hypothetical return lines of the table are useful in comparing ongoing costs only, and will not help you determine the relative total costs of owning different funds. In addition, if these transactional costs were included, your costs would have been higher.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;

---

| | | | | |
|:---|:---|:---|:---|:---|
|  | &nbsp;&nbsp; EXPENSE RATIO <br>(ANNUALIZED) <sup>1</sup> <br>| &nbsp;&nbsp; BEGINNING <br>ACCOUNT VALUE <br>AT 7/1/22<br>| &nbsp;&nbsp; ENDING <br>ACCOUNT VALUE <br>(NET OF EXPENSES) <br>AT 12/31/22<br>| &nbsp;&nbsp; EXPENSES PAID <br>DURING PERIOD <br>7/1/22-12/31/22 <sup>2</sup> <br>|
| **Schwab Government Money Market Portfolio** |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; Actual Return | 0.26% | $1000.00 | $1013.10 | $1.32 |
| &nbsp;&nbsp;&nbsp;&nbsp; Hypothetical 5% Return | 0.26% | $1000.00 | $1023.89 | $1.33 |

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;

<sup>1</sup> Based on the most recent six-month expense ratio; may differ from the expense ratio provided in the Financial Highlights.

<sup>2</sup> Expenses for the fund are equal to its annualized expense ratio, multiplied by the average account value over the period, multiplied by 184 days in the period, and divided by 365 days in the fiscal year. 

**5**Schwab Government Money Market Portfolio \| Annual Report

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Schwab Government Money Market Portfolio

Financial Statements

**FINANCIAL HIGHLIGHTS**

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| | | | | | |
|:---|:---|:---|:---|:---|:---|
|  | 1/1/22– <br>12/31/22<br>| 1/1/21– <br>12/31/21<br>| 1/1/20– <br>12/31/20<br>| 1/1/19– <br>12/31/19<br>| 1/1/18– <br>12/31/18<br>|
| **Per-Share Data** | **Per-Share Data** | **Per-Share Data** | **Per-Share Data** | **Per-Share Data** | **Per-Share Data** |
| Net asset value at beginning of period | &nbsp;&nbsp;&nbsp;&nbsp; $1.00 | &nbsp;&nbsp;&nbsp;&nbsp; $1.00 | &nbsp;&nbsp;&nbsp;&nbsp; $1.00 | &nbsp;&nbsp;&nbsp;&nbsp; $1.00 | &nbsp;&nbsp;&nbsp;&nbsp; $1.00 |
| Income (loss) from investment operations: |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; Net investment income (loss)<sup>1</sup> <br>| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 0.01 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 0.00<sup>2</sup> <br>| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 0.00<sup>2</sup> <br>| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 0.02 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 0.02 |
| &nbsp;&nbsp;&nbsp;&nbsp; Net realized and unrealized gains (losses) | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 0.00<sup>2</sup> <br>| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 0.00<sup>2</sup> <br>| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 0.00<sup>2</sup> <br>| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 0.00<sup>2</sup> <br>| &nbsp;&nbsp;&nbsp;&nbsp; (0.00)<sup>2</sup> <br>|
| &nbsp;&nbsp;&nbsp;&nbsp; Total from investment operations | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 0.01 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 0.00<sup>2</sup> <br>| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 0.00<sup>2</sup> <br>| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 0.02 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 0.02 |
| Less distributions: |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; Distributions from net investment income | &nbsp;&nbsp;&nbsp;&nbsp; (0.01) | &nbsp;&nbsp;&nbsp;&nbsp; (0.00)<sup>23</sup> <br>| &nbsp;&nbsp;&nbsp;&nbsp; (0.00)<sup>2</sup> <br>| &nbsp;&nbsp;&nbsp;&nbsp; (0.02) | &nbsp;&nbsp;&nbsp;&nbsp; (0.02) |
| Net asset value at end of period | &nbsp;&nbsp;&nbsp;&nbsp; $1.00 | &nbsp;&nbsp;&nbsp;&nbsp; $1.00 | &nbsp;&nbsp;&nbsp;&nbsp; $1.00 | &nbsp;&nbsp;&nbsp;&nbsp; $1.00 | &nbsp;&nbsp;&nbsp;&nbsp; $1.00 |
| Total return | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 1.43% | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 0.06%<sup>3</sup> <br>| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 0.28% | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 1.91% | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 1.52% |
| **Ratios/Supplemental Data** | **Ratios/Supplemental Data** | **Ratios/Supplemental Data** | **Ratios/Supplemental Data** | **Ratios/Supplemental Data** | **Ratios/Supplemental Data** |
| Ratios to average net assets: |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; Net operating expenses | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 0.23%<sup>4,5</sup> <br>| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 0.06%<sup>4</sup> <br>| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 0.26%<sup>6,7</sup> <br>| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 0.35% | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 0.35% |
| &nbsp;&nbsp;&nbsp;&nbsp; Gross operating expenses | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 0.26%<sup>5</sup> <br>| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 0.27% | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 0.41% | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 0.47% | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 0.48% |
| &nbsp;&nbsp;&nbsp;&nbsp; Net investment income (loss) | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 1.49% | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 0.06% | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 0.25% | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 1.88% | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 1.55% |
| Net assets, end of period (x 1,000) | $223154 | $184916 | $185074 | $148853 | $138275 |

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;

<sup>1</sup> Calculated based on the average shares outstanding during the period.

<sup>2</sup> Per-share amount was less than $0.005.

<sup>3</sup> These amounts include a non-recurring special distribution. The effect on the distributions from net investment income was less than $0.005 and the effect on the total return was 0.05%. 

<sup>4</sup> Reflects the effect of a voluntary yield waiver (see financial note 4 for additional information).

<sup>5</sup> Ratio includes less than 0.005% of non-routine proxy expenses.

<sup>6</sup> Effective September 24, 2020, the contractual expense limitation changed. The ratio presented for period ended December 31, 2020 is a blended ratio.

<sup>7</sup> Reflects the effect of a voluntary yield waiver in excess of the contractual expense limitation.

*See financial notes*

Schwab Government Money Market Portfolio \| Annual Report**6**

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Schwab Government Money Market Portfolio

Portfolio Holdings as of December 31, 2022

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This section shows all the securities in the fund's portfolio and their values as of the report date.

The fund files its complete schedule of portfolio holdings with the U.S. Securities and Exchange Commission (SEC) monthly on Form N-MFP, which is available immediately upon filing. The fund's Form N-MFP is available on the SEC's website at www.sec.gov. The fund also makes available its complete schedule of portfolio holdings 5 business days after month end on the fund's website at www.schwabassetmanagement.com/schwabfunds_prospectus.

For fixed-rate obligations and repurchase agreements, the rate shown is the coupon rate (the rate established when the obligation was issued) and if the coupon rate is not available, the effective yield at the time of purchase is shown. For variable-rate obligations, the rate shown is the interest rate as of the report date based on each security's rate reset date. The reference rate and spread used is shown parenthetically in the security description, if available; if not, the reference rate is described in a footnote. The date shown in the maturity date column below is either the date on which the principal amount must be paid or the date payment must be made pursuant to a demand feature. If the security's structure includes one of a number of maturity-shortening provisions set forth in Rule 2a-7, such as an interest rate reset, demand feature or put feature, the effective maturity date is also disclosed. If the effective maturity and maturity date are the same, the date will only appear in the maturity date column.

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| | | | | | |
|:---|:---|:---|:---|:---|:---|
| Issuer | Rate | Effective<br> Maturity<br>| Maturity<br> Date<br>| Face<br> Amount ($)<br>| Value ($) |
| **U.S. GOVERNMENT AGENCY DEBT** 19.8% OF NET ASSETS | **U.S. GOVERNMENT AGENCY DEBT** 19.8% OF NET ASSETS | **U.S. GOVERNMENT AGENCY DEBT** 19.8% OF NET ASSETS | **U.S. GOVERNMENT AGENCY DEBT** 19.8% OF NET ASSETS | **U.S. GOVERNMENT AGENCY DEBT** 19.8% OF NET ASSETS | **U.S. GOVERNMENT AGENCY DEBT** 19.8% OF NET ASSETS |
| **FEDERAL FARM CREDIT BANKS FUNDING CORP** |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; <br>(3 mo. US TBILL + 0.02%)<br> *(a)* | 4.42% | 01/04/23 | 05/01/23 | &nbsp;&nbsp; 700000 | &nbsp;&nbsp;&nbsp;&nbsp; 700000 |
| &nbsp;&nbsp;&nbsp;&nbsp; <br>(3 mo. US TBILL + 0.03%)<br> *(a)* | 4.42% | 01/04/23 | 07/13/23 | &nbsp;&nbsp; 300000 | &nbsp;&nbsp;&nbsp;&nbsp; 300000 |
| &nbsp;&nbsp;&nbsp;&nbsp; <br>(EFFR - 0.01%)<br> *(a)* | 4.32% | 01/03/23 | 07/21/23 | &nbsp;&nbsp; 900000 | &nbsp;&nbsp;&nbsp;&nbsp; 900000 |
| &nbsp;&nbsp;&nbsp;&nbsp; <br>(SOFR + 0.03%)<br> *(a)* | 4.33% | 01/03/23 | 08/28/23 | &nbsp;&nbsp; 300000 | &nbsp;&nbsp;&nbsp;&nbsp; 300000 |
|  | 4.88% |  | 09/25/23 | &nbsp;&nbsp; 600000 | &nbsp;&nbsp;&nbsp;&nbsp; 599990 |
| &nbsp;&nbsp;&nbsp;&nbsp; <br>(SOFR + 0.06%)<br> *(a)* | 4.36% | 01/03/23 | 11/07/23 | &nbsp;&nbsp; 200000 | &nbsp;&nbsp;&nbsp;&nbsp; 200000 |
| &nbsp;&nbsp;&nbsp;&nbsp; <br>(SOFR + 0.04%)<br> *(a)* | 4.34% | 01/03/23 | 11/28/23 | &nbsp;&nbsp; 500000 | &nbsp;&nbsp;&nbsp;&nbsp; 500000 |
| &nbsp;&nbsp;&nbsp;&nbsp; <br>(EFFR + 0.03%)<br> *(a)* | 4.36% | 01/03/23 | 12/08/23 | &nbsp;&nbsp; 100000 | &nbsp;&nbsp;&nbsp;&nbsp; 100000 |
| &nbsp;&nbsp;&nbsp;&nbsp; <br>(SOFR + 0.12%)<br> *(a)* | 4.42% | 01/03/23 | 12/08/23 | &nbsp;&nbsp; 300000 | &nbsp;&nbsp;&nbsp;&nbsp; 300169 |
| &nbsp;&nbsp;&nbsp;&nbsp; <br>(SOFR + 0.06%)<br> *(a)* | 4.36% | 01/03/23 | 12/13/23 | &nbsp;&nbsp; 200000 | &nbsp;&nbsp;&nbsp;&nbsp; 200000 |
| &nbsp;&nbsp;&nbsp;&nbsp; <br>(SOFR + 0.08%)<br> *(a)* | 4.38% | 01/03/23 | 04/26/24 | &nbsp;&nbsp; 300000 | &nbsp;&nbsp;&nbsp;&nbsp; 300000 |
| &nbsp;&nbsp;&nbsp;&nbsp; <br>(EFFR + 0.06%)<br> *(a)* | 4.39% | 01/03/23 | 06/24/24 | &nbsp;&nbsp; 300000 | &nbsp;&nbsp;&nbsp;&nbsp; 300000 |
| &nbsp;&nbsp;&nbsp;&nbsp; <br>(SOFR + 0.09%)<br> *(a)* | 4.39% | 01/03/23 | 07/01/24 | &nbsp;&nbsp; 500000 | &nbsp;&nbsp;&nbsp;&nbsp; 500000 |
| &nbsp;&nbsp;&nbsp;&nbsp; <br>(SOFR + 0.10%)<br> *(a)* | 4.40% | 01/03/23 | 08/08/24 | &nbsp;&nbsp; 100000 | &nbsp;&nbsp;&nbsp;&nbsp; 100000 |
| &nbsp;&nbsp;&nbsp;&nbsp; <br>(EFFR + 0.08%)<br> *(a)* | 4.41% | 01/03/23 | 08/12/24 | &nbsp;&nbsp; 400000 | &nbsp;&nbsp;&nbsp;&nbsp; 400060 |
| &nbsp;&nbsp;&nbsp;&nbsp; <br>(SOFR + 0.18%)<br> *(a)* | 4.48% | 01/03/23 | 10/16/24 | &nbsp;&nbsp; 500000 | &nbsp;&nbsp;&nbsp;&nbsp; 500000 |
| &nbsp;&nbsp;&nbsp;&nbsp; <br>(SOFR + 0.13%)<br> *(a)* | 4.43% | 01/03/23 | 11/01/24 | &nbsp;&nbsp; 700000 | &nbsp;&nbsp;&nbsp;&nbsp; 700000 |
| &nbsp;&nbsp;&nbsp;&nbsp; <br>(SOFR + 0.14%)<br> *(a)* | 4.44% | 01/03/23 | 11/07/24 | &nbsp;&nbsp; 300000 | &nbsp;&nbsp;&nbsp;&nbsp; 300000 |
| **FEDERAL HOME LOAN BANKS** |  |  |  |  |  |
|  | 3.84% |  | 01/03/23 | &nbsp;&nbsp; 300000 | &nbsp;&nbsp;&nbsp;&nbsp; 300000 |
|  | 2.64% |  | 01/11/23 | &nbsp;&nbsp; 700000 | &nbsp;&nbsp;&nbsp;&nbsp; 699596 |
|  | 4.02% |  | 01/20/23 | &nbsp;&nbsp; 400000 | &nbsp;&nbsp;&nbsp;&nbsp; 399248 |
|  | 4.10% |  | 01/25/23 | &nbsp;&nbsp; 600000 | &nbsp;&nbsp;&nbsp;&nbsp; 598511 |
|  | 4.09% |  | 01/27/23 | &nbsp;&nbsp; 800000 | &nbsp;&nbsp;&nbsp;&nbsp; 797840 |
|  | 4.14% |  | 02/01/23 | &nbsp;&nbsp; 600000 | &nbsp;&nbsp;&nbsp;&nbsp; 598018 |
|  | 4.23% |  | 02/03/23 | &nbsp;&nbsp; 300000 | &nbsp;&nbsp;&nbsp;&nbsp; 298915 |
|  | 2.17% |  | 02/06/23 | &nbsp;&nbsp; 200000 | &nbsp;&nbsp;&nbsp;&nbsp; 200100 |
|  | 2.15% |  | 02/08/23 | &nbsp;&nbsp; 300000 | &nbsp;&nbsp;&nbsp;&nbsp; 300153 |
|  | 4.22% |  | 02/10/23 | 1500000 | &nbsp;&nbsp; 1493391 |
|  | 4.27% |  | 02/13/23 | &nbsp;&nbsp; 300000 | &nbsp;&nbsp;&nbsp;&nbsp; 298557 |
|  | 4.30% |  | 02/13/23 | 1300000 | &nbsp;&nbsp; 1293700 |
| &nbsp;&nbsp;&nbsp;&nbsp; <br>(SOFR + 0.04%)<br> *(a)* | 4.34% | 01/03/23 | 02/13/23 | &nbsp;&nbsp; 600000 | &nbsp;&nbsp;&nbsp;&nbsp; 600000 |
|  | 4.26% |  | 02/15/23 | 3000000 | &nbsp;&nbsp; 2984896 |
|  | 4.36% |  | 02/22/23 | 1900000 | &nbsp;&nbsp; 1888626 |

---

*See financial notes*

**7**Schwab Government Money Market Portfolio \| Annual Report

------

Schwab Government Money Market Portfolio

Portfolio Holdings as of December 31, 2022 (continued)

------

---

| | | | | | |
|:---|:---|:---|:---|:---|:---|
| Issuer | Rate | Effective<br> Maturity<br>| Maturity<br> Date<br>| Face<br> Amount ($)<br>| Value ($) |
|  | 4.38% |  | 02/24/23 | &nbsp;&nbsp; 300000 | &nbsp;&nbsp;&nbsp;&nbsp; 298124 |
|  | 4.42% |  | 03/01/23 | &nbsp;&nbsp; 600000 | &nbsp;&nbsp;&nbsp;&nbsp; 595850 |
|  | 4.43% |  | 03/03/23 | &nbsp;&nbsp; 900000 | &nbsp;&nbsp;&nbsp;&nbsp; 893543 |
|  | 3.50% |  | 03/09/23 | &nbsp;&nbsp; 600000 | &nbsp;&nbsp;&nbsp;&nbsp; 600011 |
| &nbsp;&nbsp;&nbsp;&nbsp; <br>(SOFR + 0.05%)<br> *(a)* | 4.36% | 01/03/23 | 03/09/23 | &nbsp;&nbsp; 700000 | &nbsp;&nbsp;&nbsp;&nbsp; 700000 |
|  | 2.13% |  | 03/10/23 | &nbsp;&nbsp; 100000 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 99568 |
|  | 4.48% |  | 03/15/23 | 1800000 | &nbsp;&nbsp; 1784274 |
|  | 0.13% |  | 03/17/23 | &nbsp;&nbsp; 100000 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 99127 |
|  | 1.25% |  | 03/21/23 | &nbsp;&nbsp; 750000 | &nbsp;&nbsp;&nbsp;&nbsp; 750000 |
|  | 4.47% |  | 03/23/23 | 1200000 | &nbsp;&nbsp; 1188361 |
|  | 4.51% |  | 03/24/23 | &nbsp;&nbsp; 795000 | &nbsp;&nbsp;&nbsp;&nbsp; 787121 |
| <br>*(b)* | 2.01% |  | 03/30/23 | &nbsp;&nbsp; 600000 | &nbsp;&nbsp;&nbsp;&nbsp; 600000 |
| <br>*(b)* | 2.13% |  | 03/30/23 | &nbsp;&nbsp; 400000 | &nbsp;&nbsp;&nbsp;&nbsp; 399981 |
| &nbsp;&nbsp;&nbsp;&nbsp; <br>(SOFR + 0.05%)<br> *(a)* | 4.35% | 01/03/23 | 04/04/23 | &nbsp;&nbsp; 600000 | &nbsp;&nbsp;&nbsp;&nbsp; 600000 |
| <br>*(b)* | 2.35% |  | 04/05/23 | &nbsp;&nbsp; 600000 | &nbsp;&nbsp;&nbsp;&nbsp; 600000 |
| &nbsp;&nbsp;&nbsp;&nbsp; <br>(SOFR + 0.06%)<br> *(a)* | 4.36% | 01/03/23 | 05/01/23 | &nbsp;&nbsp; 600000 | &nbsp;&nbsp;&nbsp;&nbsp; 600000 |
| <br>*(b)* | 2.60% |  | 05/02/23 | &nbsp;&nbsp; 600000 | &nbsp;&nbsp;&nbsp;&nbsp; 600000 |
|  | 4.66% |  | 05/05/23 | &nbsp;&nbsp; 300000 | &nbsp;&nbsp;&nbsp;&nbsp; 295374 |
| <br>*(b)* | 2.50% |  | 05/23/23 | &nbsp;&nbsp; 600000 | &nbsp;&nbsp;&nbsp;&nbsp; 600000 |
| &nbsp;&nbsp;&nbsp;&nbsp; <br>(SOFR + 0.06%)<br> *(a)* | 4.36% | 01/03/23 | 05/24/23 | &nbsp;&nbsp; 300000 | &nbsp;&nbsp;&nbsp;&nbsp; 300000 |
| <br>*(b)* | 2.40% |  | 06/02/23 | &nbsp;&nbsp; 400000 | &nbsp;&nbsp;&nbsp;&nbsp; 400000 |
|  | 3.25% |  | 06/09/23 | &nbsp;&nbsp; 100000 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 99988 |
|  | 4.69% |  | 06/16/23 | &nbsp;&nbsp; 600000 | &nbsp;&nbsp;&nbsp;&nbsp; 587481 |
|  | 4.70% |  | 06/26/23 | &nbsp;&nbsp; 600000 | &nbsp;&nbsp;&nbsp;&nbsp; 600000 |
| <br>*(b)* | 3.50% |  | 07/14/23 | &nbsp;&nbsp; 700000 | &nbsp;&nbsp;&nbsp;&nbsp; 700000 |
|  | 3.15% |  | 07/27/23 | &nbsp;&nbsp; 400000 | &nbsp;&nbsp;&nbsp;&nbsp; 400000 |
| &nbsp;&nbsp;&nbsp;&nbsp; <br>(SOFR + 0.06%)<br> *(a)* | 4.36% | 01/03/23 | 07/27/23 | &nbsp;&nbsp; 600000 | &nbsp;&nbsp;&nbsp;&nbsp; 600000 |
|  | 3.30% |  | 07/28/23 | &nbsp;&nbsp; 400000 | &nbsp;&nbsp;&nbsp;&nbsp; 400000 |
|  | 3.36% |  | 08/01/23 | &nbsp;&nbsp; 300000 | &nbsp;&nbsp;&nbsp;&nbsp; 294295 |
| <br>*(b)* | 2.75% |  | 08/04/23 | &nbsp;&nbsp; 700000 | &nbsp;&nbsp;&nbsp;&nbsp; 700000 |
|  | 3.17% |  | 08/22/23 | &nbsp;&nbsp; 300000 | &nbsp;&nbsp;&nbsp;&nbsp; 300000 |
|  | 3.38% |  | 09/01/23 | &nbsp;&nbsp; 600000 | &nbsp;&nbsp;&nbsp;&nbsp; 598866 |
|  | 4.85% |  | 09/05/23 | &nbsp;&nbsp; 100000 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 96822 |
|  | 4.80% |  | 09/08/23 | &nbsp;&nbsp; 600000 | &nbsp;&nbsp;&nbsp;&nbsp; 600000 |
| &nbsp;&nbsp;&nbsp;&nbsp; <br>(SOFR + 0.10%)<br> *(a)* | 4.40% | 01/03/23 | 09/21/23 | &nbsp;&nbsp; 600000 | &nbsp;&nbsp;&nbsp;&nbsp; 600000 |
| &nbsp;&nbsp;&nbsp;&nbsp; <br>(SOFR + 0.04%)<br> *(a)* | 4.34% | 01/03/23 | 10/06/23 | &nbsp;&nbsp; 700000 | &nbsp;&nbsp;&nbsp;&nbsp; 700000 |
|  | 4.75% |  | 10/24/23 | &nbsp;&nbsp; 100000 | &nbsp;&nbsp;&nbsp;&nbsp; 100000 |
| &nbsp;&nbsp;&nbsp;&nbsp; <br>(SOFR + 0.10%)<br> *(a)* | 4.40% | 01/03/23 | 07/26/24 | &nbsp;&nbsp; 700000 | &nbsp;&nbsp;&nbsp;&nbsp; 700000 |
| **FEDERAL HOME LOAN MORTGAGE CORPORATION** |  |  |  |  |  |
| <br>*(b)* | 2.50% |  | 04/21/23 | &nbsp;&nbsp; 600000 | &nbsp;&nbsp;&nbsp;&nbsp; 600000 |
|  | 0.38% |  | 05/05/23 | &nbsp;&nbsp; 300000 | &nbsp;&nbsp;&nbsp;&nbsp; 297337 |
|  | 0.25% |  | 06/26/23 | &nbsp;&nbsp; 600000 | &nbsp;&nbsp;&nbsp;&nbsp; 592358 |
| **FEDERAL NATIONAL MORTGAGE ASSOCIATION** |  |  |  |  |  |
|  | 0.25% |  | 05/22/23 | &nbsp;&nbsp; 700000 | &nbsp;&nbsp;&nbsp;&nbsp; 694730 |
|  | 0.25% |  | 07/10/23 | &nbsp;&nbsp; 800000 | &nbsp;&nbsp;&nbsp;&nbsp; 788784 |
|  | 5.00% |  | 12/20/23 | &nbsp;&nbsp; 400000 | &nbsp;&nbsp;&nbsp;&nbsp; 400000 |
| **Total U.S. Government Agency Debt** <br>**(Cost $44,193,765)** | **Total U.S. Government Agency Debt** <br>**(Cost $44,193,765)** | **Total U.S. Government Agency Debt** <br>**(Cost $44,193,765)** | **Total U.S. Government Agency Debt** <br>**(Cost $44,193,765)** | **Total U.S. Government Agency Debt** <br>**(Cost $44,193,765)** | **44193765** |

---

*See financial notes*

Schwab Government Money Market Portfolio \| Annual Report**8**

------

Schwab Government Money Market Portfolio

Portfolio Holdings as of December 31, 2022 (continued)

------

---

| | | | | | |
|:---|:---|:---|:---|:---|:---|
| Issuer | Rate | Effective<br> Maturity<br>| Maturity<br> Date<br>| Face<br> Amount ($)<br>| Value ($) |
| **U.S. TREASURY DEBT** 9.7% OF NET ASSETS | **U.S. TREASURY DEBT** 9.7% OF NET ASSETS | **U.S. TREASURY DEBT** 9.7% OF NET ASSETS | **U.S. TREASURY DEBT** 9.7% OF NET ASSETS | **U.S. TREASURY DEBT** 9.7% OF NET ASSETS | **U.S. TREASURY DEBT** 9.7% OF NET ASSETS |
| **UNITED STATES TREASURY** |  |  |  |  |  |
|  | 0.13% |  | 01/31/23 | &nbsp;&nbsp; 500000 | &nbsp;&nbsp;&nbsp;&nbsp; 498461 |
| &nbsp;&nbsp;&nbsp;&nbsp; <br>(3 mo. US TBILL + 0.05%)<br> *(a)* | 4.45% | 01/03/23 | 01/31/23 | 2500000 | &nbsp;&nbsp; 2500053 |
|  | 2.86% |  | 02/02/23 | &nbsp;&nbsp; 400000 | &nbsp;&nbsp;&nbsp;&nbsp; 399059 |
|  | 2.89% |  | 02/02/23 | &nbsp;&nbsp; 800000 | &nbsp;&nbsp;&nbsp;&nbsp; 798100 |
|  | 2.00% |  | 02/15/23 | &nbsp;&nbsp; 500000 | &nbsp;&nbsp;&nbsp;&nbsp; 500541 |
|  | 0.13% |  | 02/28/23 | &nbsp;&nbsp; 600000 | &nbsp;&nbsp;&nbsp;&nbsp; 598440 |
|  | 2.63% |  | 02/28/23 | &nbsp;&nbsp; 800000 | &nbsp;&nbsp;&nbsp;&nbsp; 800909 |
|  | 4.32% |  | 03/07/23 | &nbsp;&nbsp; 700000 | &nbsp;&nbsp;&nbsp;&nbsp; 694788 |
|  | 4.38% |  | 03/14/23 | &nbsp;&nbsp; 700000 | &nbsp;&nbsp;&nbsp;&nbsp; 694123 |
|  | 4.37% |  | 03/21/23 | 1400000 | &nbsp;&nbsp; 1387093 |
|  | 0.13% |  | 03/31/23 | 1000000 | &nbsp;&nbsp;&nbsp;&nbsp; 995111 |
|  | 2.50% |  | 03/31/23 | &nbsp;&nbsp; 500000 | &nbsp;&nbsp;&nbsp;&nbsp; 501039 |
|  | 0.13% |  | 04/30/23 | &nbsp;&nbsp; 200000 | &nbsp;&nbsp;&nbsp;&nbsp; 198676 |
| &nbsp;&nbsp;&nbsp;&nbsp; <br>(3 mo. US TBILL + 0.03%)<br> *(a)* | 4.43% | 01/03/23 | 04/30/23 | &nbsp;&nbsp; 700000 | &nbsp;&nbsp;&nbsp;&nbsp; 700020 |
|  | 4.63% |  | 05/25/23 | &nbsp;&nbsp; 700000 | &nbsp;&nbsp;&nbsp;&nbsp; 687517 |
| &nbsp;&nbsp;&nbsp;&nbsp; <br>(3 mo. US TBILL + 0.03%)<br> *(a)* | 4.43% | 01/03/23 | 07/31/23 | 1500000 | &nbsp;&nbsp; 1500838 |
| &nbsp;&nbsp;&nbsp;&nbsp; <br>(3 mo. US TBILL + 0.04%)<br> *(a)* | 4.43% | 01/03/23 | 10/31/23 | 1200000 | &nbsp;&nbsp; 1200775 |
| &nbsp;&nbsp;&nbsp;&nbsp; <br>(3 mo. US TBILL + 0.04%)<br> *(a)* | 4.44% | 01/03/23 | 07/31/24 | 5200000 | &nbsp;&nbsp; 5196656 |
| &nbsp;&nbsp;&nbsp;&nbsp; <br>(3 mo. US TBILL + 0.14%)<br> *(a)* | 4.54% | 01/03/23 | 10/31/24 | 1800000 | &nbsp;&nbsp; 1797577 |
| **Total U.S. Treasury Debt** <br>**(Cost $21,649,776)** | **Total U.S. Treasury Debt** <br>**(Cost $21,649,776)** | **Total U.S. Treasury Debt** <br>**(Cost $21,649,776)** | **Total U.S. Treasury Debt** <br>**(Cost $21,649,776)** | **Total U.S. Treasury Debt** <br>**(Cost $21,649,776)** | **21649776** |
| **VARIABLE RATE DEMAND NOTES** 0.3% OF NET ASSETS | **VARIABLE RATE DEMAND NOTES** 0.3% OF NET ASSETS | **VARIABLE RATE DEMAND NOTES** 0.3% OF NET ASSETS | **VARIABLE RATE DEMAND NOTES** 0.3% OF NET ASSETS | **VARIABLE RATE DEMAND NOTES** 0.3% OF NET ASSETS | **VARIABLE RATE DEMAND NOTES** 0.3% OF NET ASSETS |
| **FARR LIFE LLC** |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; TAXABLE VARIABLE RATE DEMAND NOTES SERIES 2022 (**LOC**: FEDERAL <br> HOME LOAN BANKS)<br>*(c)* | 4.38% |  | 01/06/23 | &nbsp;&nbsp; 600000 | &nbsp;&nbsp;&nbsp;&nbsp; 600000 |
| **Total Variable Rate Demand Notes** <br>**(Cost $600,000)** | **Total Variable Rate Demand Notes** <br>**(Cost $600,000)** | **Total Variable Rate Demand Notes** <br>**(Cost $600,000)** | **Total Variable Rate Demand Notes** <br>**(Cost $600,000)** | **Total Variable Rate Demand Notes** <br>**(Cost $600,000)** | **600000** |
| **INVESTMENT COMPANIES** 0.0% OF NET ASSETS | **INVESTMENT COMPANIES** 0.0% OF NET ASSETS | **INVESTMENT COMPANIES** 0.0% OF NET ASSETS | **INVESTMENT COMPANIES** 0.0% OF NET ASSETS | **INVESTMENT COMPANIES** 0.0% OF NET ASSETS | **INVESTMENT COMPANIES** 0.0% OF NET ASSETS |
| **MONEY MARKET FUNDS 0.0%** | **MONEY MARKET FUNDS 0.0%** | **MONEY MARKET FUNDS 0.0%** | **MONEY MARKET FUNDS 0.0%** | **MONEY MARKET FUNDS 0.0%** |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; STATE STREET INSTITUTIONAL U.S. GOVERNMENT MONEY MARKET <br> FUND, PREMIER CLASS<br>*(d)* | 4.12% |  |  | &nbsp;&nbsp;&nbsp;&nbsp; 45600 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 45600 |
| **Total Investment Companies** <br>**(Cost $45,600)** | **Total Investment Companies** <br>**(Cost $45,600)** | **Total Investment Companies** <br>**(Cost $45,600)** | **Total Investment Companies** <br>**(Cost $45,600)** | **Total Investment Companies** <br>**(Cost $45,600)** | **45600** |

---

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;

---

| | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|
| ISSUER | FOOTNOTES | RATE | &nbsp;&nbsp; EFFECTIVE<br> MATURITY<br>| MATURITY<br> DATE<br>| MATURITY<br> AMOUNT ($)<br>| VALUE ($) |
| **REPURCHASE AGREEMENTS** 69.9% OF NET ASSETS | **REPURCHASE AGREEMENTS** 69.9% OF NET ASSETS | **REPURCHASE AGREEMENTS** 69.9% OF NET ASSETS | **REPURCHASE AGREEMENTS** 69.9% OF NET ASSETS | **REPURCHASE AGREEMENTS** 69.9% OF NET ASSETS | **REPURCHASE AGREEMENTS** 69.9% OF NET ASSETS | **REPURCHASE AGREEMENTS** 69.9% OF NET ASSETS |
| **U.S. GOVERNMENT AGENCY REPURCHASE AGREEMENTS\* 67.7%** | **U.S. GOVERNMENT AGENCY REPURCHASE AGREEMENTS\* 67.7%** | **U.S. GOVERNMENT AGENCY REPURCHASE AGREEMENTS\* 67.7%** | **U.S. GOVERNMENT AGENCY REPURCHASE AGREEMENTS\* 67.7%** | **U.S. GOVERNMENT AGENCY REPURCHASE AGREEMENTS\* 67.7%** | **U.S. GOVERNMENT AGENCY REPURCHASE AGREEMENTS\* 67.7%** | **U.S. GOVERNMENT AGENCY REPURCHASE AGREEMENTS\* 67.7%** |
| **BANCO SANTANDER SA** |  |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; Issued 12/30/22, repurchase date 01/03/23 |  | 4.31% |  | 01/03/23 | &nbsp;&nbsp; 1000479 | &nbsp;&nbsp;&nbsp;&nbsp; 1000000 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (Collateralized by U.S. Treasury and U.S. Government Agency <br> Securities valued at $1,030,052, 2.00% - 6.50%, due 04/30/27 - <br> 10/01/52)<br>|  |  |  |  |  |  |

---

*See financial notes*

**9**Schwab Government Money Market Portfolio \| Annual Report

------

Schwab Government Money Market Portfolio

Portfolio Holdings as of December 31, 2022 (continued)

------

---

| | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|
| ISSUER | FOOTNOTES | RATE | &nbsp;&nbsp; EFFECTIVE<br> MATURITY<br>| MATURITY<br> DATE<br>| MATURITY<br> AMOUNT ($)<br>| VALUE ($) |
| **BANK OF MONTREAL** |  |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; Issued 12/30/22, repurchase date 01/03/23 |  | 4.30% |  | 01/03/23 | 20009556 | &nbsp;&nbsp; 20000000 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (Collateralized by U.S. Government Agency Securities valued at <br> $20,609,843, 5.80% - 5.87%, due 04/20/72 - 05/20/72)<br>|  |  |  |  |  |  |
| **BARCLAYS BANK PLC** |  |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; Issued 12/30/22, repurchase date 01/03/23 |  | 4.30% |  | 01/03/23 | &nbsp;&nbsp; 5002389 | &nbsp;&nbsp;&nbsp;&nbsp; 5000000 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (Collateralized by U.S. Government Agency Securities valued at <br> $5,152,461, 2.50%, due 09/20/51)<br>|  |  |  |  |  |  |
| **BOFA SECURITIES INC** |  |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; Issued 12/30/22, repurchase date 01/03/23 |  | 4.30% |  | 01/03/23 | 30014333 | &nbsp;&nbsp; 30000000 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (Collateralized by U.S. Government Agency Securities valued at <br> $30,900,001, 5.00%, due 12/01/52)<br>|  |  |  |  |  |  |
| **DAIWA CAPITAL MARKETS AMERICA INC** |  |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; Issued 12/30/22, repurchase date 01/03/23 |  | 4.30% |  | 01/03/23 | &nbsp;&nbsp; 9004300 | &nbsp;&nbsp;&nbsp;&nbsp; 9000000 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (Collateralized by U.S. Government Agency Securities valued at <br> $9,360,001, 3.00% - 6.00%, due 09/01/37 - 12/01/52)<br>|  |  |  |  |  |  |
| **DEUTSCHE BANK AG (NEW YORK BRANCH)** |  |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; Issued 12/30/22, repurchase date 01/03/23 |  | 4.30% |  | 01/03/23 | 20009556 | &nbsp;&nbsp; 20000000 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (Collateralized by U.S. Treasury Securities valued at $20,409,783, <br> 1.25%, due 05/31/28)<br>|  |  |  |  |  |  |
| **FICC - BANK OF NEW YORK** |  |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; Issued 12/30/22, repurchase date 01/03/23 |  | 4.31% |  | 01/03/23 | &nbsp;&nbsp; 2000958 | &nbsp;&nbsp;&nbsp;&nbsp; 2000000 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (Collateralized by U.S. Government Agency Securities valued at <br> $2,060,001, 3.50% - 4.00%, due 05/01/52 - 12/01/52)<br>|  |  |  |  |  |  |
| **GOLDMAN SACHS & CO LLC** |  |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; Issued 12/28/22, repurchase date 01/04/23 |  | 4.30% |  | 01/04/23 | &nbsp;&nbsp; 5004181 | &nbsp;&nbsp;&nbsp;&nbsp; 5000000 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (Collateralized by U.S. Government Agency Securities valued at <br> $5,100,000, 2.00% - 4.50%, due 08/01/31 - 02/20/52)<br>|  |  |  |  |  |  |
| **JP MORGAN SECURITIES LLC** |  |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; Issued 12/30/22, repurchase date 01/03/23 |  | 4.30% |  | 01/03/23 | 20009556 | &nbsp;&nbsp; 20000000 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (Collateralized by U.S. Government Agency Securities valued at <br> $20,600,000, 2.50% - 7.50%, due 04/20/32 - 07/20/62)<br>|  |  |  |  |  |  |
| **MIZUHO SECURITIES USA LLC** |  |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; Issued 12/30/22, repurchase date 01/03/23 |  | 4.30% |  | 01/03/23 | 20009556 | &nbsp;&nbsp; 20000000 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (Collateralized by U.S. Treasury Securities valued at $20,400,037, <br> 0.75% - 2.88%, due 10/31/23 - 08/31/26)<br>|  |  |  |  |  |  |
| **NOMURA SECURITIES INTERNATIONAL INC** |  |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; Issued 12/30/22, repurchase date 01/03/23 |  | 4.30% |  | 01/03/23 | &nbsp;&nbsp; 9004300 | &nbsp;&nbsp;&nbsp;&nbsp; 9000000 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (Collateralized by U.S. Treasury and U.S. Government Agency <br> Securities valued at $9,180,235, 0.00% - 4.10%, due 04/13/23 - <br> 08/15/49)<br>|  |  |  |  |  |  |
| **RBC DOMINION SECURITIES INC** |  |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; Issued 12/28/22, repurchase date 01/04/23 |  | 4.30% |  | 01/04/23 | &nbsp;&nbsp; 9007525 | &nbsp;&nbsp;&nbsp;&nbsp; 9000000 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (Collateralized by U.S. Treasury and U.S. Government Agency <br> Securities valued at $9,277,609, 0.13% - 5.50%, due 09/01/24 - <br> 10/20/52)<br>|  |  |  |  |  |  |

---

*See financial notes*

Schwab Government Money Market Portfolio \| Annual Report**10**

------

Schwab Government Money Market Portfolio

Portfolio Holdings as of December 31, 2022 (continued)

------

---

| | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|
| ISSUER | FOOTNOTES | RATE | &nbsp;&nbsp; EFFECTIVE<br> MATURITY<br>| MATURITY<br> DATE<br>| MATURITY<br> AMOUNT ($)<br>| VALUE ($) |
| **WELLS FARGO SECURITIES LLC** |  |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; Issued 12/30/22, repurchase date 01/03/23 |  | 4.31% |  | 01/03/23 | &nbsp;&nbsp; 1000479 | &nbsp;&nbsp;&nbsp;&nbsp; 1000000 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (Collateralized by U.S. Government Agency Securities valued at <br> $1,040,499, 2.50%, due 09/01/51)<br>|  |  |  |  |  |  |
|  |  |  |  |  |  | **151000000** |
| **U.S. TREASURY REPURCHASE AGREEMENTS 2.2%** | **U.S. TREASURY REPURCHASE AGREEMENTS 2.2%** | **U.S. TREASURY REPURCHASE AGREEMENTS 2.2%** | **U.S. TREASURY REPURCHASE AGREEMENTS 2.2%** | **U.S. TREASURY REPURCHASE AGREEMENTS 2.2%** | **U.S. TREASURY REPURCHASE AGREEMENTS 2.2%** | **U.S. TREASURY REPURCHASE AGREEMENTS 2.2%** |
| **BARCLAYS BANK PLC** |  |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; Issued 12/30/22, repurchase date 01/03/23 |  | 4.30% |  | 01/03/23 | &nbsp;&nbsp; 2961516 | &nbsp;&nbsp;&nbsp;&nbsp; 2960102 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (Collateralized by U.S. Treasury Securities valued at $3,020,798, <br> 1.25%, due 11/30/26)<br>|  |  |  |  |  |  |
| **FICC - BANK OF NEW YORK** |  |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; Issued 12/30/22, repurchase date 01/03/23 |  | 4.30% |  | 01/03/23 | &nbsp;&nbsp; 2000956 | &nbsp;&nbsp;&nbsp;&nbsp; 2000000 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (Collateralized by U.S. Treasury Securities valued at $2,040,032, <br> 0.63%, due 07/15/32)<br>|  |  |  |  |  |  |
|  |  |  |  |  |  | **4960102** |
| **Total Repurchase Agreements** <br>**(Cost $155,960,102)** | **Total Repurchase Agreements** <br>**(Cost $155,960,102)** | **Total Repurchase Agreements** <br>**(Cost $155,960,102)** | **Total Repurchase Agreements** <br>**(Cost $155,960,102)** | **Total Repurchase Agreements** <br>**(Cost $155,960,102)** | **Total Repurchase Agreements** <br>**(Cost $155,960,102)** | **155960102** |
| **Total Investments in Securities** <br>**(Cost $222,449,243)** | **Total Investments in Securities** <br>**(Cost $222,449,243)** | **Total Investments in Securities** <br>**(Cost $222,449,243)** | **Total Investments in Securities** <br>**(Cost $222,449,243)** | **Total Investments in Securities** <br>**(Cost $222,449,243)** | **Total Investments in Securities** <br>**(Cost $222,449,243)** | **222449243** |

---

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;

\* Collateralized via U.S. Government Agency Securities or less frequently by higher rated U.S. Treasury Securities.

*(a)* Variable rate security; rate shown is effective rate at period end.

*(b)* Step up bond that pays an initial coupon rate for a set period and increased coupon rates at one or more preset intervals. Rate shown is as of period end.

*(c)* VRDN is a municipal security which allows holders to sell their security through a put or tender feature, at par value plus accrued interest. The interest rate resets on a periodic basis, the majority of which are weekly but may be daily or monthly. Unless a reference rate and spread is shown parenthetically, the Remarketing Agent, generally a dealer, determines the interest rate for the security at each interest rate reset date. The rate is typically based on the SIFMA Municipal Swap Index. 

*(d)* The rate shown is the annualized 7-day yield.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;

---

| | |
|:---|:---|
| EFFR — | Effective Federal Funds Rate is published daily by the Federal Reserve Bank of New York and is based on the interest rate financial institutions charge each other for <br> overnight funds.<br>|
| FICC — | Fixed Income Clearing Corp |
| LOC — | Letter of credit |
| SIFMA — | Securities Industry and Financial Markets Association. The SIFMA Municipal Swap Index is a market index comprised of high-grade 7-day tax-exempt Variable Rate <br> Demand Obligations with certain characteristics.<br>|
| SOFR — | Secured Overnight Financing Rate is published daily by the Federal Reserve Bank of New York and is based on the cost of borrowing cash overnight collateralized by <br> U.S. Treasury securities.<br>|
| US TBILL — | The reference rate is the weekly auction stop for the U.S. Treasury Bill. |
| VRDN — | Variable rate demand note |

---

*See financial notes*

**11**Schwab Government Money Market Portfolio \| Annual Report

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Schwab Government Money Market Portfolio

Portfolio Holdings as of December 31, 2022 (continued)

------

The following is a summary of the inputs used to value the fund's investments as of December 31, 2022 (see financial note 2(a) for additional information):

---

| | | | | |
|:---|:---|:---|:---|:---|
| DESCRIPTION | QUOTED PRICES IN <br>ACTIVE MARKETS FOR <br>IDENTICAL ASSETS <br>(LEVEL 1)<br>| &nbsp;&nbsp; OTHER SIGNIFICANT <br>OBSERVABLE INPUTS <br>(LEVEL 2)<br>| &nbsp;&nbsp; SIGNIFICANT <br>UNOBSERVABLE INPUTS <br>(LEVEL 3)<br>| TOTAL |
| **Assets** |  |  |  |  |
| U.S. Government Agency Debt<sup>1</sup> <br>| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; $— | &nbsp;&nbsp; $44193765 | $— | &nbsp;&nbsp; $44193765 |
| U.S. Treasury Debt<sup>1</sup> <br>| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; — | &nbsp;&nbsp;&nbsp;&nbsp; 21649776 | &nbsp;&nbsp; — | &nbsp;&nbsp;&nbsp;&nbsp; 21649776 |
| Variable Rate Demand Notes<sup>1</sup> <br>| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; — | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 600000 | &nbsp;&nbsp; — | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 600000 |
| Investment Companies<sup>1</sup> <br>| &nbsp;&nbsp; 45600 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; — | &nbsp;&nbsp; — | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 45600 |
| Repurchase Agreements<sup>1</sup> <br>| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; — | &nbsp;&nbsp; 155960102 | &nbsp;&nbsp; — | &nbsp;&nbsp; 155960102 |
| **Total** | **$45600** | **$222403643** | **$—** | **$222449243** |

---

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;

<sup>1</sup> As categorized in the Portfolio Holdings.

Fund investments in mutual funds are classified as Level 1, without consideration to the classification level of the underlying

securities held by the mutual funds, which could be Level 1, Level 2 or Level 3.

*See financial notes*

Schwab Government Money Market Portfolio \| Annual Report**12**

------

Schwab Government Money Market Portfolio

Statement of Assets and Liabilities

------

As of December 31, 2022

---

| | | |
|:---|:---|:---|
| **Assets** | **Assets** | **Assets** |
| Investments in securities, at cost and value - unaffiliated (Note 2a) |  | &nbsp;&nbsp; $66489141 |
| Repurchase agreements, at cost and value — unaffiliated (Note 2a) |  | &nbsp;&nbsp; 155960102 |
| Receivables: |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; Fund shares sold |  | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 579487 |
| &nbsp;&nbsp;&nbsp;&nbsp; Interest |  | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 340559 |
| &nbsp;&nbsp;&nbsp;&nbsp; Dividends |  | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 161 |
| Prepaid expenses | + | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 556 |
| **Total assets** |  | **223370006** |
| **Liabilities** | **Liabilities** | **Liabilities** |
| Payables: |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; Fund shares redeemed |  | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 87580 |
| &nbsp;&nbsp;&nbsp;&nbsp; Investment adviser and administrator fees |  | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 38182 |
| &nbsp;&nbsp;&nbsp;&nbsp; Independent trustees' fees |  | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 98 |
| Accrued expenses | + | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 90509 |
| **Total liabilities** |  | **216369** |
| **Net assets** |  | **$223153637** |
| **Net Assets by Source** | **Net Assets by Source** | **Net Assets by Source** |
| Capital received from investors |  | $223107627 |
| Total distributable earnings | + | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 46010 |
| **Net assets** |  | **$223153637** |

---

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;

---

| | | | | |
|:---|:---|:---|:---|:---|
| **Net Asset Value (NAV)**  | **Net Asset Value (NAV)**  | **Net Asset Value (NAV)**  | **Net Asset Value (NAV)**  | **Net Asset Value (NAV)**  |
| **Net Assets**  | **÷** | &nbsp;&nbsp;&nbsp;&nbsp; **Shares**<br> **Outstanding**<br>| **=** | **NAV** |
| $223153637 |  | 223154452 |  | $1.00 |

---

*See financial notes*

**13**Schwab Government Money Market Portfolio \| Annual Report

------

Schwab Government Money Market Portfolio

Statement of Operations

------

---

| | | |
|:---|:---|:---|
| For the period January 1, 2022 through December 31, 2022 | For the period January 1, 2022 through December 31, 2022 | For the period January 1, 2022 through December 31, 2022 |
| **Investment Income**  | **Investment Income**  | **Investment Income**  |
| **Interest received from securities - unaffiliated** |  | **$3670098** |
| **Expenses** | **Expenses** | **Expenses** |
| Investment adviser and administrator fees |  | &nbsp;&nbsp;&nbsp;&nbsp; 405583 |
| Portfolio accounting fees |  | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 70439 |
| Professional fees |  | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 31446 |
| Custodian fees |  | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 23670 |
| Independent trustees' fees |  | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 14444 |
| Proxy fees<sup>1</sup> <br>|  | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 9410 |
| Shareholder reports |  | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 3570 |
| Transfer agent fees  |  | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 694 |
| Other expenses | + | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 4804 |
| **Total expenses** |  | **564060** |
| Expense reduction | – | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 73813 |
| **Net expenses** | – | **490247** |
| **Net investment income** |  | **3179851** |
| **REALIZED GAINS (LOSSES)** | **REALIZED GAINS (LOSSES)** | **REALIZED GAINS (LOSSES)** |
| **Net realized gains on sales of securities - unaffiliated** |  | **409** |
| **Increase in net assets resulting from operations** |  | **$3180260** |

---

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;

<sup>1</sup> Proxy fees are non-routine expenses (see financial note 4 for additional information).

*See financial notes*

Schwab Government Money Market Portfolio \| Annual Report**14**

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Schwab Government Money Market Portfolio

Statement of Changes in Net Assets

------

For the current and prior report periods

---

| | | | |
|:---|:---|:---|:---|
| **OPERATIONS** | **OPERATIONS** | **OPERATIONS** | **OPERATIONS** |
|  | 1/1/22-12/31/22 | 1/1/22-12/31/22 | 1/1/21-12/31/21 |
| Net investment income |  | &nbsp;&nbsp;&nbsp;&nbsp; $3179851 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; $111865 |
| Net realized gains | + | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 409 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 880 |
| **Increase in net assets from operations** |  | **$3180260** | **$112745** |
| **DISTRIBUTIONS TO SHAREHOLDERS** | **DISTRIBUTIONS TO SHAREHOLDERS** | **DISTRIBUTIONS TO SHAREHOLDERS** | **DISTRIBUTIONS TO SHAREHOLDERS** |
| **Total distributions** |  | **($3180846)** | **($111865)** |
| **TRANSACTIONS IN FUND SHARES\*** | **TRANSACTIONS IN FUND SHARES\*** | **TRANSACTIONS IN FUND SHARES\*** | **TRANSACTIONS IN FUND SHARES\*** |
| Shares sold |  | &nbsp;&nbsp; 169138540 | &nbsp;&nbsp; 151802828 |
| Shares reinvested |  | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 3180846 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 111865 |
| Shares redeemed | + | &nbsp;&nbsp; (134081228) | &nbsp;&nbsp; (152073454) |
| **Net transactions in fund shares** |  | **38238158** | **(158761)** |
| **NET ASSETS** | **NET ASSETS** | **NET ASSETS** | **NET ASSETS** |
| Beginning of period |  | $184916065 | $185073946 |
| Total increase (decrease) | + | &nbsp;&nbsp;&nbsp;&nbsp; 38237572 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (157881) |
| **End of period** |  | **$223153637** | **$184916065** |

---

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;

<sup>\*</sup> Transactions took place at $1.00 per share; figures for share quantities are the same as for dollars.

*See financial notes*

**15**Schwab Government Money Market Portfolio \| Annual Report

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Schwab Government Money Market Portfolio

Financial Notes

------

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**1. Business Structure of the Fund:**

Schwab Government Money Market Portfolio (the fund) is a series of Schwab Annuity Portfolios (the trust), a no-load, open-end management investment company. The trust is organized as a Massachusetts business trust and is registered under the Investment Company Act of 1940, as amended (the 1940 Act). The list below shows all the funds in the trust as of the end of the period, including the fund discussed in this report, which is highlighted:

---

| |
|:---|
| **SCHWAB ANNUITY PORTFOLIOS (ORGANIZED JANUARY 21, 1994)** |
| **Schwab Government Money Market Portfolio** |
| Schwab S&P 500 Index Portfolio |
| Schwab VIT Balanced Portfolio |
| Schwab VIT Balanced with Growth Portfolio |
| Schwab VIT Growth Portfolio |

---

The fund in this report offers one share class. Shares are bought and sold at closing net asset value per share (NAV), which is the price for all outstanding shares of a fund. Each share has a par value of 1/1,000 of a cent, and the fund's Board of Trustees (the Board) may authorize the issuance of as many shares as necessary.

The fund is available exclusively as an investment vehicle for variable annuity and variable life insurance contracts offered by separate accounts of participating life insurance companies, and in the future may be offered to pension and retirement plans qualified under the Internal Revenue Code of 1986, as amended. At December 31, 2022, 100% of the fund's shares were held through separate accounts of seven insurance companies. Subscriptions and redemptions of these insurance separate accounts could have a material impact on the fund.

The fund maintains its own account for purposes of holding assets and accounting, and is considered a separate entity for tax purposes. Within its account, the fund may also keep certain assets in segregated accounts, as required by securities law.

------

<br>**2. Significant Accounting Policies:**

The following is a summary of the significant accounting policies the fund uses in its preparation of financial statements. The fund follows the investment company accounting and reporting guidance of the Financial Accounting Standards Board (FASB) Accounting Standard Codification Topic 946 Financial Services — Investment Companies. The accounting policies are in conformity with accounting principles generally accepted in the United States of America (GAAP).

**(a) Security Valuation:**

Pursuant to Rule 2a-5 under the 1940 Act, the Board has designated authority to a Valuation Designee, the fund's investment adviser, to make fair valuation determinations under adopted procedures, subject to Board oversight. The investment adviser has formed a Pricing Committee to administer the pricing and valuation of portfolio securities and other assets and liabilities and to ensure that prices used for internal purposes or provided by third parties reasonably reflect fair value. The Valuation Designee may utilize independent pricing services, quotations from securities and financial instrument dealers and other market sources to determine fair value.

Securities in the fund are valued at amortized cost (which approximates fair value) as permitted in accordance with Rule 2a-7 of the 1940 Act. In the event that security valuations do not approximate fair value, securities may be fair valued as determined by the Valuation Designee. The Valuation Designee considers a number of factors, including unobservable market inputs when arriving at fair value and may employ methods such as the review of related or comparable assets or liabilities, related market activities, recent transactions, market multiples, book values, transactional back-testing, disposition analysis and other relevant information. Due to the subjective and variable nature of fair value pricing, there can be no assurance that a fund could obtain the fair value assigned to the security upon the sale of such security.

In accordance with the authoritative guidance on fair value measurements and disclosures under GAAP, the fund discloses the fair value of its investments in a hierarchy that prioritizes the significant inputs to valuation methods used to measure the fair value. The hierarchy gives the highest priority to valuations based upon unadjusted quoted prices in active markets for identical assets or liabilities (Level 1 measurements) and the lowest priority to valuations based upon unobservable inputs that are significant to the valuation (Level 3 measurements). If inputs used to measure the financial instruments fall within different levels of the hierarchy, the categorization is based on the lowest level input that is significant to the valuation. If it is determined that either the volume and/or level of activity for an asset or liability has significantly decreased (from normal conditions for that asset or liability) or price quotations or observable inputs are not associated with orderly transactions, increased analysis and the Valuation Designee's judgment will be required to estimate fair value.

Schwab Government Money Market Portfolio \| Annual Report**16**

------

Schwab Government Money Market Portfolio

Financial Notes (continued)

------

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;

**2. Significant Accounting Policies (continued):** 

• **Mutual funds:** Mutual funds are valued at their respective NAVs.

The three levels of the fair value hierarchy are as follows:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• Level 1 — quoted prices in active markets for identical investments — Investments whose values are based on quoted market prices in active markets, and whose values are therefore classified as Level 1 prices, include active listed equities, mutual funds and exchange-traded funds. Mutual funds are classified as Level 1 prices, without consideration to the classification level of the underlying securities held.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• Level 2 — other significant observable inputs (including quoted prices for similar securities, interest rates, prepayment speeds, credit risk, etc.) — Investments that trade in markets that are not considered to be active, but whose values are based on quoted market prices, dealer quotations or valuations provided by alternative pricing sources supported by observable inputs are classified as Level 2 prices. These generally include U.S. government and sovereign obligations, most government agency securities, investment-grade corporate bonds, certain mortgage products, less liquid listed equities, and state, municipal and provincial obligations. Securities held by stable NAV money funds operating pursuant to Rule 2a-7 under the 1940 Act are valued at amortized cost which approximates current fair value and are considered to be valued using Level 2 inputs.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• Level 3 — significant unobservable inputs (including the fund's own assumptions in determining the fair value of investments) — Investments whose values are classified as Level 3 prices have significant unobservable inputs, as they may trade infrequently or not at all. When observable prices are not readily available for these securities, one or more valuation methods are used for which sufficient and reliable data is available. The inputs used in estimating the value of Level 3 prices may include the original transaction price, quoted prices for similar securities or assets in active markets, completed or pending third-party transactions in the underlying investment or comparable issuers, and changes in financial ratios or cash flows. Level 3 prices may also be adjusted to reflect illiquidity and/or non-transferability, with the amount of such discount estimated in the absence of market information. Assumptions used due to the lack of observable inputs may significantly impact the resulting fair value and therefore the fund's results of operations.

The inputs or methodology used for valuing securities are not necessarily an indication of the risk associated with investing in those securities.

The levels associated with valuing the fund's investments as of December 31, 2022 are disclosed in the Portfolio Holdings.

**(b) Accounting Policies for certain Portfolio Investments (if held):**

**Repurchase Agreements:** In a repurchase agreement, a fund buys a security from another party (the counterparty), usually a financial institution, with the agreement that it be sold back in the future. Repurchase agreements subject a fund to counterparty risk, meaning that the fund could lose money if the other party fails to perform under the terms of the agreement. The fund mitigates this risk by ensuring that a fund's repurchase agreements are collateralized by cash and/or U.S. government securities. All collateral is held by the fund's custodian (or, with multi-party agreements, the agent's bank) and is monitored daily to ensure that its fair value is at least equal to the maturity amount under the agreement. In the event of a default by the counterparty, realization of the collateral proceeds could be delayed or limited and the value of the collateral may decline. Investments in repurchase agreements are also based on a review of the credit quality of the repurchase agreement counterparty.

As of December 31, 2022, the fund had investments in repurchase agreements with a gross value of $155,960,102 as disclosed in the Portfolio Holdings and the Statement of Assets and Liabilities. The value of the related collateral disclosed in the Portfolio Holdings exceeded the value of the repurchase agreements at period end.

**Delayed-Delivery and When-Issued Transactions:** The fund may transact in securities on a delayed-delivery or when-issued basis. Payment and delivery may take place after the customary settlement period for that security. The price of the underlying securities and the date when the securities will be delivered and paid for are fixed at the time the transaction is negotiated. The securities purchased on a delayed-delivery or when-issued basis are identified as such in the fund's Portfolio Holdings, if any. The fund may receive compensation for interest forgone in the purchase of a delayed-delivery or when-issued security. Losses may arise due to changes in the value of the underlying securities or if the counterparty does not perform under the contract's terms, or if the issuer does not issue the securities due to political, economic, or other factors. Effective August 19, 2022, the fund complies with Rule 18f-4 under the 1940 Act, where money market funds are only permitted to invest in a security on a delayed-delivery or when-issued basis, or with a non-standard settlement cycle, and the transaction will be deemed not to involve a senior security, provided that, (i) the fund intends to physically settle the transaction and (ii) the transaction will settle within 35 days of its trade date. Pursuant to Rule 18f-4 portfolio securities are no longer required to be segregated as collateral to cover delayed-delivery or when-issued securities held within the fund.

**17**Schwab Government Money Market Portfolio \| Annual Report

------

Schwab Government Money Market Portfolio

Financial Notes (continued)

------

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;

**2. Significant Accounting Policies (continued):** 

**(c) Security Transactions:**

Security transactions are recorded as of the date the order to buy or sell the security is executed. Realized gains and losses from security transactions are based on the identified costs of the securities involved.

**(d) Investment Income:**

Interest income is recorded as it accrues. If the fund buys a debt security at a discount (less than face value) or a premium (more than face value), it amortizes premiums and accretes discounts from the purchase settlement date up to maturity. The fund then increases (in the case of discounts) or reduces (in the case of premiums) the income it records from the security. Certain securities may be callable (meaning that the issuer has the option to pay it off before its maturity date). The fund amortizes the premium and accretes the discount on each callable security to the security's maturity date, except when the purchase price is higher than the call price at the security's call date (in which case the premium is amortized to the call date). Dividends and distributions are recorded on the date they are effective.

**(e) Expenses:**

Expenses that are specific to the fund are charged directly to the fund. Expenses that are common to more than one fund in the trusts generally are allocated among those funds in proportion to their average daily net assets.

**(f) Distributions to Shareholders:**

The fund declares distributions from net investment income, if any, every day it is open for business. The fund makes distributions from net realized capital gains, if any, once a year. To receive a distribution, you must be a registered shareholder on the record date. Distributions are paid to shareholders on the payable date.

**(g) Accounting Estimates:**

The accounting policies described in this report conform to GAAP. Notwithstanding this, shareholders should understand that in order to follow these principles, fund management has to make estimates and assumptions that affect the information reported in the financial statements. It's possible that once the results are known, they may turn out to be different from these estimates and these differences may be material.

**(h) Federal Income Taxes:**

The fund intends to meet federal income and excise tax requirements for regulated investment companies under subchapter M of the Internal Revenue Code, as amended. Accordingly, the fund distributes substantially all of its net investment income and net realized capital gains, if any, to the participating insurance company's (shareholders) separate accounts each year. As long as the fund meets the tax requirements, it is not required to pay federal income tax.

**(i) Indemnification:**

Under the fund's organizational documents, the officers and trustees are indemnified against certain liabilities arising out of the performance of their duties to the fund. In addition, in the normal course of business the fund enters into contracts with its vendors and others that provide general indemnifications. The fund's maximum exposure under these arrangements is unknown as this would involve future claims that may be made against the fund. However, based on experience, the fund expects the risk of loss attributable to these arrangements to be remote.

**(j) Regulatory Update:** 

Effective January 24, 2023, the SEC adopted rule and form amendments to require mutual funds and ETFs to transmit concise and visually engaging streamlined annual and semiannual reports to shareholders that highlight key information deemed important for retail investors to assess and monitor their fund investments. Other information, including financial statements, will no longer appear in a streamlined shareholder report but must be available online, delivered free of charge upon request, and filed on a semiannual basis on Form N-CSR. The rule and form amendments have a compliance date of July 24, 2024. At this time, management is evaluating the impact of these rule and form amendment changes on the content of the current shareholder report and the newly created annual and semiannual streamlined shareholder reports.

Schwab Government Money Market Portfolio \| Annual Report**18**

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Schwab Government Money Market Portfolio

Financial Notes (continued)

------

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;

**3. Risk Factors:**

**Market Risk.** Financial markets rise and fall in response to a variety of factors, sometimes rapidly and unpredictably. Markets may be impacted by economic, political, regulatory and other conditions, including economic sanctions and other government actions. In addition, the occurrence of global events, such as war, terrorism, environmental disasters, natural disasters and epidemics may also negatively affect the financial markets. These events could reduce consumer demand or economic output; result in market closures, low or negative interest rates, travel restrictions or quarantines; and significantly adversely impact the economy. Governmental and quasi-governmental authorities and regulators throughout the world have in the past often responded to serious economic disruptions with a variety of significant fiscal and monetary policy changes which could have an unexpected impact on financial markets and the fund's investments. As with any investment whose performance is tied to these markets, the value of an investment in the fund will fluctuate, which means that an investor could lose money over short or long periods.

**Investment Risk.** You could lose money by investing in the fund. Although the fund seeks to preserve the value of your investment at $1.00 per share, it cannot guarantee it will do so. An investment in the fund is not insured or guaranteed by the Federal Deposit Insurance Corporation or any other government agency. The fund's sponsor has no legal obligation to provide financial support to the fund, and you should not expect that the sponsor will provide financial support to the fund at any time.

**Interest Rate Risk.** Interest rates rise and fall over time. As with any investment whose yield reflects current interest rates, the fund's yield will change over time. During periods when interest rates are low or there are negative interest rates, the fund's yield (and total return) also could be low or even negative. In addition, the fund may be unable to pay expenses out of fund assets or maintain a stable $1.00 share price. Also, a change in a central bank's monetary policy or economic conditions may result in a change in interest rates, which could have sudden and unpredictable effects on the markets. A sudden or unpredictable rise or decline in interest rates may cause volatility. Volatility in the market may decrease liquidity in the money market securities markets, making it more difficult for the fund to sell its money market investments at a time when the investment adviser might wish to sell such investments. Decreased market liquidity also may make it more difficult to value some or all of the fund's money market securities holdings.

**Stable Net Asset Value Risk.** If the fund or another money market fund fails to maintain a stable net asset value (or such perception exists in the market place), the fund could experience increased redemptions, which may adversely impact the fund's share price. The fund is permitted, among other things, to reduce or withhold any income and/or gains generated by the fund to maintain a stable $1.00 share price.

**Repurchase Agreements Risk.** When the fund enters into a repurchase agreement, the fund is exposed to the risk that the other party (i.e. the counterparty) will not fulfill its contractual obligation. In a repurchase agreement, there exists the risk that, when the fund buys a security from a counterparty that agrees to repurchase the security at an agreed upon price (usually higher) and time, the counterparty will not repurchase the security.

**Credit Risk.** A decline in the credit quality of an issuer, guarantor or liquidity provider of a portfolio investment or a counterparty could cause the fund to lose money or underperform. The fund could lose money if, due to a decline in credit quality, the issuer, guarantor or liquidity provider of a portfolio investment or a counterparty fails to make, or is perceived as being unable or unwilling to make, timely principal or interest payments or otherwise honor its obligations. Even though the fund's investments in repurchase agreements are collateralized at all times, there is some risk to the fund if the other party should default on its obligations and the fund is delayed or prevented from recovering or disposing of the collateral. The credit quality of the fund's portfolio holdings can change rapidly in certain market environments and any downgrade or default on the part of a single portfolio investment could cause the fund's share price or yield to fall.

Certain U.S. government securities that the fund invests in are not backed by the full faith and credit of the U.S. government, which means they are neither issued nor guaranteed by the U.S. Treasury. Although maintained in conservatorship by the Federal Housing Finance Agency (FHFA) since September 2008, the Federal National Mortgage Association (Fannie Mae) and Federal Home Loan Mortgage Corporation (Freddie Mac) maintain only lines of credit with the U.S. Treasury. The Federal Home Loan Banks maintain limited access to credit lines from the U.S. Treasury. Other securities, such as obligations issued by the Federal Farm Credit Banks Funding Corporation, are supported solely by the credit of the issuer. There can be no assurance that the U.S. government will provide financial support to securities of its agencies and instrumentalities if it is not obligated to do so under law. Also, any government guarantees on securities the fund owns do not extend to the shares of the fund itself.

**Management Risk.** Any actively managed mutual fund is subject to the risk that its investment adviser will select investments or allocate assets in a manner that could cause the fund to underperform or otherwise not meet its investment objective. The fund's investment adviser applies its own investment techniques and risk analyses in making investment decisions for the fund, but there

**19**Schwab Government Money Market Portfolio \| Annual Report

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Schwab Government Money Market Portfolio

Financial Notes (continued)

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;

**3. Risk Factors (continued):** 

can be no guarantee that they will produce the desired results. The investment adviser's maturity decisions will also affect the fund's yield, and potentially could affect its share price. To the extent that the investment adviser anticipates interest rate trends imprecisely, the fund's yield at times could lag the yields of other money market funds.

**Redemption Risk.** The fund may experience periods of heavy redemptions that could cause the fund to liquidate its assets at inopportune times or at a loss or depressed value, particularly during periods of declining or illiquid markets. Redemptions by a few large investors in the fund may have a significant adverse effect on the fund's ability to maintain a stable $1.00 share price. In the event any money market fund fails to maintain a stable net asset value, other money market funds, including the fund, could face a market-wide risk of increased redemption pressures, potentially jeopardizing the stability of their $1.00 share prices.

**Money Market Fund Regulation Risk.** The SEC and other regulatory agencies continue to review the regulation of money market funds. As of the date of this shareholder report, the SEC has proposed amendments to the rules that govern money market funds. These proposed amendments, if implemented, may affect the fund's investment strategies, performance, yield, expenses, operations and continued viability.

**Money Market Fund Risk.** The fund is not designed to offer capital appreciation. In exchange for their emphasis on stability and liquidity, money market investments may offer lower long-term performance than stock or bond investments.

**Tax Diversification Risk.** As described above, the fund intends to operate as a government money market fund under the regulations governing money market funds. Additionally, the fund intends to meet the diversification requirements that are applicable to insurance company separate accounts under Subchapter L of the Internal Revenue Code of 1986, as amended (the Diversification Requirements). To satisfy the Diversification Requirements applicable to variable annuity contracts, the value of the assets of the fund invested in securities issued by the U.S. government, its agencies or instrumentalities must remain below specified thresholds. For these purposes, each U.S. government agency or instrumentality is treated as a separate issuer.

Operating as a government money market fund may make it difficult for the fund to meet the Diversification Requirements. This difficulty may be exacerbated by the potential increase in demand for the types of securities in which the fund invests as a result of changes to the rules that govern SEC registered money market funds. A failure to satisfy the Diversification Requirements could have significant adverse tax consequences for variable life insurance and variable annuity contract owners whose contract values are determined by investment in the fund.

Please refer to the fund's prospectus for a more complete description of the principal risks of investing in the fund.

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<br>**4. Affiliates and Affiliated Transactions:**

**Investment Adviser**

Charles Schwab Investment Management, Inc., dba Schwab Asset Management, a wholly owned subsidiary of The Charles Schwab Corporation, serves as the fund's investment adviser and administrator pursuant to an Investment Advisory and Administration Agreement between the investment adviser and the trust.

For its advisory and administrative services to the fund, the investment adviser is entitled to receive an annual fee, payable monthly, equal to 0.19% of the fund's average daily net assets.

**Contractual Expense Limitation**

The investment adviser and its affiliates have made an additional agreement with the fund, for so long as the investment adviser serves as the investment adviser to the fund, which may only be amended or terminated with the approval of the Board, to limit the total annual fund operating expenses charged, excluding interest, taxes, and certain non-routine expenses (expense limitation) to 0.34%.

During the period ended December 31, 2022, the fund waived a total of $73,813 in expenses, all of which was waived voluntarily.

**Voluntary Yield Waiver/Reimbursement**

The investment adviser and its affiliates may waive and/or reimburse expenses to the extent necessary to maintain a positive net yield for the fund.

Schwab Government Money Market Portfolio \| Annual Report**20**

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Schwab Government Money Market Portfolio

Financial Notes (continued)

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;

**4. Affiliates and Affiliated Transactions (continued):** 

**Interfund Transactions**

The fund may engage in transactions with certain other funds in the Fund Complex (for definition refer to the Trustees and Officers section) in accordance with procedures adopted by the Board pursuant to Rule 17a-7 under the 1940 Act. When one fund is seeking to sell a security that another is seeking to buy, an interfund transaction can allow both funds to benefit by reducing transaction costs. This practice is limited to funds that share the same investment adviser, trustees and/or officers. For the period ended December 31, 2022, the fund's total purchases and sales of securities with other funds in the Fund Complex was $0 and $2,845,751 respectively, and includes realized gains of $0.

**Interfund Borrowing and Lending**

Pursuant to an exemptive order issued by the U.S. Securities and Exchange Commission (SEC), the fund may enter into interfund borrowing and lending transactions with other funds in the Fund Complex. All loans are for temporary or emergency purposes and the interest rate to be charged will be the average of the overnight repurchase agreement rate and the short-term bank loan rate. All loans are subject to numerous conditions designed to ensure fair and equitable treatment of all participating funds. The interfund lending facility is subject to the oversight and periodic review by the Board. The fund had no interfund borrowing or lending activity during the period.

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<br>**5. Board of Trustees:**

The Board may include people who are officers and/or directors of the investment adviser or its affiliates. Federal securities law limits the percentage of such "interested persons" who may serve on a trust's board, and the trust was in compliance with these limitations throughout the report period. The fund did not pay any of these interested persons for their services as trustees, but did pay non-interested persons (independent trustees), as noted on the fund's Statement of Operations. For information regarding the trustees, please refer to the Trustees and Officers table at the end of this report.

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<br>**6. Borrowing from Banks**

During the period, the fund was a participant with other funds in the Fund Complex in a joint, syndicated, committed $850 million line of credit (the Syndicated Credit Facility), which matured on September 29, 2022. On September 29, 2022, the Syndicated Credit Facility was amended to run for a new 364 day period with the line of credit amount increasing to $1 billion, maturing September 28, 2023. Under the terms of the Syndicated Credit Facility, in addition to the interest charged on any borrowings by the fund, the fund paid a commitment fee of 0.15% per annum on the fund's proportionate share of the unused portion of the Syndicated Credit Facility.

During the period, the fund was a participant with other funds in the Fund Complex in a joint, unsecured, uncommitted $400 million line of credit (the Uncommitted Credit Facility), with State Street Bank and Trust Company, which matured on September 29, 2022. On September 29, 2022, the Uncommitted Credit Facility was amended to run for a new 364 day period with the line of credit amount remaining unchanged, maturing on September 28, 2023. Under the terms of the Uncommitted Credit Facility, the fund pays interest on the amount the fund borrows. There were no borrowings from either line of credit during the period.

The fund also has access to custodian overdraft facilities. The fund may have utilized the overdraft facility and incurred an interest expense, which is disclosed on the fund's Statement of Operations, if any. The interest expense is determined based on a negotiated rate above the current Federal Funds Rate.

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<br>**7. Federal Income Taxes:**

As of December 31, 2022, the tax basis cost of the fund's investments was $222,403,643 and the unrealized appreciation and depreciation were $45,600 and ($0), respectively, with a net unrealized appreciation of $45,600.

As of December 31, 2022, the components of distributable earnings on a tax basis were as follows:

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| | | |
|:---|:---|:---|
| UNDISTRIBUTED <br>ORDINARY <br>INCOME <br>| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; NET UNREALIZED <br>APPRECIATION <br>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(DEPRECIATION) <br>ON INVESTMENTS <br>| TOTAL  |
| $410 | $45600 | $46010 |

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**21**Schwab Government Money Market Portfolio \| Annual Report

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Schwab Government Money Market Portfolio

Financial Notes (continued)

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;

**7. Federal Income Taxes (continued):** 

The tax basis components of distributions paid during the current and prior fiscal years were as follows:

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| | | | |
|:---|:---|:---|:---|
| CURRENT FISCAL YEAR END DISTRIBUTIONS | CURRENT FISCAL YEAR END DISTRIBUTIONS | PRIOR FISCAL YEAR END DISTRIBUTIONS | PRIOR FISCAL YEAR END DISTRIBUTIONS |
| ORDINARY <br>INCOME <br>| &nbsp;&nbsp; LONG-TERM <br>CAPITAL <br>GAINS <br>| &nbsp;&nbsp; ORDINARY <br>INCOME <br>| &nbsp;&nbsp; LONG-TERM <br>CAPITAL <br>GAINS <br>|
| $3180746 | $100 | $111865 | $— |

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Distributions paid to shareholders are based on net investment income and net realized gains determined on a tax basis, which may differ from net investment income and net realized gains for financial reporting purposes. These differences reflect the differing character of certain income items and net realized gains and losses for financial statement and tax purposes, and may result in reclassification among certain capital accounts on the financial statements. The fund may also designate a portion of the amount paid to redeeming shareholders as a distribution for tax purposes.

Permanent book and tax basis differences may result in reclassifications between components of net assets as required. The adjustments will have no impact on net assets or the results of operations.

As of December 31, 2022, management has reviewed the tax positions for open periods (for federal purposes, three years from the date of filing and for state purposes, four years from the date of filing) as applicable to the fund, and has determined that no provision for income tax is required in the fund's financial statements. The fund recognizes interest and penalties, if any, related to unrecognized tax benefits as income tax expense in the Statement of Operations. During the fiscal year ended December 31, 2022, the fund did not incur any interest or penalties.

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<br>**8. Subsequent Events:**

Management has determined there are no subsequent events or transactions through the date the financial statements were issued that would have materially impacted the financial statements as presented.

Schwab Government Money Market Portfolio \| Annual Report**22**

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Schwab Government Money Market Portfolio

Report of Independent Registered Public Accounting Firm

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To the Board of Trustees of Schwab Annuity Portfolios and Shareholders of Schwab Government Money Market Portfolio

***Opinion on the Financial Statements and Financial Highlights***

We have audited the accompanying statement of assets and liabilities, including the portfolio holdings, of Schwab Government Money Market Portfolio (the "Fund"), one of the funds constituting Schwab Annuity Portfolios, as of December 31, 2022, the related statement of operations for the year then ended, the statements of changes in net assets for each of the two years in the period then ended, the financial highlights for each of the three years in the period then ended, and the related notes. In our opinion, the financial statements and financial highlights present fairly, in all material respects, the financial position of the Fund as of December 31, 2022, and the results of its operations for the year then ended, the changes in its net assets for each of the two years in the period then ended, and the financial highlights for each of the three years in the period then ended in conformity with accounting principles generally accepted in the United States of America. The financial highlights for each of the two years in the period ended December 31, 2019 were audited by other auditors, whose report, dated February 18, 2020, expressed an unqualified opinion on such financial highlights.

***Basis for Opinion***

These financial statements and financial highlights are the responsibility of the Fund's management. Our responsibility is to express an opinion on the Fund's financial statements and financial highlights based on our audits. We are a public accounting firm registered with the Public Company Accounting Oversight Board (United States) (PCAOB) and are required to be independent with respect to the Fund in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.

We conducted our audits in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements and financial highlights are free of material misstatement, whether due to error or fraud. The Fund is not required to have, nor were we engaged to perform, an audit of its internal control over financial reporting. As part of our audits, we are required to obtain an understanding of internal control over financial reporting but not for the purpose of expressing an opinion on the effectiveness of the Fund's internal control over financial reporting. Accordingly, we express no such opinion.

Our audits included performing procedures to assess the risks of material misstatement of the financial statements and financial highlights, whether due to error or fraud, and performing procedures that respond to those risks. Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the financial statements and financial highlights. Our audits also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the financial statements and financial highlights. Our procedures included confirmation of securities owned as of December 31, 2022, by correspondence with the custodian and brokers; when replies were not received from brokers, we performed other auditing procedures. We believe that our audits provide a reasonable basis for our opinion.

**Deloitte & Touche LLP** <br>Denver, Colorado <br>February 16, 2023

We have served as the auditor of one or more investment companies in the Schwab Funds Complex since 2020.

**23**Schwab Government Money Market Portfolio \| Annual Report

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Schwab Government Money Market Portfolio

Other Federal Tax Information (unaudited)

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For the fiscal year ended December 31, 2022, the fund designates 99.99% of dividend income as business interest income under section 163(j) of the Internal Revenue Code.

Under section 852(b)(3)(C) of the Internal Revenue Code, the fund hereby designates $100 as long-term capital gain dividends for the fiscal year ended December 31, 2022.

Schwab Government Money Market Portfolio \| Annual Report**24**

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Schwab Government Money Market Portfolio

Trustees and Officers

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The tables below give information about the trustees and officers of Schwab Annuity Portfolios, which includes the fund covered in this report. The "Fund Complex" includes The Charles Schwab Family of Funds, Schwab Capital Trust, Schwab Investments, Schwab Annuity Portfolios, Schwab Strategic Trust and Laudus Trust. The Fund Complex includes 105 funds.

The address for all trustees and officers is 211 Main Street, San Francisco, CA 94105. You can find more information about the trustees and officers in the fund's Statement of Additional Information, which is available free by calling 1-877-824-5615.

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| | | | |
|:---|:---|:---|:---|
| **Independent Trustees** | **Independent Trustees** | **Independent Trustees** | **Independent Trustees** |
| Name, Year of Birth, and <br> Position(s) with the trust <br> (Terms of office, and <br> length of Time Served<sup>1</sup>)<br>| Principal Occupations<br> During the Past Five Years<br>| Number of<br> Portfolios in<br> Fund Complex<br> Overseen by<br> the Trustee<br>| Other Directorships |
| **Michael J. Beer**<br> 1961<br> Trustee<br> (Trustee of The Charles Schwab <br> Family of Funds, Schwab <br> Investments, Schwab Capital Trust, <br> Schwab Annuity Portfolios, Schwab <br> Strategic Trust and Laudus Trust <br> since 2022)<br>| Retired. Director, President and Chief Executive Officer <br> (Dec. 2016 – Sept. 2019), Principal Funds (investment management).<br>| 105 | Director (2016 – 2019), <br> Principal Funds, Inc.<br>|
| **Robert W. Burns**<br> 1959<br> Trustee<br> (Trustee of Schwab Strategic Trust <br> since 2009; The Charles Schwab <br> Family of Funds, Schwab <br> Investments, Schwab Capital Trust, <br> Schwab Annuity Portfolios and <br> Laudus Trust since 2016)<br>| Retired/Private Investor. | 105 |  |
| **Nancy F. Heller**<br> 1956<br> Trustee<br> (Trustee of The Charles Schwab <br> Family of Funds, Schwab <br> Investments, Schwab Capital Trust, <br> Schwab Annuity Portfolios, Schwab <br> Strategic Trust and Laudus Trust <br> since 2018)<br>| Retired. | 105 |  |
| **David L. Mahoney**<br> 1954<br> Trustee<br> (Trustee of The Charles Schwab <br> Family of Funds, Schwab <br> Investments, Schwab Capital Trust, <br> Schwab Annuity Portfolios and <br> Laudus Trust since 2011; Schwab <br> Strategic Trust since 2016)<br>| Private Investor. | 105 | Director <br> (2004 – present), <br> Corcept Therapeutics <br> Incorporated <br> Director (2009 – 2021), <br> Adamas <br> Pharmaceuticals, Inc.<br> Director (2003 – 2019), <br> Symantec Corporation<br>|
| **Jane P. Moncreiff**<br> 1961<br> Trustee<br> (Trustee of The Charles Schwab <br> Family of Funds, Schwab <br> Investments, Schwab Capital Trust, <br> Schwab Annuity Portfolios, Schwab <br> Strategic Trust and Laudus Trust <br> since 2019)<br>| Consultant (2018 – present), Fulham Advisers LLC (management <br> consulting); Chief Investment Officer (2009 – 2017), CareGroup <br> Healthcare System, Inc. (healthcare).<br>| 105 |  |

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**25**Schwab Government Money Market Portfolio \| Annual Report

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Schwab Government Money Market Portfolio

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| | | | |
|:---|:---|:---|:---|
| **Independent Trustees (continued)** | **Independent Trustees (continued)** | **Independent Trustees (continued)** | **Independent Trustees (continued)** |
| Name, Year of Birth, and <br> Position(s) with the trust <br> (Terms of office, and <br> length of Time Served<sup>1</sup>)<br>| Principal Occupations<br> During the Past Five Years<br>| Number of<br> Portfolios in<br> Fund Complex<br> Overseen by<br> the Trustee<br>| Other Directorships |
| **Kimberly S. Patmore**<br> 1956<br> Trustee<br> (Trustee of The Charles Schwab <br> Family of Funds, Schwab <br> Investments, Schwab Capital Trust, <br> Schwab Annuity Portfolios, Schwab <br> Strategic Trust and Laudus Trust <br> since 2016)<br>| Consultant (2008 – present), Patmore Management Consulting <br> (management consulting).<br>| 105 |  |
| **J. Derek Penn**<br> 1957<br> Trustee<br> (Trustee of The Charles Schwab <br> Family of Funds, Schwab <br> Investments, Schwab Capital Trust, <br> Schwab Annuity Portfolios, Schwab <br> Strategic Trust and Laudus Trust <br> since 2021)<br>| Head of Equity Sales and Trading (2006 – 2018), BNY Mellon (financial <br> services).<br>| 105 |  |

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Schwab Government Money Market Portfolio \| Annual Report**26**

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Schwab Government Money Market Portfolio

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;

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| | | | |
|:---|:---|:---|:---|
| **Interested Trustees** | **Interested Trustees** | **Interested Trustees** | **Interested Trustees** |
| Name, Year of Birth, and <br> Position(s) with the trust <br> (Terms of office, and <br> length of Time Served<sup>1</sup>)<br>| Principal Occupations<br> During the Past Five Years<br>| Number of<br> Portfolios in<br> Fund Complex<br> Overseen by<br> the Trustee<br>| Other Directorships |
| **Walter W. Bettinger II**<sup>2</sup> 1960<br> Chairman and Trustee<br> (Trustee of The Charles Schwab <br> Family of Funds, Schwab <br> Investments, Schwab Capital Trust <br> and Schwab Annuity Portfolios since <br> 2008; Schwab Strategic Trust since <br> 2009; Laudus Trust since 2010)<br>| Co-Chairman of the Board (July 2022 – present), Director and Chief <br> Executive Officer (Oct. 2008 – present) and President <br> (Feb. 2007 – Oct. 2021), The Charles Schwab Corporation; President and <br> Chief Executive Officer (Oct. 2008 – Oct. 2021) and Director <br> (May 2008 – Oct. 2021), Charles Schwab & Co., Inc.; Director <br> (Apr. 2006 – present), Charles Schwab Bank, SSB; Director <br> (Nov. 2017 – present), Charles Schwab Premier Bank, SSB; Director <br> (July 2019 – present), Charles Schwab Trust Bank; Director <br> (May 2008 – present), Chief Executive Officer (Aug. 2017 – present) and <br> President (Aug. 2017 – Nov. 2021), Schwab Holdings, Inc.; Director <br> (Oct. 2020 – present), TD Ameritrade Holding Corporation; Director <br> (July 2016 – Oct. 2021), Charles Schwab Investment Management, Inc.<br>| 105 | Director <br> (2008 – present), The <br> Charles Schwab <br> Corporation <br>|
| **Richard A. Wurster**<sup>2</sup> 1973<br> Trustee<br> (Trustee of The Charles Schwab <br> Family of Funds, Schwab <br> Investments, Schwab Capital Trust, <br> Schwab Annuity Portfolios, Schwab <br> Strategic Trust and Laudus Trust <br> since 2022)<br>| President (Oct. 2021 – present) and Executive Vice President – Schwab <br> Asset Management Solutions (Apr. 2019 – Oct. 2021), The Charles <br> Schwab Corporation; President, Director (Oct. 2021 – present), Executive <br> Vice President – Schwab Asset Management Solutions <br> (July 2019 – Oct. 2021) and Senior Vice President – Advisory <br> (May 2016 – July 2019), Charles Schwab & Co., Inc.; President <br> (Nov. 2021 – present), Schwab Holdings, Inc.; Director <br> (Oct. 2021 – present) and Chief Executive Officer (Nov. 2019 – Jan. 2022), <br> Charles Schwab Investment Management, Inc.; Director, Chief Executive <br> Officer and President (Mar. 2018 – Oct. 2022), Charles Schwab Investment <br> Advisory, Inc.; Chief Executive Officer (July 2016 – Apr. 2018) and <br> President (Mar. 2017 – Apr. 2018), ThomasPartners, Inc.; Chief Executive <br> Officer (July 2016 – Apr. 2018), Windhaven Investment Management, Inc.<br>| 105 |  |

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;

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| | |
|:---|:---|
| **Officers of the Trust** | **Officers of the Trust** |
| Name, Year of Birth, and Position(s) with the trust <br> (Terms of office, and length of Time Served<sup>3</sup>)<br>| Principal Occupations During the Past Five Years |
| **Jonathan de St. Paer**<br> 1973<br> President and Chief Executive Officer<br> (Officer of The Charles Schwab Family of Funds, Schwab <br> Investments, Schwab Capital Trust, Schwab Annuity <br> Portfolios, Schwab Strategic Trust and Laudus Trust since <br> 2018)<br>| Director (Apr. 2019 – present), President (Oct. 2018 – present), Chief Operating Officer <br> (Jan. 2021 – present), and Chief Executive Officer (Apr. 2019 – Nov. 2019), Charles Schwab <br> Investment Management, Inc.; Senior Vice President (June 2020 – Mar. 2022) and Chief <br> Operating Officer (Jan. 2021 – Mar. 2022), Charles Schwab Investment Advisory, Inc.; Chief <br> Executive Officer (Apr. 2019 – present), President (Nov. 2018 – present) and Trustee <br> (Apr. 2019 – Dec. 2020), Schwab Funds, Laudus Trust and Schwab ETFs; Managing Director <br> (May 2022 – present), Senior Vice President (Apr. 2019 – May 2022) and Senior Vice <br> President – Strategy and Product Development (CSIM) (Jan. 2014 – Mar. 2019), Charles <br> Schwab & Co., Inc.<br>|
| **Mark Fischer**<br> 1970<br> Chief Operating Officer<br> (Officer of The Charles Schwab Family of Funds, Schwab <br> Investments, Schwab Capital Trust, Schwab Annuity <br> Portfolios, Schwab Strategic Trust and Laudus Trust since <br> 2013)<br>| Chief Operating Officer (Dec. 2020 – present) and Treasurer and Chief Financial Officer <br> (Jan. 2016 – Dec. 2022), Schwab Funds, Laudus Trust and Schwab ETFs; Chief Financial <br> Officer (Mar. 2020 – present) and Vice President (Oct. 2013 – present), Charles Schwab <br> Investment Management, Inc.<br>|
| **Dana Smith**<br> 1965<br> Treasurer and Chief Financial Officer<br> (Officer of The Charles Schwab Family of Funds, Schwab <br> Investments, Schwab Capital Trust, Schwab Annuity <br> Portfolios, Schwab Strategic Trust and Laudus Trust since <br> 2023)<br>| Treasurer and Chief Financial Officer (Jan. 2023 – present) and Assistant Treasurer <br> (Dec. 2015 – Dec. 2022), Schwab Funds, Laudus Trust and Schwab ETFs; Vice President <br> (Mar. 2022 – present) and Director (Oct. 2015 – Mar. 2022), Charles Schwab Investment <br> Management, Inc.<br>|

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**27**Schwab Government Money Market Portfolio \| Annual Report

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Schwab Government Money Market Portfolio

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| | |
|:---|:---|
| **Officers of the Trust (continued)** | **Officers of the Trust (continued)** |
| Name, Year of Birth, and Position(s) with the trust <br> (Terms of office, and length of Time Served<sup>3</sup>)<br>| Principal Occupations During the Past Five Years |
| **Omar Aguilar**<br> 1970<br> Vice President and Chief Investment Officer<br> (Officer of The Charles Schwab Family of Funds, Schwab <br> Investments, Schwab Capital Trust, Schwab Annuity <br> Portfolios, Schwab Strategic Trust and Laudus Trust since <br> 2011)<br>| Chief Executive Officer (Jan. 2022 – present), Chief Investment Officer (Apr. 2011 – present) <br> and Senior Vice President (Apr. 2011 – Dec. 2021), Charles Schwab Investment <br> Management, Inc.; Director, Chief Executive Officer and President (Oct. 2022 – present), <br> Charles Schwab Investment Advisory, Inc.; Vice President and Chief Investment Officer <br> (June 2011 – present), Schwab Funds, Laudus Trust and Schwab ETFs.<br>|
| **Brett Wander**<br> 1961<br> Vice President and Chief Investment Officer<br> (Officer of The Charles Schwab Family of Funds, Schwab <br> Investments, Schwab Capital Trust, Schwab Annuity <br> Portfolios, Schwab Strategic Trust and Laudus Trust since <br> 2011)<br>| Senior Vice President and Chief Investment Officer (Apr. 2011 – present), Charles Schwab <br> Investment Management, Inc.; Vice President and Chief Investment Officer <br> (June 2011 – present), Schwab Funds, Laudus Trust and Schwab ETFs.<br>|
| **William P. McMahon, Jr.**<br> 1972<br> Vice President and Chief Investment Officer<br> (Officer of The Charles Schwab Family of Funds, Schwab <br> Investments, Schwab Capital Trust, Schwab Annuity <br> Portfolios, Schwab Strategic Trust and Laudus Trust since <br> 2021)<br>| Senior Vice President and Chief Investment Officer (Jan. 2020 – present), Charles Schwab <br> Investment Management, Inc.; Vice President and Chief Investment Officer <br> (June 2021 – present), Schwab Funds, Laudus Trust and Schwab ETFs; Senior Vice President <br> and Chief Investment Officer – ThomasPartners Strategies (Apr. 2018 – Dec. 2019), Charles <br> Schwab Investment Advisory, Inc.; Senior Vice President and Chief Investment Officer <br> (May 2001 – Apr. 2018), ThomasPartners, Inc.<br>|
| **Catherine MacGregor**<br> 1964<br> Chief Legal Officer and Secretary, Schwab Funds and <br> Schwab ETFs<br> Chief Legal Officer, Vice President and Clerk, Laudus Trust<br> (Officer of The Charles Schwab Family of Funds, Schwab <br> Investments, Schwab Capital Trust, Schwab Annuity <br> Portfolios and Laudus Trust since 2005; Schwab Strategic <br> Trust since 2009)<br>| Chief Legal Officer (Mar. 2022 – present) and Vice President (Sept. 2005 – present), Charles <br> Schwab Investment Management, Inc.; Managing Director (May 2022 – present) and Vice <br> President (July 2005 – May 2022), Charles Schwab & Co., Inc.; Vice President <br> (Dec. 2005 – present) and Chief Legal Officer and Clerk (Mar. 2007 – present), Laudus Trust; <br> Chief Legal Officer and Secretary (Oct. 2021 – present), Vice President <br> (Nov. 2005 – Oct. 2021) and Assistant Secretary (June 2007 – Oct. 2021), Schwab Funds; <br> Chief Legal Officer and Secretary (Oct. 2021 – present), Vice President and Assistant <br> Secretary (Oct. 2009 – Oct. 2021), Schwab ETFs.<br>|

---

<sup>1</sup>

Each Trustee shall hold office until the election and qualification of his or her successor, or until he or she dies, resigns or is removed. The retirement policy requires that each independent trustee retire by December 31 of the year in which the Trustee turns 74 or the Trustee's twentieth year of service as an independent trustee on any trust in the Fund Complex, whichever occurs first.

<sup>2</sup>

Mr. Bettinger and Mr. Wurster are Interested Trustees. Mr. Bettinger and Mr. Wurster are Interested Trustees because each owns stock of The Charles Schwab Corporation (CSC), the parent company of Charles Schwab Investment Management, Inc., the investment adviser for the trusts in the Fund Complex, and is an employee of Charles Schwab & Co., Inc. (Schwab), the principal underwriter for The Charles Schwab Family of Funds, Schwab Investments, Schwab Capital Trust, Schwab Annuity Portfolios and Laudus Trust.

<sup>3</sup>

The President, Treasurer and Secretary/Clerk hold office until their respective successors are chosen and qualified or until he or she sooner dies, resigns, is removed or becomes disqualified. Each of the other officers serves at the pleasure of the Board.

Schwab Government Money Market Portfolio \| Annual Report**28**

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;

Notes

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;

Notes

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;

Notes

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![(CHARLES SCHWAB ASSET MANAGMENT LOGO)](g36348img0af5b3121.jpg)

**Annual Report** \| December 31, 2022

Schwab S&P 500 Index Portfolio

------

**Proxy Voting Policies, Procedures and Results**

A description of the proxy voting policies and procedures used to determine how to vote proxies on behalf of the funds is available without charge, upon request, by visiting the Schwab Fund's website at www.schwabassetmanagement.com/schwabfunds_prospectus, the SEC's website at www.sec.gov, or by contacting Schwab Funds at 1-877-824-5615.

Information regarding how a fund voted proxies relating to portfolio securities during the most recent twelve-month period ended June 30 is available, without charge, by visiting Schwab's website at www.schwabassetmanagement.com/schwabfunds_prospectus or the SEC's website at www.sec.gov.

The Sector/Industry classifications in this report use the Global Industry Classification Standard (GICS) which was developed by and is the exclusive property of MSCI Inc. (MSCI) and Standard & Poor's (S&P). GICS is a service mark of MSCI and S&P and has been licensed for use by Charles Schwab & Co., Inc. The Industry classifications used in the Portfolio Holdings are sub-categories of Sector classifications.

**Investment Adviser:** Charles Schwab Investment Management, Inc., dba Schwab Asset Management<sup>TM</sup>

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Schwab S&P 500 Index Portfolio

The Investment Environment

------

For the 12-month reporting period ended December 31, 2022, several key U.S. stock indices posted their largest calendar year drop since the 2008 recession. Inflation spiked, interest rates rose, and economic growth around the world slowed. The ongoing war between Russian and Ukraine and the continuing, albeit uneven, fallout from the COVID-19 pandemic weighed on economies and markets around the world. Oil prices peaked at over $120 per barrel in early March as sanctions were imposed on Russian imports—and again in June on supply-and-demand imbalances—but retreated through most of the rest of the reporting period, ending the year at just over $80 per barrel. For the reporting period, the S&P 500<sup>®</sup> Index, a bellwether for the overall U.S. stock market, returned -18.11%.

In the United States, amid fading government stimuli, ongoing supply chain disruptions, persisting inflation, and a widening U.S. trade deficit, gross domestic product (GDP) contracted for the first two quarters of 2022, decreasing at an annualized rate of -1.6% and -0.6% for the first and second quarters, respectively. GDP grew at an annualized rate of 3.2% for the third quarter of 2022, driven primarily by energy exports and consumer spending. Inflation rose steadily in the first half of the year, hitting a 40-year high in June, before declining through the end of the reporting period as certain consumer and energy prices began to recede. The unemployment rate remained low despite inflationary pressures, ending the reporting period at pre-pandemic lows.

Monetary policy around the world varied as central banks responded to the rapidly changing conditions. In the United States, after maintaining the federal funds rate in a range of 0.00% to 0.25% through mid-March 2022, the U.S. Federal Reserve (Fed) shifted its stance as inflation continued to rise and indicators of economic activity and employment continued to strengthen. After issuing successively stronger signals that interest rates could begin to rise sooner in 2022 than previously anticipated, the Fed raised the federal funds rate seven times during the reporting period—by 0.25% in mid-March, 0.50% in early May, 0.75% in mid-June, 0.75% in late July, 0.75% in late September, 0.75% in early November, and 0.50% in mid-December. The federal funds rate ended the reporting period in a range of 4.25% to 4.50%. The Fed wrapped up its bond-buying program in March, and in June began to reduce the $9 trillion in assets held on its balance sheet, vowing to be even more aggressive than during its last round of quantitative tightening between 2017 and 2019.

**Asset Class Performance Comparison % returns during the 12 months ended December 31, 2022**![](g36348imgc8c4e07f2.jpg)

Index figures assume dividends and distributions were reinvested. Index figures do not include trading and management costs, which would lower performance. Indices are unmanaged and cannot be invested in directly. Performance results less than one year are not annualized. Past performance is not an indication of future results.

Data source: Index provider websites and Schwab Asset Management.

Nothing in this report represents a recommendation of a security by the investment adviser.

Management views may have changed since the report date.

\*

The net version of the index reflects reinvested dividends net of withholding taxes but reflects no deductions for expenses or other taxes.

Schwab S&P 500 Index Portfolio \| Annual Report**2**

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Schwab S&P 500 Index Portfolio

The Investment Environment (continued)

------

Among U.S. stocks, small-cap stocks slightly underperformed large-cap stocks over the reporting period, and among U.S. large-cap stocks, growth stocks underperformed value stocks. Nine of the 11 sectors in the S&P 500<sup>®</sup> Index posted negative returns for the reporting period, many in the double digits. The weakest was the communication services sector, dampened by reduced demand, falling advertising spending, and, for some media companies, the continuing shift to streaming versus live broadcasting. The consumer discretionary sector was also weak as consumers shifted spending away from discretionary goods and toward food and other essential items. The information technology sector—the largest sector in the index—was another notably weak performer, as many of the sector's largest companies posted their worst annual returns in years on continuing component shortages, labor issues, and reduced demand. The energy sector was the bright spot among sector performance, up over 60% for the year. Through the first half of the year, ongoing oil shortages and the war in Ukraine resulted in demand outstripping supply, driving prices significantly higher. Oil prices fell during the third quarter as supply began to recover and, despite some volatility, ended the fourth quarter roughly where they began it. The utilities sector, considered a defensive sector and therefore relatively more attractive than others during periods of economic weakness, posted a small positive return for the reporting period amid generally stable revenues.

**3**Schwab S&P 500 Index Portfolio \| Annual Report

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Schwab S&P 500 Index Portfolio

Portfolio Management

------

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;

---

| | |
|:---|:---|
| ![](g36348img1267c16d3.jpg)<br>| &nbsp;&nbsp;&nbsp;&nbsp; **Christopher Bliss, CFA,** Managing Director and Head of Passive Equity Strategies for Schwab Asset <br> Management, is responsible for overseeing the investment process and portfolio management of investment <br> strategies for passive equity Schwab Funds and Schwab ETFs. Before joining Schwab in 2016, Mr. Bliss spent <br> 12 years at BlackRock (formerly Barclays Global Investors) managing and leading institutional index teams, <br> most recently as a managing director and the head of the Americas institutional index team. In this role, Mr. <br> Bliss was responsible for overseeing a team of portfolio managers managing domestic, developed <br> international and emerging markets index strategies. Prior to BlackRock, he worked as an equity analyst and <br> portfolio manager for Harris Bretall and before that, as a research analyst for JP Morgan.<br>|

---

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;

---

| | |
|:---|:---|
| ![](g36348img5e70cefe4.jpg)<br>| &nbsp;&nbsp;&nbsp;&nbsp; **Jeremy Brown, CFA,** Senior Portfolio Manager for Schwab Asset Management, is responsible for the <br> day-to-day co-management of the fund. Prior to joining Schwab in 2017, Mr. Brown spent six years with ALPS <br> Advisors, Inc. in Denver, most recently as a senior analyst on the ETF portfolio management and research <br> team where he performed portfolio management, trading, and analytics/research functions for ALPS ETFs and <br> passive funds. Additionally, Mr. Brown led a number of investment research, commentary, industry trend <br> analysis, and sales and marketing support initiatives.<br>|

---

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;

---

| | |
|:---|:---|
| ![](g36348img281c1ffe5.jpg)<br>| &nbsp;&nbsp;&nbsp;&nbsp; **Ferian Juwono, CFA,** Senior Portfolio Manager for Schwab Asset Management, is responsible for the <br> day-to-day co-management of the fund. Prior to joining Schwab in 2010, Mr. Juwono worked at BlackRock <br> (formerly Barclays Global Investors) where he spent more than three years as a portfolio manager, managing <br> equity index funds for institutional clients, and two years as a senior business analyst. Prior to that, Mr. <br> Juwono worked for more than four years as a senior financial analyst with Union Bank of California.<br>|

---

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;

---

| | |
|:---|:---|
| ![](g36348img03e0ae596.jpg)<br>| &nbsp;&nbsp;&nbsp;&nbsp; **Sabya Sinha,** Portfolio Manager for Schwab Asset Management, is responsible for the day-to-day <br> co-management of the fund. Prior to joining Schwab in 2015, Mr. Sinha spent a year at F-Squared <br> Investments on the product development and analytics team. Prior to F-Squared, he worked at IndexIQ <br> Advisors as a senior index portfolio manager for three years and for Bank of America's Columbia Management <br> subsidiary as a portfolio manager for three years. Mr. Sinha also spent time as a software consultant at DPM <br> Mellon, LLC and an equity trader at Jane Street Capital.<br>|

---

Schwab S&P 500 Index Portfolio \| Annual Report**4**

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Schwab S&P 500 Index Portfolio as of December 31, 2022

------

**The Schwab S&P 500 Index Portfolio's** (the fund) goal is to track the total return of the S&P 500<sup>®</sup> Index (the index), which includes the stocks of 500 leading U.S. publicly-traded companies from a broad range of industries. To pursue its goal, the fund generally seeks to replicate the performance of the index by giving the same weight to a given stock as does the index. For more information concerning the fund's investment objective, strategy and risks, please see the fund's prospectus.

**Market Highlights.** For the 12-month reporting period ended December 31, 2022, several key U.S. stock indices posted their largest calendar year drop since the 2008 recession. Inflation spiked, interest rates rose, and economic growth around the world slowed. The ongoing war between Russian and Ukraine and continuing, albeit uneven, fallout from the COVID-19 pandemic weighed on economies and markets around the world. Oil prices peaked at over $120 per barrel in early March as sanctions were imposed on Russian imports—and again in June on supply-and-demand imbalances—but retreated through most of the rest of the reporting period, ending the year at just over $80 per barrel.

**Performance.** The fund closely tracked the index for the reporting period. The fund returned -18.12% for the 12-month reporting period ended December 31, 2022, compared with the index, which returned -18.11%. Differences between the return of the fund and the return of the index may be attributable to, among other things, the operational and transactional costs incurred by the fund and not the index.

**Contributors and Detractors.** The information technology sector detracted the most from the total return of the fund. Information technology stocks represented an average weight of approximately 27% of the fund's investments and returned approximately -28% for the reporting period. One example from this sector is Apple Inc., which designs, manufactures, and markets smartphones, personal computers, tablets, wearables and accessories, and sells a variety of related accessories. The fund's holdings of Apple Inc. represented an average weight of approximately 7% of the fund's investments and returned approximately -26% for the reporting period.

The consumer discretionary sector also detracted from the total return of the fund, representing an average weight of approximately 11% of the fund's investments and returning approximately -37% for the reporting period.

The energy sector contributed the most to the total return of the fund. Energy stocks represented an average weight of approximately 4% of the fund's investments and returned approximately 66% for the reporting period. One example from this sector is Exxon Mobil Corp., which operates petroleum and petro chemicals businesses. The fund's holdings of Exxon Mobil Corp. represented an average weight of approximately 1% of the fund's investments and returned approximately 87% for the reporting period.

The health care sector also contributed to the total return of the fund, though slightly, representing an average weight of approximately 14% of the fund's investments and returning approximately -2% for the reporting period.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;

Management views and portfolio holdings may have changed since the report date.

**5**Schwab S&P 500 Index Portfolio \| Annual Report

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Schwab S&P 500 Index Portfolio

Performance and Fund Facts as of December 31, 2022

------

**The performance data quoted represents past performance. Past performance does not guarantee future results. Investment returns and principal value will fluctuate so that an investor's shares may be worth more or less than their original cost. Current performance may be lower or higher than performance data quoted. To obtain performance information current to the most recent month end, please visit www.schwabassetmanagement.com/schwabfunds_prospectus.** 

**Performance of Hypothetical $10,000 Investment (December 31, 2012 – December 31, 2022)**<sup>1</sup>

![](g36348lg_2m46.jpg)

**Average Annual Total Returns**<sup>1</sup>

---

| | | | |
|:---|:---|:---|:---|
| **Fund and Inception Date** | **1 Year** | **5 Years** | **10 Years** |
| Fund: Schwab S&P 500 Index Portfolio (11/01/96) | -18.12% | 9.39% | 12.43% |
| S&P 500<sup>®</sup> Index | -18.11% | 9.42% | 12.56% |
| Fund Category: Morningstar Large-Cap Blend<sup>2</sup> <br>| -17.38% | 8.34% | 11.74% |
| *Fund Expense Ratio*<sup>3</sup>*: 0.03%* | *Fund Expense Ratio*<sup>3</sup>*: 0.03%* | *Fund Expense Ratio*<sup>3</sup>*: 0.03%* | *Fund Expense Ratio*<sup>3</sup>*: 0.03%* |

---

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;

All total return figures on this page assume dividends and distributions were reinvested. Index figures do not include trading and management costs, which would lower performance. Indices are unmanaged and cannot be invested in directly. Performance results less than one year are not annualized.

Index ownership — "Standard & Poor's<sup>®</sup>," "S&P<sup>®</sup>," and "S&P 500<sup>®</sup>" are registered trademarks of Standard & Poor's Financial Services LLC (S&P), and "Dow Jones<sup>®</sup>" is a registered trademark of Dow Jones Trademark Holdings LLC (Dow Jones) and have been licensed for use by S&P Dow Jones Indices LLC and its affiliates and sublicensed for certain purposes by Charles Schwab Investment Management, Inc. The "S&P 500<sup>®</sup> Index" is a product of S&P Dow Jones Indices LLC or its affiliates, and has been licensed for use by Charles Schwab Investment Managment, Inc. The Schwab S&P 500 Index Portfolio is not sponsored, endorsed, sold or promoted by S&P Dow Jones Indices LLC, Dow Jones, S&P, or their respective affiliates, and neither S&P Dow Jones Indices LLC, Dow Jones, S&P, nor their respective affiliates make any representation regarding the advisability of investing in the fund.

<sup>1</sup>

Fund performance does not reflect the additional fees and expenses imposed by the insurance company under the variable insurance product contract. If those contract fees and expenses were included, the performance would be less than that shown. Please refer to the variable insurance product prospectus for a complete listing of these expenses.

<sup>2</sup>

Source for category information: Morningstar, Inc. The Morningstar Category return represents all active and index mutual funds and ETFs within the category as of the report date.

<sup>3</sup>

As stated in the prospectus.

Schwab S&P 500 Index Portfolio \| Annual Report**6**

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Schwab S&P 500 Index Portfolio

Performance and Fund Facts as of December 31, 2022 (continued)

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;

**Statistics**<sup>1</sup>

---

| | |
|:---|:---|
| Number of Holdings | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 503 |
| Weighted Average Market Cap ($ x 1,000,000) | $417492 |
| Price/Earnings Ratio (P/E) | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 19.2 |
| Price/Book Ratio (P/B) | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 3.6 |
| Portfolio Turnover Rate | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 9% |

---

**Sector Weightings % of Investments**<sup>2</sup> <br>

![](g36348imgaef9e7377.jpg)

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;

**Top Equity Holdings % of Net Assets**<sup>3</sup> <br>

![](g36348img7c8771208.jpg)

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;

Portfolio holdings may have changed since the report date.

Source of Sector Classification: S&P and MSCI.

<sup>1</sup>

Excludes derivatives.

<sup>2</sup>

The percentage may differ from the Portfolio Holdings because the above calculation is based on a percentage of total investments, excluding derivatives, whereas the calculation in the Portfolio Holdings is based on a percentage of net assets.

<sup>3</sup>

This list is not a recommendation of any security by the investment adviser.

**7**Schwab S&P 500 Index Portfolio \| Annual Report

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Schwab S&P 500 Index Portfolio

Fund Expenses (Unaudited)

**Examples for a $1,000 Investment**

As a fund shareholder, you may incur two types of costs: (1) transaction costs; and (2) ongoing costs, including management fees.

The expense examples below are intended to help you understand your ongoing cost (in dollars) of investing in the fund and to compare this cost with the ongoing cost of investing in other mutual funds. These examples are based on an investment of $1,000 invested for six months beginning July 1, 2022 and held through December 31, 2022.

**The Actual Return** line in the table below provides information about actual account values and actual expenses. You may use this information, together with the amount you invested, to estimate the expenses that you paid over the period. To do so, simply divide your account value by $1,000 (for example, an $8,600 account value ÷ $1,000 = 8.6), then multiply the result by the number given for the fund under the heading entitled "Expenses Paid During Period."

**The Hypothetical Return** line in the table below provides information about hypothetical account values and hypothetical expenses based on the fund's actual expense ratio and an assumed return of 5% per year before expenses. Because the return used is not an actual return, it may not be used to estimate the actual ending account value or expenses you paid for the period.

You may use this information to compare the ongoing costs of investing in the fund and other funds. To do so, compare this 5% hypothetical example with the 5% hypothetical examples that appear in the shareholder reports of the other funds.

Please note that the expenses shown in the table are meant to highlight your ongoing costs only, and do not reflect any transactional costs. Therefore, the hypothetical return lines of the table are useful in comparing ongoing costs only, and will not help you determine the relative total costs of owning different funds. In addition, if these transactional costs were included, your costs would have been higher.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;

---

| | | | | |
|:---|:---|:---|:---|:---|
|  | &nbsp;&nbsp; EXPENSE RATIO <br>(ANNUALIZED) <sup>1</sup> <br>| &nbsp;&nbsp; BEGINNING <br>ACCOUNT VALUE <br>AT 7/1/22<br>| &nbsp;&nbsp; ENDING <br>ACCOUNT VALUE <br>(NET OF EXPENSES) <br>AT 12/31/22<br>| &nbsp;&nbsp; EXPENSES PAID <br>DURING PERIOD <br>7/1/22-12/31/22 <sup>2</sup> <br>|
| **Schwab S&P 500 Index Portfolio** |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; Actual Return | 0.03% | $1000.00 | $1022.90 | $0.15 |
| &nbsp;&nbsp;&nbsp;&nbsp; Hypothetical 5% Return | 0.03% | $1000.00 | $1025.05 | $0.15 |

---

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;

<sup>1</sup> Based on the most recent six-month expense ratio. <br> <sup>2</sup> Expenses for the fund are equal to its annualized expense ratio, multiplied by the average account value over the period, multiplied by 184 days in the period, and divided by 365 days in the fiscal year.

Schwab S&P 500 Index Portfolio \| Annual Report**8**

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Schwab S&P 500 Index Portfolio

Financial Statements

**FINANCIAL HIGHLIGHTS**

---

| | | | | | |
|:---|:---|:---|:---|:---|:---|
|  | 1/1/22– <br>12/31/22<br>| 1/1/21– <br>12/31/21<br>| 1/1/20– <br>12/31/20<br>| 1/1/19– <br>12/31/19<br>| 1/1/18– <br>12/31/18<br>|
| **Per-Share Data** | **Per-Share Data** | **Per-Share Data** | **Per-Share Data** | **Per-Share Data** | **Per-Share Data** |
| Net asset value at beginning of period | $70.41 | $55.41 | $47.48 | $37.10 | $39.51 |
| Income (loss) from investment operations: |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; Net investment income (loss)<sup>1</sup> <br>| &nbsp;&nbsp;&nbsp; 0.95 | &nbsp;&nbsp;&nbsp; 0.85 | &nbsp;&nbsp;&nbsp; 0.96 | &nbsp;&nbsp;&nbsp; 0.91 | &nbsp;&nbsp;&nbsp; 0.82 |
| &nbsp;&nbsp;&nbsp;&nbsp; Net realized and unrealized gains (losses) | (13.73) | &nbsp;&nbsp; 14.94 | &nbsp;&nbsp;&nbsp; 7.58 | &nbsp;&nbsp; 10.64 | &nbsp;&nbsp; (2.51) |
| &nbsp;&nbsp;&nbsp;&nbsp; Total from investment operations | (12.78) | &nbsp;&nbsp; 15.79 | &nbsp;&nbsp;&nbsp; 8.54 | &nbsp;&nbsp; 11.55 | &nbsp;&nbsp; (1.69) |
| Less distributions: |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; Distributions from net investment income | &nbsp;&nbsp; (0.77) | &nbsp;&nbsp; (0.79) | &nbsp;&nbsp; (0.53) | &nbsp;&nbsp; (0.78) | &nbsp;&nbsp; (0.68) |
| &nbsp;&nbsp;&nbsp;&nbsp; Distributions from net realized gains | &nbsp;&nbsp; (0.48) | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; — | &nbsp;&nbsp; (0.08) | &nbsp;&nbsp; (0.39) | &nbsp;&nbsp; (0.04) |
| &nbsp;&nbsp;&nbsp;&nbsp; Total distributions | &nbsp;&nbsp; (1.25) | &nbsp;&nbsp; (0.79) | &nbsp;&nbsp; (0.61) | &nbsp;&nbsp; (1.17) | &nbsp;&nbsp; (0.72) |
| Net asset value at end of period | $56.38 | $70.41 | $55.41 | $47.48 | $37.10 |
| Total return | (18.12%) | &nbsp;&nbsp; 28.67% | &nbsp;&nbsp; 18.28% | &nbsp;&nbsp; 31.48% | &nbsp;&nbsp; (4.40%) |
| **Ratios/Supplemental Data** | **Ratios/Supplemental Data** | **Ratios/Supplemental Data** | **Ratios/Supplemental Data** | **Ratios/Supplemental Data** | **Ratios/Supplemental Data** |
| Ratios to average net assets: |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; Total expenses | &nbsp;&nbsp;&nbsp; 0.03%<sup>2</sup> <br>| &nbsp;&nbsp;&nbsp; 0.03% | &nbsp;&nbsp;&nbsp; 0.03% | &nbsp;&nbsp;&nbsp; 0.03% | &nbsp;&nbsp;&nbsp; 0.03% |
| &nbsp;&nbsp;&nbsp;&nbsp; Net investment income (loss) | &nbsp;&nbsp;&nbsp; 1.59% | &nbsp;&nbsp;&nbsp; 1.35% | &nbsp;&nbsp;&nbsp; 2.03% | &nbsp;&nbsp;&nbsp; 2.13% | &nbsp;&nbsp;&nbsp; 2.03% |
| Portfolio turnover rate | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 9% | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 13% | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 14% | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 6% | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 5% |
| Net assets, end of period (x 1,000,000) | $2430 | $1468 | &nbsp;&nbsp; $947 | &nbsp;&nbsp; $588 | &nbsp;&nbsp; $340 |

---

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;

<sup>1</sup> Calculated based on the average shares outstanding during the period.

<sup>2</sup> Ratio includes less than 0.005% of non-routine proxy expenses.

*See financial notes*

**9**Schwab S&P 500 Index Portfolio \| Annual Report

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Schwab S&P 500 Index Portfolio

Portfolio Holdings as of December 31, 2022

------

This section shows all the securities in the fund's portfolio and their values as of the report date.

The fund files its complete schedule of portfolio holdings with the U.S. Securities and Exchange Commission (SEC) for the first and third quarters of each fiscal year on Form N-PORT Part F. The fund's Form N-PORT Part F is available on the SEC's website at www.sec.gov. The fund also makes available its complete schedule of portfolio holdings on the fund's website at www.schwabassetmanagement.com/schwabfunds_prospectus, typically 60-80 days after the end of the fund's fiscal quarter.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;

---

| | | |
|:---|:---|:---|
| SECURITY | NUMBER<br> OF SHARES<br>| VALUE ($) |
| **COMMON STOCKS** 99.2% OF NET ASSETS  | **COMMON STOCKS** 99.2% OF NET ASSETS  | **COMMON STOCKS** 99.2% OF NET ASSETS  |
| **Automobiles & Components 1.4%** | **Automobiles & Components 1.4%** | **Automobiles & Components 1.4%** |
| Aptiv plc \* | &nbsp;&nbsp;&nbsp;&nbsp; 20342 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 1894450 |
| BorgWarner, Inc.  | &nbsp;&nbsp;&nbsp;&nbsp; 17636 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 709849 |
| Ford Motor Co.  | &nbsp;&nbsp;&nbsp; 296294 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 3445899 |
| General Motors Co.  | &nbsp;&nbsp;&nbsp; 106579 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 3585318 |
| Tesla, Inc. \* | &nbsp;&nbsp;&nbsp; 201393 | &nbsp;&nbsp;&nbsp;&nbsp; 24807590 |
|  |  | **34443106** |
| **Banks 3.8%** | **Banks 3.8%** | **Banks 3.8%** |
| Bank of America Corp.  | &nbsp;&nbsp;&nbsp; 523688 | &nbsp;&nbsp;&nbsp;&nbsp; 17344546 |
| Citigroup, Inc.  | &nbsp;&nbsp;&nbsp; 145303 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 6572055 |
| Citizens Financial Group, Inc.  | &nbsp;&nbsp;&nbsp;&nbsp; 36926 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 1453777 |
| Comerica, Inc.  | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 9859 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 659074 |
| Fifth Third Bancorp  | &nbsp;&nbsp;&nbsp;&nbsp; 51585 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 1692504 |
| First Republic Bank  | &nbsp;&nbsp;&nbsp;&nbsp; 13736 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 1674281 |
| Huntington Bancshares, Inc.  | &nbsp;&nbsp;&nbsp; 108510 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 1529991 |
| JPMorgan Chase & Co.  | &nbsp;&nbsp;&nbsp; 220088 | &nbsp;&nbsp;&nbsp;&nbsp; 29513801 |
| KeyCorp  | &nbsp;&nbsp;&nbsp;&nbsp; 69923 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 1218059 |
| M&T Bank Corp.  | &nbsp;&nbsp;&nbsp;&nbsp; 12932 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 1875916 |
| Regions Financial Corp.  | &nbsp;&nbsp;&nbsp;&nbsp; 69971 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 1508575 |
| Signature Bank  | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 4752 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 547525 |
| SVB Financial Group \* | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 4434 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 1020441 |
| The PNC Financial Services Group, Inc.  | &nbsp;&nbsp;&nbsp;&nbsp; 30259 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 4779106 |
| Truist Financial Corp.  | &nbsp;&nbsp;&nbsp;&nbsp; 99534 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 4282948 |
| U.S. Bancorp  | &nbsp;&nbsp;&nbsp; 101442 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 4423885 |
| Wells Fargo & Co.  | &nbsp;&nbsp;&nbsp; 285908 | &nbsp;&nbsp;&nbsp;&nbsp; 11805141 |
| Zions Bancorp NA  | &nbsp;&nbsp;&nbsp;&nbsp; 11211 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 551133 |
|  |  | **92452758** |
| **Capital Goods 6.0%** | **Capital Goods 6.0%** | **Capital Goods 6.0%** |
| 3M Co.  | &nbsp;&nbsp;&nbsp;&nbsp; 41467 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 4972723 |
| A.O. Smith Corp.  | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 9573 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 547959 |
| Allegion plc  | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 6612 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 695979 |
| AMETEK, Inc.  | &nbsp;&nbsp;&nbsp;&nbsp; 17233 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 2407795 |
| Carrier Global Corp.  | &nbsp;&nbsp;&nbsp;&nbsp; 62728 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 2587530 |
| Caterpillar, Inc.  | &nbsp;&nbsp;&nbsp;&nbsp; 39048 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 9354339 |
| Cummins, Inc.  | &nbsp;&nbsp;&nbsp;&nbsp; 10581 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 2563670 |
| Deere & Co.  | &nbsp;&nbsp;&nbsp;&nbsp; 20609 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 8836315 |
| Dover Corp.  | &nbsp;&nbsp;&nbsp;&nbsp; 10519 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 1424378 |
| Eaton Corp. plc  | &nbsp;&nbsp;&nbsp;&nbsp; 29840 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 4683388 |
| Emerson Electric Co.  | &nbsp;&nbsp;&nbsp;&nbsp; 44365 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 4261702 |
| Fastenal Co.  | &nbsp;&nbsp;&nbsp;&nbsp; 42977 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 2033672 |
| Fortive Corp.  | &nbsp;&nbsp;&nbsp;&nbsp; 26502 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 1702753 |
| Generac Holdings, Inc. \* | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 4756 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 478739 |
| General Dynamics Corp.  | &nbsp;&nbsp;&nbsp;&nbsp; 16894 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 4191570 |
| General Electric Co.  | &nbsp;&nbsp;&nbsp;&nbsp; 81986 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 6869607 |
| Honeywell International, Inc.  | &nbsp;&nbsp;&nbsp;&nbsp; 50447 | &nbsp;&nbsp;&nbsp;&nbsp; 10810792 |
| Howmet Aerospace, Inc.  | &nbsp;&nbsp;&nbsp;&nbsp; 27545 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 1085548 |
| Huntington Ingalls Industries, Inc.  | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 3008 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 693885 |
| IDEX Corp.  | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 5655 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 1291206 |
| Illinois Tool Works, Inc.  | &nbsp;&nbsp;&nbsp;&nbsp; 20976 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 4621013 |
| Ingersoll Rand, Inc.  | &nbsp;&nbsp;&nbsp;&nbsp; 30390 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 1587877 |
| Johnson Controls International plc  | &nbsp;&nbsp;&nbsp;&nbsp; 51670 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 3306880 |
| L3Harris Technologies, Inc.  | &nbsp;&nbsp;&nbsp;&nbsp; 14293 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 2975946 |
| Lockheed Martin Corp.  | &nbsp;&nbsp;&nbsp;&nbsp; 17502 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 8514548 |

---

---

| | | |
|:---|:---|:---|
| SECURITY | NUMBER<br> OF SHARES<br>| VALUE ($) |
| Masco Corp.  | &nbsp;&nbsp;&nbsp;&nbsp; 16957 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 791383 |
| Nordson Corp.  | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 4028 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 957536 |
| Northrop Grumman Corp.  | &nbsp;&nbsp;&nbsp;&nbsp; 10856 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 5923142 |
| Otis Worldwide Corp.  | &nbsp;&nbsp;&nbsp;&nbsp; 31292 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 2450477 |
| PACCAR, Inc.  | &nbsp;&nbsp;&nbsp;&nbsp; 26091 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 2582226 |
| Parker-Hannifin Corp.  | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 9633 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 2803203 |
| Pentair plc  | &nbsp;&nbsp;&nbsp;&nbsp; 12415 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 558427 |
| Quanta Services, Inc.  | &nbsp;&nbsp;&nbsp;&nbsp; 10707 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 1525747 |
| Raytheon Technologies Corp.  | &nbsp;&nbsp;&nbsp; 110304 | &nbsp;&nbsp;&nbsp;&nbsp; 11131880 |
| Rockwell Automation, Inc.  | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 8629 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 2222572 |
| Snap-on, Inc.  | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 4000 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 913960 |
| Stanley Black & Decker, Inc.  | &nbsp;&nbsp;&nbsp;&nbsp; 11104 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 834132 |
| Textron, Inc.  | &nbsp;&nbsp;&nbsp;&nbsp; 15654 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 1108303 |
| The Boeing Co. \* | &nbsp;&nbsp;&nbsp;&nbsp; 42034 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 8007057 |
| Trane Technologies plc  | &nbsp;&nbsp;&nbsp;&nbsp; 17278 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 2904259 |
| TransDigm Group, Inc.  | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 3875 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 2439894 |
| United Rentals, Inc. \* | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 5192 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 1845341 |
| W.W. Grainger, Inc.  | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 3375 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 1877344 |
| &nbsp;&nbsp;&nbsp;&nbsp; Westinghouse Air Brake Technologies <br> Corp. <br>| &nbsp;&nbsp;&nbsp;&nbsp; 13625 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 1359911 |
| Xylem, Inc.  | &nbsp;&nbsp;&nbsp;&nbsp; 13491 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 1491700 |
|  |  | **146228308** |
| **Commercial & Professional Services 0.9%** | **Commercial & Professional Services 0.9%** | **Commercial & Professional Services 0.9%** |
| Cintas Corp.  | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 6476 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 2924691 |
| Copart, Inc. \* | &nbsp;&nbsp;&nbsp;&nbsp; 32150 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 1957613 |
| CoStar Group, Inc. \* | &nbsp;&nbsp;&nbsp;&nbsp; 30516 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 2358276 |
| Equifax, Inc.  | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 9193 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 1786751 |
| Jacobs Solutions, Inc.  | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 9570 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 1149070 |
| Leidos Holdings, Inc.  | &nbsp;&nbsp;&nbsp;&nbsp; 10245 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 1077672 |
| Republic Services, Inc.  | &nbsp;&nbsp;&nbsp;&nbsp; 15412 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 1987994 |
| Robert Half International, Inc.  | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 8163 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 602674 |
| Rollins, Inc.  | &nbsp;&nbsp;&nbsp;&nbsp; 17440 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 637258 |
| Verisk Analytics, Inc.  | &nbsp;&nbsp;&nbsp;&nbsp; 11737 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 2070642 |
| Waste Management, Inc.  | &nbsp;&nbsp;&nbsp;&nbsp; 28026 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 4396719 |
|  |  | **20949360** |
| **Consumer Durables & Apparel 0.9%** | **Consumer Durables & Apparel 0.9%** | **Consumer Durables & Apparel 0.9%** |
| D.R. Horton, Inc.  | &nbsp;&nbsp;&nbsp;&nbsp; 23528 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 2097286 |
| Garmin Ltd.  | &nbsp;&nbsp;&nbsp;&nbsp; 11495 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 1060874 |
| Hasbro, Inc.  | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 9799 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 597837 |
| Lennar Corp., Class A  | &nbsp;&nbsp;&nbsp;&nbsp; 19080 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 1726740 |
| Mohawk Industries, Inc. \* | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 3928 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 401520 |
| Newell Brands, Inc.  | &nbsp;&nbsp;&nbsp;&nbsp; 28039 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 366750 |
| NIKE, Inc., Class B  | &nbsp;&nbsp;&nbsp;&nbsp; 94504 | &nbsp;&nbsp;&nbsp;&nbsp; 11057913 |
| NVR, Inc. \* | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 225 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 1037830 |
| PulteGroup, Inc.  | &nbsp;&nbsp;&nbsp;&nbsp; 17080 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 777652 |
| Ralph Lauren Corp.  | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 3097 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 327260 |
| Tapestry, Inc.  | &nbsp;&nbsp;&nbsp;&nbsp; 18094 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 689020 |
| VF Corp.  | &nbsp;&nbsp;&nbsp;&nbsp; 24890 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 687213 |
| Whirlpool Corp.  | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 4113 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 581825 |
|  |  | **21409720** |
| **Consumer Services 2.0%** | **Consumer Services 2.0%** | **Consumer Services 2.0%** |
| Booking Holdings, Inc. \* | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 2910 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 5864465 |
| Caesars Entertainment, Inc. \* | &nbsp;&nbsp;&nbsp;&nbsp; 16120 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 670592 |
| Carnival Corp. \* | &nbsp;&nbsp;&nbsp;&nbsp; 75506 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 608578 |

---

*See financial notes*

Schwab S&P 500 Index Portfolio \| Annual Report**10**

------

Schwab S&P 500 Index Portfolio

Portfolio Holdings as of December 31, 2022 (continued)

------

---

| | | |
|:---|:---|:---|
| SECURITY | NUMBER<br> OF SHARES<br>| VALUE ($) |
| Chipotle Mexican Grill, Inc. \* | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 2080 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 2885979 |
| Darden Restaurants, Inc.  | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 9185 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 1270561 |
| Domino's Pizza, Inc.  | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 2653 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 918999 |
| Expedia Group, Inc. \* | &nbsp;&nbsp;&nbsp;&nbsp; 11332 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 992683 |
| Hilton Worldwide Holdings, Inc.  | &nbsp;&nbsp;&nbsp;&nbsp; 20310 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 2566372 |
| Las Vegas Sands Corp. \* | &nbsp;&nbsp;&nbsp;&nbsp; 24637 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 1184301 |
| Marriott International, Inc., Class A  | &nbsp;&nbsp;&nbsp;&nbsp; 20195 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 3006834 |
| McDonald's Corp.  | &nbsp;&nbsp;&nbsp;&nbsp; 54954 | &nbsp;&nbsp;&nbsp;&nbsp; 14482028 |
| MGM Resorts International  | &nbsp;&nbsp;&nbsp;&nbsp; 23915 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 801870 |
| Norwegian Cruise Line Holdings Ltd. \* | &nbsp;&nbsp;&nbsp;&nbsp; 31398 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 384311 |
| Royal Caribbean Cruises Ltd. \* | &nbsp;&nbsp;&nbsp;&nbsp; 16479 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 814557 |
| Starbucks Corp.  | &nbsp;&nbsp;&nbsp;&nbsp; 86124 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 8543501 |
| Wynn Resorts Ltd. \* | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 7711 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 635926 |
| Yum! Brands, Inc.  | &nbsp;&nbsp;&nbsp;&nbsp; 21152 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 2709148 |
|  |  | **48340705** |
| **Diversified Financials 5.3%** | **Diversified Financials 5.3%** | **Diversified Financials 5.3%** |
| American Express Co.  | &nbsp;&nbsp;&nbsp;&nbsp; 44850 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 6626588 |
| Ameriprise Financial, Inc.  | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 7993 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 2488780 |
| Berkshire Hathaway, Inc., Class B \* | &nbsp;&nbsp;&nbsp; 135194 | &nbsp;&nbsp;&nbsp;&nbsp; 41761427 |
| BlackRock, Inc.  | &nbsp;&nbsp;&nbsp;&nbsp; 11271 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 7986969 |
| Capital One Financial Corp.  | &nbsp;&nbsp;&nbsp;&nbsp; 28678 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 2665907 |
| Cboe Global Markets, Inc.  | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 7965 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 999369 |
| CME Group, Inc.  | &nbsp;&nbsp;&nbsp;&nbsp; 26997 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 4539816 |
| Discover Financial Services  | &nbsp;&nbsp;&nbsp;&nbsp; 20500 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 2005515 |
| FactSet Research Systems, Inc.  | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 2866 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 1149868 |
| Franklin Resources, Inc.  | &nbsp;&nbsp;&nbsp;&nbsp; 21188 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 558939 |
| Intercontinental Exchange, Inc.  | &nbsp;&nbsp;&nbsp;&nbsp; 41922 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 4300778 |
| Invesco Ltd.  | &nbsp;&nbsp;&nbsp;&nbsp; 34312 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 617273 |
| MarketAxess Holdings, Inc.  | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 2832 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 789816 |
| Moody's Corp.  | &nbsp;&nbsp;&nbsp;&nbsp; 11825 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 3294682 |
| Morgan Stanley  | &nbsp;&nbsp;&nbsp;&nbsp; 98925 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 8410603 |
| MSCI, Inc.  | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 6001 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 2791485 |
| Nasdaq, Inc.  | &nbsp;&nbsp;&nbsp;&nbsp; 25509 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 1564977 |
| Northern Trust Corp.  | &nbsp;&nbsp;&nbsp;&nbsp; 15617 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 1381948 |
| Raymond James Financial, Inc.  | &nbsp;&nbsp;&nbsp;&nbsp; 14547 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 1554347 |
| S&P Global, Inc.  | &nbsp;&nbsp;&nbsp;&nbsp; 24989 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 8369816 |
| State Street Corp.  | &nbsp;&nbsp;&nbsp;&nbsp; 27492 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 2132554 |
| Synchrony Financial  | &nbsp;&nbsp;&nbsp;&nbsp; 33780 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 1110011 |
| T. Rowe Price Group, Inc.  | &nbsp;&nbsp;&nbsp;&nbsp; 16740 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 1825664 |
| The Bank of New York Mellon Corp.  | &nbsp;&nbsp;&nbsp;&nbsp; 55202 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 2512795 |
| The Charles Schwab Corp. *(a)* | &nbsp;&nbsp;&nbsp; 113981 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 9490058 |
| The Goldman Sachs Group, Inc.  | &nbsp;&nbsp;&nbsp;&nbsp; 25411 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 8725629 |
|  |  | **129655614** |
| **Energy 5.2%** | **Energy 5.2%** | **Energy 5.2%** |
| APA Corp.  | &nbsp;&nbsp;&nbsp;&nbsp; 24110 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 1125455 |
| Baker Hughes Co.  | &nbsp;&nbsp;&nbsp;&nbsp; 75264 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 2222546 |
| Chevron Corp.  | &nbsp;&nbsp;&nbsp; 133482 | &nbsp;&nbsp;&nbsp;&nbsp; 23958684 |
| ConocoPhillips  | &nbsp;&nbsp;&nbsp;&nbsp; 93497 | &nbsp;&nbsp;&nbsp;&nbsp; 11032646 |
| Coterra Energy, Inc.  | &nbsp;&nbsp;&nbsp;&nbsp; 59265 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 1456141 |
| Devon Energy Corp.  | &nbsp;&nbsp;&nbsp;&nbsp; 49038 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 3016327 |
| Diamondback Energy, Inc.  | &nbsp;&nbsp;&nbsp;&nbsp; 13186 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 1803581 |
| EOG Resources, Inc.  | &nbsp;&nbsp;&nbsp;&nbsp; 44074 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 5708464 |
| EQT Corp.  | &nbsp;&nbsp;&nbsp;&nbsp; 27560 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 932355 |
| Exxon Mobil Corp.  | &nbsp;&nbsp;&nbsp; 309010 | &nbsp;&nbsp;&nbsp;&nbsp; 34083803 |
| Halliburton Co.  | &nbsp;&nbsp;&nbsp;&nbsp; 68089 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 2679302 |
| Hess Corp.  | &nbsp;&nbsp;&nbsp;&nbsp; 20820 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 2952692 |
| Kinder Morgan, Inc.  | &nbsp;&nbsp;&nbsp; 148534 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 2685495 |
| Marathon Oil Corp.  | &nbsp;&nbsp;&nbsp;&nbsp; 47606 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 1288694 |
| Marathon Petroleum Corp.  | &nbsp;&nbsp;&nbsp;&nbsp; 35163 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 4092622 |
| Occidental Petroleum Corp.  | &nbsp;&nbsp;&nbsp;&nbsp; 54558 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 3436608 |
| ONEOK, Inc.  | &nbsp;&nbsp;&nbsp;&nbsp; 33527 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 2202724 |
| Phillips 66  | &nbsp;&nbsp;&nbsp;&nbsp; 35459 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 3690573 |
| Pioneer Natural Resources Co.  | &nbsp;&nbsp;&nbsp;&nbsp; 17825 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 4071052 |
| Schlumberger Ltd.  | &nbsp;&nbsp;&nbsp; 106379 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 5687021 |

---

---

| | | |
|:---|:---|:---|
| SECURITY | NUMBER<br> OF SHARES<br>| VALUE ($) |
| Targa Resources Corp.  | &nbsp;&nbsp;&nbsp;&nbsp; 16985 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 1248398 |
| The Williams Cos., Inc.  | &nbsp;&nbsp;&nbsp;&nbsp; 91382 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 3006468 |
| Valero Energy Corp.  | &nbsp;&nbsp;&nbsp;&nbsp; 28925 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 3669426 |
|  |  | **126051077** |
| **Food & Staples Retailing 1.5%** | **Food & Staples Retailing 1.5%** | **Food & Staples Retailing 1.5%** |
| Costco Wholesale Corp.  | &nbsp;&nbsp;&nbsp;&nbsp; 33210 | &nbsp;&nbsp;&nbsp;&nbsp; 15160365 |
| Sysco Corp.  | &nbsp;&nbsp;&nbsp;&nbsp; 38054 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 2909228 |
| The Kroger Co.  | &nbsp;&nbsp;&nbsp;&nbsp; 48867 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 2178491 |
| Walgreens Boots Alliance, Inc.  | &nbsp;&nbsp;&nbsp;&nbsp; 53836 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 2011313 |
| Walmart, Inc.  | &nbsp;&nbsp;&nbsp; 105905 | &nbsp;&nbsp;&nbsp;&nbsp; 15016270 |
|  |  | **37275667** |
| **Food, Beverage & Tobacco 3.9%** | **Food, Beverage & Tobacco 3.9%** | **Food, Beverage & Tobacco 3.9%** |
| Altria Group, Inc.  | &nbsp;&nbsp;&nbsp; 134457 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 6146029 |
| Archer-Daniels-Midland Co.  | &nbsp;&nbsp;&nbsp;&nbsp; 41221 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 3827370 |
| Brown-Forman Corp., Class B  | &nbsp;&nbsp;&nbsp;&nbsp; 13732 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 901918 |
| Campbell Soup Co.  | &nbsp;&nbsp;&nbsp;&nbsp; 15006 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 851591 |
| Conagra Brands, Inc.  | &nbsp;&nbsp;&nbsp;&nbsp; 35962 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 1391729 |
| Constellation Brands, Inc., Class A  | &nbsp;&nbsp;&nbsp;&nbsp; 12177 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 2822020 |
| General Mills, Inc.  | &nbsp;&nbsp;&nbsp;&nbsp; 44541 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 3734763 |
| Hormel Foods Corp.  | &nbsp;&nbsp;&nbsp;&nbsp; 21726 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 989619 |
| Kellogg Co.  | &nbsp;&nbsp;&nbsp;&nbsp; 19219 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 1369162 |
| Keurig Dr Pepper, Inc.  | &nbsp;&nbsp;&nbsp;&nbsp; 63737 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 2272861 |
| Lamb Weston Holdings, Inc.  | &nbsp;&nbsp;&nbsp;&nbsp; 10796 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 964731 |
| &nbsp;&nbsp;&nbsp;&nbsp; McCormick & Co., Inc. Non Voting <br> Shares <br>| &nbsp;&nbsp;&nbsp;&nbsp; 18836 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 1561316 |
| Molson Coors Beverage Co., Class B  | &nbsp;&nbsp;&nbsp;&nbsp; 14159 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 729472 |
| Mondelez International, Inc., Class A  | &nbsp;&nbsp;&nbsp; 102482 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 6830425 |
| Monster Beverage Corp. \* | &nbsp;&nbsp;&nbsp;&nbsp; 28594 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 2903149 |
| PepsiCo, Inc.  | &nbsp;&nbsp;&nbsp; 103370 | &nbsp;&nbsp;&nbsp;&nbsp; 18674824 |
| Philip Morris International, Inc.  | &nbsp;&nbsp;&nbsp; 116316 | &nbsp;&nbsp;&nbsp;&nbsp; 11772342 |
| The Coca-Cola Co.  | &nbsp;&nbsp;&nbsp; 292024 | &nbsp;&nbsp;&nbsp;&nbsp; 18575647 |
| The Hershey Co.  | &nbsp;&nbsp;&nbsp;&nbsp; 11030 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 2554217 |
| The JM Smucker Co.  | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 7988 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 1265778 |
| The Kraft Heinz Co.  | &nbsp;&nbsp;&nbsp;&nbsp; 59742 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 2432097 |
| Tyson Foods, Inc., Class A  | &nbsp;&nbsp;&nbsp;&nbsp; 21693 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 1350389 |
|  |  | **93921449** |
| **Health Care Equipment & Services 6.5%** | **Health Care Equipment & Services 6.5%** | **Health Care Equipment & Services 6.5%** |
| Abbott Laboratories  | &nbsp;&nbsp;&nbsp; 130828 | &nbsp;&nbsp;&nbsp;&nbsp; 14363606 |
| Align Technology, Inc. \* | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 5450 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 1149405 |
| AmerisourceBergen Corp.  | &nbsp;&nbsp;&nbsp;&nbsp; 12155 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 2014205 |
| Baxter International, Inc.  | &nbsp;&nbsp;&nbsp;&nbsp; 37821 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 1927736 |
| Becton Dickinson & Co.  | &nbsp;&nbsp;&nbsp;&nbsp; 21399 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 5441766 |
| Boston Scientific Corp. \* | &nbsp;&nbsp;&nbsp; 107475 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 4972868 |
| Cardinal Health, Inc.  | &nbsp;&nbsp;&nbsp;&nbsp; 19645 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 1510111 |
| Centene Corp. \* | &nbsp;&nbsp;&nbsp;&nbsp; 42489 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 3484523 |
| Cigna Corp.  | &nbsp;&nbsp;&nbsp;&nbsp; 22942 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 7601602 |
| CVS Health Corp.  | &nbsp;&nbsp;&nbsp;&nbsp; 98594 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 9187975 |
| DaVita, Inc. \* | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 4149 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 309806 |
| Dentsply Sirona, Inc.  | &nbsp;&nbsp;&nbsp;&nbsp; 16052 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 511096 |
| DexCom, Inc. \* | &nbsp;&nbsp;&nbsp;&nbsp; 28984 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 3282148 |
| Edwards Lifesciences Corp. \* | &nbsp;&nbsp;&nbsp;&nbsp; 46388 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 3461009 |
| Elevance Health, Inc.  | &nbsp;&nbsp;&nbsp;&nbsp; 17921 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 9192935 |
| HCA Healthcare, Inc.  | &nbsp;&nbsp;&nbsp;&nbsp; 15909 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 3817524 |
| Henry Schein, Inc. \* | &nbsp;&nbsp;&nbsp;&nbsp; 10141 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 809962 |
| Hologic, Inc. \* | &nbsp;&nbsp;&nbsp;&nbsp; 18701 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 1399022 |
| Humana, Inc.  | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 9500 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 4865805 |
| IDEXX Laboratories, Inc. \* | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 6220 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 2537511 |
| Intuitive Surgical, Inc. \* | &nbsp;&nbsp;&nbsp;&nbsp; 26515 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 7035755 |
| Laboratory Corp. of America Holdings  | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 6640 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 1563587 |
| McKesson Corp.  | &nbsp;&nbsp;&nbsp;&nbsp; 10640 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 3991277 |
| Medtronic plc  | &nbsp;&nbsp;&nbsp;&nbsp; 99728 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 7750860 |
| Molina Healthcare, Inc. \* | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 4384 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 1447684 |

---

*See financial notes*

**11**Schwab S&P 500 Index Portfolio \| Annual Report

------

Schwab S&P 500 Index Portfolio

Portfolio Holdings as of December 31, 2022 (continued)

------

---

| | | |
|:---|:---|:---|
| SECURITY | NUMBER<br> OF SHARES<br>| VALUE ($) |
| Quest Diagnostics, Inc.  | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 8538 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 1335685 |
| ResMed, Inc.  | &nbsp;&nbsp;&nbsp;&nbsp; 10992 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 2287765 |
| STERIS plc  | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 7492 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 1383697 |
| Stryker Corp.  | &nbsp;&nbsp;&nbsp;&nbsp; 25271 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 6178507 |
| Teleflex, Inc.  | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 3524 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 879696 |
| The Cooper Cos., Inc.  | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 3699 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 1223148 |
| UnitedHealth Group, Inc.  | &nbsp;&nbsp;&nbsp;&nbsp; 70109 | &nbsp;&nbsp;&nbsp;&nbsp; 37170390 |
| Universal Health Services, Inc., Class B  | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 4820 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 679090 |
| Zimmer Biomet Holdings, Inc.  | &nbsp;&nbsp;&nbsp;&nbsp; 15749 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 2007998 |
|  |  | **156775754** |
| **Household & Personal Products 1.7%** | **Household & Personal Products 1.7%** | **Household & Personal Products 1.7%** |
| Church & Dwight Co., Inc.  | &nbsp;&nbsp;&nbsp;&nbsp; 18305 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 1475566 |
| Colgate-Palmolive Co.  | &nbsp;&nbsp;&nbsp;&nbsp; 62648 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 4936036 |
| Kimberly-Clark Corp.  | &nbsp;&nbsp;&nbsp;&nbsp; 25307 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 3435425 |
| The Clorox Co.  | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 9278 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 1301982 |
| The Estee Lauder Cos., Inc., Class A  | &nbsp;&nbsp;&nbsp;&nbsp; 17350 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 4304708 |
| The Procter & Gamble Co.  | &nbsp;&nbsp;&nbsp; 177812 | &nbsp;&nbsp;&nbsp;&nbsp; 26949187 |
|  |  | **42402904** |
| **Insurance 2.4%** | **Insurance 2.4%** | **Insurance 2.4%** |
| Aflac, Inc.  | &nbsp;&nbsp;&nbsp;&nbsp; 42473 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 3055508 |
| American International Group, Inc.  | &nbsp;&nbsp;&nbsp;&nbsp; 55745 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 3525314 |
| Aon plc, Class A  | &nbsp;&nbsp;&nbsp;&nbsp; 15520 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 4658173 |
| Arch Capital Group Ltd. \* | &nbsp;&nbsp;&nbsp;&nbsp; 27754 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 1742396 |
| Arthur J. Gallagher & Co.  | &nbsp;&nbsp;&nbsp;&nbsp; 15825 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 2983646 |
| Assurant, Inc.  | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 3964 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 495738 |
| Brown & Brown, Inc.  | &nbsp;&nbsp;&nbsp;&nbsp; 17595 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 1002387 |
| Chubb Ltd.  | &nbsp;&nbsp;&nbsp;&nbsp; 31150 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 6871690 |
| Cincinnati Financial Corp.  | &nbsp;&nbsp;&nbsp;&nbsp; 11784 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 1206564 |
| Everest Re Group Ltd.  | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 2936 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 972609 |
| Globe Life, Inc.  | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 6813 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 821307 |
| Lincoln National Corp.  | &nbsp;&nbsp;&nbsp;&nbsp; 11542 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 354570 |
| Loews Corp.  | &nbsp;&nbsp;&nbsp;&nbsp; 14762 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 861067 |
| Marsh & McLennan Cos., Inc.  | &nbsp;&nbsp;&nbsp;&nbsp; 37223 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 6159662 |
| MetLife, Inc.  | &nbsp;&nbsp;&nbsp;&nbsp; 49458 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 3579275 |
| Principal Financial Group, Inc.  | &nbsp;&nbsp;&nbsp;&nbsp; 17053 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 1431088 |
| Prudential Financial, Inc.  | &nbsp;&nbsp;&nbsp;&nbsp; 27631 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 2748179 |
| The Allstate Corp.  | &nbsp;&nbsp;&nbsp;&nbsp; 19916 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 2700610 |
| &nbsp;&nbsp;&nbsp;&nbsp; The Hartford Financial Services Group, <br> Inc. <br>| &nbsp;&nbsp;&nbsp;&nbsp; 23833 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 1807256 |
| The Progressive Corp.  | &nbsp;&nbsp;&nbsp;&nbsp; 43906 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 5695047 |
| The Travelers Cos., Inc.  | &nbsp;&nbsp;&nbsp;&nbsp; 17588 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 3297574 |
| W.R. Berkley Corp.  | &nbsp;&nbsp;&nbsp;&nbsp; 15325 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 1112135 |
| Willis Towers Watson plc  | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 8108 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 1983055 |
|  |  | **59064850** |
| **Materials 2.7%** | **Materials 2.7%** | **Materials 2.7%** |
| Air Products and Chemicals, Inc.  | &nbsp;&nbsp;&nbsp;&nbsp; 16641 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 5129755 |
| Albemarle Corp.  | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 8789 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 1905982 |
| Amcor plc  | &nbsp;&nbsp;&nbsp; 111976 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 1333634 |
| Avery Dennison Corp.  | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 6055 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 1095955 |
| Ball Corp.  | &nbsp;&nbsp;&nbsp;&nbsp; 23560 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 1204858 |
| Celanese Corp.  | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 7491 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 765880 |
| CF Industries Holdings, Inc.  | &nbsp;&nbsp;&nbsp;&nbsp; 14704 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 1252781 |
| Corteva, Inc.  | &nbsp;&nbsp;&nbsp;&nbsp; 53611 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 3151255 |
| Dow, Inc.  | &nbsp;&nbsp;&nbsp;&nbsp; 52847 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 2662960 |
| DuPont de Nemours, Inc.  | &nbsp;&nbsp;&nbsp;&nbsp; 37312 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 2560723 |
| Eastman Chemical Co.  | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 9006 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 733449 |
| Ecolab, Inc.  | &nbsp;&nbsp;&nbsp;&nbsp; 18589 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 2705815 |
| FMC Corp.  | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 9444 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 1178611 |
| Freeport-McMoRan, Inc.  | &nbsp;&nbsp;&nbsp; 107208 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 4073904 |
| International Flavors & Fragrances, Inc.  | &nbsp;&nbsp;&nbsp;&nbsp; 19135 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 2006113 |
| International Paper Co.  | &nbsp;&nbsp;&nbsp;&nbsp; 26678 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 923859 |
| Linde plc  | &nbsp;&nbsp;&nbsp;&nbsp; 37095 | &nbsp;&nbsp;&nbsp;&nbsp; 12099647 |

---

---

| | | |
|:---|:---|:---|
| SECURITY | NUMBER<br> OF SHARES<br>| VALUE ($) |
| LyondellBasell Industries N.V., Class A  | &nbsp;&nbsp;&nbsp;&nbsp; 19046 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 1581389 |
| Martin Marietta Materials, Inc.  | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 4648 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 1570885 |
| Newmont Corp.  | &nbsp;&nbsp;&nbsp;&nbsp; 59533 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 2809958 |
| Nucor Corp.  | &nbsp;&nbsp;&nbsp;&nbsp; 19264 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 2539188 |
| Packaging Corp. of America  | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 6929 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 886288 |
| PPG Industries, Inc.  | &nbsp;&nbsp;&nbsp;&nbsp; 17630 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 2216796 |
| Sealed Air Corp.  | &nbsp;&nbsp;&nbsp;&nbsp; 10819 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 539652 |
| Steel Dynamics, Inc.  | &nbsp;&nbsp;&nbsp;&nbsp; 12543 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 1225451 |
| The Mosaic Co.  | &nbsp;&nbsp;&nbsp;&nbsp; 25528 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 1119913 |
| The Sherwin-Williams Co.  | &nbsp;&nbsp;&nbsp;&nbsp; 17693 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 4199080 |
| Vulcan Materials Co.  | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 9987 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 1748824 |
| Westrock Co.  | &nbsp;&nbsp;&nbsp;&nbsp; 19151 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 673349 |
|  |  | **65895954** |
| **Media & Entertainment 6.0%** | **Media & Entertainment 6.0%** | **Media & Entertainment 6.0%** |
| Activision Blizzard, Inc.  | &nbsp;&nbsp;&nbsp;&nbsp; 53441 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 4090908 |
| Alphabet, Inc., Class A \* | &nbsp;&nbsp;&nbsp; 448168 | &nbsp;&nbsp;&nbsp;&nbsp; 39541863 |
| Alphabet, Inc., Class C \* | &nbsp;&nbsp;&nbsp; 397283 | &nbsp;&nbsp;&nbsp;&nbsp; 35250921 |
| Charter Communications, Inc., Class A \* | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 8066 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 2735181 |
| Comcast Corp., Class A  | &nbsp;&nbsp;&nbsp; 323693 | &nbsp;&nbsp;&nbsp;&nbsp; 11319544 |
| DISH Network Corp., Class A \* | &nbsp;&nbsp;&nbsp;&nbsp; 18698 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 262520 |
| Electronic Arts, Inc.  | &nbsp;&nbsp;&nbsp;&nbsp; 19681 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 2404624 |
| Fox Corp., Class A  | &nbsp;&nbsp;&nbsp;&nbsp; 22599 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 686332 |
| Fox Corp., Class B  | &nbsp;&nbsp;&nbsp;&nbsp; 10485 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 298298 |
| Live Nation Entertainment, Inc. \* | &nbsp;&nbsp;&nbsp;&nbsp; 10688 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 745381 |
| Match Group, Inc. \* | &nbsp;&nbsp;&nbsp;&nbsp; 20923 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 868095 |
| Meta Platforms, Inc., Class A \* | &nbsp;&nbsp;&nbsp; 168723 | &nbsp;&nbsp;&nbsp;&nbsp; 20304126 |
| Netflix, Inc. \* | &nbsp;&nbsp;&nbsp;&nbsp; 33391 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 9846338 |
| News Corp., Class A  | &nbsp;&nbsp;&nbsp;&nbsp; 28730 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 522886 |
| News Corp., Class B  | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 8900 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 164116 |
| Omnicom Group, Inc.  | &nbsp;&nbsp;&nbsp;&nbsp; 15261 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 1244840 |
| Paramount Global, Class B  | &nbsp;&nbsp;&nbsp;&nbsp; 38052 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 642318 |
| Take-Two Interactive Software, Inc. \* | &nbsp;&nbsp;&nbsp;&nbsp; 11852 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 1234149 |
| The Interpublic Group of Cos., Inc.  | &nbsp;&nbsp;&nbsp;&nbsp; 29132 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 970387 |
| The Walt Disney Co. \* | &nbsp;&nbsp;&nbsp; 136791 | &nbsp;&nbsp;&nbsp;&nbsp; 11884402 |
| Warner Bros Discovery, Inc. \* | &nbsp;&nbsp;&nbsp; 166096 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 1574590 |
|  |  | **146591819** |
| **Pharmaceuticals, Biotechnology & Life Sciences 9.2%** | **Pharmaceuticals, Biotechnology & Life Sciences 9.2%** | **Pharmaceuticals, Biotechnology & Life Sciences 9.2%** |
| AbbVie, Inc.  | &nbsp;&nbsp;&nbsp; 132695 | &nbsp;&nbsp;&nbsp;&nbsp; 21444839 |
| Agilent Technologies, Inc.  | &nbsp;&nbsp;&nbsp;&nbsp; 22214 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 3324325 |
| Amgen, Inc.  | &nbsp;&nbsp;&nbsp;&nbsp; 40035 | &nbsp;&nbsp;&nbsp;&nbsp; 10514792 |
| Biogen, Inc. \* | &nbsp;&nbsp;&nbsp;&nbsp; 10808 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 2992951 |
| Bio-Rad Laboratories, Inc., Class A \* | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 1614 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 678671 |
| Bio-Techne Corp.  | &nbsp;&nbsp;&nbsp;&nbsp; 11781 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 976409 |
| Bristol-Myers Squibb Co.  | &nbsp;&nbsp;&nbsp; 159527 | &nbsp;&nbsp;&nbsp;&nbsp; 11477968 |
| Catalent, Inc. \* | &nbsp;&nbsp;&nbsp;&nbsp; 13513 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 608220 |
| &nbsp;&nbsp;&nbsp;&nbsp; Charles River Laboratories International, <br> Inc. \*<br>| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 3823 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 833032 |
| Danaher Corp.  | &nbsp;&nbsp;&nbsp;&nbsp; 49160 | &nbsp;&nbsp;&nbsp;&nbsp; 13048047 |
| Eli Lilly & Co.  | &nbsp;&nbsp;&nbsp;&nbsp; 59174 | &nbsp;&nbsp;&nbsp;&nbsp; 21648216 |
| Gilead Sciences, Inc.  | &nbsp;&nbsp;&nbsp;&nbsp; 94109 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 8079258 |
| Illumina, Inc. \* | &nbsp;&nbsp;&nbsp;&nbsp; 11801 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 2386162 |
| Incyte Corp. \* | &nbsp;&nbsp;&nbsp;&nbsp; 13847 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 1112191 |
| IQVIA Holdings, Inc. \* | &nbsp;&nbsp;&nbsp;&nbsp; 13935 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 2855142 |
| Johnson & Johnson  | &nbsp;&nbsp;&nbsp; 196173 | &nbsp;&nbsp;&nbsp;&nbsp; 34653961 |
| Merck & Co., Inc.  | &nbsp;&nbsp;&nbsp; 190237 | &nbsp;&nbsp;&nbsp;&nbsp; 21106795 |
| Mettler-Toledo International, Inc. \* | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 1675 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 2421129 |
| Moderna, Inc. \* | &nbsp;&nbsp;&nbsp;&nbsp; 24790 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 4452780 |
| Organon & Co.  | &nbsp;&nbsp;&nbsp;&nbsp; 19206 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 536424 |
| PerkinElmer, Inc.  | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 9456 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 1325920 |
| Pfizer, Inc.  | &nbsp;&nbsp;&nbsp; 421175 | &nbsp;&nbsp;&nbsp;&nbsp; 21581007 |
| Regeneron Pharmaceuticals, Inc. \* | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 8035 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 5797172 |
| Thermo Fisher Scientific, Inc.  | &nbsp;&nbsp;&nbsp;&nbsp; 29428 | &nbsp;&nbsp;&nbsp;&nbsp; 16205705 |
| Vertex Pharmaceuticals, Inc. \* | &nbsp;&nbsp;&nbsp;&nbsp; 19261 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 5562192 |
| Viatris, Inc.  | &nbsp;&nbsp;&nbsp;&nbsp; 91011 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 1012952 |

---

*See financial notes*

Schwab S&P 500 Index Portfolio \| Annual Report**12**

------

Schwab S&P 500 Index Portfolio

Portfolio Holdings as of December 31, 2022 (continued)

------

---

| | | |
|:---|:---|:---|
| SECURITY | NUMBER<br> OF SHARES<br>| VALUE ($) |
| Waters Corp. \* | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 4460 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 1527907 |
| West Pharmaceutical Services, Inc.  | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 5547 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 1305487 |
| Zoetis, Inc.  | &nbsp;&nbsp;&nbsp;&nbsp; 34966 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 5124267 |
|  |  | **224593921** |
| **Real Estate 2.7%** | **Real Estate 2.7%** | **Real Estate 2.7%** |
| Alexandria Real Estate Equities, Inc.  | &nbsp;&nbsp;&nbsp;&nbsp; 11208 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 1632669 |
| American Tower Corp.  | &nbsp;&nbsp;&nbsp;&nbsp; 34937 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 7401753 |
| AvalonBay Communities, Inc.  | &nbsp;&nbsp;&nbsp;&nbsp; 10507 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 1697091 |
| Boston Properties, Inc.  | &nbsp;&nbsp;&nbsp;&nbsp; 10733 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 725336 |
| Camden Property Trust  | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 8001 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 895152 |
| CBRE Group, Inc., Class A \* | &nbsp;&nbsp;&nbsp;&nbsp; 23670 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 1821643 |
| Crown Castle, Inc.  | &nbsp;&nbsp;&nbsp;&nbsp; 32495 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 4407622 |
| Digital Realty Trust, Inc.  | &nbsp;&nbsp;&nbsp;&nbsp; 21574 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 2163225 |
| Equinix, Inc.  | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 6944 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 4548528 |
| Equity Residential  | &nbsp;&nbsp;&nbsp;&nbsp; 25534 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 1506506 |
| Essex Property Trust, Inc.  | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 4852 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 1028236 |
| Extra Space Storage, Inc.  | &nbsp;&nbsp;&nbsp;&nbsp; 10025 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 1475479 |
| Federal Realty Investment Trust  | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 5495 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 555215 |
| Healthpeak Properties, Inc.  | &nbsp;&nbsp;&nbsp;&nbsp; 40198 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 1007764 |
| Host Hotels & Resorts, Inc.  | &nbsp;&nbsp;&nbsp;&nbsp; 53684 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 861628 |
| Invitation Homes, Inc.  | &nbsp;&nbsp;&nbsp;&nbsp; 43684 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 1294794 |
| Iron Mountain, Inc.  | &nbsp;&nbsp;&nbsp;&nbsp; 21794 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 1086431 |
| Kimco Realty Corp.  | &nbsp;&nbsp;&nbsp;&nbsp; 46425 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 983281 |
| &nbsp;&nbsp;&nbsp;&nbsp; Mid-America Apartment Communities, <br> Inc. <br>| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 8647 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 1357493 |
| Prologis, Inc.  | &nbsp;&nbsp;&nbsp;&nbsp; 69268 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 7808582 |
| Public Storage  | &nbsp;&nbsp;&nbsp;&nbsp; 11863 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 3323894 |
| Realty Income Corp.  | &nbsp;&nbsp;&nbsp;&nbsp; 47072 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 2985777 |
| Regency Centers Corp.  | &nbsp;&nbsp;&nbsp;&nbsp; 11591 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 724437 |
| SBA Communications Corp.  | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 8101 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 2270791 |
| Simon Property Group, Inc.  | &nbsp;&nbsp;&nbsp;&nbsp; 24529 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 2881667 |
| UDR, Inc.  | &nbsp;&nbsp;&nbsp;&nbsp; 22940 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 888466 |
| Ventas, Inc.  | &nbsp;&nbsp;&nbsp;&nbsp; 29943 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 1348932 |
| VICI Properties, Inc.  | &nbsp;&nbsp;&nbsp;&nbsp; 72289 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 2342164 |
| Vornado Realty Trust  | &nbsp;&nbsp;&nbsp;&nbsp; 11991 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 249533 |
| Welltower, Inc.  | &nbsp;&nbsp;&nbsp;&nbsp; 35458 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 2324272 |
| Weyerhaeuser Co.  | &nbsp;&nbsp;&nbsp;&nbsp; 55159 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 1709929 |
|  |  | **65308290** |
| **Retailing 5.4%** | **Retailing 5.4%** | **Retailing 5.4%** |
| Advance Auto Parts, Inc.  | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 4518 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 664281 |
| Amazon.com, Inc. \* | &nbsp;&nbsp;&nbsp; 665949 | &nbsp;&nbsp;&nbsp;&nbsp; 55939716 |
| AutoZone, Inc. \* | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 1424 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 3511840 |
| Bath & Body Works, Inc.  | &nbsp;&nbsp;&nbsp;&nbsp; 17186 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 724218 |
| Best Buy Co., Inc.  | &nbsp;&nbsp;&nbsp;&nbsp; 15021 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 1204834 |
| CarMax, Inc. \* | &nbsp;&nbsp;&nbsp;&nbsp; 11859 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 722094 |
| Dollar General Corp.  | &nbsp;&nbsp;&nbsp;&nbsp; 16924 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 4167535 |
| Dollar Tree, Inc. \* | &nbsp;&nbsp;&nbsp;&nbsp; 15793 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 2233762 |
| eBay, Inc.  | &nbsp;&nbsp;&nbsp;&nbsp; 40659 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 1686129 |
| Etsy, Inc. \* | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 9431 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 1129645 |
| Genuine Parts Co.  | &nbsp;&nbsp;&nbsp;&nbsp; 10579 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 1835562 |
| LKQ Corp.  | &nbsp;&nbsp;&nbsp;&nbsp; 19036 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 1016713 |
| Lowe's Cos., Inc.  | &nbsp;&nbsp;&nbsp;&nbsp; 46568 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 9278208 |
| O'Reilly Automotive, Inc. \* | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 4695 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 3962721 |
| Pool Corp.  | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 2927 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 884920 |
| Ross Stores, Inc.  | &nbsp;&nbsp;&nbsp;&nbsp; 26051 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 3023740 |
| Target Corp.  | &nbsp;&nbsp;&nbsp;&nbsp; 34531 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 5146500 |
| The Home Depot, Inc.  | &nbsp;&nbsp;&nbsp;&nbsp; 76810 | &nbsp;&nbsp;&nbsp;&nbsp; 24261207 |
| The TJX Cos., Inc.  | &nbsp;&nbsp;&nbsp;&nbsp; 87108 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 6933797 |
| Tractor Supply Co.  | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 8304 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 1868151 |
| Ulta Beauty, Inc. \* | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 3838 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 1800291 |
|  |  | **131995864** |

---

---

| | | |
|:---|:---|:---|
| SECURITY | NUMBER<br> OF SHARES<br>| VALUE ($) |
| **Semiconductors & Semiconductor Equipment 5.1%** | **Semiconductors & Semiconductor Equipment 5.1%** | **Semiconductors & Semiconductor Equipment 5.1%** |
| Advanced Micro Devices, Inc. \* | &nbsp;&nbsp;&nbsp; 120970 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 7835227 |
| Analog Devices, Inc.  | &nbsp;&nbsp;&nbsp;&nbsp; 38591 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 6330082 |
| Applied Materials, Inc.  | &nbsp;&nbsp;&nbsp;&nbsp; 64545 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 6285392 |
| Broadcom, Inc.  | &nbsp;&nbsp;&nbsp;&nbsp; 30388 | &nbsp;&nbsp;&nbsp;&nbsp; 16990843 |
| Enphase Energy, Inc. \* | &nbsp;&nbsp;&nbsp;&nbsp; 10198 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 2702062 |
| First Solar, Inc. \* | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 7447 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 1115486 |
| Intel Corp.  | &nbsp;&nbsp;&nbsp; 309634 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 8183627 |
| KLA Corp.  | &nbsp;&nbsp;&nbsp;&nbsp; 10631 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 4008206 |
| Lam Research Corp.  | &nbsp;&nbsp;&nbsp;&nbsp; 10232 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 4300510 |
| Microchip Technology, Inc.  | &nbsp;&nbsp;&nbsp;&nbsp; 41265 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 2898866 |
| Micron Technology, Inc.  | &nbsp;&nbsp;&nbsp;&nbsp; 81563 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 4076519 |
| Monolithic Power Systems, Inc.  | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 3351 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 1184947 |
| NVIDIA Corp.  | &nbsp;&nbsp;&nbsp; 186828 | &nbsp;&nbsp;&nbsp;&nbsp; 27303044 |
| NXP Semiconductors N.V.  | &nbsp;&nbsp;&nbsp;&nbsp; 19448 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 3073367 |
| ON Semiconductor Corp. \* | &nbsp;&nbsp;&nbsp;&nbsp; 32498 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 2026900 |
| Qorvo, Inc. \* | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 7610 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 689770 |
| QUALCOMM, Inc.  | &nbsp;&nbsp;&nbsp;&nbsp; 84109 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 9246944 |
| Skyworks Solutions, Inc.  | &nbsp;&nbsp;&nbsp;&nbsp; 12030 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 1096294 |
| SolarEdge Technologies, Inc. \* | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 4197 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 1188884 |
| Teradyne, Inc.  | &nbsp;&nbsp;&nbsp;&nbsp; 11681 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 1020335 |
| Texas Instruments, Inc.  | &nbsp;&nbsp;&nbsp;&nbsp; 68096 | &nbsp;&nbsp;&nbsp;&nbsp; 11250821 |
|  |  | **122808126** |
| **Software & Services 12.7%** | **Software & Services 12.7%** | **Software & Services 12.7%** |
| Accenture plc, Class A  | &nbsp;&nbsp;&nbsp;&nbsp; 47280 | &nbsp;&nbsp;&nbsp;&nbsp; 12616195 |
| Adobe, Inc. \* | &nbsp;&nbsp;&nbsp;&nbsp; 34882 | &nbsp;&nbsp;&nbsp;&nbsp; 11738839 |
| Akamai Technologies, Inc. \* | &nbsp;&nbsp;&nbsp;&nbsp; 11760 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 991368 |
| ANSYS, Inc. \* | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 6547 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 1581690 |
| Autodesk, Inc. \* | &nbsp;&nbsp;&nbsp;&nbsp; 16195 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 3026360 |
| Automatic Data Processing, Inc.  | &nbsp;&nbsp;&nbsp;&nbsp; 31130 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 7435712 |
| Broadridge Financial Solutions, Inc.  | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 8840 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 1185709 |
| Cadence Design Systems, Inc. \* | &nbsp;&nbsp;&nbsp;&nbsp; 20582 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 3306292 |
| Ceridian HCM Holding, Inc. \* | &nbsp;&nbsp;&nbsp;&nbsp; 11513 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 738559 |
| &nbsp;&nbsp;&nbsp;&nbsp; Cognizant Technology Solutions Corp., <br> Class A <br>| &nbsp;&nbsp;&nbsp;&nbsp; 38581 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 2206447 |
| DXC Technology Co. \* | &nbsp;&nbsp;&nbsp;&nbsp; 17127 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 453866 |
| EPAM Systems, Inc. \* | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 4318 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 1415181 |
| &nbsp;&nbsp;&nbsp;&nbsp; Fidelity National Information Services, <br> Inc. <br>| &nbsp;&nbsp;&nbsp;&nbsp; 44539 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 3021971 |
| Fiserv, Inc. \* | &nbsp;&nbsp;&nbsp;&nbsp; 47654 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 4816390 |
| FleetCor Technologies, Inc. \* | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 5531 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 1015934 |
| Fortinet, Inc. \* | &nbsp;&nbsp;&nbsp;&nbsp; 48706 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 2381236 |
| Gartner, Inc. \* | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 5935 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 1994991 |
| Gen Digital, Inc.  | &nbsp;&nbsp;&nbsp;&nbsp; 43483 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 931841 |
| Global Payments, Inc.  | &nbsp;&nbsp;&nbsp;&nbsp; 20256 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 2011826 |
| International Business Machines Corp.  | &nbsp;&nbsp;&nbsp;&nbsp; 67841 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 9558119 |
| Intuit, Inc.  | &nbsp;&nbsp;&nbsp;&nbsp; 21149 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 8231614 |
| Jack Henry & Associates, Inc.  | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 5470 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 960313 |
| Mastercard, Inc., Class A  | &nbsp;&nbsp;&nbsp;&nbsp; 63697 | &nbsp;&nbsp;&nbsp;&nbsp; 22149358 |
| Microsoft Corp.  | &nbsp;&nbsp;&nbsp; 559331 | &nbsp;&nbsp;&nbsp; 134138760 |
| Oracle Corp.  | &nbsp;&nbsp;&nbsp; 115313 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 9425685 |
| Paychex, Inc.  | &nbsp;&nbsp;&nbsp;&nbsp; 24073 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 2781876 |
| Paycom Software, Inc. \* | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 3645 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 1131080 |
| PayPal Holdings, Inc. \* | &nbsp;&nbsp;&nbsp;&nbsp; 85538 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 6092016 |
| PTC, Inc. \* | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 7936 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 952637 |
| Roper Technologies, Inc.  | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 7958 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 3438572 |
| Salesforce, Inc. \* | &nbsp;&nbsp;&nbsp;&nbsp; 75032 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 9948493 |
| ServiceNow, Inc. \* | &nbsp;&nbsp;&nbsp;&nbsp; 15156 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 5884620 |
| Synopsys, Inc. \* | &nbsp;&nbsp;&nbsp;&nbsp; 11473 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 3663214 |
| Tyler Technologies, Inc. \* | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 3121 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 1006242 |
| VeriSign, Inc. \* | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 6913 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 1420207 |
| Visa, Inc., Class A  | &nbsp;&nbsp;&nbsp; 122684 | &nbsp;&nbsp;&nbsp;&nbsp; 25488828 |
|  |  | **309142041** |

---

*See financial notes*

**13**Schwab S&P 500 Index Portfolio \| Annual Report

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Schwab S&P 500 Index Portfolio

Portfolio Holdings as of December 31, 2022 (continued)

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---

| | | |
|:---|:---|:---|
| SECURITY | NUMBER<br> OF SHARES<br>| VALUE ($) |
| **Technology Hardware & Equipment 7.8%** | **Technology Hardware & Equipment 7.8%** | **Technology Hardware & Equipment 7.8%** |
| Amphenol Corp., Class A  | &nbsp;&nbsp;&nbsp;&nbsp; 44654 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 3399956 |
| Apple Inc.  | 1122012 | &nbsp;&nbsp;&nbsp; 145783019 |
| Arista Networks, Inc. \* | &nbsp;&nbsp;&nbsp;&nbsp; 18574 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 2253955 |
| CDW Corp.  | &nbsp;&nbsp;&nbsp;&nbsp; 10157 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 1813837 |
| Cisco Systems, Inc.  | &nbsp;&nbsp;&nbsp; 308106 | &nbsp;&nbsp;&nbsp;&nbsp; 14678170 |
| Corning, Inc.  | &nbsp;&nbsp;&nbsp;&nbsp; 57134 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 1824860 |
| F5, Inc. \* | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 4487 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 643929 |
| Hewlett Packard Enterprise Co.  | &nbsp;&nbsp;&nbsp;&nbsp; 96335 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 1537507 |
| HP, Inc.  | &nbsp;&nbsp;&nbsp;&nbsp; 66319 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 1781991 |
| Juniper Networks, Inc.  | &nbsp;&nbsp;&nbsp;&nbsp; 24262 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 775413 |
| Keysight Technologies, Inc. \* | &nbsp;&nbsp;&nbsp;&nbsp; 13415 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 2294904 |
| Motorola Solutions, Inc.  | &nbsp;&nbsp;&nbsp;&nbsp; 12548 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 3233745 |
| NetApp, Inc.  | &nbsp;&nbsp;&nbsp;&nbsp; 16377 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 983603 |
| Seagate Technology Holdings plc  | &nbsp;&nbsp;&nbsp;&nbsp; 14410 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 758110 |
| TE Connectivity Ltd.  | &nbsp;&nbsp;&nbsp;&nbsp; 23861 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 2739243 |
| Teledyne Technologies, Inc. \* | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 3510 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 1403684 |
| Trimble, Inc. \* | &nbsp;&nbsp;&nbsp;&nbsp; 18453 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 932984 |
| Western Digital Corp. \* | &nbsp;&nbsp;&nbsp;&nbsp; 23930 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 754991 |
| Zebra Technologies Corp., Class A \* | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 3888 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 996922 |
|  |  | **188590823** |
| **Telecommunication Services 1.2%** | **Telecommunication Services 1.2%** | **Telecommunication Services 1.2%** |
| AT&T, Inc.  | &nbsp;&nbsp;&nbsp; 534768 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 9845079 |
| Lumen Technologies, Inc.  | &nbsp;&nbsp;&nbsp;&nbsp; 70945 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 370333 |
| T-Mobile US, Inc. \* | &nbsp;&nbsp;&nbsp;&nbsp; 44819 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 6274660 |
| Verizon Communications, Inc.  | &nbsp;&nbsp;&nbsp; 315139 | &nbsp;&nbsp;&nbsp;&nbsp; 12416476 |
|  |  | **28906548** |
| **Transportation 1.7%** | **Transportation 1.7%** | **Transportation 1.7%** |
| Alaska Air Group, Inc. \* | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 9442 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 405439 |
| American Airlines Group, Inc. \* | &nbsp;&nbsp;&nbsp;&nbsp; 48986 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 623102 |
| C.H. Robinson Worldwide, Inc.  | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 8833 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 808750 |
| CSX Corp.  | &nbsp;&nbsp;&nbsp; 157754 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 4887219 |
| Delta Air Lines, Inc. \* | &nbsp;&nbsp;&nbsp;&nbsp; 47998 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 1577214 |
| &nbsp;&nbsp;&nbsp;&nbsp; Expeditors International of Washington, <br> Inc. <br>| &nbsp;&nbsp;&nbsp;&nbsp; 11929 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 1239662 |
| FedEx Corp.  | &nbsp;&nbsp;&nbsp;&nbsp; 17960 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 3110672 |
| JB Hunt Transport Services, Inc.  | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 6229 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 1086088 |
| Norfolk Southern Corp.  | &nbsp;&nbsp;&nbsp;&nbsp; 17372 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 4280808 |
| Old Dominion Freight Line, Inc.  | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 6786 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 1925731 |
| Southwest Airlines Co. \* | &nbsp;&nbsp;&nbsp;&nbsp; 44607 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 1501918 |
| Union Pacific Corp.  | &nbsp;&nbsp;&nbsp;&nbsp; 46131 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 9552346 |
| United Airlines Holdings, Inc. \* | &nbsp;&nbsp;&nbsp;&nbsp; 24527 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 924668 |
| United Parcel Service, Inc., Class B  | &nbsp;&nbsp;&nbsp;&nbsp; 54764 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 9520174 |
|  |  | **41443791** |
| **Utilities 3.2%** | **Utilities 3.2%** | **Utilities 3.2%** |
| Alliant Energy Corp.  | &nbsp;&nbsp;&nbsp;&nbsp; 18830 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 1039604 |
| Ameren Corp.  | &nbsp;&nbsp;&nbsp;&nbsp; 19417 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 1726560 |

---

---

| | | |
|:---|:---|:---|
| SECURITY | NUMBER<br> OF SHARES<br>| VALUE ($) |
| American Electric Power Co., Inc.  | &nbsp;&nbsp;&nbsp;&nbsp; 38546 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 3659943 |
| American Water Works Co., Inc.  | &nbsp;&nbsp;&nbsp;&nbsp; 13643 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 2079466 |
| Atmos Energy Corp.  | &nbsp;&nbsp;&nbsp;&nbsp; 10486 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 1175166 |
| CenterPoint Energy, Inc.  | &nbsp;&nbsp;&nbsp;&nbsp; 47135 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 1413579 |
| CMS Energy Corp.  | &nbsp;&nbsp;&nbsp;&nbsp; 21739 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 1376731 |
| Consolidated Edison, Inc.  | &nbsp;&nbsp;&nbsp;&nbsp; 26630 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 2538105 |
| Constellation Energy Corp.  | &nbsp;&nbsp;&nbsp;&nbsp; 24538 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 2115421 |
| Dominion Energy, Inc.  | &nbsp;&nbsp;&nbsp;&nbsp; 62515 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 3833420 |
| DTE Energy Co.  | &nbsp;&nbsp;&nbsp;&nbsp; 14559 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 1711119 |
| Duke Energy Corp.  | &nbsp;&nbsp;&nbsp;&nbsp; 57772 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 5949938 |
| Edison International  | &nbsp;&nbsp;&nbsp;&nbsp; 28647 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 1822522 |
| Entergy Corp.  | &nbsp;&nbsp;&nbsp;&nbsp; 15284 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 1719450 |
| Evergy, Inc.  | &nbsp;&nbsp;&nbsp;&nbsp; 17219 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 1083592 |
| Eversource Energy  | &nbsp;&nbsp;&nbsp;&nbsp; 26124 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 2190236 |
| Exelon Corp.  | &nbsp;&nbsp;&nbsp;&nbsp; 74539 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 3222321 |
| FirstEnergy Corp.  | &nbsp;&nbsp;&nbsp;&nbsp; 40798 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 1711068 |
| NextEra Energy, Inc.  | &nbsp;&nbsp;&nbsp; 149103 | &nbsp;&nbsp;&nbsp;&nbsp; 12465011 |
| NiSource, Inc.  | &nbsp;&nbsp;&nbsp;&nbsp; 30515 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 836721 |
| NRG Energy, Inc.  | &nbsp;&nbsp;&nbsp;&nbsp; 17295 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 550327 |
| PG&E Corp. \* | &nbsp;&nbsp;&nbsp; 120892 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 1965704 |
| Pinnacle West Capital Corp.  | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 8514 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 647405 |
| PPL Corp.  | &nbsp;&nbsp;&nbsp;&nbsp; 55349 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 1617298 |
| Public Service Enterprise Group, Inc.  | &nbsp;&nbsp;&nbsp;&nbsp; 37428 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 2293213 |
| Sempra Energy  | &nbsp;&nbsp;&nbsp;&nbsp; 23590 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 3645599 |
| The AES Corp.  | &nbsp;&nbsp;&nbsp;&nbsp; 50030 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 1438863 |
| The Southern Co.  | &nbsp;&nbsp;&nbsp;&nbsp; 81679 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 5832697 |
| WEC Energy Group, Inc.  | &nbsp;&nbsp;&nbsp;&nbsp; 23671 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 2219393 |
| Xcel Energy, Inc.  | &nbsp;&nbsp;&nbsp;&nbsp; 41049 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 2877945 |
|  |  | **76758417** |
| **Total Common Stocks** <br>**(Cost $1,993,016,098)** | **Total Common Stocks** <br>**(Cost $1,993,016,098)** | **2411006866** |
| **Total Investments in Securities** <br>**(Cost $1,993,016,098)** | **Total Investments in Securities** <br>**(Cost $1,993,016,098)** | **2411006866** |

---

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;

---

| | | | |
|:---|:---|:---|:---|
|  | NUMBER OF<br> CONTRACTS<br>| NOTIONAL<br> AMOUNT<br> ($)<br>| CURRENT VALUE/ <br>UNREALIZED <br>DEPRECIATION <br>($)<br>|
| **FUTURES CONTRACTS** | **FUTURES CONTRACTS** | **FUTURES CONTRACTS** | **FUTURES CONTRACTS** |
| **Long** |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; S&P 500 Index, e-mini, expires <br> 03/17/23<br>| 91 | 17567550 | **(269253)** |

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;

\* Non-income producing security. <br> *(a)* Issuer is affiliated with the fund's investment adviser.

Below is a summary of the fund's transactions with affiliated issuers during the period ended December 31, 2022:

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| | | | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|:---|:---|
| SECURITY | VALUE AT<br> 12/31/21<br>| PURCHASES | SALES | REALIZED<br> GAINS (LOSSES)<br>| NET CHANGE<br> IN UNREALIZED<br> APPRECIATION<br> (DEPRECIATION)<br>| VALUE AT<br> 12/31/22<br>| BALANCE<br> OF SHARES<br> HELD AT<br> 12/31/22<br>| DIVIDENDS<br> RECEIVED<br>|
| **COMMON STOCKS** 0.4% OF NET ASSETS | **COMMON STOCKS** 0.4% OF NET ASSETS | **COMMON STOCKS** 0.4% OF NET ASSETS | **COMMON STOCKS** 0.4% OF NET ASSETS | **COMMON STOCKS** 0.4% OF NET ASSETS | **COMMON STOCKS** 0.4% OF NET ASSETS | **COMMON STOCKS** 0.4% OF NET ASSETS | **COMMON STOCKS** 0.4% OF NET ASSETS | **COMMON STOCKS** 0.4% OF NET ASSETS |
| **Diversified Financials 0.4%** | **Diversified Financials 0.4%** | **Diversified Financials 0.4%** | **Diversified Financials 0.4%** | **Diversified Financials 0.4%** | **Diversified Financials 0.4%** | **Diversified Financials 0.4%** | **Diversified Financials 0.4%** | **Diversified Financials 0.4%** |
| The Charles Schwab Corp. | $4552333 | $4947064 | ($346891) | ($75901) | $413453 | **$9490058** | 113981 | $51887 |

---

*See financial notes*

Schwab S&P 500 Index Portfolio \| Annual Report**14**

------

Schwab S&P 500 Index Portfolio

Portfolio Holdings as of December 31, 2022 (continued)

------

The following is a summary of the inputs used to value the fund's investments as of December 31, 2022 (see financial note 2(a) for additional information):

---

| | | | | |
|:---|:---|:---|:---|:---|
| DESCRIPTION | QUOTED PRICES IN <br>ACTIVE MARKETS FOR <br>IDENTICAL ASSETS <br>(LEVEL 1)<br>| &nbsp;&nbsp; OTHER SIGNIFICANT <br>OBSERVABLE INPUTS <br>(LEVEL 2)<br>| &nbsp;&nbsp; SIGNIFICANT <br>UNOBSERVABLE INPUTS <br>(LEVEL 3)<br>| TOTAL |
| **Assets** |  |  |  |  |
| Common Stocks<sup>1</sup> <br>| $2411006866 | $— | $— | $2411006866 |
| **Liabilities** |  |  |  |  |
| Futures Contracts<sup>2</sup> <br>| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (269253) | &nbsp;&nbsp; — | &nbsp;&nbsp; — | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (269253) |
| **Total** | **$2410737613** | **$—** | **$—** | **$2410737613** |

---

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;

<sup>1</sup> As categorized in the Portfolio Holdings. <br> <sup>2</sup> Futures contracts are reported at cumulative unrealized appreciation or depreciation.

*See financial notes*

**15**Schwab S&P 500 Index Portfolio \| Annual Report

------

Schwab S&P 500 Index Portfolio

Statement of Assets and Liabilities

------

As of December 31, 2022

---

| | | |
|:---|:---|:---|
| **Assets** | **Assets** | **Assets** |
| Investments in securities, at value - affiliated (cost $6,585,395) |  | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; $9490058 |
| Investments in securities, at value - unaffiliated (cost $1,986,430,703) |  | &nbsp;&nbsp;&nbsp; 2401516808 |
| Cash |  | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 10183338 |
| Deposit with broker for futures contracts |  | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 943400 |
| Receivables: |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; Fund shares sold |  | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 6213697 |
| &nbsp;&nbsp;&nbsp;&nbsp; Dividends | + | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 2013459 |
| **Total assets** |  | **2430360760** |
| **Liabilities** | **Liabilities** | **Liabilities** |
| Payables: |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; Fund shares redeemed |  | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 509789 |
| &nbsp;&nbsp;&nbsp;&nbsp; Investment adviser fees |  | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 60617 |
| &nbsp;&nbsp;&nbsp;&nbsp; Variation margin on futures contracts | + | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 31499 |
| **Total liabilities** |  | **601905** |
| **Net assets** |  | **$2429758855** |
| **Net Assets by Source** | **Net Assets by Source** | **Net Assets by Source** |
| Capital received from investors |  | $2029076784 |
| Total distributable earnings | + | &nbsp;&nbsp;&nbsp;&nbsp; 400682071 |
| **Net assets** |  | **$2429758855** |

---

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;

---

| | | | | |
|:---|:---|:---|:---|:---|
| **Net Asset Value (NAV)**  | **Net Asset Value (NAV)**  | **Net Asset Value (NAV)**  | **Net Asset Value (NAV)**  | **Net Asset Value (NAV)**  |
| **Net Assets**  | **÷** | &nbsp;&nbsp;&nbsp;&nbsp; **Shares**<br> **Outstanding**<br>| **=** | **NAV** |
| $2429758855 |  | 43093870 |  | $56.38 |

---

*See financial notes*

Schwab S&P 500 Index Portfolio \| Annual Report**16**

------

Schwab S&P 500 Index Portfolio

Statement of Operations

------

---

| | | |
|:---|:---|:---|
| For the period January 1, 2022 through December 31, 2022 | For the period January 1, 2022 through December 31, 2022 | For the period January 1, 2022 through December 31, 2022 |
| **Investment Income**  | **Investment Income**  | **Investment Income**  |
| Dividends received from securities - unaffiliated (net of foreign withholding tax of $6,492) |  | &nbsp;&nbsp;&nbsp; $23949387 |
| Interest received from securities - unaffiliated |  | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 60273 |
| Dividends received from securities - affiliated |  | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 51887 |
| Securities on loan, net | + | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 157 |
| **Total investment income**  |  | **24061704** |
| **Expenses** | **Expenses** | **Expenses** |
| Investment adviser fees |  | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 446552 |
| Proxy fees<sup>1</sup> <br>| + | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 11925 |
| **Total expenses** | – | **458477** |
| **Net investment income** |  | **23603227** |
| **REALIZED AND UNREALIZED GAINS (LOSSES)** | **REALIZED AND UNREALIZED GAINS (LOSSES)** | **REALIZED AND UNREALIZED GAINS (LOSSES)** |
| Net realized losses on sales of securities - affiliated |  | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (75901) |
| Net realized losses on sales of securities - unaffiliated |  | &nbsp;&nbsp;&nbsp;&nbsp; (22275782) |
| Net realized losses on futures contracts | + | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (1642681) |
| **Net realized losses** |  | **(23994364)** |
| Net change in unrealized appreciation (depreciation) on securities - affiliated |  | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 413453 |
| Net change in unrealized appreciation (depreciation) on securities - unaffiliated |  | &nbsp;&nbsp;&nbsp; (286659909) |
| Net change in unrealized appreciation (depreciation) on futures contracts | + | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (430052) |
| **Net change in unrealized appreciation (depreciation)** | **+** | **(286676508)** |
| **Net realized and unrealized losses** |  | **(310670872)** |
| **Decrease in net assets resulting from operations** |  | **($287067645)** |

---

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;

<sup>1</sup> Proxy fees are non-routine expenses (see financial note 2(e) for additional information).

*See financial notes*

**17**Schwab S&P 500 Index Portfolio \| Annual Report

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Schwab S&P 500 Index Portfolio

Statement of Changes in Net Assets

------

For the current and prior report periods

---

| | | | |
|:---|:---|:---|:---|
| **OPERATIONS** | **OPERATIONS** | **OPERATIONS** | **OPERATIONS** |
|  | 1/1/22-12/31/22 | 1/1/22-12/31/22 | 1/1/21-12/31/21 |
| Net investment income |  | &nbsp;&nbsp;&nbsp; $23603227 | &nbsp;&nbsp; $15981303 |
| Net realized gains (losses) |  | &nbsp;&nbsp;&nbsp;&nbsp; (23994364) | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 8570083 |
| Net change in unrealized appreciation (depreciation) | + | &nbsp;&nbsp;&nbsp; (286676508) | &nbsp;&nbsp; 272288798 |
| **Increase (decrease) in net assets resulting from operations** |  | **($287067645)** | **$296840184** |
| **DISTRIBUTIONS TO SHAREHOLDERS** | **DISTRIBUTIONS TO SHAREHOLDERS** | **DISTRIBUTIONS TO SHAREHOLDERS** | **DISTRIBUTIONS TO SHAREHOLDERS** |
| **Total distributions** |  | **($25887212)** | **($15017859)** |

---

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;

---

| | | | | | |
|:---|:---|:---|:---|:---|:---|
| **TRANSACTIONS IN FUND SHARES** | **TRANSACTIONS IN FUND SHARES** | **TRANSACTIONS IN FUND SHARES** | **TRANSACTIONS IN FUND SHARES** | **TRANSACTIONS IN FUND SHARES** | **TRANSACTIONS IN FUND SHARES** |
|  | 1/1/22-12/31/22 | 1/1/22-12/31/22 | 1/1/22-12/31/22 | 1/1/21-12/31/21 | 1/1/21-12/31/21 |
|  |  | SHARES | VALUE | SHARES | VALUE |
| Shares sold |  | 26590753 | $1541744983 | &nbsp;&nbsp; 7110963 | &nbsp;&nbsp;&nbsp; $452221843 |
| Shares reinvested |  | &nbsp;&nbsp;&nbsp;&nbsp; 469652 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 25887212 | &nbsp;&nbsp;&nbsp;&nbsp; 238190 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 15017859 |
| Shares redeemed | + | (4810109) | &nbsp;&nbsp;&nbsp;&nbsp; (292503530) | (3588771) | &nbsp;&nbsp;&nbsp;&nbsp; (228019959) |
| **Net transactions in fund shares**  |  | **22250296** | **$1275128665** | **3760382** | **$239219743** |
| **SHARES OUTSTANDING AND NET ASSETS** | **SHARES OUTSTANDING AND NET ASSETS** | **SHARES OUTSTANDING AND NET ASSETS** | **SHARES OUTSTANDING AND NET ASSETS** | **SHARES OUTSTANDING AND NET ASSETS** | **SHARES OUTSTANDING AND NET ASSETS** |
|  | 1/1/22-12/31/22 | 1/1/22-12/31/22 | 1/1/22-12/31/22 | 1/1/21-12/31/21 | 1/1/21-12/31/21 |
|  |  | SHARES | NET ASSETS | SHARES | NET ASSETS |
| Beginning of period |  | 20843574 | $1467585047 | 17083192 | &nbsp;&nbsp;&nbsp; $946542979 |
| Total increase | + | 22250296 | &nbsp;&nbsp;&nbsp;&nbsp; 962173808 | &nbsp;&nbsp; 3760382 | &nbsp;&nbsp;&nbsp;&nbsp; 521042068 |
| **End of period** |  | **43093870** | **$2429758855** | **20843574** | **$1467585047** |

---

*See financial notes*

Schwab S&P 500 Index Portfolio \| Annual Report**18**

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Schwab S&P 500 Index Portfolio

Financial Notes

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**1. Business Structure of the Fund:**

Schwab S&P 500 Index Portfolio (the fund) is a series of Schwab Annuity Portfolios (the trust), a no-load, open-end management investment company. The trust is organized as a Massachusetts business trust and is registered under the Investment Company Act of 1940, as amended (the 1940 Act). The list below shows all the funds in the trust as of the end of the period, including the fund discussed in this report, which is highlighted:

---

| |
|:---|
| **SCHWAB ANNUITY PORTFOLIOS (ORGANIZED JANUARY 21, 1994)** |
| Schwab Government Money Market Portfolio |
| **Schwab S&P 500 Index Portfolio** |
| Schwab VIT Balanced Portfolio |
| Schwab VIT Balanced with Growth Portfolio |
| Schwab VIT Growth Portfolio |

---

The fund in this report offers one share class. Shares are bought and sold at closing net asset value per share (NAV), which is the price for all outstanding shares of the fund. Each share has a par value of 1/1,000 of a cent, and the fund's Board of Trustees (the Board) may authorize the issuance of as many shares as necessary.

The fund is available exclusively as an investment vehicle for variable annuity and variable life insurance contracts offered by separate accounts of participating life insurance companies, and in the future may be offered to pension and retirement plans qualified under the Internal Revenue Code of 1986, as amended. At December 31, 2022, 100% of the fund's shares were held through separate accounts of six insurance companies. Subscriptions and redemptions of these insurance separate accounts could have a material impact on the fund.

The fund maintains its own account for purposes of holding assets and accounting, and is considered a separate entity for tax purposes. Within its account, the fund may also keep certain assets in segregated accounts, as required by securities law.

------

<br>**2. Significant Accounting Policies:**

The following is a summary of the significant accounting policies the fund uses in its preparation of financial statements. The fund follows the investment company accounting and reporting guidance of the Financial Accounting Standards Board (FASB) Accounting Standard Codification *Topic 946 Financial Services — Investment Companies*. The accounting policies are in conformity with accounting principles generally accepted in the United States of America (GAAP).

**(a) Security Valuation:**

Pursuant to Rule 2a-5 under the 1940 Act, the Board has designated authority to a Valuation Designee, the fund's investment adviser, to make fair valuation determinations under adopted procedures, subject to Board oversight. The investment adviser has formed a Pricing Committee to administer the pricing and valuation of portfolio securities and other assets and liabilities and to ensure that prices used for internal purposes or provided by third parties reasonably reflect fair value. The Valuation Designee may utilize independent pricing services, quotations from securities and financial instrument dealers and other market sources to determine fair value.

Securities held in the fund's portfolio are valued every business day. The following valuation policies and procedures are used by the Valuation Designee to value various types of securities:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• **Securities traded on an exchange or over-the-counter:** Traded securities are valued at the closing value for the day, or, on days when no closing value has been reported, at the mean of the most recent bid and ask quotes.

• **Futures contracts:** Futures contracts are valued at their settlement prices as of the close of their exchanges.

• **Mutual funds:** Mutual funds are valued at their respective NAVs.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• **Cash management sweep time deposits:** Balances held in cash management sweep time deposits are accounted for on a cost basis, which approximates fair value.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• **Securities for which no quoted value is available:** The Valuation Designee has adopted procedures to fair value the fund's securities when market prices are not "readily available" or are unreliable. For example, a security may be fair valued when it's de-listed or its trading is halted or suspended; when a security's primary pricing source is unable or unwilling to provide a price; or when a security's primary trading market is closed during regular market hours. Fair value determinations are made in good faith in accordance with adopted valuation procedures. The Valuation Designee considers a number of factors, including unobservable market inputs, when arriving at fair value. The Valuation Designee may employ methods such as the review of

**19**Schwab S&P 500 Index Portfolio \| Annual Report

------

Schwab S&P 500 Index Portfolio

Financial Notes (continued)

------

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;

**2. Significant Accounting Policies (continued):** 

related or comparable assets or liabilities, related market activities, recent transactions, market multiples, book values, transactional back-testing, disposition analysis and other relevant information. Due to the subjective and variable nature of fair value pricing, there can be no assurance that the fund could obtain the fair value assigned to the security upon the sale of such security.

In accordance with the authoritative guidance on fair value measurements and disclosures under GAAP, the fund discloses the fair value of its investments in a hierarchy that prioritizes the significant inputs to valuation methods used to measure the fair value. The hierarchy gives the highest priority to valuations based upon unadjusted quoted prices in active markets for identical assets or liabilities (Level 1 measurements) and the lowest priority to valuations based upon unobservable inputs that are significant to the valuation (Level 3 measurements). If inputs used to measure the financial instruments fall within different levels of the hierarchy, the categorization is based on the lowest level input that is significant to the valuation. If it is determined that either the volume and/or level of activity for an asset or liability has significantly decreased (from normal conditions for that asset or liability) or price quotations or observable inputs are not associated with orderly transactions, increased analysis and the Valuation Designee's judgment will be required to estimate fair value.

The three levels of the fair value hierarchy are as follows:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• Level 1 — quoted prices in active markets for identical investments — Investments whose values are based on quoted market prices in active markets, and whose values are therefore classified as Level 1 prices, include active listed equities, mutual funds, exchange-traded funds, and futures contracts. Mutual funds and exchange-traded funds are classified as Level 1 prices, without consideration to the classification level of the underlying securities held.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• Level 2 — other significant observable inputs (including quoted prices for similar securities, interest rates, prepayment speeds, credit risk, etc.) — Investments that trade in markets that are not considered to be active, but whose values are based on quoted market prices, dealer quotations or valuations provided by alternative pricing sources supported by observable inputs are classified as Level 2 prices. These generally include U.S. government and sovereign obligations, most government agency securities, investment-grade corporate bonds, certain mortgage products, less liquid listed equities, and state, municipal and provincial obligations.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• Level 3 — significant unobservable inputs (including the Valuation Designee's assumptions in determining the fair value of investments) — Investments whose values are classified as Level 3 prices have significant unobservable inputs, as they may trade infrequently or not at all. When observable prices are not readily available for these securities, one or more valuation methods are used for which sufficient and reliable data is available. The inputs used in estimating the value of Level 3 prices may include the original transaction price, quoted prices for similar securities or assets in active markets, completed or pending third-party transactions in the underlying investment or comparable issuers, and changes in financial ratios or cash flows. Level 3 prices may also be adjusted to reflect illiquidity and/or non-transferability, with the amount of such discount estimated in the absence of market information. Assumptions used due to the lack of observable inputs may significantly impact the resulting fair value and therefore the fund's results of operations.

The inputs or methodology used for valuing securities are not necessarily an indication of the risk associated with investing in those securities.

The levels associated with valuing the fund's investments as of December 31, 2022 are disclosed in the Portfolio Holdings.

**(b) Accounting Policies for certain Portfolio Investments (if held):**

**Futures Contracts:** Futures contracts are instruments that represent an agreement between two parties that obligates one party to buy, and the other party to sell, specific instruments at an agreed upon price on a stipulated future date. The fund must give the broker a deposit of cash and/or securities (initial margin) whenever it enters into a futures contract. The amount of the deposit may vary from one contract to another. Subsequent payments (variation margin) are made or received by the fund depending on the daily fluctuations in the value of the futures contract and are accounted for as unrealized appreciation or depreciation until the contract is closed, at which time the gains or losses are realized. Futures contracts are traded publicly on exchanges, and their value may change daily.

**Cash Management Transactions:** Effective May 23, 2022 Brown Brothers Harriman & Co. (BBH) was replaced by Citibank, N.A as custodian of the fund. The fund no longer subscribes to the BBH Cash Management Service Sweep (CMS Sweep). The BBH CMS Sweep was an investment product that automatically swept the fund's cash balances into overnight offshore time deposits with either the BBH Grand Cayman branch or a branch of a pre-approved commercial bank. This fully automated program allowed the fund to earn interest on cash balances. Excess cash invested with deposit institutions domiciled outside of the U.S., as with any

Schwab S&P 500 Index Portfolio \| Annual Report**20**

------

Schwab S&P 500 Index Portfolio

Financial Notes (continued)

------

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;

**2. Significant Accounting Policies (continued):** 

offshore deposit, was subject to sovereign actions in the jurisdiction of the deposit institution including, but not limited to, freeze, seizure or diminution. The fund assumed the risk associated with the repayment of principal and payment of interest on such instruments by the institution with which the deposit was ultimately placed. The fund terminated the CMS Sweep program and cash was returned to the fund prior to terminating services with BBH.

**Cash Investments:** The fund may invest a portion of its assets in cash. Cash includes cash bank balances in an interest-bearing demand deposit account with maturity on demand by the fund.

**Securities Lending:** Under the trust's Securities Lending Program, the fund (lender) may make short-term loans of its securities to another party (borrower) to generate additional revenue for the fund. The borrower pledges collateral in the form of cash, securities issued or fully guaranteed by the U.S. government or foreign governments, or letters of credit issued by a bank. Collateral at the individual loan level is required to be maintained on a daily marked-to-market basis in an amount at least equal to the current value of the securities loaned. The lending agent provides the fund with indemnification against borrower default (the borrower fails to return the security on loan) reducing the risk of loss as a result of default. The cash collateral of securities loaned is currently invested in money market portfolios operating pursuant to Rule 2a-7 under the 1940 Act. The fund bears the risk of loss with respect to the investment of cash collateral. The terms of the securities lending agreement allow the fund or the lending agent to terminate any loan at any given time and the securities must be returned within the earlier of the standard trade settlement period or the specified time period under the relevant securities lending agreement. Securities lending income, as disclosed in the fund's Statement of Operations, if applicable, represents the income earned from the investment of the cash collateral plus any fees paid by borrowers, less the fees paid to the lending agent and broker rebates which are subject to adjustments pursuant to the securities lending agreement. On loans not collateralized by cash, a fee is received from the borrower, and is allocated between the fund and the lending agent. The aggregate fair value of securities loaned will not at any time exceed one-third of the total assets of the fund, including collateral received from the loan. Securities lending fees paid to the unaffiliated lending agents start at 9% of gross lending revenue, with subsequent breakpoints to a low of 5%. In this context, the gross lending revenue equals the income received from the investment of cash collateral and fees paid by borrowers less any rebates paid to the borrowers. Any expenses charged by the cash collateral fund are in addition to these fees. All remaining revenue is retained by the fund, as applicable. No portion of lending revenue is paid to or retained by the investment adviser or any of its affiliates.

As of December 31, 2022, the fund had no securities on loan.

**(c) Security Transactions:** 

Security transactions are recorded as of the date the order to buy or sell the security is executed. Realized gains and losses from security transactions are based on the identified costs of the securities involved.

When the fund closes out a futures contract position, it calculates the difference between the value of the position at the beginning and at the end of the contract, and records a realized gain or loss accordingly.

**(d) Investment Income:**

Interest income is recorded as it accrues. Dividends and distributions from portfolio securities funds are recorded on the date they are effective (the ex-dividend date).

**(e) Expenses:**

Pursuant to an Amended and Restated Investment Advisory and Administration Agreement (Advisory Agreement) between the investment adviser and the fund, the investment adviser pays the operating expenses of the fund, excluding acquired fund fees and expenses, taxes, any brokerage expenses, and extraordinary or non-routine expenses. Taxes, any brokerage expenses and extraordinary or non-routine expenses that are specific to the fund are charged directly to the fund. The Advisory Agreement excludes paying acquired fund fees and expenses, which are indirect expenses incurred by the fund through its investments in underlying funds.

**(f) Distributions to Shareholders:**

The fund makes distributions from net investment income and net realized capital gains, if any, once a year. To receive a distribution, you must be a registered shareholder on the record date. Distributions are paid to shareholders on the payable date.

**21**Schwab S&P 500 Index Portfolio \| Annual Report

------

Schwab S&P 500 Index Portfolio

Financial Notes (continued)

------

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;

**2. Significant Accounting Policies (continued):** 

**(g) Accounting Estimates:**

The accounting policies described in this report conform to GAAP. Notwithstanding this, shareholders should understand that in order to follow these principles, fund management has to make estimates and assumptions that affect the information reported in the financial statements. It's possible that once the results are known, they may turn out to be different from these estimates and these differences may be material.

**(h) Federal Income Taxes:**

The fund intends to meet federal income and excise tax requirements for regulated investment companies under subchapter M of the Internal Revenue Code, as amended. Accordingly, the fund distributes substantially all of its net investment income and net realized capital gains, if any, to the participating insurance company's (shareholders) separate accounts each year. As long as the fund meets the tax requirements, it is not required to pay federal income tax.

**(i) Indemnification:**

Under the fund's organizational documents, the officers and trustees are indemnified against certain liabilities arising out of the performance of their duties to the fund. In addition, in the normal course of business the fund enters into contracts with its vendors and others that provide general indemnifications. The fund's maximum exposure under these arrangements is unknown as this would involve future claims that may be made against the fund. However, based on experience, the fund expects the risk of loss attributable to these arrangements to be remote.

**(j) Regulatory Update:** 

Effective January 24, 2023, the SEC adopted rule and form amendments to require mutual funds and ETFs to transmit concise and visually engaging streamlined annual and semiannual reports to shareholders that highlight key information deemed important for retail investors to assess and monitor their fund investments. Other information, including financial statements, will no longer appear in a streamlined shareholder report but must be available online, delivered free of charge upon request, and filed on a semiannual basis on Form N-CSR. The rule and form amendments have a compliance date of July 24, 2024. At this time, management is evaluating the impact of these rule and form amendment changes on the content of the current shareholder report and the newly created annual and semiannual streamlined shareholder reports.

------

<br>**3. Risk Factors:**

**Market Risk.** Financial markets rise and fall in response to a variety of factors, sometimes rapidly and unpredictably. Markets may be impacted by economic, political, regulatory and other conditions, including economic sanctions and other government actions. In addition, the occurrence of global events, such as war, terrorism, environmental disasters, natural disasters and epidemics may also negatively affect the financial markets. As with any investment whose performance is tied to these markets, the value of an investment in the fund will fluctuate, which means that an investor could lose money over short or long periods.

**Equity Risk.** The prices of equity securities rise and fall daily. These price movements may result from factors affecting individual companies, industries or the securities market as a whole. In addition, equity markets tend to move in cycles, which may cause stock prices to fall over short or extended periods of time.

**Investment Style Risk.** The fund primarily follows the large-cap portion of the U.S. stock market, as measured by the index. It follows these stocks during upturns as well as downturns. Because of its indexing strategy, the fund does not take steps to reduce market exposure or to lessen the effects of a declining market. In addition, because of the fund's expenses, the fund's performance may be below that of the index. Market disruptions could cause delays in the index's rebalancing schedule which may result in the index and, in turn, the fund experiencing returns different than those that would have been achieved under a normal rebalancing schedule.

A significant percentage of the index may be composed of securities in a single industry or sector of the economy. If the fund is focused in an industry or sector, it may present more risks than if it were broadly diversified over numerous industries and sectors of the economy.

**Tracking Error Risk.** As an index fund, the fund seeks to track the performance of its benchmark index, although it may not be successful in doing so. The divergence between the performance of a fund and its benchmark index, positive or negative, is called "tracking error." Tracking error can be caused by many factors and it may be significant.

Schwab S&P 500 Index Portfolio \| Annual Report**22**

------

Schwab S&P 500 Index Portfolio

Financial Notes (continued)

------

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;

**3. Risk Factors (continued):** 

**Market Capitalization Risk.** Securities issued by companies of different market capitalizations tend to go in and out of favor based on market and economic conditions. During a period when securities of a particular market capitalization fall behind other types of investments, the fund's performance could be impacted.

**Large-Cap Company Risk.** Large-cap companies are generally more mature and the securities issued by these companies may not be able to reach the same levels of growth as the securities issued by small- or mid-cap companies.

**Concentration Risk.** To the extent that the fund's or the index's portfolio is concentrated in the securities of issuers in a particular market, industry, group of industries, sector, or asset class, the fund may be adversely affected by the performance of those securities, may be subject to increased price volatility and may be more vulnerable to adverse economic, market, political or regulatory occurrences affecting that market, industry, group of industries, sector, or asset class.

**Derivatives Risk.** The fund's use of derivative instruments involves risks different from, or possibly greater than, the risks associated with investing directly in securities and other traditional investments. The fund's use of derivatives could reduce the fund's performance, increase its volatility, and could cause the fund to lose more than the initial amount invested. In addition, investments in derivatives may involve leverage, which means a small percentage of assets invested in derivatives can have a disproportionately large impact on the fund.

**Liquidity Risk.** The fund may be unable to sell certain securities, such as illiquid securities, readily at a favorable time or price, or the fund may have to sell them at a loss.

**Securities Lending Risk.** Securities lending involves the risk of loss of rights in, or delay in recovery of, the loaned securities if the borrower fails to return the security loaned or becomes insolvent.

Please refer to the fund's prospectus for a more complete description of the principal risks of investing in the fund.

------

<br>**4. Affiliates and Affiliated Transactions:**

**Investment Adviser**

Charles Schwab Investment Management, Inc., dba Schwab Asset Management, a wholly owned subsidiary of The Charles Schwab Corporation, serves as the fund's investment adviser and administrator pursuant to an Advisory Agreement between the investment adviser and the trust.

For its advisory services to the fund, the investment adviser is entitled to receive an annual fee, payable monthly, equal to 0.03% of the fund's average daily net assets.

**Interfund Transactions**

The fund may engage in transactions with certain other funds in the Fund Complex (for definition refer to the Trustees and Officers section) in accordance with procedures adopted by the Board pursuant to Rule 17a-7 under the 1940 Act. When one fund is seeking to sell a security that another is seeking to buy, an interfund transaction can allow both funds to benefit by reducing transaction costs. This practice is limited to funds that share the same investment adviser, trustees and/or officers. For the period ended December 31, 2022, the fund's purchases and sales of securities with other funds in the Fund Complex was $405,138,792 and $4,288,883, respectively, and includes realized losses of $1,943,640.

**Interfund Borrowing and Lending**

Pursuant to an exemptive order issued by the U.S. Securities and Exchange Commission (SEC), the fund may enter into interfund borrowing and lending transactions with other funds in the Fund Complex . All loans are for temporary or emergency purposes and the interest rate to be charged will be the average of the overnight repurchase agreement rate and the short-term bank loan rate. All loans are subject to numerous conditions designed to ensure fair and equitable treatment of all participating funds. The interfund lending facility is subject to the oversight and periodic review by the Board. The fund had no interfund borrowing or lending activity during the period.

**23**Schwab S&P 500 Index Portfolio \| Annual Report

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Schwab S&P 500 Index Portfolio

Financial Notes (continued)

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;

**5. Board of Trustees:**

The Board may include people who are officers and/or directors of the investment adviser or its affiliates. Federal securities law limits the percentage of such "interested persons" who may serve on a trust's board, and the trust was in compliance with these limitations throughout the report period. The fund did not pay any interested or non-interested (independent trustees) trustees. The independent trustees are paid by the investment adviser. For information regarding the trustees, please refer to the Trustees and Officers table at the end of this report.

------

<br>**6. Borrowing from Banks:**

During the period, the fund was a participant with other funds in the Fund Complex in a joint, syndicated, committed $850 million line of credit (the Syndicated Credit Facility), which matured on September 29, 2022. On September 29, 2022, the Syndicated Credit Facility was amended to run for a new 364 day period with the line of credit amount increasing to $1 billion, maturing on September 28, 2023. Under the terms of the Syndicated Credit Facility, in addition to the investment adviser paying the interest charged on any borrowings by the fund, the investment adviser paid a commitment fee of 0.15% per annum on the fund's proportionate share of the unused portion of the Syndicated Credit Facility.

During the period, the fund was a participant with other funds in the Fund Complex, in a joint, unsecured, uncommitted $400 million line of credit (the Uncommitted Credit Facility), with State Street Bank and Trust Company, which matured on September 29, 2022. On September 29, 2022, the Uncommitted Credit Facility was amended to run for a new 364 day period with the line of credit amount remaining unchanged, maturing on September 28, 2023. Under the terms of the Uncommitted Credit Facility, the investment adviser pays interest on the amount the fund borrows. There were no borrowings from either line of credit during the period.

The fund also has access to custodian overdraft facilities. The fund may have utilized the overdraft facility and incurred an interest expense, which is paid by the investment adviser. The interest expense is determined based on a negotiated rate above the current Federal Funds Rate.

------

<br>**7. Purchases and Sales/Maturities of Investment Securities:**

For the period ended December 31, 2022, purchases and sales of securities (excluding short-term obligations) were as follows:

---

| | |
|:---|:---|
| PURCHASES <br>OF SECURITIES <br>| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; SALES <br>OF SECURITIES <br>|
| $1406558765 | $139827615 |

---

------

<br>**8. Derivatives:**

The fund entered into equity index futures contracts during the report period. The fund invested in futures contracts to equitize available cash. The value and variation margin on futures contracts held at December 31, 2022 are presented in the Portfolio Holdings and Statement of Assets and Liabilities, respectively. The net realized gains (losses) and change in unrealized appreciation (depreciation) on futures contracts are presented in the Statement of Operations. Refer to financial note 2(b) for the fund's accounting policies with respect to futures contracts and financial note 3 for disclosures concerning the risks of investing in futures contracts. During the period ended December 31, 2022, the month-end average notional amounts of futures contracts held by the fund and the month-end average number of contracts held were as follows:

---

| | |
|:---|:---|
| Notional Amount | Number of Contracts |
| $7314487 | 36 |

---

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<br>**9. Federal Income Taxes:**

As of December 31, 2022, the tax basis cost of the fund's investments and gross unrealized appreciation and depreciation were as follows:

---

| | | | |
|:---|:---|:---|:---|
| TAX COST  | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; GROSS UNREALIZED <br>APPRECIATION <br>| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; GROSS UNREALIZED <br>DEPRECIATION <br>| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; NET UNREALIZED <br>APPRECIATION <br>&nbsp;&nbsp;&nbsp;&nbsp;(DEPRECIATION)<br>|
| $2024446628 | $465879976 | ($79588991)  | $386290985 |

---

Schwab S&P 500 Index Portfolio \| Annual Report**24**

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Schwab S&P 500 Index Portfolio

Financial Notes (continued)

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;

**9. Federal Income Taxes (continued):** 

As of December 31, 2022, the components of distributable earnings on a tax basis were as follows:

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| | | | |
|:---|:---|:---|:---|
| UNDISTRIBUTED <br>ORDINARY <br>INCOME <br>| &nbsp;&nbsp;&nbsp; NET UNREALIZED <br>APPRECIATION <br>&nbsp;&nbsp;&nbsp;&nbsp;(DEPRECIATION) <br>ON INVESTMENTS <br>| &nbsp;&nbsp;&nbsp; CAPITAL LOSS <br>CARRYFORWARDS AND OTHER LOSSES<br>| TOTAL  |
| $23601993 | $386290985 | ($9210907)  | $400682071 |

---

The primary difference between book basis and tax basis unrealized appreciation or unrealized depreciation of investments is the tax deferral of losses on wash sales and realization for tax purposes of unrealized gains (losses) on futures contracts. The tax cost of the fund's investments, disclosed above, has been adjusted from the book amounts to reflect these unrealized appreciation or depreciation differences, as applicable.

Capital loss carryforwards have no expiration and may be used to offset future realized capital gains for federal income tax purposes. As of December 31, 2022, the fund had capital loss carryforwards of $9,210,907.

The tax basis components of distributions paid during the current and prior fiscal years were as follows:

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| | | | |
|:---|:---|:---|:---|
| CURRENT FISCAL YEAR END DISTRIBUTIONS | CURRENT FISCAL YEAR END DISTRIBUTIONS | PRIOR FISCAL YEAR END DISTRIBUTIONS | PRIOR FISCAL YEAR END DISTRIBUTIONS |
| ORDINARY <br>INCOME <br>| &nbsp;&nbsp; LONG-TERM <br>CAPITAL <br>GAINS <br>| &nbsp;&nbsp; ORDINARY <br>INCOME <br>| &nbsp;&nbsp; LONG-TERM <br>CAPITAL <br>GAINS <br>|
| $19219296 | $6667916 | $15017859 | $— |

---

Distributions paid to shareholders are based on net investment income and net realized gains determined on a tax basis, which may differ from net investment income and net realized gains for financial reporting purposes. These differences reflect the differing character of certain income items and net realized gains and losses for financial statement and tax purposes, and may result in reclassification among certain capital accounts on the financial statements. The fund may also designate a portion of the amount paid to redeeming shareholders as a distribution for tax purposes.

Permanent book and tax basis differences may result in reclassifications between components of net assets as required. The adjustments will have no impact on net assets or the results of operations.

As of December 31, 2022, management has reviewed the tax positions for open periods (for federal purposes, three years from the date of filing and for state purposes, four years from the date of filing) as applicable to the fund, and has determined that no provision for income tax is required in the fund's financial statements. The fund recognizes interest and penalties, if any, related to unrecognized tax benefits as income tax expense in the Statement of Operations. During the fiscal year ended December 31, 2022, the fund did not incur any interest or penalties.

------

<br>**10. Subsequent Events:**

Management has determined there are no subsequent events or transactions through the date the financial statements were issued that would have materially impacted the financial statements as presented.

**25**Schwab S&P 500 Index Portfolio \| Annual Report

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Schwab S&P 500 Index Portfolio

Report of Independent Registered Public Accounting Firm

------

To the Board of Trustees of Schwab Annuity Portfolios and Shareholders of Schwab S&P 500 Index Portfolio

***Opinion on the Financial Statements and Financial Highlights***

We have audited the accompanying statement of assets and liabilities, including the portfolio holdings, of Schwab S&P 500 Index Portfolio (the "Fund"), one of the funds constituting Schwab Annuity Portfolios, as of December 31, 2022, the related statement of operations for the year then ended, the statements of changes in net assets for each of the two years in the period then ended, the financial highlights for each of the three years in the period then ended, and the related notes. In our opinion, the financial statements and financial highlights present fairly, in all material respects, the financial position of the Fund as of December 31, 2022, and the results of its operations for the year then ended, the changes in its net assets for each of the two years in the period then ended, and the financial highlights for each of the three years in the period then ended in conformity with accounting principles generally accepted in the United States of America. The financial highlights for each of the two years in the period ended December 31, 2019 were audited by other auditors, whose report, dated February 18, 2020, expressed an unqualified opinion on such financial highlights.

***Basis for Opinion***

These financial statements and financial highlights are the responsibility of the Fund's management. Our responsibility is to express an opinion on the Fund's financial statements and financial highlights based on our audits. We are a public accounting firm registered with the Public Company Accounting Oversight Board (United States) (PCAOB) and are required to be independent with respect to the Fund in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.

We conducted our audits in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements and financial highlights are free of material misstatement, whether due to error or fraud. The Fund is not required to have, nor were we engaged to perform, an audit of its internal control over financial reporting. As part of our audits, we are required to obtain an understanding of internal control over financial reporting but not for the purpose of expressing an opinion on the effectiveness of the Fund's internal control over financial reporting. Accordingly, we express no such opinion.

Our audits included performing procedures to assess the risks of material misstatement of the financial statements and financial highlights, whether due to error or fraud, and performing procedures that respond to those risks. Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the financial statements and financial highlights. Our audits also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the financial statements and financial highlights. Our procedures included confirmation of securities owned as of December 31, 2022, by correspondence with the custodian and brokers; when replies were not received from brokers, we performed other auditing procedures. We believe that our audits provide a reasonable basis for our opinion.

**Deloitte & Touche LLP** <br>Denver, Colorado <br>February 16, 2023

We have served as the auditor of one or more investment companies in the Schwab Funds Complex since 2020.

Schwab S&P 500 Index Portfolio \| Annual Report**26**

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Schwab S&P 500 Index Portfolio

Other Federal Tax Information (unaudited)

------

For corporate shareholders, 79.29% of the fund's dividend distributions paid during the fiscal year ended December 31, 2022, qualify for the corporate dividends received deduction.

Under section 852(b)(3)(C) of the Internal Revenue Code, the fund hereby designates $6,667,916 as long-term capital gain dividends for the fiscal year ended December 31, 2022.

**27**Schwab S&P 500 Index Portfolio \| Annual Report

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Schwab S&P 500 Index Portfolio

Liquidity Risk Management Program (unaudited)

------

The fund has adopted and implemented a liquidity risk management program (the "program") as required by Rule 22e-4 under the Investment Company Act of 1940, as amended. The fund's Board of Trustees (the "Board") has designated the fund's investment adviser, Charles Schwab Investment Management, Inc., dba Schwab Asset Management, as the administrator of the program. Personnel of the investment adviser or its affiliates conduct the day-to-day operation of the program.

Under the program, the investment adviser manages a fund's liquidity risk, which is the risk that the fund could not meet shareholder redemption requests without significant dilution of remaining shareholders' interests in the fund. The program is reasonably designed to assess and manage a fund's liquidity risk, taking into consideration the fund's investment strategy and the liquidity of its portfolio investments during normal and reasonably foreseeable stressed conditions; its historical redemption history and shareholder concentrations; and its cash holdings and access to other funding sources, including the custodian overdraft facility and lines of credit. The investment adviser's process of determining the degree of liquidity of each fund's investments is supported by third-party liquidity assessment vendors.

The fund's Board reviewed a report at its meeting held on September 19, 2022 prepared by the investment adviser regarding the operation and effectiveness of the program for the period June 1, 2021, through May 31, 2022, which included individual fund liquidity metrics. No significant liquidity events impacting the fund were noted in the report. In addition, the investment adviser provided its assessment that the program had been operating effectively in managing the fund's liquidity risk.

Schwab S&P 500 Index Portfolio \| Annual Report**28**

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Schwab S&P 500 Index Portfolio

Trustees and Officers

------

The tables below give information about the trustees and officers of Schwab Annuity Portfolios, which includes the fund covered in this report. The "Fund Complex" includes The Charles Schwab Family of Funds, Schwab Capital Trust, Schwab Investments, Schwab Annuity Portfolios, Schwab Strategic Trust and Laudus Trust. The Fund Complex includes 105 funds.

The address for all trustees and officers is 211 Main Street, San Francisco, CA 94105. You can find more information about the trustees and officers in the fund's Statement of Additional Information, which is available free by calling 1-877-824-5615.

---

| | | | |
|:---|:---|:---|:---|
| **Independent Trustees** | **Independent Trustees** | **Independent Trustees** | **Independent Trustees** |
| Name, Year of Birth, and <br> Position(s) with the trust <br> (Terms of office, and <br> length of Time Served<sup>1</sup>)<br>| Principal Occupations<br> During the Past Five Years<br>| Number of<br> Portfolios in<br> Fund Complex<br> Overseen by<br> the Trustee<br>| Other Directorships |
| **Michael J. Beer**<br> 1961<br> Trustee<br> (Trustee of The Charles Schwab <br> Family of Funds, Schwab <br> Investments, Schwab Capital Trust, <br> Schwab Annuity Portfolios, Schwab <br> Strategic Trust and Laudus Trust <br> since 2022)<br>| Retired. Director, President and Chief Executive Officer <br> (Dec. 2016 – Sept. 2019), Principal Funds (investment management).<br>| 105 | Director (2016 – 2019), <br> Principal Funds, Inc.<br>|
| **Robert W. Burns**<br> 1959<br> Trustee<br> (Trustee of Schwab Strategic Trust <br> since 2009; The Charles Schwab <br> Family of Funds, Schwab <br> Investments, Schwab Capital Trust, <br> Schwab Annuity Portfolios and <br> Laudus Trust since 2016)<br>| Retired/Private Investor. | 105 |  |
| **Nancy F. Heller**<br> 1956<br> Trustee<br> (Trustee of The Charles Schwab <br> Family of Funds, Schwab <br> Investments, Schwab Capital Trust, <br> Schwab Annuity Portfolios, Schwab <br> Strategic Trust and Laudus Trust <br> since 2018)<br>| Retired. | 105 |  |
| **David L. Mahoney**<br> 1954<br> Trustee<br> (Trustee of The Charles Schwab <br> Family of Funds, Schwab <br> Investments, Schwab Capital Trust, <br> Schwab Annuity Portfolios and <br> Laudus Trust since 2011; Schwab <br> Strategic Trust since 2016)<br>| Private Investor. | 105 | Director <br> (2004 – present), <br> Corcept Therapeutics <br> Incorporated <br> Director (2009 – 2021), <br> Adamas <br> Pharmaceuticals, Inc.<br> Director (2003 – 2019), <br> Symantec Corporation<br>|
| **Jane P. Moncreiff**<br> 1961<br> Trustee<br> (Trustee of The Charles Schwab <br> Family of Funds, Schwab <br> Investments, Schwab Capital Trust, <br> Schwab Annuity Portfolios, Schwab <br> Strategic Trust and Laudus Trust <br> since 2019)<br>| Consultant (2018 – present), Fulham Advisers LLC (management <br> consulting); Chief Investment Officer (2009 – 2017), CareGroup <br> Healthcare System, Inc. (healthcare).<br>| 105 |  |

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**29**Schwab S&P 500 Index Portfolio \| Annual Report

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Schwab S&P 500 Index Portfolio

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| | | | |
|:---|:---|:---|:---|
| **Independent Trustees (continued)** | **Independent Trustees (continued)** | **Independent Trustees (continued)** | **Independent Trustees (continued)** |
| Name, Year of Birth, and <br> Position(s) with the trust <br> (Terms of office, and <br> length of Time Served<sup>1</sup>)<br>| Principal Occupations<br> During the Past Five Years<br>| Number of<br> Portfolios in<br> Fund Complex<br> Overseen by<br> the Trustee<br>| Other Directorships |
| **Kimberly S. Patmore**<br> 1956<br> Trustee<br> (Trustee of The Charles Schwab <br> Family of Funds, Schwab <br> Investments, Schwab Capital Trust, <br> Schwab Annuity Portfolios, Schwab <br> Strategic Trust and Laudus Trust <br> since 2016)<br>| Consultant (2008 – present), Patmore Management Consulting <br> (management consulting).<br>| 105 |  |
| **J. Derek Penn**<br> 1957<br> Trustee<br> (Trustee of The Charles Schwab <br> Family of Funds, Schwab <br> Investments, Schwab Capital Trust, <br> Schwab Annuity Portfolios, Schwab <br> Strategic Trust and Laudus Trust <br> since 2021)<br>| Head of Equity Sales and Trading (2006 – 2018), BNY Mellon (financial <br> services).<br>| 105 |  |

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Schwab S&P 500 Index Portfolio \| Annual Report**30**

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Schwab S&P 500 Index Portfolio

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;

---

| | | | |
|:---|:---|:---|:---|
| **Interested Trustees** | **Interested Trustees** | **Interested Trustees** | **Interested Trustees** |
| Name, Year of Birth, and <br> Position(s) with the trust <br> (Terms of office, and <br> length of Time Served<sup>1</sup>)<br>| Principal Occupations<br> During the Past Five Years<br>| Number of<br> Portfolios in<br> Fund Complex<br> Overseen by<br> the Trustee<br>| Other Directorships |
| **Walter W. Bettinger II**<sup>2</sup> 1960<br> Chairman and Trustee<br> (Trustee of The Charles Schwab <br> Family of Funds, Schwab <br> Investments, Schwab Capital Trust <br> and Schwab Annuity Portfolios since <br> 2008; Schwab Strategic Trust since <br> 2009; Laudus Trust since 2010)<br>| Co-Chairman of the Board (July 2022 – present), Director and Chief <br> Executive Officer (Oct. 2008 – present) and President <br> (Feb. 2007 – Oct. 2021), The Charles Schwab Corporation; President and <br> Chief Executive Officer (Oct. 2008 – Oct. 2021) and Director <br> (May 2008 – Oct. 2021), Charles Schwab & Co., Inc.; Director <br> (Apr. 2006 – present), Charles Schwab Bank, SSB; Director <br> (Nov. 2017 – present), Charles Schwab Premier Bank, SSB; Director <br> (July 2019 – present), Charles Schwab Trust Bank; Director <br> (May 2008 – present), Chief Executive Officer (Aug. 2017 – present) and <br> President (Aug. 2017 – Nov. 2021), Schwab Holdings, Inc.; Director <br> (Oct. 2020 – present), TD Ameritrade Holding Corporation; Director <br> (July 2016 – Oct. 2021), Charles Schwab Investment Management, Inc.<br>| 105 | Director <br> (2008 – present), The <br> Charles Schwab <br> Corporation <br>|
| **Richard A. Wurster**<sup>2</sup> 1973<br> Trustee<br> (Trustee of The Charles Schwab <br> Family of Funds, Schwab <br> Investments, Schwab Capital Trust, <br> Schwab Annuity Portfolios, Schwab <br> Strategic Trust and Laudus Trust <br> since 2022)<br>| President (Oct. 2021 – present) and Executive Vice President – Schwab <br> Asset Management Solutions (Apr. 2019 – Oct. 2021), The Charles <br> Schwab Corporation; President, Director (Oct. 2021 – present), Executive <br> Vice President – Schwab Asset Management Solutions <br> (July 2019 – Oct. 2021) and Senior Vice President – Advisory <br> (May 2016 – July 2019), Charles Schwab & Co., Inc.; President <br> (Nov. 2021 – present), Schwab Holdings, Inc.; Director <br> (Oct. 2021 – present) and Chief Executive Officer (Nov. 2019 – Jan. 2022), <br> Charles Schwab Investment Management, Inc.; Director, Chief Executive <br> Officer and President (Mar. 2018 – Oct. 2022), Charles Schwab Investment <br> Advisory, Inc.; Chief Executive Officer (July 2016 – Apr. 2018) and <br> President (Mar. 2017 – Apr. 2018), ThomasPartners, Inc.; Chief Executive <br> Officer (July 2016 – Apr. 2018), Windhaven Investment Management, Inc.<br>| 105 |  |

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;

---

| | |
|:---|:---|
| **Officers of the Trust** | **Officers of the Trust** |
| Name, Year of Birth, and Position(s) with the trust <br> (Terms of office, and length of Time Served<sup>3</sup>)<br>| Principal Occupations During the Past Five Years |
| **Jonathan de St. Paer**<br> 1973<br> President and Chief Executive Officer<br> (Officer of The Charles Schwab Family of Funds, Schwab <br> Investments, Schwab Capital Trust, Schwab Annuity <br> Portfolios, Schwab Strategic Trust and Laudus Trust since <br> 2018)<br>| Director (Apr. 2019 – present), President (Oct. 2018 – present), Chief Operating Officer <br> (Jan. 2021 – present), and Chief Executive Officer (Apr. 2019 – Nov. 2019), Charles Schwab <br> Investment Management, Inc.; Senior Vice President (June 2020 – Mar. 2022) and Chief <br> Operating Officer (Jan. 2021 – Mar. 2022), Charles Schwab Investment Advisory, Inc.; Chief <br> Executive Officer (Apr. 2019 – present), President (Nov. 2018 – present) and Trustee <br> (Apr. 2019 – Dec. 2020), Schwab Funds, Laudus Trust and Schwab ETFs; Managing Director <br> (May 2022 – present), Senior Vice President (Apr. 2019 – May 2022) and Senior Vice <br> President – Strategy and Product Development (CSIM) (Jan. 2014 – Mar. 2019), Charles <br> Schwab & Co., Inc.<br>|
| **Mark Fischer**<br> 1970<br> Chief Operating Officer<br> (Officer of The Charles Schwab Family of Funds, Schwab <br> Investments, Schwab Capital Trust, Schwab Annuity <br> Portfolios, Schwab Strategic Trust and Laudus Trust since <br> 2013)<br>| Chief Operating Officer (Dec. 2020 – present) and Treasurer and Chief Financial Officer <br> (Jan. 2016 – Dec. 2022), Schwab Funds, Laudus Trust and Schwab ETFs; Chief Financial <br> Officer (Mar. 2020 – present) and Vice President (Oct. 2013 – present), Charles Schwab <br> Investment Management, Inc.<br>|
| **Dana Smith**<br> 1965<br> Treasurer and Chief Financial Officer<br> (Officer of The Charles Schwab Family of Funds, Schwab <br> Investments, Schwab Capital Trust, Schwab Annuity <br> Portfolios, Schwab Strategic Trust and Laudus Trust since <br> 2023)<br>| Treasurer and Chief Financial Officer (Jan. 2023 – present) and Assistant Treasurer <br> (Dec. 2015 – Dec. 2022), Schwab Funds, Laudus Trust and Schwab ETFs; Vice President <br> (Mar. 2022 – present) and Director (Oct. 2015 – Mar. 2022), Charles Schwab Investment <br> Management, Inc.<br>|

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**31**Schwab S&P 500 Index Portfolio \| Annual Report

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Schwab S&P 500 Index Portfolio

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| | |
|:---|:---|
| **Officers of the Trust (continued)** | **Officers of the Trust (continued)** |
| Name, Year of Birth, and Position(s) with the trust <br> (Terms of office, and length of Time Served<sup>3</sup>)<br>| Principal Occupations During the Past Five Years |
| **Omar Aguilar**<br> 1970<br> Vice President and Chief Investment Officer<br> (Officer of The Charles Schwab Family of Funds, Schwab <br> Investments, Schwab Capital Trust, Schwab Annuity <br> Portfolios, Schwab Strategic Trust and Laudus Trust since <br> 2011)<br>| Chief Executive Officer (Jan. 2022 – present), Chief Investment Officer (Apr. 2011 – present) <br> and Senior Vice President (Apr. 2011 – Dec. 2021), Charles Schwab Investment <br> Management, Inc.; Director, Chief Executive Officer and President (Oct. 2022 – present), <br> Charles Schwab Investment Advisory, Inc.; Vice President and Chief Investment Officer <br> (June 2011 – present), Schwab Funds, Laudus Trust and Schwab ETFs.<br>|
| **Brett Wander**<br> 1961<br> Vice President and Chief Investment Officer<br> (Officer of The Charles Schwab Family of Funds, Schwab <br> Investments, Schwab Capital Trust, Schwab Annuity <br> Portfolios, Schwab Strategic Trust and Laudus Trust since <br> 2011)<br>| Senior Vice President and Chief Investment Officer (Apr. 2011 – present), Charles Schwab <br> Investment Management, Inc.; Vice President and Chief Investment Officer <br> (June 2011 – present), Schwab Funds, Laudus Trust and Schwab ETFs.<br>|
| **William P. McMahon, Jr.**<br> 1972<br> Vice President and Chief Investment Officer<br> (Officer of The Charles Schwab Family of Funds, Schwab <br> Investments, Schwab Capital Trust, Schwab Annuity <br> Portfolios, Schwab Strategic Trust and Laudus Trust since <br> 2021)<br>| Senior Vice President and Chief Investment Officer (Jan. 2020 – present), Charles Schwab <br> Investment Management, Inc.; Vice President and Chief Investment Officer <br> (June 2021 – present), Schwab Funds, Laudus Trust and Schwab ETFs; Senior Vice President <br> and Chief Investment Officer – ThomasPartners Strategies (Apr. 2018 – Dec. 2019), Charles <br> Schwab Investment Advisory, Inc.; Senior Vice President and Chief Investment Officer <br> (May 2001 – Apr. 2018), ThomasPartners, Inc.<br>|
| **Catherine MacGregor**<br> 1964<br> Chief Legal Officer and Secretary, Schwab Funds and <br> Schwab ETFs<br> Chief Legal Officer, Vice President and Clerk, Laudus Trust<br> (Officer of The Charles Schwab Family of Funds, Schwab <br> Investments, Schwab Capital Trust, Schwab Annuity <br> Portfolios and Laudus Trust since 2005; Schwab Strategic <br> Trust since 2009)<br>| Chief Legal Officer (Mar. 2022 – present) and Vice President (Sept. 2005 – present), Charles <br> Schwab Investment Management, Inc.; Managing Director (May 2022 – present) and Vice <br> President (July 2005 – May 2022), Charles Schwab & Co., Inc.; Vice President <br> (Dec. 2005 – present) and Chief Legal Officer and Clerk (Mar. 2007 – present), Laudus Trust; <br> Chief Legal Officer and Secretary (Oct. 2021 – present), Vice President <br> (Nov. 2005 – Oct. 2021) and Assistant Secretary (June 2007 – Oct. 2021), Schwab Funds; <br> Chief Legal Officer and Secretary (Oct. 2021 – present), Vice President and Assistant <br> Secretary (Oct. 2009 – Oct. 2021), Schwab ETFs.<br>|

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<sup>1</sup>

Each Trustee shall hold office until the election and qualification of his or her successor, or until he or she dies, resigns or is removed. The retirement policy requires that each independent trustee retire by December 31 of the year in which the Trustee turns 74 or the Trustee's twentieth year of service as an independent trustee on any trust in the Fund Complex, whichever occurs first.

<sup>2</sup>

Mr. Bettinger and Mr. Wurster are Interested Trustees. Mr. Bettinger and Mr. Wurster are Interested Trustees because each owns stock of The Charles Schwab Corporation (CSC), the parent company of Charles Schwab Investment Management, Inc., the investment adviser for the trusts in the Fund Complex, and is an employee of Charles Schwab & Co., Inc. (Schwab), the principal underwriter for The Charles Schwab Family of Funds, Schwab Investments, Schwab Capital Trust, Schwab Annuity Portfolios and Laudus Trust.

<sup>3</sup>

The President, Treasurer and Secretary/Clerk hold office until their respective successors are chosen and qualified or until he or she sooner dies, resigns, is removed or becomes disqualified. Each of the other officers serves at the pleasure of the Board.

Schwab S&P 500 Index Portfolio \| Annual Report**32**

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;

Notes

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;

Notes

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;

Notes

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![(CHARLES SCHWAB ASSET MANAGMENT LOGO)](g90966img8030c00a1.jpg)

**Annual Report** \| December 31, 2022

Schwab VIT Balanced Portfolio

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**Proxy Voting Policies, Procedures and Results**

A description of the proxy voting policies and procedures used to determine how to vote proxies on behalf of the funds is available without charge, upon request, by visiting the Schwab Fund's website at www.schwabassetmanagement.com/schwabfunds_prospectus, the SEC's website at www.sec.gov, or by contacting Schwab Funds at 1-877-824-5615.

Information regarding how a fund voted proxies relating to portfolio securities during the most recent twelve-month period ended June 30 is available, without charge, by visiting Schwab's website at www.schwabassetmanagement.com/schwabfunds_prospectus or the SEC's website at www.sec.gov.

**Investment Adviser:** Charles Schwab Investment Management, Inc., dba Schwab Asset Management<sup>TM</sup>

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Schwab VIT Balanced Portfolio

The Investment Environment

------

For the 12-month reporting period ended December 31, 2022, several key U.S. stock indices posted their largest calendar year drop since the 2008 recession and the Bloomberg US Aggregate Bond Index suffered its worst calendar year performance since its inception in 1976, with longer-term bonds underperforming shorter-term bonds. Inflation spiked, interest rates rose, and economic growth around the world slowed. The ongoing war between Russia and Ukraine and the continuing, albeit uneven, fallout from the COVID-19 pandemic weighed on economies and markets around the world. Oil prices peaked at over $120 per barrel in early March as sanctions were imposed on Russian imports—and again in June on supply-and-demand imbalances—but retreated through most of the rest of the reporting period, ending it at just over $80 per barrel. The U.S. dollar strengthened against a basket of international currencies over the reporting period, generally decreasing the returns on overseas investments in U.S. dollar terms. For the reporting period, the S&P 500<sup>®</sup> Index, a bellwether for the overall U.S. stock market, returned -18.11%. The MSCI EAFE<sup>®</sup> Index (Net)\*, a broad measure of developed international equity performance, returned -14.45%. Emerging market equities were weaker, with the MSCI Emerging Markets Index (Net)\* returning -20.09%. Among U.S. and international bonds, the Bloomberg US Aggregate Bond Index returned -13.01% and the FTSE non-US Dollar World Government Bond Index returned -22.07%.

As inflation continued to rise and U.S. Federal Reserve (Fed) monetary policy shifted, bond yields began to climb early in 2022, for the most part maintaining that trajectory through the first three quarters of the year, exerting downward pressure on bond prices. (Bond yields and bond prices typically move in opposite directions.) In the final quarter, longer-term yields became more volatile and prices rebounded slightly, leading to an inversion of certain parts of the yield curve. Over the reporting period, the yield on the 10-year U.S. Treasury rose from 1.52% to 3.88%. Short-term rates also rose sharply, with the yield on the three-month U.S. Treasury climbing from 0.06% to 4.42% over the reporting period, ending the year just slightly off its one-year high.

**Asset Class Performance Comparison % returns during the 12 months ended December 31, 2022**![](g90966img776b50682.jpg)

Index figures assume dividends and distributions were reinvested. Index figures do not include trading and management costs, which would lower performance. Indices are unmanaged and cannot be invested in directly. Performance results less than one year are not annualized. Past performance is not an indication of future results.

For index definitions, please see the Glossary.

Data source: Index provider websites and Schwab Asset Management.

Nothing in this report represents a recommendation of a security by the investment adviser.

Management views may have changed since the report date.

\*

The net version of the index reflects reinvested dividends net of withholding taxes but reflects no deductions for expenses or other taxes.

Schwab VIT Balanced Portfolio \| Annual Report**2**

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Schwab VIT Balanced Portfolio

The Investment Environment (continued)

------

In the United States, amid fading government stimuli, ongoing supply chain disruptions, persisting inflation, and a widening U.S. trade deficit, gross domestic product (GDP) contracted for the first two quarters of 2022, decreasing at an annualized rate of -1.6% and -0.6% for the first and second quarters, respectively. GDP grew at an annualized rate of 3.2% for the third quarter of 2022, driven primarily by energy exports and consumer spending. Inflation rose steadily in the first half of the year, hitting a 40-year high in June, before declining through the end of the reporting period as certain consumer and energy prices began to recede. The unemployment rate remained low despite inflationary pressures, ending the reporting period at pre-pandemic lows.

Outside the United States, conditions were similar. The eurozone, despite considerable headwinds, managed to maintain positive, albeit waning, GDP growth for the first, second, and third quarters of 2022 on easing COVID-19 restrictions and an increase in tourism in response to pent-up demand. The United Kingdom posted small gains in GDP growth for the first two quarters of 2022, in part driven by increases in COVID-19 testing and tracing and an expansion of its vaccination program but contracted slightly in the third quarter of 2022 on reduced household spending. Among emerging markets, China's GDP growth turned negative for the second quarter as it dealt with numerous headwinds including lockdowns and quarantines, declining domestic consumption, and a severe property downturn, but by the third quarter, GDP growth was again positive, buoyed by a series of policies and stimuli implemented to revive economic activity. India's GDP growth remained positive throughout the reporting period, and was particularly strong in the second quarter, but third-quarter GDP growth waned as high prices and rising interest rates weighed on demand.

Monetary policy around the world varied as central banks responded to the rapidly changing conditions. In the United States, after maintaining the federal funds rate in a range of 0.00% to 0.25% through mid-March 2022, the Fed shifted its stance as inflation continued to rise and indicators of economic activity and employment continued to strengthen. After issuing successively stronger signals that interest rates could begin to rise sooner in 2022 than previously anticipated, the Fed raised the federal funds rate seven times during the reporting period—by 0.25% in mid-March, 0.50% in early May, 0.75% in mid-June, 0.75% in late July, 0.75% in late September, 0.75% in early November, and 0.50% in mid-December. The federal funds rate ended the reporting period in a range of 4.25% to 4.50%. The Fed wrapped up its bond-buying program in March, and in June began to reduce the $9 trillion in assets held on its balance sheet, vowing to be even more aggressive than during its last round of quantitative tightening between 2017 and 2019. In developed international countries, central banks wrestled with similar issues. After holding its policy rate unchanged since March 2016, at 0.00%, the European Central Bank raised its interest rate four times over the reporting period in an effort to dampen demand and control inflation, which in October rose into double-digits. The Bank of England raised its key official bank rate eight times during the reporting period, bringing borrowing costs to a 14-year high as the Bank of England wrestled with soaring inflation. In contrast, the Bank of Japan continued to uphold its short-term interest rate target of -0.1%, unchanged since 2016, but in late December unexpectedly announced that it would widen the band around the yield target on its 10-year government bond, which pushed the yen higher and effectively marked the end of an extended period in which Japan was the only major developed country to resist raising rates. Monetary policy rates in emerging markets for the most part rose, with a few exceptions. Central banks in India, Indonesia, Brazil, Mexico, and Pakistan all raised their rates multiple times over the reporting period to counteract the impacts of inflation. In contrast, China cut its prime rate twice during the period, in part following a resurgence of COVID-19 cases and a lingering property downturn. Russia, which had raised its benchmark policy rate to 20% in late February amid the broadening fallout of Western sanctions in retaliation against Russia's invasion of Ukraine, subsequently reduced it multiple times by the end of the reporting period.

**3**Schwab VIT Balanced Portfolio \| Annual Report

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Schwab VIT Balanced Portfolio

Portfolio Management

------

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;

---

| | |
|:---|:---|
| ![](g90966img530a1cae3.jpg)<br>| &nbsp;&nbsp;&nbsp;&nbsp; **Zifan Tang, Ph.D., CFA,** Senior Portfolio Manager for Schwab Asset Management, is responsible for the <br> co-management of the fund. Prior to joining Schwab in 2012, Ms. Tang was a product manager at Thomson <br> Reuters and from 1997 to 2009 worked as a portfolio manager at Barclays Global Investors (now known as <br> BlackRock).<br>|

---

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;

---

| | |
|:---|:---|
| ![(DREW HAYES PHOTO)](g90966imgb50ebdb24.jpg)<br>| &nbsp;&nbsp;&nbsp;&nbsp; **Drew Hayes, CFA,** Portfolio Manager for Schwab Asset Management, is responsible for the co-management <br> of the fund. Mr. Hayes has been with Schwab since 2006. Before becoming a portfolio manager, he spent <br> seven years as a senior fixed income specialist for Schwab Wealth Advisory, Inc. Prior to that, he worked as a <br> bond investment specialist for two years and as a registered representative for two years for Charles <br> Schwab & Co., Inc.<br>|

---

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;

---

| | |
|:---|:---|
| ![](g90966imge43dbb895.jpg)<br>| &nbsp;&nbsp;&nbsp;&nbsp; **Patrick Kwok, CFA,** Portfolio Manager for Schwab Asset Management, is responsible for the co-management <br> of the fund. Previously, Mr. Kwok served as an associate portfolio manager from 2012 to 2016. Prior to that, he <br> worked as a fund administration manager, where he was responsible for oversight of sub-advisers, trading, <br> cash management, and fund administration supporting the Charles Schwab Trust Bank Collective Investment <br> Trusts and multi-asset Schwab Funds. Prior to joining Schwab Asset Management in 2008, Mr. Kwok spent <br> two years as an asset operations specialist at Charles Schwab Trust Company. He also worked for one year at <br> State Street Bank & Trust as a portfolio accountant and pricing specialist.<br>|

---

Schwab VIT Balanced Portfolio \| Annual Report**4**

------

Schwab VIT Balanced Portfolio as of December 31, 2022

------

**The Schwab VIT Balanced Portfolio** (the fund) seeks long-term capital appreciation and income. To pursue its goal, the fund aims to provide diversification across major asset classes, including domestic equity securities, international equity securities, real assets, fixed-income securities, and money market investments, as well as diversification across a range of sub-asset classes within the major asset classes.

The fund is considered a "fund-of-funds" in that it gains exposure to these asset classes by primarily investing in affiliated exchange-traded funds (ETFs) from Schwab Funds. The fund may also invest in affiliated mutual funds from Schwab Funds and unaffiliated third-party ETFs and mutual funds. The fund uses the internally calculated VIT Balanced Composite Index (the composite index) as a performance gauge. The components that make up the composite index may vary over time. For index definition, please see the Glossary.

**Market Highlights.** For the 12-month reporting period ended December 31, 2022, several key U.S. stock indices posted their largest calendar year drop since the 2008 recession and the Bloomberg US Aggregate Bond Index suffered its worst calendar year performance since its inception in 1976, with longer-term bonds underperforming shorter-term bonds. Inflation spiked, interest rates rose, and economic growth around the world slowed. The ongoing war between Russia and Ukraine and the continuing, albeit uneven, fallout from the COVID-19 pandemic weighed on economies and markets around the world. Oil prices peaked at over $120 per barrel in early March as sanctions were imposed on Russian imports—and again in June on supply-and-demand imbalances—but retreated through most of the rest of the reporting period, ending it at just over $80 per barrel. The U.S. dollar strengthened against a basket of international currencies over the reporting period, generally decreasing the returns on overseas investments in U.S. dollar terms. As inflation continued to rise and U.S. Federal Reserve monetary policy shifted, bond yields began to climb early in 2022, for the most part maintaining that trajectory through the first three quarters of the year, exerting downward pressure on bond prices. (Bond yields and bond prices typically move in opposite directions.)

**Performance**. For the 12-month reporting period ended December 31, 2022, the fund returned -14.71%. The Dow Jones U.S. Total Stock Market Index and the Bloomberg US Aggregate Bond Index, reflecting broad-based U.S. stock and bond market performance, returned -19.53% and -13.01%, respectively. The composite index, described above, returned -14.15%.

**Positioning and Strategies**. The fund's allocations were broadly in line with those of the composite index.

The fund's fixed-income exposure detracted the most from the total return of the fund. The Schwab U.S. Aggregate Bond ETF was the largest detractor from the total return of the fund, returning approximately -13% for the reporting period and generally tracking its comparative index component. The Schwab U.S. TIPS ETF and the Schwab Short-Term U.S. Treasury ETF also detracted from the total return of the fund, returning approximately -12% and -4%, respectively, for the reporting period and generally tracking their respective comparative index components.

The fund's U.S. equity exposure detracted from the total return of the fund. The Schwab U.S. Large-Cap ETF and the Schwab U.S. Small-Cap ETF detracted from the total return of the fund, returning approximately -19% and -20%, respectively, for the reporting period and generally tracking their respective comparative index components.

The fund's international equity exposure detracted from the total return of the fund. The Schwab International Equity ETF and the Schwab Emerging Markets Equity ETF detracted from the total return of the fund, returning approximately -15% and -18%, respectively, for the reporting period and generally tracking their respective comparative index components. The Schwab International Small-Cap Equity ETF was the smallest detractor from the total return of the fund, returning approximately -22% for the reporting period and generally tracking its comparative index component.

The fund's real estate exposure, the Schwab U.S. REIT ETF, also detracted from the total return of the fund, returning approximately -25% for the reporting period and generally tracking its comparative index component.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;

Management views and portfolio holdings may have changed since the report date.

**5**Schwab VIT Balanced Portfolio \| Annual Report

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Schwab VIT Balanced Portfolio

Performance and Fund Facts as of December 31, 2022

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**The performance data quoted represents past performance. Past performance does not guarantee future results. Investment returns and principal value will fluctuate so that an investor's shares may be worth more or less than their original cost. Current performance may be lower or higher than performance data quoted. To obtain performance information current to the most recent month end, please visit www.schwabassetmanagement.com/schwabfunds_prospectus.** 

**Performance of Hypothetical $10,000 Investment (December 31, 2012 – December 31, 2022)**<sup>1</sup>

![](g90966lg_2mq7.jpg)

**Average Annual Total Returns**<sup>1</sup>

---

| | | | |
|:---|:---|:---|:---|
| **Fund and Inception Date** | **1 Year** | **5 Years** | **10 Years** |
| Fund: Schwab VIT Balanced Portfolio (07/25/12) | -14.71% | 1.70% | &nbsp;&nbsp; 3.18% |
| S&P 500<sup>®</sup> Index | -18.11% | 9.42% | 12.56% |
| Bloomberg US Aggregate Bond Index | -13.01% | 0.02% | &nbsp;&nbsp; 1.06% |
| VIT Balanced Composite Index | -14.15% | 2.31% | &nbsp;&nbsp; 3.86% |
| Fund Category: Morningstar Allocation – 30% to 50% Equity<sup>2</sup> <br>| -14.39% | 2.28% | &nbsp;&nbsp; 4.20% |
| *Fund Expense Ratio*<sup>3</sup>*: 0.57%* | *Fund Expense Ratio*<sup>3</sup>*: 0.57%* | *Fund Expense Ratio*<sup>3</sup>*: 0.57%* | *Fund Expense Ratio*<sup>3</sup>*: 0.57%* |

---

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;

All total return figures on this page assume dividends and distributions were reinvested. Index figures do not include trading and management costs, which would lower performance. Indices are unmanaged and cannot be invested in directly. Performance results less than one year are not annualized.

The components that make up the composite index may vary over time. For index definitions, please see the Glossary.

<sup>1</sup>

Fund expenses may have been partially absorbed by the investment adviser and its affiliates. Without these reductions, the fund's returns would have been lower. Fund performance does not reflect the additional fees and expenses imposed by the insurance company under the variable insurance product contract. If those contract fees and expenses were included, the performance would be less than that shown. Please refer to the variable insurance product prospectus for a complete listing of these expenses.

<sup>2</sup>

Source for category information: Morningstar, Inc. The Morningstar Category return represents all active and index mutual funds and ETFs within the category as of the report date.

<sup>3</sup>

As stated in the prospectus. Includes 0.05% of acquired fund fees and expenses (AFFE), which are indirect expenses incurred by the fund through its investments in the underlying funds. Reflects the total annual operating expenses without contractual fee waivers. For actual expense ratios during the period, not including AFFE, refer to the Financial Highlights section of the financial statements.

Schwab VIT Balanced Portfolio \| Annual Report**6**

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Schwab VIT Balanced Portfolio

Performance and Fund Facts as of December 31, 2022 (continued)

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;

**Statistics**

---

| | |
|:---|:---|
| Number of Holdings | &nbsp;&nbsp; 10 |
| Portfolio Turnover Rate | 19% |

---

**Asset Class Weightings % of Investments**<sup>1,2</sup> <br>

![](g90966img889623286.jpg)

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;

**Top Holdings % of Net Assets**<sup>1,3</sup> <br>

![](g90966img69ef7c2e7.jpg)

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;

Portfolio holdings may have changed since the report date.

<sup>1</sup>

The fund intends to primarily invest in affiliated Schwab ETFs and may also invest in affiliated Schwab Funds and unaffiliated third-party ETFs and mutual funds (all such ETFs and mutual funds referred to as "underlying funds"). The fund may also invest directly in equity, fixed-income, or other securities or investments, as appropriate, consistent with its investment objectives, strategies, and policies.

<sup>2</sup>

The percentage may differ from the Portfolio Holdings because the above calculation is based on a percentage of total investments, whereas the calculation in the Portfolio Holdings is based on a percentage of net assets.

<sup>3</sup>

This list is not a recommendation of any security by the investment adviser.

**7**Schwab VIT Balanced Portfolio \| Annual Report

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Schwab VIT Balanced Portfolio

Fund Expenses (Unaudited)

**Examples for a $1,000 Investment**

As a fund shareholder, you may incur two types of costs: (1) transaction costs; and (2) ongoing costs, including management fees, transfer agent fees, and other fund expenses.

The expense examples below are intended to help you understand your ongoing cost (in dollars) of investing in the fund and to compare this cost with the ongoing cost of investing in other mutual funds. These examples are based on an investment of $1,000 invested for six months beginning July 1, 2022 and held through December 31, 2022.

**The Actual Return** line in the table below provides information about actual account values and actual expenses. You may use this information, together with the amount you invested, to estimate the expenses that you paid over the period. To do so, simply divide your account value by $1,000 (for example, an $8,600 account value ÷ $1,000 = 8.6), then multiply the result by the number given for the fund under the heading entitled "Expenses Paid During Period."

**The Hypothetical Return** line in the table below provides information about hypothetical account values and hypothetical expenses based on the fund's actual expense ratio and an assumed return of 5% per year before expenses. Because the return used is not an actual return, it may not be used to estimate the actual ending account value or expenses you paid for the period.

You may use this information to compare the ongoing costs of investing in the fund and other funds. To do so, compare this 5% hypothetical example with the 5% hypothetical examples that appear in the shareholder reports of the other funds.

Please note that the expenses shown in the table are meant to highlight your ongoing costs only, and do not reflect any transactional costs. Therefore, the hypothetical return lines of the table are useful in comparing ongoing costs only, and will not help you determine the relative total costs of owning different funds. In addition, if these transactional costs were included, your costs would have been higher.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;

---

| | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|
|  | &nbsp;&nbsp; EXPENSE RATIO <br>(ANNUALIZED)<sup>1,2</sup> <br>| &nbsp;&nbsp; EFFECTIVE <br>EXPENSE RATIO <br>(ANNUALIZED)<sup>3,4</sup> <br>| &nbsp;&nbsp; BEGINNING <br>ACCOUNT VALUE <br>AT 7/1/22<br>| &nbsp;&nbsp; ENDING <br>ACCOUNT VALUE <br>(NET OF EXPENSES) <br>AT 12/31/22<sup>2</sup> <br>| &nbsp;&nbsp; EXPENSES PAID <br>DURING PERIOD <br>7/1/22-12/31/22<sup>2,5</sup> <br>| &nbsp;&nbsp; EFFECTIVE <br>EXPENSES PAID <br>DURING PERIOD <br>7/1/22-12/31/22<sup>4,5</sup> <br>|
| **Schwab VIT Balanced Portfolio** |  |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; Actual Return | 0.53% | 0.58% | $1000.00 | $991.20 | $2.66 | $2.91 |
| &nbsp;&nbsp;&nbsp;&nbsp; Hypothetical 5% Return | 0.53% | 0.58% | $1000.00 | $1022.53 | $2.70 | $2.96 |

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;

<sup>1</sup> Based on the most recent six-month expense ratio; may differ from the expense ratio provided in the Financial Highlights.

<sup>2</sup> Excludes acquired fund fees and expenses, which are indirect expenses incurred by the fund through its investments in underlying funds.

<sup>3</sup> Based on the most recent six-month acquired fund fees and expenses and the expense ratio; may differ from the acquired fund fees and expenses and the expense ratio in the prospectus. 

<sup>4</sup> Includes acquired fund fees and expenses, which are indirect expenses incurred by the fund through its investments in underlying funds.

<sup>5</sup> Expenses for the fund are equal to its annualized expense ratio, multiplied by the average account value over the period, multiplied by 184 days in the period, and divided by 365 days in the fiscal year. 

Schwab VIT Balanced Portfolio \| Annual Report**8**

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Schwab VIT Balanced Portfolio

Financial Statements

**FINANCIAL HIGHLIGHTS**

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| | | | | | |
|:---|:---|:---|:---|:---|:---|
|  | 1/1/22– <br>12/31/22<br>| 1/1/21– <br>12/31/21<br>| 1/1/20– <br>12/31/20<br>| 1/1/19– <br>12/31/19<br>| 1/1/18– <br>12/31/18<br>|
| **Per-Share Data** | **Per-Share Data** | **Per-Share Data** | **Per-Share Data** | **Per-Share Data** | **Per-Share Data** |
| Net asset value at beginning of period | &nbsp;&nbsp; $14.99 | &nbsp;&nbsp; $14.04 | &nbsp;&nbsp; $13.25 | &nbsp;&nbsp; $11.82 | &nbsp;&nbsp; $12.58 |
| Income (loss) from investment operations: |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; Net investment income (loss)<sup>1</sup> <br>| &nbsp;&nbsp;&nbsp;&nbsp; 0.22 | &nbsp;&nbsp;&nbsp;&nbsp; 0.21 | &nbsp;&nbsp;&nbsp;&nbsp; 0.20 | &nbsp;&nbsp;&nbsp;&nbsp; 0.25 | &nbsp;&nbsp;&nbsp;&nbsp; 0.23 |
| &nbsp;&nbsp;&nbsp;&nbsp; Net realized and unrealized gains (losses) | &nbsp;&nbsp;&nbsp;&nbsp; (2.42) | &nbsp;&nbsp;&nbsp;&nbsp; 0.93 | &nbsp;&nbsp;&nbsp;&nbsp; 0.86 | &nbsp;&nbsp;&nbsp;&nbsp; 1.42 | &nbsp;&nbsp;&nbsp;&nbsp; (0.80) |
| &nbsp;&nbsp;&nbsp;&nbsp; Total from investment operations | &nbsp;&nbsp;&nbsp;&nbsp; (2.20) | &nbsp;&nbsp;&nbsp;&nbsp; 1.14 | &nbsp;&nbsp;&nbsp;&nbsp; 1.06 | &nbsp;&nbsp;&nbsp;&nbsp; 1.67 | &nbsp;&nbsp;&nbsp;&nbsp; (0.57) |
| Less distributions: |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; Distributions from net investment income | &nbsp;&nbsp;&nbsp;&nbsp; (0.21) | &nbsp;&nbsp;&nbsp;&nbsp; (0.19) | &nbsp;&nbsp;&nbsp;&nbsp; (0.24) | &nbsp;&nbsp;&nbsp;&nbsp; (0.22) | &nbsp;&nbsp;&nbsp;&nbsp; (0.17) |
| &nbsp;&nbsp;&nbsp;&nbsp; Distributions from net realized gains | &nbsp;&nbsp;&nbsp;&nbsp; (0.25) | &nbsp;&nbsp;&nbsp;&nbsp; (0.00)<sup>2</sup> <br>| &nbsp;&nbsp;&nbsp;&nbsp; (0.03) | &nbsp;&nbsp;&nbsp;&nbsp; (0.02) | &nbsp;&nbsp;&nbsp;&nbsp; (0.02) |
| &nbsp;&nbsp;&nbsp;&nbsp; Total distributions | &nbsp;&nbsp;&nbsp;&nbsp; (0.46) | &nbsp;&nbsp;&nbsp;&nbsp; (0.19) | &nbsp;&nbsp;&nbsp;&nbsp; (0.27) | &nbsp;&nbsp;&nbsp;&nbsp; (0.24) | &nbsp;&nbsp;&nbsp;&nbsp; (0.19) |
| Net asset value at end of period | &nbsp;&nbsp; $12.33 | &nbsp;&nbsp; $14.99 | &nbsp;&nbsp; $14.04 | &nbsp;&nbsp; $13.25 | &nbsp;&nbsp; $11.82 |
| Total return | &nbsp;&nbsp; (14.71%) | &nbsp;&nbsp;&nbsp;&nbsp; 8.19% | &nbsp;&nbsp;&nbsp;&nbsp; 8.23% | &nbsp;&nbsp;&nbsp; 14.24% | &nbsp;&nbsp;&nbsp;&nbsp; (4.63%) |
| **Ratios/Supplemental Data** | **Ratios/Supplemental Data** | **Ratios/Supplemental Data** | **Ratios/Supplemental Data** | **Ratios/Supplemental Data** | **Ratios/Supplemental Data** |
| Ratios to average net assets: |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; Net operating expenses<sup>3</sup> <br>| &nbsp;&nbsp;&nbsp;&nbsp; 0.53%<sup>4</sup> <br>| &nbsp;&nbsp;&nbsp;&nbsp; 0.52% | &nbsp;&nbsp;&nbsp;&nbsp; 0.54% | &nbsp;&nbsp;&nbsp;&nbsp; 0.56% | &nbsp;&nbsp;&nbsp;&nbsp; 0.55% |
| &nbsp;&nbsp;&nbsp;&nbsp; Gross operating expenses<sup>3</sup> <br>| &nbsp;&nbsp;&nbsp;&nbsp; 0.53%<sup>4</sup> <br>| &nbsp;&nbsp;&nbsp;&nbsp; 0.52% | &nbsp;&nbsp;&nbsp;&nbsp; 0.54% | &nbsp;&nbsp;&nbsp;&nbsp; 0.56% | &nbsp;&nbsp;&nbsp;&nbsp; 0.55% |
| &nbsp;&nbsp;&nbsp;&nbsp; Net investment income (loss) | &nbsp;&nbsp;&nbsp;&nbsp; 1.70% | &nbsp;&nbsp;&nbsp;&nbsp; 1.42% | &nbsp;&nbsp;&nbsp;&nbsp; 1.53% | &nbsp;&nbsp;&nbsp;&nbsp; 1.97% | &nbsp;&nbsp;&nbsp;&nbsp; 1.87% |
| Portfolio turnover rate | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 19% | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 13% | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 38% | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 15% | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 9% |
| Net assets, end of period (x 1,000) | $74061 | $92777 | $83577 | $75883 | $66475 |

---

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;

<sup>1</sup> Calculated based on the average shares outstanding during the period.

<sup>2</sup> Per-share amount was less than $0.005.

<sup>3</sup> Ratio excludes acquired fund fees and expenses, which are indirect expenses incurred by the fund through its investments in underlying funds.

<sup>4</sup> Ratio includes less than 0.005% of non-routine proxy expenses.

*See financial notes*

**9**Schwab VIT Balanced Portfolio \| Annual Report

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Schwab VIT Balanced Portfolio

Portfolio Holdings as of December 31, 2022

------

This section shows all the securities in the fund's portfolio and their values as of the report date, including a summary of the fund's transactions with its affiliated underlying funds during the period.

The fund files its complete schedule of portfolio holdings with the U.S. Securities and Exchange Commission (SEC) for the first and third quarters of each fiscal year on Form N-PORT Part F. The fund's Form N-PORT Part F is available on the SEC's website at www.sec.gov. The fund also makes available its complete schedule of portfolio holdings on the fund's website at www.schwabassetmanagement.com/schwabfunds_prospectus, typically 60-80 days after the end of the fund's fiscal quarter.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;

---

| | | | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|:---|:---|
| SECURITY | VALUE AT<br> 12/31/21<br>| PURCHASES | SALES | REALIZED<br> GAINS (LOSSES)<br>| NET CHANGE IN<br> UNREALIZED<br> APPRECIATION<br> (DEPRECIATION)<br>| VALUE AT<br> 12/31/22<br>| BALANCE<br> OF SHARES<br> HELD AT<br> 12/31/22<br>| DISTRIBUTIONS<br> RECEIVED<sup>(a)</sup> <br>|
| **AFFILIATED UNDERLYING FUNDS** 99.7% OF NET ASSETS | **AFFILIATED UNDERLYING FUNDS** 99.7% OF NET ASSETS | **AFFILIATED UNDERLYING FUNDS** 99.7% OF NET ASSETS | **AFFILIATED UNDERLYING FUNDS** 99.7% OF NET ASSETS | **AFFILIATED UNDERLYING FUNDS** 99.7% OF NET ASSETS | **AFFILIATED UNDERLYING FUNDS** 99.7% OF NET ASSETS | **AFFILIATED UNDERLYING FUNDS** 99.7% OF NET ASSETS | **AFFILIATED UNDERLYING FUNDS** 99.7% OF NET ASSETS | **AFFILIATED UNDERLYING FUNDS** 99.7% OF NET ASSETS |
| **U.S. Stocks 23.0%** | **U.S. Stocks 23.0%** | **U.S. Stocks 23.0%** | **U.S. Stocks 23.0%** | **U.S. Stocks 23.0%** | **U.S. Stocks 23.0%** | **U.S. Stocks 23.0%** | **U.S. Stocks 23.0%** | **U.S. Stocks 23.0%** |
| **Large-Cap 19.0%** | **Large-Cap 19.0%** | **Large-Cap 19.0%** | **Large-Cap 19.0%** | **Large-Cap 19.0%** | **Large-Cap 19.0%** | **Large-Cap 19.0%** | **Large-Cap 19.0%** | **Large-Cap 19.0%** |
| Schwab U.S. Large-Cap ETF  | $17744083 | &nbsp;&nbsp; $3744631 | &nbsp;&nbsp; ($3835442) | &nbsp;&nbsp; $205487 | &nbsp;&nbsp; ($3778867) | $14079892 | &nbsp;&nbsp; 311847 | &nbsp;&nbsp;&nbsp; $231671 |
| **Small-Cap 4.0%** | **Small-Cap 4.0%** | **Small-Cap 4.0%** | **Small-Cap 4.0%** | **Small-Cap 4.0%** | **Small-Cap 4.0%** | **Small-Cap 4.0%** | **Small-Cap 4.0%** | **Small-Cap 4.0%** |
| Schwab U.S. Small-Cap ETF  | &nbsp;&nbsp;&nbsp;&nbsp; 3732787 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 751669 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (751128) | &nbsp;&nbsp;&nbsp;&nbsp; (52979) | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (714895) | &nbsp;&nbsp;&nbsp;&nbsp; 2965454 | &nbsp;&nbsp;&nbsp;&nbsp; 73203 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 40988 |
|  |  |  |  |  |  | &nbsp;&nbsp; 17045346 |  |  |
| **International Stocks 18.1%** | **International Stocks 18.1%** | **International Stocks 18.1%** | **International Stocks 18.1%** | **International Stocks 18.1%** | **International Stocks 18.1%** | **International Stocks 18.1%** | **International Stocks 18.1%** | **International Stocks 18.1%** |
| **Developed Markets 13.1%** | **Developed Markets 13.1%** | **Developed Markets 13.1%** | **Developed Markets 13.1%** | **Developed Markets 13.1%** | **Developed Markets 13.1%** | **Developed Markets 13.1%** | **Developed Markets 13.1%** | **Developed Markets 13.1%** |
| Schwab International Equity ETF  | &nbsp;&nbsp; 10229845 | &nbsp;&nbsp;&nbsp;&nbsp; 1891515 | &nbsp;&nbsp;&nbsp;&nbsp; (2285041) | &nbsp;&nbsp;&nbsp;&nbsp; (99640) | &nbsp;&nbsp;&nbsp;&nbsp; (1561491) | &nbsp;&nbsp;&nbsp;&nbsp; 8175188 | &nbsp;&nbsp; 253809 | &nbsp;&nbsp;&nbsp;&nbsp; 230404 |
| Schwab International Small-Cap Equity ETF  | &nbsp;&nbsp;&nbsp;&nbsp; 1865262 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 357437 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (298177) | &nbsp;&nbsp;&nbsp;&nbsp; (31304) | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (389991) | &nbsp;&nbsp;&nbsp;&nbsp; 1503227 | &nbsp;&nbsp;&nbsp;&nbsp; 47767 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 26774 |
|  |  |  |  |  |  | &nbsp;&nbsp;&nbsp;&nbsp; 9678415 |  |  |
| **Emerging Markets 5.0%** | **Emerging Markets 5.0%** | **Emerging Markets 5.0%** | **Emerging Markets 5.0%** | **Emerging Markets 5.0%** | **Emerging Markets 5.0%** | **Emerging Markets 5.0%** | **Emerging Markets 5.0%** | **Emerging Markets 5.0%** |
| Schwab Emerging Markets Equity ETF  | &nbsp;&nbsp;&nbsp;&nbsp; 4572025 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 729903 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (684116) | &nbsp;&nbsp;&nbsp;&nbsp; (92555) | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (800498) | &nbsp;&nbsp;&nbsp;&nbsp; 3724759 | &nbsp;&nbsp; 157362 | &nbsp;&nbsp;&nbsp;&nbsp; 106924 |
|  |  |  |  |  |  | &nbsp;&nbsp; 13403174 |  |  |
| **Real Estate 6.0%** | **Real Estate 6.0%** | **Real Estate 6.0%** | **Real Estate 6.0%** | **Real Estate 6.0%** | **Real Estate 6.0%** | **Real Estate 6.0%** | **Real Estate 6.0%** | **Real Estate 6.0%** |
| **U.S. REITs 6.0%** | **U.S. REITs 6.0%** | **U.S. REITs 6.0%** | **U.S. REITs 6.0%** | **U.S. REITs 6.0%** | **U.S. REITs 6.0%** | **U.S. REITs 6.0%** | **U.S. REITs 6.0%** | **U.S. REITs 6.0%** |
| Schwab U.S. REIT ETF  | &nbsp;&nbsp;&nbsp;&nbsp; 5680561 | &nbsp;&nbsp;&nbsp;&nbsp; 1141689 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (930713) | &nbsp;&nbsp;&nbsp;&nbsp; 84925 | &nbsp;&nbsp;&nbsp;&nbsp; (1529230) | &nbsp;&nbsp;&nbsp;&nbsp; 4447232 | &nbsp;&nbsp; 230546 | &nbsp;&nbsp;&nbsp;&nbsp; 107951 |
| **Fixed Income 49.3%** | **Fixed Income 49.3%** | **Fixed Income 49.3%** | **Fixed Income 49.3%** | **Fixed Income 49.3%** | **Fixed Income 49.3%** | **Fixed Income 49.3%** | **Fixed Income 49.3%** | **Fixed Income 49.3%** |
| **Inflation-Protected Bond 3.7%** | **Inflation-Protected Bond 3.7%** | **Inflation-Protected Bond 3.7%** | **Inflation-Protected Bond 3.7%** | **Inflation-Protected Bond 3.7%** | **Inflation-Protected Bond 3.7%** | **Inflation-Protected Bond 3.7%** | **Inflation-Protected Bond 3.7%** | **Inflation-Protected Bond 3.7%** |
| Schwab U.S. TIPS ETF  | &nbsp;&nbsp;&nbsp;&nbsp; 3402978 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 340712 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (399249) | &nbsp;&nbsp;&nbsp;&nbsp; (21186) | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (562227) | &nbsp;&nbsp;&nbsp;&nbsp; 2761028 | &nbsp;&nbsp;&nbsp;&nbsp; 53312 | &nbsp;&nbsp;&nbsp;&nbsp; 195534 |
| **Intermediate-Term Bond 36.5%** | **Intermediate-Term Bond 36.5%** | **Intermediate-Term Bond 36.5%** | **Intermediate-Term Bond 36.5%** | **Intermediate-Term Bond 36.5%** | **Intermediate-Term Bond 36.5%** | **Intermediate-Term Bond 36.5%** | **Intermediate-Term Bond 36.5%** | **Intermediate-Term Bond 36.5%** |
| Schwab U.S. Aggregate Bond ETF  | &nbsp;&nbsp; 33519116 | &nbsp;&nbsp;&nbsp;&nbsp; 5121147 | &nbsp;&nbsp;&nbsp;&nbsp; (6554560) | &nbsp;&nbsp; (691165) | &nbsp;&nbsp;&nbsp;&nbsp; (4380694) | &nbsp;&nbsp; 27013844 | &nbsp;&nbsp; 591760 | &nbsp;&nbsp;&nbsp;&nbsp; 729207 |
| **Treasury Bond 9.1%** | **Treasury Bond 9.1%** | **Treasury Bond 9.1%** | **Treasury Bond 9.1%** | **Treasury Bond 9.1%** | **Treasury Bond 9.1%** | **Treasury Bond 9.1%** | **Treasury Bond 9.1%** | **Treasury Bond 9.1%** |
| Schwab Short-Term U.S. Treasury ETF  | &nbsp;&nbsp;&nbsp;&nbsp; 8325874 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 998201 | &nbsp;&nbsp;&nbsp;&nbsp; (2193190) | &nbsp;&nbsp;&nbsp;&nbsp; (87003) | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (318454) | &nbsp;&nbsp;&nbsp;&nbsp; 6725428 | &nbsp;&nbsp; 139416 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 93368 |
|  |  |  |  |  |  | &nbsp;&nbsp; 36500300 |  |  |
| **Money Market Funds 3.3%** | **Money Market Funds 3.3%** | **Money Market Funds 3.3%** | **Money Market Funds 3.3%** | **Money Market Funds 3.3%** | **Money Market Funds 3.3%** | **Money Market Funds 3.3%** | **Money Market Funds 3.3%** | **Money Market Funds 3.3%** |
| &nbsp;&nbsp;&nbsp;&nbsp; Schwab Variable Share Price Money Fund, <br> Ultra Shares, 4.42% <sup>(b)</sup> <br>| &nbsp;&nbsp;&nbsp;&nbsp; 2403051 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 40108 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; — | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; — | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 5 | &nbsp;&nbsp;&nbsp;&nbsp; 2443164 | 2442431 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 40318 |
| **Total Affiliated Underlying Funds** <br>**(Cost $68,305,196)**<br>| **$91475582** | **$15117012** | **($17931616)** | **($785420)** | **($14036342)** | **$73839216** |  | **$1803139** |
| **Total Investments in Securities** <br>**(Cost $68,305,196)**<br>|  |  |  |  |  | **$73839216** |  |  |

---

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;

<sup>(a)</sup> Distributions received include distributions from net investment income and capital gains, if any, from the underlying funds. Amounts shown are only presented for affiliated underlying funds, which are presented in the corresponding line-item in the Statement of Operations, if applicable (see financial note 2(d) for additional information). 

<sup>(b)</sup> The rate shown is the annualized 7-day yield.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;

*See financial notes*

Schwab VIT Balanced Portfolio \| Annual Report**10**

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Schwab VIT Balanced Portfolio

Portfolio Holdings as of December 31, 2022 (continued)

------

ETF — Exchange traded fund <br> REIT — Real Estate Investment Trust <br> TIPS — Treasury Inflation Protected Securities

At December 31, 2022, all of the fund's investment securities were classified as Level 1. Fund investments in underlying mutual funds and ETFs are classified as Level 1, without consideration to the classification level of the investments held by the underlying

mutual funds and ETFs, which could be Level 1, Level 2 or Level 3 (see financial note 2(a) for additional information).

*See financial notes*

**11**Schwab VIT Balanced Portfolio \| Annual Report

------

Schwab VIT Balanced Portfolio

Statement of Assets and Liabilities

------

As of December 31, 2022

---

| | | |
|:---|:---|:---|
| **Assets** | **Assets** | **Assets** |
| Investments in securities, at value - affiliated (cost $68,305,196) |  | $73839216 |
| Cash |  | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 478942 |
| Receivables: |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; Investments sold |  | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 580346 |
| &nbsp;&nbsp;&nbsp;&nbsp; Dividends |  | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 13319 |
| Prepaid expenses | + | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 186 |
| **Total assets** |  | **74912009** |
| **Liabilities** | **Liabilities** | **Liabilities** |
| Payables: |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; Investments bought |  | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 587334 |
| &nbsp;&nbsp;&nbsp;&nbsp; Fund shares redeemed |  | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 198588 |
| &nbsp;&nbsp;&nbsp;&nbsp; Investment adviser and administrator fees |  | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 30995 |
| &nbsp;&nbsp;&nbsp;&nbsp; Independent trustees' fees |  | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 31 |
| Accrued expenses | + | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 34286 |
| **Total liabilities** |  | **851234** |
| **Net assets** |  | **$74060775** |
| **Net Assets by Source** | **Net Assets by Source** | **Net Assets by Source** |
| Capital received from investors |  | $68607557 |
| Total distributable earnings | + | &nbsp;&nbsp;&nbsp;&nbsp; 5453218 |
| **Net assets** |  | **$74060775** |

---

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;

---

| | | | | |
|:---|:---|:---|:---|:---|
| **Net Asset Value (NAV)**  | **Net Asset Value (NAV)**  | **Net Asset Value (NAV)**  | **Net Asset Value (NAV)**  | **Net Asset Value (NAV)**  |
| **Net Assets**  | **÷** | &nbsp;&nbsp;&nbsp;&nbsp; **Shares**<br> **Outstanding**<br>| **=** | **NAV** |
| $74060775 |  | 6005552 |  | $12.33 |

---

*See financial notes*

Schwab VIT Balanced Portfolio \| Annual Report**12**

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Schwab VIT Balanced Portfolio

Statement of Operations

------

---

| | | |
|:---|:---|:---|
| For the period January 1, 2022 through December 31, 2022 | For the period January 1, 2022 through December 31, 2022 | For the period January 1, 2022 through December 31, 2022 |
| **Investment Income**  | **Investment Income**  | **Investment Income**  |
| Dividends received from securities - affiliated |  | &nbsp;&nbsp;&nbsp; $1803139 |
| Interest received from securities - unaffiliated | + | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 4287 |
| **Total investment income**  |  | **1807426** |
| **Expenses** | **Expenses** | **Expenses** |
| Investment adviser and administrator fees |  | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 365137 |
| Professional fees |  | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 22114 |
| Portfolio accounting fees |  | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 12146 |
| Independent trustees' fees |  | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 11637 |
| Shareholder reports |  | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 10075 |
| Custodian fees |  | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 1855 |
| Proxy fees<sup>1</sup> <br>|  | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 1671 |
| Transfer agent fees  |  | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 637 |
| Other expenses | + | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 3278 |
| **Total expenses** | – | **428550** |
| **Net investment income** |  | **1378876** |
| **REALIZED AND UNREALIZED GAINS (LOSSES)** | **REALIZED AND UNREALIZED GAINS (LOSSES)** | **REALIZED AND UNREALIZED GAINS (LOSSES)** |
| **Net realized losses on sales of securities - affiliated** |  | **(785420)** |
| **Net change in unrealized appreciation (depreciation) on securities - affiliated** | + | **(14036342)** |
| **Net realized and unrealized losses** |  | **(14821762)** |
| **Decrease in net assets resulting from operations** |  | **($13442886)** |

---

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;

<sup>1</sup> Proxy fees are non-routine expenses (see financial note 4 for additional information).

*See financial notes*

**13**Schwab VIT Balanced Portfolio \| Annual Report

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Schwab VIT Balanced Portfolio

Statement of Changes in Net Assets

------

For the current and prior report periods

---

| | | | |
|:---|:---|:---|:---|
| **OPERATIONS** | **OPERATIONS** | **OPERATIONS** | **OPERATIONS** |
|  | 1/1/22-12/31/22 | 1/1/22-12/31/22 | 1/1/21-12/31/21 |
| Net investment income |  | &nbsp;&nbsp;&nbsp; $1378876 | &nbsp;&nbsp; $1257633 |
| Net realized gains (losses) |  | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (785420) | &nbsp;&nbsp;&nbsp; 1491073 |
| Net change in unrealized appreciation (depreciation) | + | &nbsp;&nbsp; (14036342) | &nbsp;&nbsp;&nbsp; 4105072 |
| **Increase (decrease) in net assets resulting from operations** |  | **($13442886)** | **$6853778** |
| **DISTRIBUTIONS TO SHAREHOLDERS** | **DISTRIBUTIONS TO SHAREHOLDERS** | **DISTRIBUTIONS TO SHAREHOLDERS** | **DISTRIBUTIONS TO SHAREHOLDERS** |
| **Total distributions** |  | **($2780278)** | **($1172672)** |

---

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;

---

| | | | | | |
|:---|:---|:---|:---|:---|:---|
| **TRANSACTIONS IN FUND SHARES** | **TRANSACTIONS IN FUND SHARES** | **TRANSACTIONS IN FUND SHARES** | **TRANSACTIONS IN FUND SHARES** | **TRANSACTIONS IN FUND SHARES** | **TRANSACTIONS IN FUND SHARES** |
|  | 1/1/22-12/31/22 | 1/1/22-12/31/22 | 1/1/22-12/31/22 | 1/1/21-12/31/21 | 1/1/21-12/31/21 |
|  |  | SHARES | VALUE | SHARES | VALUE |
| Shares sold |  | &nbsp;&nbsp;&nbsp; 799054 | $10814402 | 1041182 | $15151379 |
| Shares reinvested |  | &nbsp;&nbsp;&nbsp; 223495 | &nbsp;&nbsp;&nbsp;&nbsp; 2780278 | &nbsp;&nbsp;&nbsp;&nbsp; 80101 | &nbsp;&nbsp;&nbsp;&nbsp; 1172672 |
| Shares redeemed | + | (1206933) | &nbsp;&nbsp; (16087896) | &nbsp;&nbsp; (883201) | &nbsp;&nbsp; (12804877) |
| **Net transactions in fund shares**  |  | **(184384)** | **($2493216)** | **238082** | **$3519174** |
| **SHARES OUTSTANDING AND NET ASSETS** | **SHARES OUTSTANDING AND NET ASSETS** | **SHARES OUTSTANDING AND NET ASSETS** | **SHARES OUTSTANDING AND NET ASSETS** | **SHARES OUTSTANDING AND NET ASSETS** | **SHARES OUTSTANDING AND NET ASSETS** |
|  | 1/1/22-12/31/22 | 1/1/22-12/31/22 | 1/1/22-12/31/22 | 1/1/21-12/31/21 | 1/1/21-12/31/21 |
|  |  | SHARES | NET ASSETS | SHARES | NET ASSETS |
| Beginning of period |  | 6189936 | $92777155 | 5951854 | $83576875 |
| Total increase (decrease) | + | &nbsp;&nbsp; (184384) | &nbsp;&nbsp; (18716380) | &nbsp;&nbsp;&nbsp; 238082 | &nbsp;&nbsp;&nbsp;&nbsp; 9200280 |
| **End of period** |  | **6005552** | **$74060775** | **6189936** | **$92777155** |

---

*See financial notes*

Schwab VIT Balanced Portfolio \| Annual Report**14**

------

Schwab VIT Balanced Portfolio

Financial Notes

------

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**1. Business Structure of the Fund:**

Schwab VIT Balanced Portfolio (the fund) is a series of Schwab Annuity Portfolios (the trust), a no-load, open-end management investment company. The trust is organized as a Massachusetts business trust and is registered under the Investment Company Act of 1940, as amended (the 1940 Act). The list below shows all the funds in the trust as of the end of the period, including the fund discussed in this report, which is highlighted:

---

| |
|:---|
| **SCHWAB ANNUITY PORTFOLIOS (ORGANIZED JANUARY 21, 1994)** |
| Schwab Government Money Market Portfolio |
| Schwab S&P 500 Index Portfolio |
| **Schwab VIT Balanced Portfolio** |
| Schwab VIT Balanced with Growth Portfolio |
| Schwab VIT Growth Portfolio |

---

The fund is a "fund of funds" which primarily invests in affiliated Schwab Exchange-Traded Funds (ETFs). The fund may also invest in affiliated mutual funds from Schwab Funds and unaffiliated third-party ETFs and mutual funds (all such ETFs and mutual funds referred to as "underlying funds"). The fund may also invest directly in equity or fixed-income securities, including bonds, cash equivalents, money market funds and money market investments, to achieve its investment objectives.

The fund in this report offers one share class. Shares are bought and sold at closing net asset value per share (NAV), which is the price for all outstanding shares of the fund. Each share has a par value of 1/1,000 of a cent, and the fund's Board of Trustees (the Board) may authorize the issuance of as many shares as necessary.

The fund is available exclusively as an investment vehicle for variable annuity and variable life insurance contracts offered by separate accounts of participating life insurance companies, and in the future may be offered to pension and retirement plans qualified under the Internal Revenue Code of 1986, as amended. At December 31, 2022, 100% of the fund's shares were held through separate accounts of five insurance companies. Subscriptions and redemptions of these insurance separate accounts could have a material impact on the fund.

The fund maintains its own account for purposes of holding assets and accounting, and is considered a separate entity for tax purposes. Within its account, the fund may also keep certain assets in segregated accounts, as required by securities law.

------

<br>**2. Significant Accounting Policies:**

The following is a summary of the significant accounting policies the fund uses in its preparation of financial statements. The fund follows the investment company accounting and reporting guidance of the Financial Accounting Standards Board (FASB) Accounting Standard Codification *Topic 946 Financial Services — Investment Companies*. The accounting policies are in conformity with accounting principles generally accepted in the United States of America (GAAP).

The financial statements of the fund should be read in conjunction with the underlying funds' financial statements. For more information about the underlying funds' operations and policies, please refer to those funds' semiannual and annual reports, which are filed with the U.S. Securities and Exchange Commission (SEC) and are available on the SEC's website at www.sec.gov.

**(a) Security Valuation:**

Pursuant to Rule 2a-5 under the 1940 Act, the Board has designated authority to a Valuation Designee, the fund's investment adviser, to make fair valuation determinations under adopted procedures, subject to Board oversight. The investment adviser has formed a Pricing Committee to administer the pricing and valuation of portfolio securities and other assets and liabilities and to ensure that prices used for internal purposes or provided by third parties reasonably reflect fair value. The Valuation Designee may utilize independent pricing services, quotations from securities and financial instrument dealers and other market sources to determine fair value.

Securities held in the fund's portfolio are valued every business day. The following valuation policies and procedures are used by the Valuation Designee to value various types of securities:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• **Securities traded on an exchange or over-the-counter:** Traded securities are valued at the closing value for the day, or, on days when no closing value has been reported, at the mean of the most recent bid and ask quotes.

• **Mutual funds:** Mutual funds are valued at their respective NAVs.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• **Cash management sweep time deposits:** Balances held in cash management sweep time deposits are accounted for on a cost basis, which approximates fair value.

**15**Schwab VIT Balanced Portfolio \| Annual Report

------

Schwab VIT Balanced Portfolio

Financial Notes (continued)

------

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;

**2. Significant Accounting Policies (continued):** 

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• **Securities for which no quoted value is available:** The Valuation Designee has adopted procedures to fair value the fund's securities when market prices are not "readily available" or are unreliable. For example, a security may be fair valued when it's de-listed or its trading is halted or suspended; when a security's primary pricing source is unable or unwilling to provide a price; or when a security's primary trading market is closed during regular market hours. Fair value determinations are made in good faith in accordance with adopted valuation procedures. The Valuation Designee considers a number of factors, including unobservable market inputs, when arriving at fair value. The Valuation Designee may employ methods such as the review of related or comparable assets or liabilities, related market activities, recent transactions, market multiples, book values, transactional back-testing, disposition analysis and other relevant information. Due to the subjective and variable nature of fair value pricing, there can be no assurance that the fund could obtain the fair value assigned to the security upon the sale of such security.

In accordance with the authoritative guidance on fair value measurements and disclosures under GAAP, the fund discloses the fair value of its investments in a hierarchy that prioritizes the significant inputs to valuation methods used to measure the fair value. The hierarchy gives the highest priority to valuations based upon unadjusted quoted prices in active markets for identical assets or liabilities (Level 1 measurements) and the lowest priority to valuations based upon unobservable inputs that are significant to the valuation (Level 3 measurements). If inputs used to measure the financial instruments fall within different levels of the hierarchy, the categorization is based on the lowest level input that is significant to the valuation. If it is determined that either the volume and/or level of activity for an asset or liability has significantly decreased (from normal conditions for that asset or liability) or price quotations or observable inputs are not associated with orderly transactions, increased analysis and the Valuation Designee's judgment will be required to estimate fair value.

The three levels of the fair value hierarchy are as follows:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• Level 1 — quoted prices in active markets for identical investments — Investments whose values are based on quoted market prices in active markets, and whose values are therefore classified as Level 1 prices, include active listed equities and underlying funds. Underlying funds are classified as Level 1 prices, without consideration to the classification level of the underlying securities held.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• Level 2 — other significant observable inputs (including quoted prices for similar securities, interest rates, prepayment speeds, credit risk, etc.) — Investments that trade in markets that are not considered to be active, but whose values are based on quoted market prices, dealer quotations or valuations provided by alternative pricing sources supported by observable inputs are classified as Level 2 prices. These generally include U.S. government and sovereign obligations, most government agency securities, investment-grade corporate bonds, certain mortgage products, less liquid listed equities, and state, municipal and provincial obligations.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• Level 3 — significant unobservable inputs (including the Valuation Designee's assumptions in determining the fair value of investments) — Investments whose values are classified as Level 3 prices have significant unobservable inputs, as they may trade infrequently or not at all. When observable prices are not readily available for these securities, one or more valuation methods are used for which sufficient and reliable data is available. The inputs used in estimating the value of Level 3 prices may include the original transaction price, quoted prices for similar securities or assets in active markets, completed or pending third-party transactions in the underlying investment or comparable issuers, and changes in financial ratios or cash flows. Level 3 prices may also be adjusted to reflect illiquidity and/or non-transferability, with the amount of such discount estimated in the absence of market information. Assumptions used due to the lack of observable inputs may significantly impact the resulting fair value and therefore the fund's results of operations.

The inputs or methodology used for valuing securities are not necessarily an indication of the risk associated with investing in those securities.

The levels associated with valuing the fund's investments as of December 31, 2022 are disclosed in the Portfolio Holdings.

**(b) Accounting Policies for certain Portfolio Investments (if held):**

**Securities Lending:** Under the trust's Securities Lending Program, a fund (lender) may make short-term loans of its securities to another party (borrower) to generate additional revenue for the fund. The borrower pledges collateral in the form of cash, securities issued or fully guaranteed by the U.S. government or foreign governments, or letters of credit issued by a bank. Collateral at the individual loan level is required to be maintained on a daily marked-to-market basis in an amount at least equal to the current value of the securities loaned. The lending agent provides the fund with indemnification against borrower default (the borrower fails to return the security on loan) reducing the risk of loss as a result of default. The cash collateral of securities loaned is currently invested in money market portfolios operating pursuant to Rule 2a-7 under the 1940 Act. The fund bears the risk of loss with

Schwab VIT Balanced Portfolio \| Annual Report**16**

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Schwab VIT Balanced Portfolio

Financial Notes (continued)

------

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;

**2. Significant Accounting Policies (continued):** 

respect to the investment of cash collateral. The terms of the securities lending agreement allow the fund or the lending agent to terminate any loan at any given time and the securities must be returned within the earlier of the standard trade settlement period or the specified time period under the relevant securities lending agreement. Securities lending income, as disclosed in the fund's Statement of Operations, if applicable, represents the income earned from the investment of the cash collateral plus any fees paid by borrowers, less the fees paid to the lending agent and broker rebates which are subject to adjustments pursuant to the securities lending agreement. On loans not collateralized by cash, a fee is received from the borrower, and is allocated between the fund and the lending agent. The aggregate fair value of securities loaned will not at any time exceed one-third of the total assets of the fund, including collateral received from the loan. Securities lending fees paid to the unaffiliated lending agents start at 9% of gross lending revenue, with subsequent breakpoints to a low of 5%. In this context, the gross lending revenue equals the income received from the investment of cash collateral and fees paid by borrowers less any rebates paid to the borrowers. Any expenses charged by the cash collateral fund are in addition to these fees. All remaining revenue is retained by the fund, as applicable. No portion of lending revenue is paid to or retained by the investment adviser or any of its affiliates.

As of December 31, 2022, the fund had no securities on loan.

**Cash Management Transactions:** Effective May 23, 2022 Brown Brothers Harriman & Co. (BBH) was replaced by Citibank, N.A as custodian of the fund. The fund no longer subscribes to the BBH Cash Management Service Sweep (CMS Sweep). The BBH CMS Sweep was an investment product that automatically swept the fund's cash balances into overnight offshore time deposits with either the BBH Grand Cayman branch or a branch of a pre-approved commercial bank. This fully automated program allowed the fund to earn interest on cash balances. Excess cash invested with deposit institutions domiciled outside of the U.S., as with any offshore deposit, was subject to sovereign actions in the jurisdiction of the deposit institution including, but not limited to, freeze, seizure or diminution. The fund assumed the risk associated with the repayment of principal and payment of interest on such instruments by the institution with which the deposit was ultimately placed. The fund terminated the CMS Sweep program and cash was returned to the fund prior to terminating services with BBH.

**Cash Investments:** The fund may invest a portion of its assets in cash. Cash includes cash bank balances in an interest-bearing demand deposit account with maturity on demand by the fund.

**(c) Security Transactions:** 

Security transactions are recorded as of the date the order to buy or sell the security is executed. Realized gains and losses from security transactions are based on the identified costs of the securities involved.

**(d) Investment Income:**

Interest income is recorded as it accrues. Dividends and distributions from portfolio securities and underlying funds are recorded on the date they are effective (the ex-dividend date). Any distributions from underlying funds are recorded in accordance with the character of the distributions as designated by the underlying funds.

**(e) Expenses:**

Expenses that are specific to the fund are charged directly to the fund. Expenses that are common to more than one fund in the trusts generally are allocated among those funds in proportion to their average daily net assets. The fund bears its share of the acquired fund fees and expenses of the underlying funds, which are indirect expenses incurred by the fund through its investments in the underlying funds. Such expenses are reflected in the net asset values of the underlying funds.

**(f) Distributions to Shareholders:**

The fund makes distributions from net investment income and net realized capital gains, if any, once a year. To receive a distribution, you must be a registered shareholder on the record date. Distributions are paid to shareholders on the payable date.

**(g) Accounting Estimates:**

The accounting policies described in this report conform to GAAP. Notwithstanding this, shareholders should understand that in order to follow these principles, fund management has to make estimates and assumptions that affect the information reported in the financial statements. It's possible that once the results are known, they may turn out to be different from these estimates and these differences may be material.

**17**Schwab VIT Balanced Portfolio \| Annual Report

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Schwab VIT Balanced Portfolio

Financial Notes (continued)

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;

**2. Significant Accounting Policies (continued):** 

**(h) Federal Income Taxes:**

The fund intends to meet federal income and excise tax requirements for regulated investment companies under subchapter M of the Internal Revenue Code, as amended. Accordingly, the fund distributes substantially all of its net investment income and net realized capital gains, if any, to the participating insurance company's (shareholders) separate accounts each year. As long as the fund meets the tax requirements, it is not required to pay federal income tax.

**(i) Indemnification:**

Under the fund's organizational documents, the officers and trustees are indemnified against certain liabilities arising out of the performance of their duties to the fund. In addition, in the normal course of business the fund enters into contracts with its vendors and others that provide general indemnifications. The fund's maximum exposure under these arrangements is unknown as this would involve future claims that may be made against the fund. However, based on experience, the fund expects the risk of loss attributable to these arrangements to be remote.

**(j) Regulatory Update:** 

Effective January 24, 2023, the SEC adopted rule and form amendments to require mutual funds and ETFs to transmit concise and visually engaging streamlined annual and semiannual reports to shareholders that highlight key information deemed important for retail investors to assess and monitor their fund investments. Other information, including financial statements, will no longer appear in a streamlined shareholder report but must be available online, delivered free of charge upon request, and filed on a semiannual basis on Form N-CSR. The rule and form amendments have a compliance date of July 24, 2024. At this time, management is evaluating the impact of these rule and form amendment changes on the content of the current shareholder report and the newly created annual and semiannual streamlined shareholder reports.

------

<br>**3. Risk Factors:**

Investing in the fund may involve certain risks, as discussed in the fund's prospectus, including, but not limited to, those described below. Any of these risks could cause an investor to lose money.

**Asset Allocation Risk.** The fund is subject to the risk that the selection of the underlying funds and the allocation of the fund's assets among the various asset classes and market segments may cause the fund to underperform other funds with a similar investment objective.

**Conflicts of Interest Risk.** The investment adviser's authority to select and substitute underlying funds from a variety of affiliated and unaffiliated mutual funds and ETFs may create a conflict of interest because the fees paid to it and its affiliates by some underlying funds are higher than the fees paid by other underlying funds. The investment adviser also may have an incentive to select an affiliated underlying fund for other reasons, including to increase assets under management or to support new investment strategies. In addition, other conflicts of interest may exist where the best interests of the affiliated underlying fund may not be aligned with those of the fund. However, the investment adviser is a fiduciary to the fund and is legally obligated to act in the fund's best interests when selecting underlying funds.

**Market Risk.** Financial markets rise and fall in response to a variety of factors, sometimes rapidly and unpredictably. Markets may be impacted by economic, political, regulatory and other conditions, including economic sanctions and other government actions. In addition, the occurrence of global events, such as war, terrorism, environmental disasters, natural disasters and epidemics may also negatively affect the financial markets. As with any investment whose performance is tied to these markets, the value of an investment in the fund will fluctuate, which means that an investor could lose money over short or long periods.

**Securities Lending Risk.** Securities lending involves the risk of loss of rights in, or delay in recovery of, the loaned securities if the borrower fails to return the security loaned or becomes insolvent.

**ETF Risk.** When the fund invests in an ETF, it will bear a proportionate share of the ETF's expenses. In addition, lack of liquidity in the market for an ETF's shares can result in its value being more volatile than the underlying portfolio of securities.

**Direct Investment Risk.** The fund may invest directly in cash, cash equivalents and equity and fixed-income securities, including money market securities, to maintain its allocations. The fund's direct investment in these securities is subject to the same or similar risks as an underlying fund's investment in the same securities.

**Underlying Fund Investment Risk.** Before investing in the fund, investors should assess the risks associated with the underlying funds in which the fund may invest, which include any combination of the risks described below.

Schwab VIT Balanced Portfolio \| Annual Report**18**

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Schwab VIT Balanced Portfolio

Financial Notes (continued)

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;

**3. Risk Factors (continued):** 

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• **Equity Risk.** The prices of equity securities rise and fall daily. These price movements may result from factors affecting individual companies, industries or the securities market as a whole. In addition, equity markets tend to move in cycles, which may cause stock prices to fall over short or extended periods of time.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• **Market Capitalization Risk.** Securities issued by companies of different market capitalizations tend to go in and out of favor based on market and economic conditions. During a period when securities of a particular market capitalization fall behind other types of investments, an underlying fund's performance could be impacted.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• **Foreign Investment Risk.** An underlying fund's investments in securities of foreign issuers involve certain risks that may be greater than those associated with investments in securities of U.S. issuers. These include risks of adverse changes in foreign economic, political, regulatory and other conditions; changes in currency exchange rates or exchange control regulations (including limitations on currency movements and exchanges); the imposition of economic sanctions or other government restrictions; differing accounting, auditing, financial reporting and legal standards and practices; differing securities market structures; and higher transaction costs. These risks may negatively impact the value or liquidity of an underlying fund's investments, and could impair the underlying fund's ability to meet its investment objective or invest in accordance with its investment strategy. There is a risk that investments in securities denominated in, and/or receiving revenues in, foreign currencies will decline in value relative to the U.S. dollar or, in the case of hedging positions, that the U.S. dollar will decline in value relative to the currency hedged, resulting in the dollar value of an underlying fund's investment being adversely affected.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• **Emerging Markets Risk.** Emerging market countries may be more likely to experience political turmoil or rapid changes in market or economic conditions than more developed countries. Emerging market countries often have less uniformity in accounting, auditing, financial reporting and recordkeeping requirements and greater risk associated with the custody of securities. In addition, the financial stability of issuers (including governments) in emerging market countries may be more precarious than in developed countries. As a result, there may be an increased risk of illiquidity and price volatility associated with an underlying fund's investments in emerging market countries, which may be magnified by currency fluctuations relative to the U.S. dollar, and, at times, it may be difficult to value such investments.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• **Growth Investing Risk.** Certain of the underlying funds pursue a "growth style" of investing. Growth investing focuses on a company's prospects for growth of revenue and earnings. If a company's earnings or revenues fall short of expectations, its stock price may fall dramatically. Growth stocks also can perform differently from the market as a whole and other types of stocks and can be more volatile than other types of stocks. Since growth companies usually invest a high portion of earnings in their business, they may lack the dividends of value stocks that can cushion stock prices in a falling market. Growth stocks may also be more expensive relative to their earnings or assets compared to value or other stocks.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• **Value Investing Risk.** Certain of the underlying funds may pursue a "value style" of investing. Value investing focuses on companies whose stocks appear undervalued in light of factors such as the company's earnings, book value, revenues or cash flow. If an underlying fund's investment adviser's (or sub-adviser's) assessment of a company's value or prospects for exceeding earnings expectations or market conditions is wrong, the underlying fund could suffer losses or produce poor performance relative to other funds. In addition, "value stocks" can continue to be undervalued by the market for long periods of time.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• **Fixed-Income Risk.** Interest rates rise and fall over time, which will affect an underlying fund's yield and share price. A change in a central bank's monetary policy or economic conditions, among other things, may result in a change in interest rates. A rise in interest rates could cause an underlying fund's share price to fall. The credit quality of a portfolio investment could also cause an underlying fund's share price to fall. An underlying fund could lose money if the issuer or guarantor of a portfolio investment or the counterparty to a derivatives contract fails to make timely principal or interest payments or otherwise honor its obligations. Fixed-income securities may be paid off earlier or later than expected. Either situation could cause an underlying fund to hold securities paying lower-than-market rates of interest, which could hurt an underlying fund's yield or share price. Below investment-grade bonds (junk bonds) involve greater credit risk, are more volatile, involve greater risk of price declines and may be more susceptible to economic downturns than investment-grade securities.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• **Interest Rate Risk.** Interest rates rise and fall over time. As with any investment whose yield reflects current interest rates, an underlying fund's yield will change over time. During periods when interest rates are low, an underlying fund's yield (and total return) also may be low. Changes in interest rates also may affect an underlying fund's share price: a rise in interest rates generally causes an underlying fund's share price to fall. The longer an underlying fund's portfolio duration, the more sensitive to interest rate movements its share price is likely to be. Also, a change in a central bank's monetary policy or economic conditions, among other things, may result in a change in interest rates, which could have sudden and unpredictable effects on the markets and significantly impact the value of fixed-income securities in which the underlying fund invests.

**19**Schwab VIT Balanced Portfolio \| Annual Report

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Schwab VIT Balanced Portfolio

Financial Notes (continued)

------

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;

**3. Risk Factors (continued):** 

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• **Credit Risk.** A decline in the credit quality of an issuer or guarantor of a portfolio investment could cause an underlying fund to lose money or underperform. An underlying fund could lose money if the issuer or guarantor of a portfolio investment fails to make timely principal or interest payments or otherwise honor its obligations.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• **Prepayment and Extension Risk.** Certain fixed income securities are subject to the risk that the securities may be paid off earlier or later than expected, especially during periods of falling or rising interest rates, respectively. Prepayments of obligations could cause an underlying fund to forgo future interest income on the portion of the security's principal repaid early and force the underlying fund to reinvest that money at the lower prevailing interest rates. Extensions of obligations could cause the fund to exhibit additional volatility and hold securities paying lower-than-market rates of interest. Either case could hurt the underlying fund's performance.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• **U.S. Government Securities Risk.** Some of the U.S. government securities that the underlying funds invest in are not backed by the full faith and credit of the U.S. government, which means they are neither issued nor guaranteed by the U.S. Treasury. Issuers such as the Federal Home Loan Banks (FHLB) maintain limited access to credit lines from the U.S. Treasury. Certain securities, such as obligations issued by the Federal Farm Credit Banks Funding Corporation, are supported solely by the credit of the issuer. There can be no assurance that the U.S. government will provide financial support to securities of its agencies and instrumentalities if it is not obligated to do so under law. Also, any government guarantees on securities the underlying funds own do not extend to shares of the underlying funds themselves.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• **Real Estate Investment Risk.** An underlying fund in which the fund may invest may have a policy of concentrating its investments in real estate companies and companies related to the real estate industry. As such, an underlying fund is subject to risks associated with the direct ownership of real estate securities and the fund's investment in such an underlying fund is subject to risks associated with the direct ownership of real estate securities and an investment in the underlying fund will be closely linked to the performance of the real estate markets. These risks include, among others, declines in the value of real estate; risks related to general and local economic conditions; possible lack of availability of mortgage funds or other limits to accessing the credit or capital markets; defaults by borrowers or tenants, particularly during an economic downturn; and changes in interest rates.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• **Real Estate Investment Trusts (REITs) Risk**. An underlying fund may invest in REITs. An underlying fund's investments in REITs will be subject to the risks associated with the direct ownership of real estate, including fluctuations in the value of underlying properties, defaults by borrowers or tenants, changes in interest rates and risks related to general or local economic conditions. REITs are also subject to certain additional risks. For example, equity REITs may be affected by changes in the value of the underlying properties owned by the trusts, and mortgage REITs may be affected by the quality of any credit extended. Further, REITs may have their investments in relatively few properties, a small geographic area or a single property type. In addition, REITs have their own expenses, and the underlying fund will bear a proportionate share of those expenses.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• **Mortgage-Backed and Mortgage Pass-Through Securities Risk.** Mortgage-backed securities tend to increase in value less than other debt securities when interest rates decline, but are subject to similar or greater risk of decline in fair value during periods of rising interest rates. Certain of the mortgage-backed securities in which an underlying fund may invest are issued or guaranteed by agencies or instrumentalities of the U.S. government but are not backed by the full faith and credit of the U.S. government. There can be no assurance that the U.S. government would provide financial support to its agencies or instrumentalities where it was not obligated to do so which can cause an underlying fund to lose money or underperform. The risks of investing in mortgage-backed securities include, among others, interest rate risk, credit risk, prepayment risk and extension risk. Transactions in mortgage pass-through securities often occur through to-be-announced (TBA) transactions. An underlying fund could lose money or underperform if a TBA counterparty defaults or goes bankrupt.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• **Portfolio Turnover Risk.** Certain of the underlying funds may buy and sell portfolio securities actively. If they do, their portfolio turnover rate and transaction costs will rise, which may lower the underlying fund's performance and may increase the likelihood of capital gains distributions.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• **Liquidity Risk.** An underlying fund may be unable to sell certain securities, such as illiquid securities, readily at a favorable time or price, or the underlying fund may have to sell them at a loss.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• **Derivatives Risk.** An underlying fund's use of derivative instruments involves risks different from, or possibly greater than, the risks associated with investing directly in securities and other traditional investments. An underlying fund's use of derivatives could reduce the underlying fund's performance, increase volatility, and could cause the underlying fund to lose more than the initial amount invested. In addition, investments in derivatives may involve leverage, which means a small percentage of assets invested in derivatives can have a disproportionately large impact on an underlying fund.

Schwab VIT Balanced Portfolio \| Annual Report**20**

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Schwab VIT Balanced Portfolio

Financial Notes (continued)

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;

**3. Risk Factors (continued):** 

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• **Securities Lending Risk.** Certain underlying funds engage in securities lending, which involves the risk of loss of rights in, or delay in recovery of, the loaned securities if the borrower fails to return the security loaned or becomes insolvent.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• **Management Risk.** An underlying fund may be an actively managed mutual fund. Any actively managed mutual fund is subject to the risk that its investment adviser (or sub-adviser(s)) will make poor security selections. An underlying fund's adviser applies its own investment techniques and risk analyses in making investment decisions for the fund, but there can be no guarantee that they will produce the desired results.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• **Investment Style Risk.** Certain underlying funds seek to track the performance of various segments of the stock market, as measured by their respective indices. Such underlying funds follow these stocks during upturns as well as downturns. Because of their indexing strategy, these underlying funds do not take steps to reduce market exposure or to lessen the effects of a declining market. In addition, because of an underlying fund's expenses, the underlying fund's performance is normally below that of the index. Errors relating to an index may occur from time to time and may not be identified by the underlying fund's index provider for a period of time. In addition, market disruptions could cause delays in an underlying fund's index's rebalancing schedule. Such errors and/or market disruptions may result in losses for an underlying fund.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• **Tracking Error Risk.** An underlying fund may seek to track the performance of its benchmark index, although it may not be successful in doing so. The divergence between the performance of a fund and its benchmark index, positive or negative, is called "tracking error." Tracking error can be caused by many factors and it may be significant.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• **Concentration Risk.** To the extent that an underlying fund's portfolio is concentrated in the securities of issuers in a particular market, industry, group of industries, sector or asset class, the underlying fund may be adversely affected by the performance of those securities, may be subject to increased price volatility and may be more vulnerable to adverse economic, market, political, or regulatory occurrences affecting that market, industry, group of industries, sector or asset class.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• **Commodity Risk.** To the extent that an underlying fund invests in commodity-linked derivative instruments, it may subject the underlying fund to greater volatility than investments in traditional securities. Also, commodity-linked investments may be more volatile and less liquid than the underlying commodity. The value of commodity-linked derivative instruments may be affected by changes in overall market movements, commodity index volatility, changes in interest rates, or factors affecting a particular industry or commodity, such as drought, floods, weather, livestock disease, embargoes, tariffs and international economic, political and other regulatory and market developments. The use of leveraged commodity-linked derivatives creates an opportunity for increased return, but also creates the possibility for a greater loss.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• **Money Market Fund Risk.** The fund may invest in underlying money market funds that either seek to maintain a stable $1.00 net asset value ("stable share price money market funds") or that have a share price that fluctuates ("variable share price money market funds"). Although an underlying stable share price money market fund seeks to maintain a stable $1.00 net asset value, it is possible to lose money by investing in such a money market fund. Because the share price of an underlying variable share price money market fund will fluctuate, when the fund sells the shares it owns they may be worth more or less than what the fund originally paid for them. In addition, neither type of money market fund is designed to offer capital appreciation. Certain underlying money market funds may impose a fee upon the sale of shares or may temporarily suspend the ability to sell shares if such fund's liquidity falls below required minimums.

Please refer to the fund's prospectus for a more complete description of the principal risks of investing in the fund.

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<br>**4. Affiliates and Affiliated Transactions:**

**Investment Adviser**

Charles Schwab Investment Management Inc., dba Schwab Asset Management, a wholly owned subsidiary of The Charles Schwab Corporation, serves as the fund's investment adviser and administrator pursuant to an Investment Advisory and Administration Agreement between the investment adviser and the trust.

For its advisory and administrative services to the fund, the investment adviser is entitled to receive an annual fee, accrued daily and payable monthly, equal to 0.45% of the fund's average daily net assets.

**21**Schwab VIT Balanced Portfolio \| Annual Report

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Schwab VIT Balanced Portfolio

Financial Notes (continued)

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;

**4. Affiliates and Affiliated Transactions (continued):** 

**Expense Limitation**

The investment adviser and its affiliates have agreed with the fund, for so long as the investment adviser serves as the investment adviser to the fund, which may only be amended or terminated with approval of the fund's Board, to limit the total annual fund operating expenses charged, excluding interest, taxes and certain non-routine expenses to 0.58%.

The agreement to limit the fund's total expenses charged is limited to the fund's direct operating expenses and, therefore, does not apply to acquired fund fees and expenses, which are indirect expenses incurred by the fund through its investments in the underlying funds.

**Investments in Affiliates**

The fund may engage in certain transactions involving related parties. Pursuant to an exemptive order issued by the SEC, the fund may invest in other related ETFs and mutual funds. As of December 31, 2022, the Schwab VIT Balanced Portfolio's ownership percentages of other related funds' shares are:

---

| | |
|:---|:---|
| Schwab Emerging Markets Equity ETF | 0.0%\* |
| Schwab International Equity ETF | 0.0%\* |
| Schwab International Small-Cap Equity ETF | 0.0%\* |
| Schwab Short-Term U.S. Treasury ETF | 0.1% |
| Schwab U.S. Aggregate Bond ETF | 0.4% |
| Schwab U.S. Large-Cap ETF | 0.0%\* |
| Schwab U.S. REIT ETF | 0.1% |
| Schwab U.S. Small-Cap ETF | 0.0%\* |
| Schwab U.S. TIPS ETF | 0.0%\* |
| Schwab Variable Share Price Money Fund, Ultra Shares | 0.1% |

---

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;

\* Less than 0.05%

**Interfund Transactions**

The fund may engage in transactions with certain other funds in the Fund Complex (for definition refer to the Trustees and Officers section) in accordance with procedures adopted by the Board pursuant to Rule 17a-7 under the 1940 Act. When one fund is seeking to sell a security that another is seeking to buy, an interfund transaction can allow both funds to benefit by reducing transaction costs. This practice is limited to funds that share the same investment adviser, trustees and/or officers. For the period ended December 31, 2022, the fund's purchases and sales of securities with other funds in the Fund Complex was $290,151 and $237,206 respectively, and includes realized losses of $14,301.

**Interfund Borrowing and Lending**

Pursuant to an exemptive order issued by the SEC, the fund may enter into interfund borrowing and lending transactions with other funds in the Fund Complex (for definition refer to the Trustees and Officers section). All loans are for temporary or emergency purposes and the interest rate to be charged will be the average of the overnight repurchase agreement rate and the short-term bank loan rate. All loans are subject to numerous conditions designed to ensure fair and equitable treatment of all participating funds. The interfund lending facility is subject to the oversight and periodic review by the Board. The fund had no interfund borrowing or lending activity during the period.

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<br>**5. Board of Trustees:**

The Board may include people who are officers and/or directors of the investment adviser or its affiliates. Federal securities law limits the percentage of such "interested persons" who may serve on a trust's board, and the trust was in compliance with these limitations throughout the report period. The fund did not pay any of these interested persons for their services as trustees, but did pay non-interested persons (independent trustees), as noted on the fund's Statement of Operations. For information regarding the trustees, please refer to the Trustees and Officers table at the end of this report.

Schwab VIT Balanced Portfolio \| Annual Report**22**

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Schwab VIT Balanced Portfolio

Financial Notes (continued)

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;

**6. Borrowing from Banks:**

During the period, the fund was a participant with other funds in the Fund Complex in a joint, syndicated, committed $850 million line of credit (the Syndicated Credit Facility), which matured on September 29, 2022. On September 29, 2022, the Syndicated Credit Facility was amended to run for a new 364 day period with the line of credit amount increasing to $1 billion, maturing on September 28, 2023. Under the terms of the Syndicated Credit Facility, in addition to the interest charged on any borrowings by the fund, the fund paid a commitment fee of 0.15% per annum on the fund's proportionate share of the unused portion of the Syndicated Credit Facility.

During the period, the fund was a participant with other funds in the Fund Complex in a joint, unsecured, uncommitted $400 million line of credit (the Uncommitted Credit Facility), with State Street Bank and Trust Company, which matured on September 29, 2022. On September 29, 2022, the Uncommitted Credit Facility was amended to run for a new 364 day period with the line of credit amount remaining unchanged, maturing on September 28, 2023. Under the terms of the Uncommitted Credit Facility, the fund pays interest on the amount the fund borrows. There were no borrowings from either line of credit during the period.

The fund also has access to custodian overdraft facilities. The fund may have utilized the overdraft facility and incurred an interest expense, which is disclosed on the fund's Statement of Operations, if any. The interest expense is determined based on a negotiated rate above the current Federal Funds Rate.

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<br>**7. Purchases and Sales of Investment Securities:**

For the period ended December 31, 2022, purchases and sales of securities (excluding short-term obligations) were as follows:

---

| | |
|:---|:---|
| PURCHASES <br>OF SECURITIES <br>| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; SALES <br>OF SECURITIES <br>|
| $15117012 | $17931616 |

---

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<br>**8. Federal Income Taxes:**

As of December 31, 2022, the tax basis cost of the fund's investments and gross unrealized appreciation and depreciation were as follows:

---

| | | | |
|:---|:---|:---|:---|
| TAX COST  | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; GROSS UNREALIZED <br>APPRECIATION <br>| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; GROSS UNREALIZED <br>DEPRECIATION <br>| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; NET UNREALIZED <br>APPRECIATION <br>&nbsp;&nbsp;&nbsp;&nbsp;(DEPRECIATION)<br>|
| $69361216 | $10188450 | ($5710450)  | $4478000 |

---

As of December 31, 2022, the components of distributable earnings on a tax basis were as follows:

---

| | | | |
|:---|:---|:---|:---|
| UNDISTRIBUTED <br>ORDINARY <br>INCOME <br>| &nbsp;&nbsp;&nbsp;&nbsp; NET UNREALIZED <br>APPRECIATION <br>&nbsp;&nbsp;&nbsp;&nbsp;(DEPRECIATION) <br>ON INVESTMENTS <br>| &nbsp;&nbsp;&nbsp;&nbsp; CAPITAL LOSS <br>CARRYFORWARDS AND OTHER LOSSES<br>| TOTAL  |
| $1378169 | $4478000 | ($402951) | $5453218 |

---

The primary difference between book basis and tax basis unrealized appreciation or unrealized depreciation of investments is the tax deferral of losses on wash sales. The tax cost of the fund's investments, disclosed above, have been adjusted from their book amounts to reflect these unrealized appreciation or depreciation differences, as applicable.

Capital loss carryforwards have no expiration and may be used to offset future realized capital gains for federal income tax purposes. As of December 31, 2022, the fund had capital loss carryforwards of $402,951.

The tax basis components of distributions paid during the current and prior fiscal years were as follows:

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| | | | |
|:---|:---|:---|:---|
| CURRENT FISCAL YEAR END DISTRIBUTIONS | CURRENT FISCAL YEAR END DISTRIBUTIONS | PRIOR FISCAL YEAR END DISTRIBUTIONS | PRIOR FISCAL YEAR END DISTRIBUTIONS |
| ORDINARY <br>INCOME <br>| &nbsp;&nbsp; LONG-TERM <br>CAPITAL <br>GAINS <br>| &nbsp;&nbsp; ORDINARY <br>INCOME <br>| &nbsp;&nbsp; LONG-TERM <br>CAPITAL <br>GAINS <br>|
| $1333602 | $1446676 | $1172672 | $— |

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**23**Schwab VIT Balanced Portfolio \| Annual Report

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Schwab VIT Balanced Portfolio

Financial Notes (continued)

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;

**8. Federal Income Taxes (continued):** 

Distributions paid to shareholders are based on net investment income and net realized gains determined on a tax basis, which may differ from net investment income and net realized gains for financial reporting purposes. These differences reflect the differing character of certain income items and net realized gains and losses for financial statement and tax purposes, and may result in reclassification among certain capital accounts on the financial statements. The fund may also designate a portion of the amount paid to redeeming shareholders as a distribution for tax purposes.

Permanent book and tax basis differences may result in reclassifications between components of net assets as required. The adjustments will have no impact on net assets or the results of operations.

As of December 31, 2022, management has reviewed the tax positions for open periods (for federal purposes, three years from the date of filing and for state purposes, four years from the date of filing) as applicable to the fund, and has determined that no provision for income tax is required in the fund's financial statements. The fund recognizes interest and penalties, if any, related to unrecognized tax benefits as income tax expense in the Statement of Operations. During the fiscal year ended December 31, 2022, the fund did not incur any interest or penalties.

------

<br>**9. Subsequent Events:**

Management has determined there are no subsequent events or transactions through the date the financial statements were issued that would have materially impacted the financial statements as presented.

Schwab VIT Balanced Portfolio \| Annual Report**24**

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Schwab VIT Balanced Portfolio

Report of Independent Registered Public Accounting Firm

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To the Board of Trustees of Schwab Annuity Portfolios and Shareholders of Schwab VIT Balanced Portfolio

***Opinion on the Financial Statements and Financial Highlights***

We have audited the accompanying statement of assets and liabilities, including the portfolio holdings, of Schwab VIT Balanced Portfolio (the "Fund"), one of the funds constituting Schwab Annuity Portfolios, as of December 31, 2022, the related statement of operations for the year then ended, the statements of changes in net assets for each of the two years in the period then ended, the financial highlights for each of the three years in the period then ended, and the related notes. In our opinion, the financial statements and financial highlights present fairly, in all material respects, the financial position of the Fund as of December 31, 2022, and the results of its operations for the year then ended, the changes in its net assets for each of the two years in the period then ended, and the financial highlights for each of the three years in the period then ended in conformity with accounting principles generally accepted in the United States of America. The financial highlights for each of the two years in the period ended December 31, 2019 were audited by other auditors, whose report, dated February 18, 2020, expressed an unqualified opinion on such financial highlights.

***Basis for Opinion***

These financial statements and financial highlights are the responsibility of the Fund's management. Our responsibility is to express an opinion on the Fund's financial statements and financial highlights based on our audits. We are a public accounting firm registered with the Public Company Accounting Oversight Board (United States) (PCAOB) and are required to be independent with respect to the Fund in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.

We conducted our audits in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements and financial highlights are free of material misstatement, whether due to error or fraud. The Fund is not required to have, nor were we engaged to perform, an audit of its internal control over financial reporting. As part of our audits, we are required to obtain an understanding of internal control over financial reporting but not for the purpose of expressing an opinion on the effectiveness of the Fund's internal control over financial reporting. Accordingly, we express no such opinion.

Our audits included performing procedures to assess the risks of material misstatement of the financial statements and financial highlights, whether due to error or fraud, and performing procedures that respond to those risks. Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the financial statements and financial highlights. Our audits also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the financial statements and financial highlights. Our procedures included confirmation of securities owned as of December 31, 2022, by correspondence with the custodian and transfer agent. We believe that our audits provide a reasonable basis for our opinion.

**Deloitte & Touche LLP** <br>Denver, Colorado <br>February 16, 2023

We have served as the auditor of one or more investment companies in the Schwab Funds Complex since 2020.

**25**Schwab VIT Balanced Portfolio \| Annual Report

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Schwab VIT Balanced Portfolio

Other Federal Tax Information (unaudited)

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The fund may elect to pass through, under section 853(a) of the Internal Revenue Code, the foreign tax credit of $35,479 to its shareholders for the fiscal year ended December 31, 2022. The respective foreign source income on the fund is $360,521.

For corporate shareholders, 18.43% of the fund's dividend distributions paid during the fiscal year ended December 31, 2022, qualify for the corporate dividends received deduction.

Under section 852(b)(3)(C) of the Internal Revenue Code, the fund hereby designates $1,446,676 as long-term capital gain dividends for the fiscal year ended December 31, 2022.

For the fiscal year ended December 31, 2022, the fund designates 78.78% of dividend income as business interest income under section 163(j) of the Internal Revenue Code.

Schwab VIT Balanced Portfolio \| Annual Report**26**

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Schwab VIT Balanced Portfolio

Liquidity Risk Management Program (unaudited)

------

The fund has adopted and implemented a liquidity risk management program (the "program") as required by Rule 22e-4 under the Investment Company Act of 1940, as amended. The fund's Board of Trustees (the "Board") has designated the fund's investment adviser, Charles Schwab Investment Management, Inc., dba Schwab Asset Management, as the administrator of the program. Personnel of the investment adviser or its affiliates conduct the day-to-day operation of the program.

Under the program, the investment adviser manages a fund's liquidity risk, which is the risk that the fund could not meet shareholder redemption requests without significant dilution of remaining shareholders' interests in the fund. The program is reasonably designed to assess and manage a fund's liquidity risk, taking into consideration the fund's investment strategy and the liquidity of its portfolio investments during normal and reasonably foreseeable stressed conditions; its historical redemption history and shareholder concentrations; and its cash holdings and access to other funding sources, including the custodian overdraft facility and lines of credit. The investment adviser's process of determining the degree of liquidity of each fund's investments is supported by third-party liquidity assessment vendors.

The fund's Board reviewed a report at its meeting held on September 19, 2022 prepared by the investment adviser regarding the operation and effectiveness of the program for the period June 1, 2021, through May 31, 2022, which included individual fund liquidity metrics. No significant liquidity events impacting the fund were noted in the report. In addition, the investment adviser provided its assessment that the program had been operating effectively in managing the fund's liquidity risk.

**27**Schwab VIT Balanced Portfolio \| Annual Report

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Schwab VIT Balanced Portfolio

Trustees and Officers

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The tables below give information about the trustees and officers of Schwab Annuity Portfolios, which includes the fund covered in this report. The "Fund Complex" includes The Charles Schwab Family of Funds, Schwab Capital Trust, Schwab Investments, Schwab Annuity Portfolios, Schwab Strategic Trust and Laudus Trust. The Fund Complex includes 105 funds.

The address for all trustees and officers is 211 Main Street, San Francisco, CA 94105. You can find more information about the trustees and officers in the fund's Statement of Additional Information, which is available free by calling 1-877-824-5615.

---

| | | | |
|:---|:---|:---|:---|
| **Independent Trustees** | **Independent Trustees** | **Independent Trustees** | **Independent Trustees** |
| Name, Year of Birth, and <br> Position(s) with the trust <br> (Terms of office, and <br> length of Time Served<sup>1</sup>)<br>| Principal Occupations<br> During the Past Five Years<br>| Number of<br> Portfolios in<br> Fund Complex<br> Overseen by<br> the Trustee<br>| Other Directorships |
| **Michael J. Beer**<br> 1961<br> Trustee<br> (Trustee of The Charles Schwab <br> Family of Funds, Schwab <br> Investments, Schwab Capital Trust, <br> Schwab Annuity Portfolios, Schwab <br> Strategic Trust and Laudus Trust <br> since 2022)<br>| Retired. Director, President and Chief Executive Officer <br> (Dec. 2016 – Sept. 2019), Principal Funds (investment management).<br>| 105 | Director (2016 – 2019), <br> Principal Funds, Inc.<br>|
| **Robert W. Burns**<br> 1959<br> Trustee<br> (Trustee of Schwab Strategic Trust <br> since 2009; The Charles Schwab <br> Family of Funds, Schwab <br> Investments, Schwab Capital Trust, <br> Schwab Annuity Portfolios and <br> Laudus Trust since 2016)<br>| Retired/Private Investor. | 105 |  |
| **Nancy F. Heller**<br> 1956<br> Trustee<br> (Trustee of The Charles Schwab <br> Family of Funds, Schwab <br> Investments, Schwab Capital Trust, <br> Schwab Annuity Portfolios, Schwab <br> Strategic Trust and Laudus Trust <br> since 2018)<br>| Retired. | 105 |  |
| **David L. Mahoney**<br> 1954<br> Trustee<br> (Trustee of The Charles Schwab <br> Family of Funds, Schwab <br> Investments, Schwab Capital Trust, <br> Schwab Annuity Portfolios and <br> Laudus Trust since 2011; Schwab <br> Strategic Trust since 2016)<br>| Private Investor. | 105 | Director <br> (2004 – present), <br> Corcept Therapeutics <br> Incorporated <br> Director (2009 – 2021), <br> Adamas <br> Pharmaceuticals, Inc.<br> Director (2003 – 2019), <br> Symantec Corporation<br>|
| **Jane P. Moncreiff**<br> 1961<br> Trustee<br> (Trustee of The Charles Schwab <br> Family of Funds, Schwab <br> Investments, Schwab Capital Trust, <br> Schwab Annuity Portfolios, Schwab <br> Strategic Trust and Laudus Trust <br> since 2019)<br>| Consultant (2018 – present), Fulham Advisers LLC (management <br> consulting); Chief Investment Officer (2009 – 2017), CareGroup <br> Healthcare System, Inc. (healthcare).<br>| 105 |  |

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Schwab VIT Balanced Portfolio \| Annual Report**28**

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Schwab VIT Balanced Portfolio

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| | | | |
|:---|:---|:---|:---|
| **Independent Trustees (continued)** | **Independent Trustees (continued)** | **Independent Trustees (continued)** | **Independent Trustees (continued)** |
| Name, Year of Birth, and <br> Position(s) with the trust <br> (Terms of office, and <br> length of Time Served<sup>1</sup>)<br>| Principal Occupations<br> During the Past Five Years<br>| Number of<br> Portfolios in<br> Fund Complex<br> Overseen by<br> the Trustee<br>| Other Directorships |
| **Kimberly S. Patmore**<br> 1956<br> Trustee<br> (Trustee of The Charles Schwab <br> Family of Funds, Schwab <br> Investments, Schwab Capital Trust, <br> Schwab Annuity Portfolios, Schwab <br> Strategic Trust and Laudus Trust <br> since 2016)<br>| Consultant (2008 – present), Patmore Management Consulting <br> (management consulting).<br>| 105 |  |
| **J. Derek Penn**<br> 1957<br> Trustee<br> (Trustee of The Charles Schwab <br> Family of Funds, Schwab <br> Investments, Schwab Capital Trust, <br> Schwab Annuity Portfolios, Schwab <br> Strategic Trust and Laudus Trust <br> since 2021)<br>| Head of Equity Sales and Trading (2006 – 2018), BNY Mellon (financial <br> services).<br>| 105 |  |

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**29**Schwab VIT Balanced Portfolio \| Annual Report

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Schwab VIT Balanced Portfolio

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;

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| | | | |
|:---|:---|:---|:---|
| **Interested Trustees** | **Interested Trustees** | **Interested Trustees** | **Interested Trustees** |
| Name, Year of Birth, and <br> Position(s) with the trust <br> (Terms of office, and <br> length of Time Served<sup>1</sup>)<br>| Principal Occupations<br> During the Past Five Years<br>| Number of<br> Portfolios in<br> Fund Complex<br> Overseen by<br> the Trustee<br>| Other Directorships |
| **Walter W. Bettinger II**<sup>2</sup> 1960<br> Chairman and Trustee<br> (Trustee of The Charles Schwab <br> Family of Funds, Schwab <br> Investments, Schwab Capital Trust <br> and Schwab Annuity Portfolios since <br> 2008; Schwab Strategic Trust since <br> 2009; Laudus Trust since 2010)<br>| Co-Chairman of the Board (July 2022 – present), Director and Chief <br> Executive Officer (Oct. 2008 – present) and President <br> (Feb. 2007 – Oct. 2021), The Charles Schwab Corporation; President and <br> Chief Executive Officer (Oct. 2008 – Oct. 2021) and Director <br> (May 2008 – Oct. 2021), Charles Schwab & Co., Inc.; Director <br> (Apr. 2006 – present), Charles Schwab Bank, SSB; Director <br> (Nov. 2017 – present), Charles Schwab Premier Bank, SSB; Director <br> (July 2019 – present), Charles Schwab Trust Bank; Director <br> (May 2008 – present), Chief Executive Officer (Aug. 2017 – present) and <br> President (Aug. 2017 – Nov. 2021), Schwab Holdings, Inc.; Director <br> (Oct. 2020 – present), TD Ameritrade Holding Corporation; Director <br> (July 2016 – Oct. 2021), Charles Schwab Investment Management, Inc.<br>| 105 | Director <br> (2008 – present), The <br> Charles Schwab <br> Corporation <br>|
| **Richard A. Wurster**<sup>2</sup> 1973<br> Trustee<br> (Trustee of The Charles Schwab <br> Family of Funds, Schwab <br> Investments, Schwab Capital Trust, <br> Schwab Annuity Portfolios, Schwab <br> Strategic Trust and Laudus Trust <br> since 2022)<br>| President (Oct. 2021 – present) and Executive Vice President – Schwab <br> Asset Management Solutions (Apr. 2019 – Oct. 2021), The Charles <br> Schwab Corporation; President, Director (Oct. 2021 – present), Executive <br> Vice President – Schwab Asset Management Solutions <br> (July 2019 – Oct. 2021) and Senior Vice President – Advisory <br> (May 2016 – July 2019), Charles Schwab & Co., Inc.; President <br> (Nov. 2021 – present), Schwab Holdings, Inc.; Director <br> (Oct. 2021 – present) and Chief Executive Officer (Nov. 2019 – Jan. 2022), <br> Charles Schwab Investment Management, Inc.; Director, Chief Executive <br> Officer and President (Mar. 2018 – Oct. 2022), Charles Schwab Investment <br> Advisory, Inc.; Chief Executive Officer (July 2016 – Apr. 2018) and <br> President (Mar. 2017 – Apr. 2018), ThomasPartners, Inc.; Chief Executive <br> Officer (July 2016 – Apr. 2018), Windhaven Investment Management, Inc.<br>| 105 |  |

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;

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| | |
|:---|:---|
| **Officers of the Trust** | **Officers of the Trust** |
| Name, Year of Birth, and Position(s) with the trust <br> (Terms of office, and length of Time Served<sup>3</sup>)<br>| Principal Occupations During the Past Five Years |
| **Jonathan de St. Paer**<br> 1973<br> President and Chief Executive Officer<br> (Officer of The Charles Schwab Family of Funds, Schwab <br> Investments, Schwab Capital Trust, Schwab Annuity <br> Portfolios, Schwab Strategic Trust and Laudus Trust since <br> 2018)<br>| Director (Apr. 2019 – present), President (Oct. 2018 – present), Chief Operating Officer <br> (Jan. 2021 – present), and Chief Executive Officer (Apr. 2019 – Nov. 2019), Charles Schwab <br> Investment Management, Inc.; Senior Vice President (June 2020 – Mar. 2022) and Chief <br> Operating Officer (Jan. 2021 – Mar. 2022), Charles Schwab Investment Advisory, Inc.; Chief <br> Executive Officer (Apr. 2019 – present), President (Nov. 2018 – present) and Trustee <br> (Apr. 2019 – Dec. 2020), Schwab Funds, Laudus Trust and Schwab ETFs; Managing Director <br> (May 2022 – present), Senior Vice President (Apr. 2019 – May 2022) and Senior Vice <br> President – Strategy and Product Development (CSIM) (Jan. 2014 – Mar. 2019), Charles <br> Schwab & Co., Inc.<br>|
| **Mark Fischer**<br> 1970<br> Chief Operating Officer<br> (Officer of The Charles Schwab Family of Funds, Schwab <br> Investments, Schwab Capital Trust, Schwab Annuity <br> Portfolios, Schwab Strategic Trust and Laudus Trust since <br> 2013)<br>| Chief Operating Officer (Dec. 2020 – present) and Treasurer and Chief Financial Officer <br> (Jan. 2016 – Dec. 2022), Schwab Funds, Laudus Trust and Schwab ETFs; Chief Financial <br> Officer (Mar. 2020 – present) and Vice President (Oct. 2013 – present), Charles Schwab <br> Investment Management, Inc.<br>|
| **Dana Smith**<br> 1965<br> Treasurer and Chief Financial Officer<br> (Officer of The Charles Schwab Family of Funds, Schwab <br> Investments, Schwab Capital Trust, Schwab Annuity <br> Portfolios, Schwab Strategic Trust and Laudus Trust since <br> 2023)<br>| Treasurer and Chief Financial Officer (Jan. 2023 – present) and Assistant Treasurer <br> (Dec. 2015 – Dec. 2022), Schwab Funds, Laudus Trust and Schwab ETFs; Vice President <br> (Mar. 2022 – present) and Director (Oct. 2015 – Mar. 2022), Charles Schwab Investment <br> Management, Inc.<br>|

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Schwab VIT Balanced Portfolio \| Annual Report**30**

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Schwab VIT Balanced Portfolio

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| | |
|:---|:---|
| **Officers of the Trust (continued)** | **Officers of the Trust (continued)** |
| Name, Year of Birth, and Position(s) with the trust <br> (Terms of office, and length of Time Served<sup>3</sup>)<br>| Principal Occupations During the Past Five Years |
| **Omar Aguilar**<br> 1970<br> Vice President and Chief Investment Officer<br> (Officer of The Charles Schwab Family of Funds, Schwab <br> Investments, Schwab Capital Trust, Schwab Annuity <br> Portfolios, Schwab Strategic Trust and Laudus Trust since <br> 2011)<br>| Chief Executive Officer (Jan. 2022 – present), Chief Investment Officer (Apr. 2011 – present) <br> and Senior Vice President (Apr. 2011 – Dec. 2021), Charles Schwab Investment <br> Management, Inc.; Director, Chief Executive Officer and President (Oct. 2022 – present), <br> Charles Schwab Investment Advisory, Inc.; Vice President and Chief Investment Officer <br> (June 2011 – present), Schwab Funds, Laudus Trust and Schwab ETFs.<br>|
| **Brett Wander**<br> 1961<br> Vice President and Chief Investment Officer<br> (Officer of The Charles Schwab Family of Funds, Schwab <br> Investments, Schwab Capital Trust, Schwab Annuity <br> Portfolios, Schwab Strategic Trust and Laudus Trust since <br> 2011)<br>| Senior Vice President and Chief Investment Officer (Apr. 2011 – present), Charles Schwab <br> Investment Management, Inc.; Vice President and Chief Investment Officer <br> (June 2011 – present), Schwab Funds, Laudus Trust and Schwab ETFs.<br>|
| **William P. McMahon, Jr.**<br> 1972<br> Vice President and Chief Investment Officer<br> (Officer of The Charles Schwab Family of Funds, Schwab <br> Investments, Schwab Capital Trust, Schwab Annuity <br> Portfolios, Schwab Strategic Trust and Laudus Trust since <br> 2021)<br>| Senior Vice President and Chief Investment Officer (Jan. 2020 – present), Charles Schwab <br> Investment Management, Inc.; Vice President and Chief Investment Officer <br> (June 2021 – present), Schwab Funds, Laudus Trust and Schwab ETFs; Senior Vice President <br> and Chief Investment Officer – ThomasPartners Strategies (Apr. 2018 – Dec. 2019), Charles <br> Schwab Investment Advisory, Inc.; Senior Vice President and Chief Investment Officer <br> (May 2001 – Apr. 2018), ThomasPartners, Inc.<br>|
| **Catherine MacGregor**<br> 1964<br> Chief Legal Officer and Secretary, Schwab Funds and <br> Schwab ETFs<br> Chief Legal Officer, Vice President and Clerk, Laudus Trust<br> (Officer of The Charles Schwab Family of Funds, Schwab <br> Investments, Schwab Capital Trust, Schwab Annuity <br> Portfolios and Laudus Trust since 2005; Schwab Strategic <br> Trust since 2009)<br>| Chief Legal Officer (Mar. 2022 – present) and Vice President (Sept. 2005 – present), Charles <br> Schwab Investment Management, Inc.; Managing Director (May 2022 – present) and Vice <br> President (July 2005 – May 2022), Charles Schwab & Co., Inc.; Vice President <br> (Dec. 2005 – present) and Chief Legal Officer and Clerk (Mar. 2007 – present), Laudus Trust; <br> Chief Legal Officer and Secretary (Oct. 2021 – present), Vice President <br> (Nov. 2005 – Oct. 2021) and Assistant Secretary (June 2007 – Oct. 2021), Schwab Funds; <br> Chief Legal Officer and Secretary (Oct. 2021 – present), Vice President and Assistant <br> Secretary (Oct. 2009 – Oct. 2021), Schwab ETFs.<br>|

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<sup>1</sup>

Each Trustee shall hold office until the election and qualification of his or her successor, or until he or she dies, resigns or is removed. The retirement policy requires that each independent trustee retire by December 31 of the year in which the Trustee turns 74 or the Trustee's twentieth year of service as an independent trustee on any trust in the Fund Complex, whichever occurs first.

<sup>2</sup>

Mr. Bettinger and Mr. Wurster are Interested Trustees. Mr. Bettinger and Mr. Wurster are Interested Trustees because each owns stock of The Charles Schwab Corporation (CSC), the parent company of Charles Schwab Investment Management, Inc., the investment adviser for the trusts in the Fund Complex, and is an employee of Charles Schwab & Co., Inc. (Schwab), the principal underwriter for The Charles Schwab Family of Funds, Schwab Investments, Schwab Capital Trust, Schwab Annuity Portfolios and Laudus Trust.

<sup>3</sup>

The President, Treasurer and Secretary/Clerk hold office until their respective successors are chosen and qualified or until he or she sooner dies, resigns, is removed or becomes disqualified. Each of the other officers serves at the pleasure of the Board.

**31**Schwab VIT Balanced Portfolio \| Annual Report

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Schwab VIT Balanced Portfolio

Glossary

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**Bloomberg US Aggregate Bond Index** An index that is a broad-based benchmark measuring the performance of the U.S. investment grade, taxable bond market, including U.S. Treasuries, government-related and corporate bonds, mortgage pass-through securities, commercial mortgage-backed securities, and asset-backed securities that are publicly available for sale in the United States. To be eligible for inclusion in the index, securities must be fixed rate, non-convertible, U.S. dollar-denominated with at least $300 million or more of outstanding face value and have one or more years remaining to maturity. The index excludes certain types of securities, including tax-exempt state and local government series bonds, structured notes embedded with swaps or other special features, private placements, floating rate securities, inflation-linked bonds and Eurobonds. The index is market capitalization weighted and the securities in the index are updated on the last business day of each month.

**Bloomberg US Treasury 1–3 Year Index** An index which includes all publicly-issued U.S. Treasury securities that have a remaining maturity of greater than or equal to one year and less than three years, are rated investment grade, and have $300 million or more of outstanding face value. The securities in the index must be denominated in U.S. dollars and must be fixed-rate and non-convertible. The index excludes state and local government series bonds and coupon issues that have been stripped from bonds. The index is market capitalization weighted and the securities in the index are updated on the last business day of each month.

**Bloomberg US Treasury 3–10 Year Index** An index which includes all publicly-issued U.S. Treasury securities that have a remaining maturity of greater than or equal to three years and less than ten years, are rated investment grade, and have $300 million or more of outstanding face value. The securities in the index must be denominated in U.S. dollars and must be fixed-rate and non-convertible. The index excludes state and local government series bonds and coupon issues that have been stripped from bonds. The index is market capitalization weighted and the securities in the index are updated on the last business day of each month.

**Bloomberg US Treasury Bills 1–3 Month Index** An index that includes all publicly issued zero-coupon U.S. Treasury Bills that have a remaining maturity of less than 3 months but more than 1 month, are rated investment grade and have $300 million or more of outstanding face value. It excludes zero-coupon STRIPS.

**Bloomberg US Treasury Inflation-Linked Bond Index (Series-L)** An index which includes all publicly-issued U.S. Treasury Inflation-Protected Securities (TIPS) that have at least one year remaining to maturity, are rated investment grade and have $500 million or more of outstanding face value. The TIPS in the index must be denominated in U.S. dollars and must be fixed-rate and non-convertible. The index is market capitalization weighted and the TIPS in the index are updated on the last business day of each month. TIPS are publicly issued, dollar denominated U.S. Government securities issued by the U.S. Treasury that have principal and interest payments linked to an official inflation measure (as measured by the Consumer Price Index, or CPI) and their payments are supported by the full faith and credit of the United States.

**Dow Jones Equity All REIT Capped Index** A float-adjusted market cap weighted index that is designed to measure all equity real estate investment trusts (REITs) in the Dow Jones U.S. Total Stock Market Index, as defined by the S&P Dow Jones Indices REIT/RESI Industry Classification Hierarchy, that meet the minimum float market capitalization (FMC) and liquidity thresholds. The aggregate weight of

all companies weighing more than 4.5% cannot exceed 22.5%, and no single company's weight can exceed 10%. The index is reviewed daily based on each company's capped market capitalization weight. Daily capping is only performed when the sum of companies with weights great than 5% exceeds 25%.

**Dow Jones U.S. Large-Cap Total Stock Market Index** An index that is a subset of the Dow Jones U.S. Total Stock Market Index, and is designed to measure the performance of large-cap U.S. equity securities. The index is a float-adjusted market capitalization weighted index.

**Dow Jones U.S. Select REIT Index** An index that is a float-adjusted market-capitalization weighted index comprised of income-producing commercial and/or residential real estate investment trusts (REITs). The index excludes mortgage REITs, net-lease REITs, real estate finance companies, mortgage brokers and bankers, commercial and residential real estate brokers and estate agents, homebuilders, large landowners and sub-dividers of unimproved land, hybrid REITs, timber REITs and companies that have more than 25% of their assets in direct mortgage investments.

**Dow Jones U.S. Small-Cap Total Stock Market Index** An index that is a subset of the Dow Jones U.S. Total Stock Market Index, and is designed to measure the performance of small-cap U.S. equity securities. The index is a float-adjusted market capitalization weighted index.

**Dow Jones U.S. Total Stock Market Index** An index which includes all U.S. equity issues with readily available prices. The index is a float-adjusted market capitalization weighted index that reflects the shares of securities actually available to investors in the marketplace.

**FTSE Developed ex US Index (Net)** An index that is comprised of large- and mid-capitalization companies in developed countries outside the United States, as defined by the index provider. The index defines the large- and mid-capitalization universe as approximately the top 90% of the eligible universe. The Net version of the index reflects reinvested dividends net of withholding taxes, but reflects no deductions for expenses or other taxes.

**FTSE Developed Small Cap ex US Liquid Index (Net)** An index comprised of small-capitalization companies in developed countries outside the United States, as defined by the index provider. The index defines the small-capitalization universe as approximately the bottom 10% of the eligible universe with a minimum free float capitalization of $150 million. The Net version of the index reflects reinvested dividends net of withholding taxes, but reflects no deductions for expenses or other taxes.

**FTSE Emerging Index (Net)** An index that is comprised of large- and mid-capitalization companies in emerging market countries, as defined by the index provider. The index defines the large- and mid-capitalization universe as approximately the top 90% of the eligible universe. The Net version of the index reflects reinvested dividends net of withholding taxes, but reflects no deductions for expenses or other taxes.

**FTSE non-US Dollar World Government Bond Index** A market capitalization index that measures the total rate of return performance for the government bonds of 22 countries, excluding the U.S., with a remaining maturity of at least 1 year.

Schwab VIT Balanced Portfolio \| Annual Report**32**

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Schwab VIT Balanced Portfolio

**MSCI EAFE Index (Net)** A free float-adjusted market capitalization index that is designed to measure the equity market performance of developed markets in Europe, Australasia, and the Far East. The Net version of the index reflects reinvested dividends net of withholding taxes, but reflects no deductions for expenses or other taxes; returns are calculated applying dividend withholding rates applicable to non-resident persons who do not benefit from double taxation treaties.

**MSCI Emerging Markets Index (Net)** A free float-adjusted market capitalization weighted index that is designed to measure equity market performance in the global emerging markets. This series approximates the minimum possible dividend reinvestment. The returns are calculated applying dividend withholding rates applicable to non-resident persons who do not benefit from double taxation treaties.

**Russell 2000 Index** An index that measures the performance of the 2,000 smallest companies in the Russell 3000 Index. The Russell 3000 Index measures the performance of the largest 3,000 U.S. companies representing approximately 98% of the investable U.S. equity market.

**S&P 500 Index** An index that is designed to measure the performance of 500 leading publicly traded companies from a broad range of industries.

**VIT Balanced Composite Index** A custom blended index developed by Schwab Asset Management based on a comparable portfolio asset allocation and calculated using the following portion allocations effective July 1, 2020: 36.3% Bloomberg US Aggregate Bond Index, 9.0% Bloomberg US Treasury 1-3 Year Index, 4.0% Bloomberg US Treasury Bills 1-3 Month Index, 3.7% Bloomberg US Treasury Inflation-Linked Bond Index (Series-L), 6.0% Dow Jones Equity All REIT Capped Index, 19.0% Dow Jones U.S. Large-Cap Total Stock Market Index, 4.0% Dow Jones U.S. Small-Cap Total Stock Market Index, 5.0% FTSE All Emerging Index (Net), 11.0% FTSE Developed ex US Index

(Net), and 2.0% FTSE Developed Small Cap ex US Liquid Index (Net). From April 29, 2020 through June 30, 2020, the blended index was derived using the following allocations: 36.3% Bloomberg US Aggregate Bond Index, 9.0% Bloomberg US Treasury 1-3 Year Index, 4.0% Bloomberg US Treasury Bills 1-3 Month Index, 3.7% Bloomberg US Treasury Inflation-Linked Bond Index (Series-L), 6.0% Dow Jones U.S. Select REIT Index, 19.0% Dow Jones U.S. Large-Cap Total Stock Market Index, 4.0% Dow Jones U.S. Small-Cap Total Stock Market Index, 5.0% FTSE All Emerging Index (Net), 11.0% FTSE Developed ex US Index (Net), and 2.0% FTSE Developed Small Cap ex US Liquid Index (Net). From June 8, 2016 through April 28, 2020, the blended index was derived using the following allocations: 2% Bloomberg Global Treasury ex-US Capped Index, 34% Bloomberg US Aggregate Bond Index, 15% Bloomberg US Treasury Bills 1-3 Month Index, 2% Bloomberg US Treasury Inflation-Linked Bond Index (Series-L), 3% Bloomberg Commodity Index, 6% Dow Jones U.S. Select REIT Index, 15% Dow Jones U.S. Large-Cap Total Stock Market Index, 4% Dow Jones U.S. Small-Cap Total Stock Market Index, 5% FTSE All Emerging Index (Net), 11% FTSE Developed ex US Index (Net), 2% FTSE Developed Small Cap ex US Liquid Index (Net), and 1% Russell Microcap Index. Prior to June 8, 2016, the composite index was derived using the following allocations: 15% Dow Jones U.S. Large-Cap Total Stock Market Index, 4% Dow Jones U.S. Small-Cap Total Stock Market Index, 1% Russell Microcap Index, 11% FTSE Developed ex US Index (Net), 2% FTSE Developed Small Cap ex US Liquid Index (Net), 5% FTSE Emerging Index (Net), 6% Dow Jones U.S. Select REIT Index, 3% Dow Jones UBS Commodity Index, 2% Bloomberg US Treasury Inflation-Linked Bond Index (Series-L), 12% Bloomberg US Treasury 3-10 Year Index, 2% Bloomberg US Aggregate: Agencies Index, 6% Bloomberg US Credit Index, 13% Bloomberg US Mortgage Backed Securities Index, 2% Bloomberg Global Treasury ex-US Capped Index, 1% Bloomberg High Yield Bond Very Liquid Index, and 15% Bloomberg US Treasury Bills 1–3 Month Index.

**33**Schwab VIT Balanced Portfolio \| Annual Report

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;

Notes

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;

Notes

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![(CHARLES SCHWAB ASSET MANAGMENT LOGO)](g103049img6c8879be1.jpg)

**Annual Report** \| December 31, 2022

Schwab VIT Balanced with Growth Portfolio

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**Proxy Voting Policies, Procedures and Results**

A description of the proxy voting policies and procedures used to determine how to vote proxies on behalf of the funds is available without charge, upon request, by visiting the Schwab Fund's website at www.schwabassetmanagement.com/schwabfunds_prospectus, the SEC's website at www.sec.gov, or by contacting Schwab Funds at 1-877-824-5615.

Information regarding how a fund voted proxies relating to portfolio securities during the most recent twelve-month period ended June 30 is available, without charge, by visiting Schwab's website at www.schwabassetmanagement.com/schwabfunds_prospectus or the SEC's website at www.sec.gov.

**Investment Adviser:** Charles Schwab Investment Management, Inc., dba Schwab Asset Management<sup>TM</sup>

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Schwab VIT Balanced with Growth Portfolio

The Investment Environment

------

For the 12-month reporting period ended December 31, 2022, several key U.S. stock indices posted their largest calendar year drop since the 2008 recession and the Bloomberg US Aggregate Bond Index suffered its worst calendar year performance since its inception in 1976, with longer-term bonds underperforming shorter-term bonds. Inflation spiked, interest rates rose, and economic growth around the world slowed. The ongoing war between Russia and Ukraine and the continuing, albeit uneven, fallout from the COVID-19 pandemic weighed on economies and markets around the world. Oil prices peaked at over $120 per barrel in early March as sanctions were imposed on Russian imports—and again in June on supply-and-demand imbalances—but retreated through most of the rest of the reporting period, ending it at just over $80 per barrel. The U.S. dollar strengthened against a basket of international currencies over the reporting period, generally decreasing the returns on overseas investments in U.S. dollar terms. For the reporting period, the S&P 500<sup>®</sup> Index, a bellwether for the overall U.S. stock market, returned -18.11%. The MSCI EAFE<sup>®</sup> Index (Net)\*, a broad measure of developed international equity performance, returned -14.45%. Emerging market equities were weaker, with the MSCI Emerging Markets Index (Net)\* returning -20.09%. Among U.S. and international bonds, the Bloomberg US Aggregate Bond Index returned -13.01% and the FTSE non-US Dollar World Government Bond Index returned -22.07%.

As inflation continued to rise and U.S. Federal Reserve (Fed) monetary policy shifted, bond yields began to climb early in 2022, for the most part maintaining that trajectory through the first three quarters of the year, exerting downward pressure on bond prices. (Bond yields and bond prices typically move in opposite directions.) In the final quarter, longer-term yields became more volatile and prices rebounded slightly, leading to an inversion of certain parts of the yield curve. Over the reporting period, the yield on the 10-year U.S. Treasury rose from 1.52% to 3.88%. Short-term rates also rose sharply, with the yield on the three-month U.S. Treasury climbing from 0.06% to 4.42% over the reporting period, ending the year just slightly off its one-year high.

**Asset Class Performance Comparison % returns during the 12 months ended December 31, 2022**![](g103049img755aa6562.jpg)

Index figures assume dividends and distributions were reinvested. Index figures do not include trading and management costs, which would lower performance. Indices are unmanaged and cannot be invested in directly. Performance results less than one year are not annualized. Past performance is not an indication of future results.

For index definitions, please see the Glossary.

Data source: Index provider websites and Schwab Asset Management.

Nothing in this report represents a recommendation of a security by the investment adviser.

Management views may have changed since the report date.

\*

The net version of the index reflects reinvested dividends net of withholding taxes but reflects no deductions for expenses or other taxes.

Schwab VIT Balanced with Growth Portfolio \| Annual Report**2**

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Schwab VIT Balanced with Growth Portfolio

The Investment Environment (continued)

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In the United States, amid fading government stimuli, ongoing supply chain disruptions, persisting inflation, and a widening U.S. trade deficit, gross domestic product (GDP) contracted for the first two quarters of 2022, decreasing at an annualized rate of -1.6% and -0.6% for the first and second quarters, respectively. GDP grew at an annualized rate of 3.2% for the third quarter of 2022, driven primarily by energy exports and consumer spending. Inflation rose steadily in the first half of the year, hitting a 40-year high in June, before declining through the end of the reporting period as certain consumer and energy prices began to recede. The unemployment rate remained low despite inflationary pressures, ending the reporting period at pre-pandemic lows.

Outside the United States, conditions were similar. The eurozone, despite considerable headwinds, managed to maintain positive, albeit waning, GDP growth for the first, second, and third quarters of 2022 on easing COVID-19 restrictions and an increase in tourism in response to pent-up demand. The United Kingdom posted small gains in GDP growth for the first two quarters of 2022, in part driven by increases in COVID-19 testing and tracing and an expansion of its vaccination program but contracted slightly in the third quarter of 2022 on reduced household spending. Among emerging markets, China's GDP growth turned negative for the second quarter as it dealt with numerous headwinds including lockdowns and quarantines, declining domestic consumption, and a severe property downturn, but by the third quarter, GDP growth was again positive, buoyed by a series of policies and stimuli implemented to revive economic activity. India's GDP growth remained positive throughout the reporting period, and was particularly strong in the second quarter, but third-quarter GDP growth waned as high prices and rising interest rates weighed on demand.

Monetary policy around the world varied as central banks responded to the rapidly changing conditions. In the United States, after maintaining the federal funds rate in a range of 0.00% to 0.25% through mid-March 2022, the Fed shifted its stance as inflation continued to rise and indicators of economic activity and employment continued to strengthen. After issuing successively stronger signals that interest rates could begin to rise sooner in 2022 than previously anticipated, the Fed raised the federal funds rate seven times during the reporting period—by 0.25% in mid-March, 0.50% in early May, 0.75% in mid-June, 0.75% in late July, 0.75% in late September, 0.75% in early November, and 0.50% in mid-December. The federal funds rate ended the reporting period in a range of 4.25% to 4.50%. The Fed wrapped up its bond-buying program in March, and in June began to reduce the $9 trillion in assets held on its balance sheet, vowing to be even more aggressive than during its last round of quantitative tightening between 2017 and 2019. In developed international countries, central banks wrestled with similar issues. After holding its policy rate unchanged since March 2016, at 0.00%, the European Central Bank raised its interest rate four times over the reporting period in an effort to dampen demand and control inflation, which in October rose into double-digits. The Bank of England raised its key official bank rate eight times during the reporting period, bringing borrowing costs to a 14-year high as the Bank of England wrestled with soaring inflation. In contrast, the Bank of Japan continued to uphold its short-term interest rate target of -0.1%, unchanged since 2016, but in late December unexpectedly announced that it would widen the band around the yield target on its 10-year government bond, which pushed the yen higher and effectively marked the end of an extended period in which Japan was the only major developed country to resist raising rates. Monetary policy rates in emerging markets for the most part rose, with a few exceptions. Central banks in India, Indonesia, Brazil, Mexico, and Pakistan all raised their rates multiple times over the reporting period to counteract the impacts of inflation. In contrast, China cut its prime rate twice during the period, in part following a resurgence of COVID-19 cases and a lingering property downturn. Russia, which had raised its benchmark policy rate to 20% in late February amid the broadening fallout of Western sanctions in retaliation against Russia's invasion of Ukraine, subsequently reduced it multiple times by the end of the reporting period.

**3**Schwab VIT Balanced with Growth Portfolio \| Annual Report

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Schwab VIT Balanced with Growth Portfolio

Portfolio Management

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;

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| | |
|:---|:---|
| ![](g103049img4a18a25b3.jpg)<br>| &nbsp;&nbsp;&nbsp;&nbsp; **Zifan Tang, Ph.D., CFA,** Senior Portfolio Manager for Schwab Asset Management, is responsible for the <br> co-management of the fund. Prior to joining Schwab in 2012, Ms. Tang was a product manager at Thomson <br> Reuters and from 1997 to 2009 worked as a portfolio manager at Barclays Global Investors (now known as <br> BlackRock).<br>|

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;

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| | |
|:---|:---|
| ![(DREW HAYES PHOTO)](g103049img7dce0ae64.jpg)<br>| &nbsp;&nbsp;&nbsp;&nbsp; **Drew Hayes, CFA,** Portfolio Manager for Schwab Asset Management, is responsible for the co-management <br> of the fund. Mr. Hayes has been with Schwab since 2006. Before becoming a portfolio manager, he spent <br> seven years as a senior fixed income specialist for Schwab Wealth Advisory, Inc. Prior to that, he worked as a <br> bond investment specialist for two years and as a registered representative for two years for Charles <br> Schwab & Co., Inc.<br>|

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;

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| | |
|:---|:---|
| ![](g103049img7ae8d34e5.jpg)<br>| &nbsp;&nbsp;&nbsp;&nbsp; **Patrick Kwok, CFA,** Portfolio Manager for Schwab Asset Management, is responsible for the co-management <br> of the fund. Previously, Mr. Kwok served as an associate portfolio manager from 2012 to 2016. Prior to that, he <br> worked as a fund administration manager, where he was responsible for oversight of sub-advisers, trading, <br> cash management, and fund administration supporting the Charles Schwab Trust Bank Collective Investment <br> Trusts and multi-asset Schwab Funds. Prior to joining Schwab Asset Management in 2008, Mr. Kwok spent <br> two years as an asset operations specialist at Charles Schwab Trust Company. He also worked for one year at <br> State Street Bank & Trust as a portfolio accountant and pricing specialist.<br>|

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Schwab VIT Balanced with Growth Portfolio \| Annual Report**4**

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Schwab VIT Balanced with Growth Portfolio as of December 31, 2022

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**The Schwab VIT Balanced with Growth Portfolio** (the fund) seeks long-term capital appreciation and income. To pursue its goal, the fund aims to provide diversification across major asset classes, including domestic equity securities, international equity securities, real assets, fixed-income securities, and money market investments, as well as diversification across a range of sub-asset classes within the major asset classes.

The fund is considered a "fund-of-funds" in that it gains exposure to these asset classes by primarily investing in affiliated exchange-traded funds (ETFs) from Schwab Funds. The fund may also invest in affiliated mutual funds from Schwab Funds and unaffiliated third-party ETFs and mutual funds. The fund uses the internally calculated VIT Balanced with Growth Composite Index (the composite index) as a performance gauge. The components that make up the composite index may vary over time. For index definition, please see the Glossary.

**Market Highlights.** For the 12-month reporting period ended December 31, 2022, several key U.S. stock indices posted their largest calendar year drop since the 2008 recession and the Bloomberg US Aggregate Bond Index suffered its worst calendar year performance since its inception in 1976, with longer-term bonds underperforming shorter-term bonds. Inflation spiked, interest rates rose, and economic growth around the world slowed. The ongoing war between Russia and Ukraine and the continuing, albeit uneven, fallout from the COVID-19 pandemic weighed on economies and markets around the world. Oil prices peaked at over $120 per barrel in early March as sanctions were imposed on Russian imports—and again in June on supply-and-demand imbalances—but retreated through most of the rest of the reporting period, ending it at just over $80 per barrel. The U.S. dollar strengthened against a basket of international currencies over the reporting period, generally decreasing the returns on overseas investments in U.S. dollar terms. As inflation continued to rise and U.S. Federal Reserve monetary policy shifted, bond yields began to climb early in 2022, for the most part maintaining that trajectory through the first three quarters of the year, exerting downward pressure on bond prices. (Bond yields and bond prices typically move in opposite directions.)

**Performance.** For the 12-month reporting period ended December 31, 2022, the fund returned -16.00%. The Dow Jones U.S. Total Stock Market Index and the Bloomberg US Aggregate Bond Index, reflecting broad-based U.S. stock and bond market performance, returned -19.53% and -13.01%, respectively. The composite index, described above, returned -15.52%.

**Positioning and Strategies**. The fund's allocations were broadly in line with those of the composite index.

The fund's U.S. equity exposure detracted the most from the total return of the fund. The Schwab U.S. Large-Cap ETF was the largest detractor from the total return of the fund, returning approximately -19% for the reporting period and generally tracking its comparative index components. The Schwab U.S. Small-Cap ETF also detracted from the total return of the fund, returning approximately -20% for the reporting period and generally tracking its comparative index component.

The fund's international equity exposure detracted from the total return of the fund. The Schwab International Equity ETF, the Schwab Emerging Markets Equity ETF, and the Schwab International Small-Cap Equity ETF detracted from the total return of the fund, returning approximately -15%, -18%, and -22%, respectively, for the reporting period and generally tracking their respective comparative index components.

The fund's fixed-income exposure detracted from the total return of the fund. The Schwab U.S. Aggregate Bond ETF and the Schwab Short-Term U.S. Treasury ETF detracted from the total return of the fund, returning approximately -13% and -4%, respectively, for the reporting period and generally tracking their respective comparative index components. The Schwab U.S. TIPS ETF was the smallest detractor from the total return of the fund, returning approximately -12% for the reporting period and generally tracking its comparative index component.

The fund's real estate exposure, the Schwab U.S. REIT ETF, also detracted from the total return of the fund, returning approximately -25% for the reporting period and generally tracking its comparative index component.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;

Management views and portfolio holdings may have changed since the report date.

**5**Schwab VIT Balanced with Growth Portfolio \| Annual Report

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Schwab VIT Balanced with Growth Portfolio

Performance and Fund Facts as of December 31, 2022

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**The performance data quoted represents past performance. Past performance does not guarantee future results. Investment returns and principal value will fluctuate so that an investor's shares may be worth more or less than their original cost. Current performance may be lower or higher than performance data quoted. To obtain performance information current to the most recent month end, please visit www.schwabassetmanagement.com/schwabfunds_prospectus.** 

**Performance of Hypothetical $10,000 Investment (December 31, 2012 – December 31, 2022)**<sup>1</sup>

![](g103049lg_2mq8.jpg)

**Average Annual Total Returns**<sup>1</sup>

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| | | | |
|:---|:---|:---|:---|
| **Fund and Inception Date** | **1 Year** | **5 Years** | **10 Years** |
| Fund: Schwab VIT Balanced with Growth Portfolio (07/25/12) | -16.00% | 2.56% | &nbsp;&nbsp; 4.44% |
| S&P 500<sup>®</sup> Index | -18.11% | 9.42% | 12.56% |
| Bloomberg US Aggregate Bond Index | -13.01% | 0.02% | &nbsp;&nbsp; 1.06% |
| VIT Balanced with Growth Composite Index | -15.52% | 3.16% | &nbsp;&nbsp; 5.14% |
| Fund Category: Morningstar Allocation – 50% to 70% Equity<sup>2</sup> <br>| -16.01% | 3.55% | &nbsp;&nbsp; 6.27% |
| *Fund Expense Ratio*<sup>3</sup>*: 0.54%* | *Fund Expense Ratio*<sup>3</sup>*: 0.54%* | *Fund Expense Ratio*<sup>3</sup>*: 0.54%* | *Fund Expense Ratio*<sup>3</sup>*: 0.54%* |

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;

All total return figures on this page assume dividends and distributions were reinvested. Index figures do not include trading and management costs, which would lower performance. Indices are unmanaged and cannot be invested in directly. Performance results less than one year are not annualized.

The components that make up the composite index may vary over time. For index definitions, please see the Glossary.

<sup>1</sup>

Fund expenses may have been partially absorbed by the investment adviser and its affiliates. Without these reductions, the fund's returns would have been lower. Fund performance does not reflect the additional fees and expenses imposed by the insurance company under the variable insurance product contract. If those contract fees and expenses were included, the performance would be less than that shown. Please refer to the variable insurance product prospectus for a complete listing of these expenses.

<sup>2</sup>

Source for category information: Morningstar, Inc. The Morningstar Category return represents all active and index mutual funds and ETFs within the category as of the report date.

<sup>3</sup>

As stated in the prospectus. Includes 0.05% of acquired fund fees and expenses (AFFE), which are indirect expenses incurred by the fund through its investments in the underlying funds. Reflects the total annual fund operating expenses without contractual fee waivers. For actual expense ratios during the period, not including AFFE, refer to the Financial Highlights section of the financial statements.

Schwab VIT Balanced with Growth Portfolio \| Annual Report**6**

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Schwab VIT Balanced with Growth Portfolio

Performance and Fund Facts as of December 31, 2022 (continued)

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;

**Statistics**

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| | |
|:---|:---|
| Number of Holdings | &nbsp;&nbsp; 10 |
| Portfolio Turnover Rate | 13% |

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**Asset Class Weightings % of Investments**<sup>1,2</sup> <br>

![](g103049img51a82d7c6.jpg)

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;

**Top Holdings % of Net Assets**<sup>1,3</sup> <br>

![](g103049img16a772c37.jpg)

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;

Portfolio holdings may have changed since the report date.

<sup>1</sup>

The fund intends to primarily invest in affiliated Schwab ETFs and may also invest in affiliated Schwab Funds and unaffiliated third-party ETFs and mutual funds (all such ETFs and mutual funds referred to as "underlying funds"). The fund may also invest directly in equity, fixed-income, or other securities or investments, as appropriate, consistent with its investment objectives, strategies, and policies.

<sup>2</sup>

The percentage may differ from the Portfolio Holdings because the above calculation is based on a percentage of total investments, whereas the calculation in the Portfolio Holdings is based on a percentage of net assets.

<sup>3</sup>

This list is not a recommendation of any security by the investment adviser.

**7**Schwab VIT Balanced with Growth Portfolio \| Annual Report

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Schwab VIT Balanced with Growth Portfolio

Fund Expenses (Unaudited)

**Examples for a $1,000 Investment**

As a fund shareholder, you may incur two types of costs: (1) transaction costs; and (2) ongoing costs, including management fees, transfer agent fees, and other fund expenses.

The expense examples below are intended to help you understand your ongoing cost (in dollars) of investing in the fund and to compare this cost with the ongoing cost of investing in other mutual funds. These examples are based on an investment of $1,000 invested for six months beginning July 1, 2022 and held through December 31, 2022.

**The Actual Return** line in the table below provides information about actual account values and actual expenses. You may use this information, together with the amount you invested, to estimate the expenses that you paid over the period. To do so, simply divide your account value by $1,000 (for example, an $8,600 account value ÷ $1,000 = 8.6), then multiply the result by the number given for the fund under the heading entitled "Expenses Paid During Period."

**The Hypothetical Return** line in the table below provides information about hypothetical account values and hypothetical expenses based on the fund's actual expense ratio and an assumed return of 5% per year before expenses. Because the return used is not an actual return, it may not be used to estimate the actual ending account value or expenses you paid for the period.

You may use this information to compare the ongoing costs of investing in the fund and other funds. To do so, compare this 5% hypothetical example with the 5% hypothetical examples that appear in the shareholder reports of the other funds.

Please note that the expenses shown in the table are meant to highlight your ongoing costs only, and do not reflect any transactional costs. Therefore, the hypothetical return lines of the table are useful in comparing ongoing costs only, and will not help you determine the relative total costs of owning different funds. In addition, if these transactional costs were included, your costs would have been higher.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;

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| | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|
|  | &nbsp;&nbsp; EXPENSE RATIO <br>(ANNUALIZED)<sup>1,2</sup> <br>| &nbsp;&nbsp; EFFECTIVE <br>EXPENSE RATIO <br>(ANNUALIZED)<sup>3,4</sup> <br>| &nbsp;&nbsp; BEGINNING <br>ACCOUNT VALUE <br>AT 7/1/22<br>| &nbsp;&nbsp; ENDING <br>ACCOUNT VALUE <br>(NET OF EXPENSES) <br>AT 12/31/22<sup>2</sup> <br>| &nbsp;&nbsp; EXPENSES PAID <br>DURING PERIOD <br>7/1/22-12/31/22<sup>2,5</sup> <br>| &nbsp;&nbsp; EFFECTIVE <br>EXPENSES PAID <br>DURING PERIOD <br>7/1/22-12/31/22<sup>4,5</sup> <br>|
| **Schwab VIT Balanced with Growth** <br> **Portfolio**<br>|  |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; Actual Return | 0.49% | 0.55% | $1000.00 | $1000.70 | $2.47 | $2.77 |
| &nbsp;&nbsp;&nbsp;&nbsp; Hypothetical 5% Return | 0.49% | 0.55% | $1000.00 | $1022.74 | $2.50 | $2.80 |

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;

<sup>1</sup> Based on the most recent six-month expense ratio; may differ from the expense ratio provided in the Financial Highlights.

<sup>2</sup> Excludes acquired fund fees and expenses, which are indirect expenses incurred by the fund through its investments in underlying funds.

<sup>3</sup> Based on the most recent six-month acquired fund fees and expenses and the expense ratio; may differ from the acquired fund fees and expenses and the expense ratio in the prospectus. 

<sup>4</sup> Includes acquired fund fees and expenses, which are indirect expenses incurred by the fund through its investments in underlying funds.

<sup>5</sup> Expenses for the fund are equal to its annualized expense ratio, multiplied by the average account value over the period, multiplied by 184 days in the period, and divided by 365 days in the fiscal year. 

Schwab VIT Balanced with Growth Portfolio \| Annual Report**8**

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Schwab VIT Balanced with Growth Portfolio

Financial Statements

**FINANCIAL HIGHLIGHTS**

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| | | | | | |
|:---|:---|:---|:---|:---|:---|
|  | 1/1/22– <br>12/31/22<br>| 1/1/21– <br>12/31/21<br>| 1/1/20– <br>12/31/20<br>| 1/1/19– <br>12/31/19<br>| 1/1/18– <br>12/31/18<br>|
| **Per-Share Data** | **Per-Share Data** | **Per-Share Data** | **Per-Share Data** | **Per-Share Data** | **Per-Share Data** |
| Net asset value at beginning of period | &nbsp;&nbsp;&nbsp; $17.24 | &nbsp;&nbsp;&nbsp; $15.68 | &nbsp;&nbsp;&nbsp; $14.59 | &nbsp;&nbsp;&nbsp; $12.66 | &nbsp;&nbsp;&nbsp; $13.80 |
| Income (loss) from investment operations: |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; Net investment income (loss)<sup>1</sup> <br>| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 0.24 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 0.25 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 0.22 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 0.28 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 0.25 |
| &nbsp;&nbsp;&nbsp;&nbsp; Net realized and unrealized gains (losses) | &nbsp;&nbsp;&nbsp;&nbsp; (3.00) | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 1.53 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 1.20 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 1.99 | &nbsp;&nbsp;&nbsp;&nbsp; (1.16) |
| &nbsp;&nbsp;&nbsp;&nbsp; Total from investment operations | &nbsp;&nbsp;&nbsp;&nbsp; (2.76) | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 1.78 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 1.42 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 2.27 | &nbsp;&nbsp;&nbsp;&nbsp; (0.91) |
| Less distributions: |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; Distributions from net investment income | &nbsp;&nbsp;&nbsp;&nbsp; (0.25) | &nbsp;&nbsp;&nbsp;&nbsp; (0.22) | &nbsp;&nbsp;&nbsp;&nbsp; (0.29) | &nbsp;&nbsp;&nbsp;&nbsp; (0.26) | &nbsp;&nbsp;&nbsp;&nbsp; (0.21) |
| &nbsp;&nbsp;&nbsp;&nbsp; Distributions from net realized gains | &nbsp;&nbsp;&nbsp;&nbsp; (0.30) | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; — | &nbsp;&nbsp;&nbsp;&nbsp; (0.04) | &nbsp;&nbsp;&nbsp;&nbsp; (0.08) | &nbsp;&nbsp;&nbsp;&nbsp; (0.02) |
| &nbsp;&nbsp;&nbsp;&nbsp; Total distributions | &nbsp;&nbsp;&nbsp;&nbsp; (0.55) | &nbsp;&nbsp;&nbsp;&nbsp; (0.22) | &nbsp;&nbsp;&nbsp;&nbsp; (0.33) | &nbsp;&nbsp;&nbsp;&nbsp; (0.34) | &nbsp;&nbsp;&nbsp;&nbsp; (0.23) |
| Net asset value at end of period | &nbsp;&nbsp;&nbsp; $13.93 | &nbsp;&nbsp;&nbsp; $17.24 | &nbsp;&nbsp;&nbsp; $15.68 | &nbsp;&nbsp;&nbsp; $14.59 | &nbsp;&nbsp;&nbsp; $12.66 |
| Total return | &nbsp;&nbsp;&nbsp;&nbsp; (16.00%) | &nbsp;&nbsp;&nbsp;&nbsp; 11.42% | &nbsp;&nbsp;&nbsp;&nbsp; 10.09% | &nbsp;&nbsp;&nbsp;&nbsp; 18.05% | &nbsp;&nbsp;&nbsp;&nbsp; (6.70%) |
| **Ratios/Supplemental Data** | **Ratios/Supplemental Data** | **Ratios/Supplemental Data** | **Ratios/Supplemental Data** | **Ratios/Supplemental Data** | **Ratios/Supplemental Data** |
| Ratios to average net assets: |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; Net operating expenses<sup>2</sup> <br>| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 0.49%<sup>3</sup> <br>| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 0.49% | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 0.50% | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 0.51% | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 0.50% |
| &nbsp;&nbsp;&nbsp;&nbsp; Gross operating expenses<sup>2</sup> <br>| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 0.49%<sup>3</sup> <br>| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 0.49% | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 0.50% | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 0.51% | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 0.50% |
| &nbsp;&nbsp;&nbsp;&nbsp; Net investment income (loss) | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 1.61% | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 1.48% | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 1.56% | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 2.04% | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 1.87% |
| Portfolio turnover rate | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 13% | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 8% | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 21% | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 7% | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 8% |
| Net assets, end of period (x 1,000) | $150867 | $184104 | $163848 | $162364 | $139551 |

---

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;

<sup>1</sup> Calculated based on the average shares outstanding during the period.

<sup>2</sup> Ratio excludes acquired fund fees and expenses, which are indirect expenses incurred by the fund through its investments in underlying funds.

<sup>3</sup> Ratio includes less than 0.005% of non-routine proxy expenses.

*See financial notes*

**9**Schwab VIT Balanced with Growth Portfolio \| Annual Report

------

Schwab VIT Balanced with Growth Portfolio

Portfolio Holdings as of December 31, 2022

------

This section shows all the securities in the fund's portfolio and their values as of the report date, including a summary of the fund's transactions with its affiliated underlying funds during the period.

The fund files its complete schedule of portfolio holdings with the U.S. Securities and Exchange Commission (SEC) for the first and third quarters of each fiscal year on Form N-PORT Part F. The fund's Form N-PORT Part F is available on the SEC's website at www.sec.gov. The fund also makes available its complete schedule of portfolio holdings on the fund's website at www.schwabassetmanagement.com/schwabfunds_prospectus, typically 60-80 days after the end of the fund's fiscal quarter.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;

---

| | | | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|:---|:---|
| SECURITY | VALUE AT<br> 12/31/21<br>| PURCHASES | SALES | REALIZED<br> GAINS (LOSSES)<br>| NET CHANGE IN<br> UNREALIZED<br> APPRECIATION<br> (DEPRECIATION)<br>| VALUE AT<br> 12/31/22<br>| BALANCE<br> OF SHARES<br> HELD AT<br> 12/31/22<br>| DISTRIBUTIONS<br> RECEIVED<sup>(a)</sup> <br>|
| **AFFILIATED UNDERLYING FUNDS** 99.4% OF NET ASSETS | **AFFILIATED UNDERLYING FUNDS** 99.4% OF NET ASSETS | **AFFILIATED UNDERLYING FUNDS** 99.4% OF NET ASSETS | **AFFILIATED UNDERLYING FUNDS** 99.4% OF NET ASSETS | **AFFILIATED UNDERLYING FUNDS** 99.4% OF NET ASSETS | **AFFILIATED UNDERLYING FUNDS** 99.4% OF NET ASSETS | **AFFILIATED UNDERLYING FUNDS** 99.4% OF NET ASSETS | **AFFILIATED UNDERLYING FUNDS** 99.4% OF NET ASSETS | **AFFILIATED UNDERLYING FUNDS** 99.4% OF NET ASSETS |
| **U.S. Stocks 33.0%** | **U.S. Stocks 33.0%** | **U.S. Stocks 33.0%** | **U.S. Stocks 33.0%** | **U.S. Stocks 33.0%** | **U.S. Stocks 33.0%** | **U.S. Stocks 33.0%** | **U.S. Stocks 33.0%** | **U.S. Stocks 33.0%** |
| **Large-Cap 27.0%** | **Large-Cap 27.0%** | **Large-Cap 27.0%** | **Large-Cap 27.0%** | **Large-Cap 27.0%** | **Large-Cap 27.0%** | **Large-Cap 27.0%** | **Large-Cap 27.0%** | **Large-Cap 27.0%** |
| Schwab U.S. Large-Cap ETF  | &nbsp;&nbsp; $49940687 | &nbsp;&nbsp; $6645312 | &nbsp;&nbsp; ($5666156) | &nbsp;&nbsp;&nbsp;&nbsp; $378528 | ($10582011) | &nbsp;&nbsp; $40716360 | &nbsp;&nbsp; 901802 | &nbsp;&nbsp;&nbsp; $656672 |
| **Small-Cap 6.0%** | **Small-Cap 6.0%** | **Small-Cap 6.0%** | **Small-Cap 6.0%** | **Small-Cap 6.0%** | **Small-Cap 6.0%** | **Small-Cap 6.0%** | **Small-Cap 6.0%** | **Small-Cap 6.0%** |
| Schwab U.S. Small-Cap ETF  | &nbsp;&nbsp;&nbsp;&nbsp; 11102413 | &nbsp;&nbsp;&nbsp;&nbsp; 1509314 | &nbsp;&nbsp;&nbsp;&nbsp; (1264946) | &nbsp;&nbsp;&nbsp;&nbsp; (139307) | &nbsp;&nbsp;&nbsp;&nbsp; (2181724) | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 9025750 | &nbsp;&nbsp; 222803 | &nbsp;&nbsp;&nbsp;&nbsp; 123309 |
|  |  |  |  |  |  | &nbsp;&nbsp;&nbsp;&nbsp; 49742110 |  |  |
| **International Stocks 26.0%** | **International Stocks 26.0%** | **International Stocks 26.0%** | **International Stocks 26.0%** | **International Stocks 26.0%** | **International Stocks 26.0%** | **International Stocks 26.0%** | **International Stocks 26.0%** | **International Stocks 26.0%** |
| **Developed Markets 20.0%** | **Developed Markets 20.0%** | **Developed Markets 20.0%** | **Developed Markets 20.0%** | **Developed Markets 20.0%** | **Developed Markets 20.0%** | **Developed Markets 20.0%** | **Developed Markets 20.0%** | **Developed Markets 20.0%** |
| Schwab International Equity ETF  | &nbsp;&nbsp;&nbsp;&nbsp; 31394366 | &nbsp;&nbsp;&nbsp;&nbsp; 2436577 | &nbsp;&nbsp;&nbsp;&nbsp; (2934060) | &nbsp;&nbsp;&nbsp;&nbsp; (423714) | &nbsp;&nbsp;&nbsp;&nbsp; (4831207) | &nbsp;&nbsp;&nbsp;&nbsp; 25641962 | &nbsp;&nbsp; 796087 | &nbsp;&nbsp;&nbsp;&nbsp; 723939 |
| &nbsp;&nbsp;&nbsp;&nbsp; Schwab International Small-Cap Equity <br> ETF <br>| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 5553873 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 514030 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (197185) | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (47475) | &nbsp;&nbsp;&nbsp;&nbsp; (1230700) | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 4592543 | &nbsp;&nbsp; 145934 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 81796 |
|  |  |  |  |  |  | &nbsp;&nbsp;&nbsp;&nbsp; 30234505 |  |  |
| **Emerging Markets 6.0%** | **Emerging Markets 6.0%** | **Emerging Markets 6.0%** | **Emerging Markets 6.0%** | **Emerging Markets 6.0%** | **Emerging Markets 6.0%** | **Emerging Markets 6.0%** | **Emerging Markets 6.0%** | **Emerging Markets 6.0%** |
| Schwab Emerging Markets Equity ETF  | &nbsp;&nbsp;&nbsp;&nbsp; 10893792 | &nbsp;&nbsp;&nbsp;&nbsp; 1599701 | &nbsp;&nbsp;&nbsp;&nbsp; (1327226) | &nbsp;&nbsp;&nbsp;&nbsp; (225529) | &nbsp;&nbsp;&nbsp;&nbsp; (1900857) | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 9039881 | &nbsp;&nbsp; 381913 | &nbsp;&nbsp;&nbsp;&nbsp; 258191 |
|  |  |  |  |  |  | &nbsp;&nbsp;&nbsp;&nbsp; 39274386 |  |  |
| **Real Estate 6.0%** | **Real Estate 6.0%** | **Real Estate 6.0%** | **Real Estate 6.0%** | **Real Estate 6.0%** | **Real Estate 6.0%** | **Real Estate 6.0%** | **Real Estate 6.0%** | **Real Estate 6.0%** |
| **U.S. REITs 6.0%** | **U.S. REITs 6.0%** | **U.S. REITs 6.0%** | **U.S. REITs 6.0%** | **U.S. REITs 6.0%** | **U.S. REITs 6.0%** | **U.S. REITs 6.0%** | **U.S. REITs 6.0%** | **U.S. REITs 6.0%** |
| Schwab U.S. REIT ETF  | &nbsp;&nbsp;&nbsp;&nbsp; 11277189 | &nbsp;&nbsp;&nbsp;&nbsp; 1837741 | &nbsp;&nbsp;&nbsp;&nbsp; (1178723) | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 120984 | &nbsp;&nbsp;&nbsp;&nbsp; (3033367) | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 9023824 | &nbsp;&nbsp; 467798 | &nbsp;&nbsp;&nbsp;&nbsp; 213815 |
| **Fixed Income 31.1%** | **Fixed Income 31.1%** | **Fixed Income 31.1%** | **Fixed Income 31.1%** | **Fixed Income 31.1%** | **Fixed Income 31.1%** | **Fixed Income 31.1%** | **Fixed Income 31.1%** | **Fixed Income 31.1%** |
| **Inflation-Protected Bond 1.0%** | **Inflation-Protected Bond 1.0%** | **Inflation-Protected Bond 1.0%** | **Inflation-Protected Bond 1.0%** | **Inflation-Protected Bond 1.0%** | **Inflation-Protected Bond 1.0%** | **Inflation-Protected Bond 1.0%** | **Inflation-Protected Bond 1.0%** | **Inflation-Protected Bond 1.0%** |
| Schwab U.S. TIPS ETF  | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 1776580 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; — | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; — | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; — | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (313564) | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 1463016 | &nbsp;&nbsp;&nbsp;&nbsp; 28249 | &nbsp;&nbsp;&nbsp;&nbsp; 105239 |
| **Intermediate-Term Bond 26.2%** | **Intermediate-Term Bond 26.2%** | **Intermediate-Term Bond 26.2%** | **Intermediate-Term Bond 26.2%** | **Intermediate-Term Bond 26.2%** | **Intermediate-Term Bond 26.2%** | **Intermediate-Term Bond 26.2%** | **Intermediate-Term Bond 26.2%** | **Intermediate-Term Bond 26.2%** |
| Schwab U.S. Aggregate Bond ETF  | &nbsp;&nbsp;&nbsp;&nbsp; 47709154 | &nbsp;&nbsp;&nbsp;&nbsp; 5649531 | &nbsp;&nbsp;&nbsp;&nbsp; (6566459) | &nbsp;&nbsp;&nbsp;&nbsp; (878054) | &nbsp;&nbsp;&nbsp;&nbsp; (6381546) | &nbsp;&nbsp;&nbsp;&nbsp; 39532626 | &nbsp;&nbsp; 865994 | &nbsp;&nbsp; 1040989 |
| **Treasury Bond 3.9%** | **Treasury Bond 3.9%** | **Treasury Bond 3.9%** | **Treasury Bond 3.9%** | **Treasury Bond 3.9%** | **Treasury Bond 3.9%** | **Treasury Bond 3.9%** | **Treasury Bond 3.9%** | **Treasury Bond 3.9%** |
| Schwab Short-Term U.S. Treasury ETF  | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 7156171 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 557994 | &nbsp;&nbsp;&nbsp;&nbsp; (1446068) | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (73940) | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (275061) | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 5919096 | &nbsp;&nbsp; 122701 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 80597 |
|  |  |  |  |  |  | &nbsp;&nbsp;&nbsp;&nbsp; 46914738 |  |  |
| **Money Market Funds 3.3%** | **Money Market Funds 3.3%** | **Money Market Funds 3.3%** | **Money Market Funds 3.3%** | **Money Market Funds 3.3%** | **Money Market Funds 3.3%** | **Money Market Funds 3.3%** | **Money Market Funds 3.3%** | **Money Market Funds 3.3%** |
| &nbsp;&nbsp;&nbsp;&nbsp; Schwab Variable Share Price Money Fund, <br> Ultra Shares, 4.42% <sup>(b)</sup> <br>| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 4911439 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 81976 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; — | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; — | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 10 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 4993425 | 4991928 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 82405 |
| **Total Affiliated Underlying Funds** <br>**(Cost $126,703,790)**<br>| **$181715664** | **$20832176** | **($20580823)** | **($1288507)** | **($30730027)** | **$149948483** |  | **$3366952** |
| **Total Investments in Securities** <br>**(Cost $126,703,790)**<br>|  |  |  |  |  | **$149948483** |  |  |

---

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;

<sup>(a)</sup> Distributions received include distributions from net investment income and capital gains, if any, from the underlying funds. Amounts shown are only presented for affiliated underlying funds, which are presented in the corresponding line-item in the Statement of Operations, if applicable (see financial note 2(d) for additional information). 

<sup>(b)</sup> The rate shown is the annualized 7-day yield.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;

*See financial notes*

Schwab VIT Balanced with Growth Portfolio \| Annual Report**10**

------

Schwab VIT Balanced with Growth Portfolio

Portfolio Holdings as of December 31, 2022 (continued)

------

ETF — Exchange traded fund <br> REIT — Real Estate Investment Trust <br> TIPS — Treasury Inflation Protected Securities

At December 31, 2022, all of the fund's investment securities were classified as Level 1. Fund investments in underlying mutual funds and ETFs are classified as Level 1, without consideration to the classification level of the investments held by the underlying

mutual funds and ETFs, which could be Level 1, Level 2 or Level 3 (see financial note 2(a) for additional information).

*See financial notes*

**11**Schwab VIT Balanced with Growth Portfolio \| Annual Report

------

Schwab VIT Balanced with Growth Portfolio

Statement of Assets and Liabilities

------

As of December 31, 2022

---

| | | |
|:---|:---|:---|
| **Assets** | **Assets** | **Assets** |
| Investments in securities, at value - affiliated (cost $126,703,790) |  | $149948483 |
| Cash |  | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 871562 |
| Receivables: |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; Investments sold |  | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 1343220 |
| &nbsp;&nbsp;&nbsp;&nbsp; Dividends |  | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 27221 |
| Prepaid expenses | + | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 366 |
| **Total assets** |  | **152190852** |
| **Liabilities** | **Liabilities** | **Liabilities** |
| Payables: |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; Investments bought |  | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 1203964 |
| &nbsp;&nbsp;&nbsp;&nbsp; Investment adviser and administrator fees |  | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 62505 |
| &nbsp;&nbsp;&nbsp;&nbsp; Fund shares redeemed |  | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 21603 |
| &nbsp;&nbsp;&nbsp;&nbsp; Independent trustees' fees |  | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 36 |
| Accrued expenses | + | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 35331 |
| **Total liabilities** |  | **1323439** |
| **Net assets** |  | **$150867413** |
| **Net Assets by Source** | **Net Assets by Source** | **Net Assets by Source** |
| Capital received from investors |  | $127249567 |
| Total distributable earnings | + | &nbsp;&nbsp;&nbsp;&nbsp; 23617846 |
| **Net assets** |  | **$150867413** |

---

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;

---

| | | | | |
|:---|:---|:---|:---|:---|
| **Net Asset Value (NAV)**  | **Net Asset Value (NAV)**  | **Net Asset Value (NAV)**  | **Net Asset Value (NAV)**  | **Net Asset Value (NAV)**  |
| **Net Assets**  | **÷** | &nbsp;&nbsp;&nbsp;&nbsp; **Shares**<br> **Outstanding**<br>| **=** | **NAV** |
| $150867413 |  | 10834073 |  | $13.93 |

---

*See financial notes*

Schwab VIT Balanced with Growth Portfolio \| Annual Report**12**

------

Schwab VIT Balanced with Growth Portfolio

Statement of Operations

------

---

| | | |
|:---|:---|:---|
| For the period January 1, 2022 through December 31, 2022 | For the period January 1, 2022 through December 31, 2022 | For the period January 1, 2022 through December 31, 2022 |
| **Investment Income**  | **Investment Income**  | **Investment Income**  |
| Dividends received from securities - affiliated |  | &nbsp;&nbsp;&nbsp; $3366952 |
| Interest received from securities - unaffiliated | + | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 6758 |
| **Total investment income**  |  | **3373710** |
| **Expenses** | **Expenses** | **Expenses** |
| Investment adviser and administrator fees |  | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 721464 |
| Professional fees |  | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 23674 |
| Independent trustees' fees |  | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 13639 |
| Portfolio accounting fees |  | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 13059 |
| Shareholder reports |  | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 10517 |
| Proxy fees<sup>1</sup> <br>|  | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 2383 |
| Custodian fees |  | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 2120 |
| Transfer agent fees  |  | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 341 |
| Other expenses | + | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 3928 |
| **Total expenses** | – | **791125** |
| **Net investment income** |  | **2582585** |
| **REALIZED AND UNREALIZED GAINS (LOSSES)** | **REALIZED AND UNREALIZED GAINS (LOSSES)** | **REALIZED AND UNREALIZED GAINS (LOSSES)** |
| **Net realized losses on sales of securities - affiliated** |  | **(1288507)** |
| **Net change in unrealized appreciation (depreciation) on securities - affiliated** | + | **(30730027)** |
| **Net realized and unrealized losses** |  | **(32018534)** |
| **Decrease in net assets resulting from operations** |  | **($29435949)** |

---

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;

<sup>1</sup> Proxy fees are non-routine expenses (see financial note 4 for additional information).

*See financial notes*

**13**Schwab VIT Balanced with Growth Portfolio \| Annual Report

------

Schwab VIT Balanced with Growth Portfolio

Statement of Changes in Net Assets

------

For the current and prior report periods

---

| | | | |
|:---|:---|:---|:---|
| **OPERATIONS** | **OPERATIONS** | **OPERATIONS** | **OPERATIONS** |
|  | 1/1/22-12/31/22 | 1/1/22-12/31/22 | 1/1/21-12/31/21 |
| Net investment income |  | &nbsp;&nbsp;&nbsp; $2582585 | &nbsp;&nbsp; $2609162 |
| Net realized gains (losses) |  | &nbsp;&nbsp;&nbsp;&nbsp; (1288507) | &nbsp;&nbsp;&nbsp;&nbsp; 3443646 |
| Net change in unrealized appreciation (depreciation) | + | &nbsp;&nbsp; (30730027) | &nbsp;&nbsp; 12728493 |
| **Increase (decrease) in net assets resulting from operations** |  | **($29435949)** | **$18781301** |
| **DISTRIBUTIONS TO SHAREHOLDERS** | **DISTRIBUTIONS TO SHAREHOLDERS** | **DISTRIBUTIONS TO SHAREHOLDERS** | **DISTRIBUTIONS TO SHAREHOLDERS** |
| **Total distributions** |  | **($5827177)** | **($2357386)** |

---

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;

---

| | | | | | |
|:---|:---|:---|:---|:---|:---|
| **TRANSACTIONS IN FUND SHARES** | **TRANSACTIONS IN FUND SHARES** | **TRANSACTIONS IN FUND SHARES** | **TRANSACTIONS IN FUND SHARES** | **TRANSACTIONS IN FUND SHARES** | **TRANSACTIONS IN FUND SHARES** |
|  | 1/1/22-12/31/22 | 1/1/22-12/31/22 | 1/1/22-12/31/22 | 1/1/21-12/31/21 | 1/1/21-12/31/21 |
|  |  | SHARES | VALUE | SHARES | VALUE |
| Shares sold |  | &nbsp;&nbsp;&nbsp;&nbsp; 590536 | &nbsp;&nbsp;&nbsp;&nbsp; $8857377 | &nbsp;&nbsp;&nbsp;&nbsp; 875732 | &nbsp;&nbsp; $14657809 |
| Shares reinvested |  | &nbsp;&nbsp;&nbsp;&nbsp; 418619 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 5827177 | &nbsp;&nbsp;&nbsp;&nbsp; 140908 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 2357386 |
| Shares redeemed | + | &nbsp;&nbsp;&nbsp;&nbsp; (852798) | &nbsp;&nbsp;&nbsp; (12658007) | &nbsp;&nbsp;&nbsp;&nbsp; (791626) | &nbsp;&nbsp;&nbsp; (13183009) |
| **Net transactions in fund shares**  |  | **156357** | **$2026547** | **225014** | **$3832186** |
| **SHARES OUTSTANDING AND NET ASSETS** | **SHARES OUTSTANDING AND NET ASSETS** | **SHARES OUTSTANDING AND NET ASSETS** | **SHARES OUTSTANDING AND NET ASSETS** | **SHARES OUTSTANDING AND NET ASSETS** | **SHARES OUTSTANDING AND NET ASSETS** |
|  | 1/1/22-12/31/22 | 1/1/22-12/31/22 | 1/1/22-12/31/22 | 1/1/21-12/31/21 | 1/1/21-12/31/21 |
|  |  | SHARES | NET ASSETS | SHARES | NET ASSETS |
| Beginning of period |  | 10677716 | $184103992 | 10452702 | $163847891 |
| Total increase (decrease) | + | &nbsp;&nbsp;&nbsp;&nbsp; 156357 | &nbsp;&nbsp;&nbsp; (33236579) | &nbsp;&nbsp;&nbsp;&nbsp; 225014 | &nbsp;&nbsp;&nbsp;&nbsp; 20256101 |
| **End of period** |  | **10834073** | **$150867413** | **10677716** | **$184103992** |

---

*See financial notes*

Schwab VIT Balanced with Growth Portfolio \| Annual Report**14**

------

Schwab VIT Balanced with Growth Portfolio

Financial Notes

------

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**1. Business Structure of the Fund:**

Schwab VIT Balanced with Growth Portfolio (the fund) is a series of Schwab Annuity Portfolios (the trust), a no-load, open-end management investment company. The trust is organized as a Massachusetts business trust and is registered under the Investment Company Act of 1940, as amended (the 1940 Act). The list below shows all the funds in the trust as of the end of the period, including the fund discussed in this report, which is highlighted:

---

| |
|:---|
| **SCHWAB ANNUITY PORTFOLIOS (ORGANIZED JANUARY 21, 1994)** |
| Schwab Government Money Market Portfolio |
| Schwab S&P 500 Index Portfolio |
| Schwab VIT Balanced Portfolio |
| **Schwab VIT Balanced with Growth Portfolio** |
| Schwab VIT Growth Portfolio |

---

The fund is a "fund of funds" which primarily invests in affiliated Schwab Exchange-Traded Funds (ETFs). The fund may also invest in affiliated mutual funds from Schwab Funds and unaffiliated third-party ETFs and mutual funds (all such ETFs and mutual funds referred to as "underlying funds"). The fund may also invest directly in equity or fixed-income securities, including bonds, cash equivalents, money market funds and money market investments, to achieve its investment objectives.

The fund in this report offers one share class. Shares are bought and sold at closing net asset value per share (NAV), which is the price for all outstanding shares of the fund. Each share has a par value of 1/1,000 of a cent, and the fund's Board of Trustees (the Board) may authorize the issuance of as many shares as necessary.

The fund is available exclusively as an investment vehicle for variable annuity and variable life insurance contracts offered by separate accounts of participating life insurance companies and in the future may be offered to pension and retirement plans qualified under the Internal Revenue Code of 1986, as amended. At December 31, 2022, 100% of the fund's shares were held through separate accounts of five insurance companies. Subscriptions and redemptions of these insurance separate accounts could have a material impact on the fund.

The fund maintains its own account for purposes of holding assets and accounting, and is considered a separate entity for tax purposes. Within its account, the fund may also keep certain assets in segregated accounts, as required by securities law.

------

<br>**2. Significant Accounting Policies:**

The following is a summary of the significant accounting policies the fund uses in its preparation of financial statements. The fund follows the investment company accounting and reporting guidance of the Financial Accounting Standards Board (FASB) Accounting Standard Codification *Topic 946 Financial Services — Investment Companies*. The accounting policies are in conformity with accounting principles generally accepted in the United States of America (GAAP).

The financial statements of the fund should be read in conjunction with the underlying funds' financial statements. For more information about the underlying funds' operations and policies, please refer to those funds' semiannual and annual reports, which are filed with the U.S. Securities and Exchange Commission (SEC) and are available on the SEC's website at www.sec.gov.

**(a) Security Valuation:**

Pursuant to Rule 2a-5 under the 1940 Act, the Board has designated authority to a Valuation Designee, the fund's investment adviser, to make fair valuation determinations under adopted procedures, subject to Board oversight. The investment adviser has formed a Pricing Committee to administer the pricing and valuation of portfolio securities and other assets and liabilities and to ensure that prices used for internal purposes or provided by third parties reasonably reflect fair value. The Valuation Designee may utilize independent pricing services, quotations from securities and financial instrument dealers and other market sources to determine fair value.

Securities held in the fund's portfolio are valued every business day. The following valuation policies and procedures are used by the Valuation Designee to value various types of securities:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• **Securities traded on an exchange or over-the-counter:** Traded securities are valued at the closing value for the day, or, on days when no closing value has been reported, at the mean of the most recent bid and ask quotes.

• **Mutual funds:** Mutual funds are valued at their respective NAVs.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• **Cash management sweep time deposits:** Balances held in cash management sweep time deposits are accounted for on a cost basis, which approximates fair value.

**15**Schwab VIT Balanced with Growth Portfolio \| Annual Report

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Schwab VIT Balanced with Growth Portfolio

Financial Notes (continued)

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;

**2. Significant Accounting Policies (continued):** 

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• **Securities for which no quoted value is available:** The Valuation Designee has adopted procedures to fair value the fund's securities when market prices are not "readily available" or are unreliable. For example, a security may be fair valued when it's de-listed or its trading is halted or suspended; when a security's primary pricing source is unable or unwilling to provide a price; or when a security's primary trading market is closed during regular market hours. Fair value determinations are made in good faith in accordance with adopted valuation procedures. The Valuation Designee considers a number of factors, including unobservable market inputs, when arriving at fair value. The Valuation Designee may employ methods such as the review of related or comparable assets or liabilities, related market activities, recent transactions, market multiples, book values, transactional back-testing, disposition analysis and other relevant information. Due to the subjective and variable nature of fair value pricing, there can be no assurance that the fund could obtain the fair value assigned to the security upon the sale of such security.

In accordance with the authoritative guidance on fair value measurements and disclosures under GAAP, the fund discloses the fair value of its investments in a hierarchy that prioritizes the significant inputs to valuation methods used to measure the fair value. The hierarchy gives the highest priority to valuations based upon unadjusted quoted prices in active markets for identical assets or liabilities (Level 1 measurements) and the lowest priority to valuations based upon unobservable inputs that are significant to the valuation (Level 3 measurements). If inputs used to measure the financial instruments fall within different levels of the hierarchy, the categorization is based on the lowest level input that is significant to the valuation. If it is determined that either the volume and/or level of activity for an asset or liability has significantly decreased (from normal conditions for that asset or liability) or price quotations or observable inputs are not associated with orderly transactions, increased analysis and the Valuation Designee's judgment will be required to estimate fair value.

The three levels of the fair value hierarchy are as follows:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• Level 1 — quoted prices in active markets for identical investments — Investments whose values are based on quoted market prices in active markets, and whose values are therefore classified as Level 1 prices, include active listed equities and underlying funds. Underlying funds are classified as Level 1 prices, without consideration to the classification level of the underlying securities held.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• Level 2 — other significant observable inputs (including quoted prices for similar securities, interest rates, prepayment speeds, credit risk, etc.) — Investments that trade in markets that are not considered to be active, but whose values are based on quoted market prices, dealer quotations or valuations provided by alternative pricing sources supported by observable inputs are classified as Level 2 prices. These generally include U.S. government and sovereign obligations, most government agency securities, investment-grade corporate bonds, certain mortgage products, less liquid listed equities, and state, municipal and provincial obligations.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• Level 3 — significant unobservable inputs (including the Valuation Designee's assumptions in determining the fair value of investments) — Investments whose values are classified as Level 3 prices have significant unobservable inputs, as they may trade infrequently or not at all. When observable prices are not readily available for these securities, one or more valuation methods are used for which sufficient and reliable data is available. The inputs used in estimating the value of Level 3 prices may include the original transaction price, quoted prices for similar securities or assets in active markets, completed or pending third-party transactions in the underlying investment or comparable issuers, and changes in financial ratios or cash flows. Level 3 prices may also be adjusted to reflect illiquidity and/or non-transferability, with the amount of such discount estimated in the absence of market information. Assumptions used due to the lack of observable inputs may significantly impact the resulting fair value and therefore the fund's results of operations.

The inputs or methodology used for valuing securities are not necessarily an indication of the risk associated with investing in those securities.

The levels associated with valuing the fund's investments as of December 31, 2022 are disclosed in the Portfolio Holdings.

**(b) Accounting Policies for certain Portfolio Investments (if held):**

**Securities Lending:** Under the trust's Securities Lending Program, a fund (lender) may make short-term loans of its securities to another party (borrower) to generate additional revenue for the fund. The borrower pledges collateral in the form of cash, securities issued or fully guaranteed by the U.S. government or foreign governments, or letters of credit issued by a bank. Collateral at the individual loan level is required to be maintained on a daily marked-to-market basis in an amount at least equal to the current value of the securities loaned. The lending agent provides the fund with indemnification against borrower default (the borrower fails to return the security on loan) reducing the risk of loss as a result of default. The cash collateral of securities loaned is currently invested in money market portfolios operating pursuant to Rule 2a-7 under the 1940 Act. The fund bears the risk of loss with

Schwab VIT Balanced with Growth Portfolio \| Annual Report**16**

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Schwab VIT Balanced with Growth Portfolio

Financial Notes (continued)

------

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;

**2. Significant Accounting Policies (continued):** 

respect to the investment of cash collateral. The terms of the securities lending agreement allow the fund or the lending agent to terminate any loan at any given time and the securities must be returned within the earlier of the standard trade settlement period or the specified time period under the relevant securities lending agreement. Securities lending income, as disclosed in the fund's Statement of Operations, if applicable, represents the income earned from the investment of the cash collateral plus any fees paid by borrowers, less the fees paid to the lending agent and broker rebates which are subject to adjustments pursuant to the securities lending agreement. On loans not collateralized by cash, a fee is received from the borrower, and is allocated between the fund and the lending agent. The aggregate fair value of securities loaned will not at any time exceed one-third of the total assets of the fund, including collateral received from the loan. Securities lending fees paid to the unaffiliated lending agents start at 9% of gross lending revenue, with subsequent breakpoints to a low of 5%. In this context, the gross lending revenue equals the income received from the investment of cash collateral and fees paid by borrowers less any rebates paid to the borrowers. Any expenses charged by the cash collateral fund are in addition to these fees. All remaining revenue is retained by the fund, as applicable. No portion of lending revenue is paid to or retained by the investment adviser or any of its affiliates.

As of December 31, 2022, the fund had no securities on loan. <br>

<br>**Cash Management Transactions:** Effective May 23, 2022 Brown Brothers Harriman & Co. (BBH) was replaced by Citibank, N.A as custodian of the fund. The fund no longer subscribes to the BBH Cash Management Service Sweep (CMS Sweep). The BBH CMS Sweep was an investment product that automatically swept the fund's cash balances into overnight offshore time deposits with either the BBH Grand Cayman branch or a branch of a pre-approved commercial bank. This fully automated program allowed the fund to earn interest on cash balances. Excess cash invested with deposit institutions domiciled outside of the U.S., as with any offshore deposit, was subject to sovereign actions in the jurisdiction of the deposit institution including, but not limited to, freeze, seizure or diminution. The fund assumed the risk associated with the repayment of principal and payment of interest on such instruments by the institution with which the deposit was ultimately placed. The fund terminated the CMS Sweep program and cash was returned to the fund prior to terminating services with BBH.

**Cash Investments:** The fund may invest a portion of its assets in cash. Cash includes cash bank balances in an interest-bearing demand deposit account with maturity on demand by the fund.

**(c) Security Transactions:** 

Security transactions are recorded as of the date the order to buy or sell the security is executed. Realized gains and losses from security transactions are based on the identified costs of the securities involved.

**(d) Investment Income:**

Interest income is recorded as it accrues. Dividends and distributions from portfolio securities and underlying funds are recorded on the date they are effective (the ex-dividend date). Any distributions from underlying funds are recorded in accordance with the character of the distributions as designated by the underlying funds.

**(e) Expenses:**

Expenses that are specific to the fund are charged directly to the fund. Expenses that are common to more than one fund in the trusts generally are allocated among those funds in proportion to their average daily net assets. The fund bears its share of the acquired fund fees and expenses of the underlying funds, which are indirect expenses incurred by the fund through its investments in the underlying funds. Such expenses are reflected in the net asset values of the underlying funds.

**(f) Distributions to Shareholders:**

The fund makes distributions from net investment income and net realized capital gains, if any, once a year. To receive a distribution, you must be a registered shareholder on the record date. Distributions are paid to shareholders on the payable date.

**(g) Accounting Estimates:**

The accounting policies described in this report conform to GAAP. Notwithstanding this, shareholders should understand that in order to follow these principles, fund management has to make estimates and assumptions that affect the information reported in the financial statements. It's possible that once the results are known, they may turn out to be different from these estimates and these differences may be material.

**17**Schwab VIT Balanced with Growth Portfolio \| Annual Report

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Schwab VIT Balanced with Growth Portfolio

Financial Notes (continued)

------

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;

**2. Significant Accounting Policies (continued):** 

**(h) Federal Income Taxes:**

The fund intends to meet federal income and excise tax requirements for regulated investment companies under subchapter M of the Internal Revenue Code, as amended. Accordingly, the fund distributes substantially all of its net investment income and net realized capital gains, if any, to the participating insurance company's (shareholders) separate accounts each year. As long as the fund meets the tax requirements, it is not required to pay federal income tax.

**(i) Indemnification:**

Under the fund's organizational documents, the officers and trustees are indemnified against certain liabilities arising out of the performance of their duties to the fund. In addition, in the normal course of business the fund enters into contracts with its vendors and others that provide general indemnifications. The fund's maximum exposure under these arrangements is unknown as this would involve future claims that may be made against the fund. However, based on experience, the fund expects the risk of loss attributable to these arrangements to be remote.

**(j) Regulatory Update:** 

Effective January 24, 2023, the SEC adopted rule and form amendments to require mutual funds and ETFs to transmit concise and visually engaging streamlined annual and semiannual reports to shareholders that highlight key information deemed important for retail investors to assess and monitor their fund investments. Other information, including financial statements, will no longer appear in a streamlined shareholder report but must be available online, delivered free of charge upon request, and filed on a semiannual basis on Form N-CSR. The rule and form amendments have a compliance date of July 24, 2024. At this time, management is evaluating the impact of these rule and form amendment changes on the content of the current shareholder report and the newly created annual and semiannual streamlined shareholder reports.

------

<br>**3. Risk Factors:**

Investing in the fund may involve certain risks, as discussed in the fund's prospectus, including, but not limited to, those described below. Any of these risks could cause an investor to lose money.

**Asset Allocation Risk.** The fund is subject to the risk that the selection of the underlying funds and the allocation of the fund's assets among the various asset classes and market segments may cause the fund to underperform other funds with a similar investment objective.

**Conflicts of Interest Risk.** The investment adviser's authority to select and substitute underlying funds from a variety of affiliated and unaffiliated mutual funds and ETFs may create a conflict of interest because the fees paid to it and its affiliates by some underlying funds are higher than the fees paid by other underlying funds. The investment adviser also may have an incentive to select an affiliated underlying fund for other reasons, including to increase assets under management or to support new investment strategies. In addition, other conflicts of interest may exist where the best interests of the affiliated underlying fund may not be aligned with those of the fund. However, the investment adviser is a fiduciary to the fund and is legally obligated to act in the fund's best interests when selecting underlying funds.

**Market Risk.** Financial markets rise and fall in response to a variety of factors, sometimes rapidly and unpredictably. Markets may be impacted by economic, political, regulatory and other conditions, including economic sanctions and other government actions. In addition, the occurrence of global events, such as war, terrorism, environmental disasters, natural disasters and epidemics may also negatively affect the financial markets. As with any investment whose performance is tied to these markets, the value of an investment in the fund will fluctuate, which means that an investor could lose money over short or long periods.

**Securities Lending Risk.** Securities lending involves the risk of loss of rights in, or delay in recovery of, the loaned securities if the borrower fails to return the security loaned or becomes insolvent.

**ETF Risk.** When the fund invests in an ETF, it will bear a proportionate share of the ETF's expenses. In addition, lack of liquidity in the market for an ETF's shares can result in its value being more volatile than the underlying portfolio of securities.

**Direct Investment Risk.** The fund may invest directly in cash, cash equivalents and equity and fixed-income securities, including money market securities, to maintain its allocations. The fund's direct investment in these securities is subject to the same or similar risks as an underlying fund's investment in the same securities.

**Underlying Fund Investment Risk.** Before investing in the fund, investors should assess the risks associated with the underlying funds in which the fund may invest, which include any combination of the risks described below.

Schwab VIT Balanced with Growth Portfolio \| Annual Report**18**

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Schwab VIT Balanced with Growth Portfolio

Financial Notes (continued)

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;

**3. Risk Factors (continued):** 

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• **Equity Risk.** The prices of equity securities rise and fall daily. These price movements may result from factors affecting individual companies, industries or the securities market as a whole. In addition, equity markets tend to move in cycles, which may cause stock prices to fall over short or extended periods of time.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• **Market Capitalization Risk.** Securities issued by companies of different market capitalizations tend to go in and out of favor based on market and economic conditions. During a period when securities of a particular market capitalization fall behind other types of investments, an underlying fund's performance could be impacted.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• **Foreign Investment Risk.** An underlying fund's investments in securities of foreign issuers involve certain risks that may be greater than those associated with investments in securities of U.S. issuers. These include risks of adverse changes in foreign economic, political, regulatory and other conditions; changes in currency exchange rates or exchange control regulations (including limitations on currency movements and exchanges); the imposition of economic sanctions or other government restrictions; differing accounting, auditing, financial reporting and legal standards and practices; differing securities market structures; and higher transaction costs. These risks may negatively impact the value or liquidity of an underlying fund's investments, and could impair the underlying fund's ability to meet its investment objective or invest in accordance with its investment strategy. There is a risk that investments in securities denominated in, and/or receiving revenues in, foreign currencies will decline in value relative to the U.S. dollar or, in the case of hedging positions, that the U.S. dollar will decline in value relative to the currency hedged, resulting in the dollar value of an underlying fund's investment being adversely affected.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• **Emerging Markets Risk.** Emerging market countries may be more likely to experience political turmoil or rapid changes in market or economic conditions than more developed countries. Emerging market countries often have less uniformity in accounting, auditing, financial reporting and recordkeeping requirements and greater risk associated with the custody of securities. In addition, the financial stability of issuers (including governments) in emerging market countries may be more precarious than in developed countries. As a result, there may be an increased risk of illiquidity and price volatility associated with an underlying fund's investments in emerging market countries, which may be magnified by currency fluctuations relative to the U.S. dollar, and, at times, it may be difficult to value such investments.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• **Growth Investing Risk.** Certain of the underlying funds pursue a "growth style" of investing. Growth investing focuses on a company's prospects for growth of revenue and earnings. If a company's earnings or revenues fall short of expectations, its stock price may fall dramatically. Growth stocks also can perform differently from the market as a whole and other types of stocks and can be more volatile than other types of stocks. Since growth companies usually invest a high portion of earnings in their business, they may lack the dividends of value stocks that can cushion stock prices in a falling market. Growth stocks may also be more expensive relative to their earnings or assets compared to value or other stocks.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• **Value Investing Risk.** Certain of the underlying funds may pursue a "value style" of investing. Value investing focuses on companies whose stocks appear undervalued in light of factors such as the company's earnings, book value, revenues or cash flow. If an underlying fund's investment adviser's (or sub-adviser's) assessment of a company's value or prospects for exceeding earnings expectations or market conditions is wrong, the underlying fund could suffer losses or produce poor performance relative to other funds. In addition, "value stocks" can continue to be undervalued by the market for long periods of time.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• **Fixed-Income Risk.** Interest rates rise and fall over time, which will affect an underlying fund's yield and share price. A change in a central bank's monetary policy or economic conditions, among other things, may result in a change in interest rates. A rise in interest rates could cause an underlying fund's share price to fall. The credit quality of a portfolio investment could also cause an underlying fund's share price to fall. An underlying fund could lose money if the issuer or guarantor of a portfolio investment or the counterparty to a derivatives contract fails to make timely principal or interest payments or otherwise honor its obligations. Fixed-income securities may be paid off earlier or later than expected. Either situation could cause an underlying fund to hold securities paying lower-than-market rates of interest, which could hurt an underlying fund's yield or share price. Below investment-grade bonds (junk bonds) involve greater credit risk, are more volatile, involve greater risk of price declines and may be more susceptible to economic downturns than investment-grade securities.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• **Interest Rate Risk.** Interest rates rise and fall over time. As with any investment whose yield reflects current interest rates, an underlying fund's yield will change over time. During periods when interest rates are low, an underlying fund's yield (and total return) also may be low. Changes in interest rates also may affect an underlying fund's share price: a rise in interest rates generally causes an underlying fund's share price to fall. The longer an underlying fund's portfolio duration, the more sensitive to interest rate movements its share price is likely to be. Also, a change in a central bank's monetary policy or economic conditions, among other things, may result in a change in interest rates, which could have sudden and unpredictable effects on the markets and significantly impact the value of fixed-income securities in which the underlying fund invests.

**19**Schwab VIT Balanced with Growth Portfolio \| Annual Report

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Schwab VIT Balanced with Growth Portfolio

Financial Notes (continued)

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;

**3. Risk Factors (continued):** 

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• **Credit Risk.** A decline in the credit quality of an issuer or guarantor of a portfolio investment could cause an underlying fund to lose money or underperform. An underlying fund could lose money if the issuer or guarantor of a portfolio investment fails to make timely principal or interest payments or otherwise honor its obligations.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• **Prepayment and Extension Risk.** Certain fixed income securities are subject to the risk that the securities may be paid off earlier or later than expected, especially during periods of falling or rising interest rates, respectively. Prepayments of obligations could cause an underlying fund to forgo future interest income on the portion of the security's principal repaid early and force the underlying fund to reinvest that money at the lower prevailing interest rates. Extensions of obligations could cause the fund to exhibit additional volatility and hold securities paying lower-than-market rates of interest. Either case could hurt the underlying fund's performance.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• **U.S. Government Securities Risk.** Some of the U.S. government securities that the underlying funds invest in are not backed by the full faith and credit of the U.S. government, which means they are neither issued nor guaranteed by the U.S. Treasury. Issuers such as the Federal Home Loan Banks (FHLB) maintain limited access to credit lines from the U.S. Treasury. Certain securities, such as obligations issued by the Federal Farm Credit Banks Funding Corporation, are supported solely by the credit of the issuer. There can be no assurance that the U.S. government will provide financial support to securities of its agencies and instrumentalities if it is not obligated to do so under law. Also, any government guarantees on securities the underlying funds own do not extend to shares of the underlying funds themselves.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• **Real Estate Investment Risk.** An underlying fund in which the fund may invest may have a policy of concentrating its investments in real estate companies and companies related to the real estate industry. As such, an underlying fund is subject to risks associated with the direct ownership of real estate securities and the fund's investment in such an underlying fund is subject to risks associated with the direct ownership of real estate securities and an investment in the underlying fund will be closely linked to the performance of the real estate markets. These risks include, among others, declines in the value of real estate; risks related to general and local economic conditions; possible lack of availability of mortgage funds or other limits to accessing the credit or capital markets; defaults by borrowers or tenants, particularly during an economic downturn; and changes in interest rates.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• **Real Estate Investment Trusts (REITs) Risk**. An underlying fund may invest in REITs. An underlying fund's investments in REITs will be subject to the risks associated with the direct ownership of real estate, including fluctuations in the value of underlying properties, defaults by borrowers or tenants, changes in interest rates and risks related to general or local economic conditions. REITs are also subject to certain additional risks. For example, equity REITs may be affected by changes in the value of the underlying properties owned by the trusts, and mortgage REITs may be affected by the quality of any credit extended. Further, REITs may have their investments in relatively few properties, a small geographic area or a single property type. In addition, REITs have their own expenses, and the underlying fund will bear a proportionate share of those expenses.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• **Mortgage-Backed and Mortgage Pass-Through Securities Risk.** Mortgage-backed securities tend to increase in value less than other debt securities when interest rates decline, but are subject to similar or greater risk of decline in fair value during periods of rising interest rates. Certain of the mortgage-backed securities in which an underlying fund may invest are issued or guaranteed by agencies or instrumentalities of the U.S. government but are not backed by the full faith and credit of the U.S. government. There can be no assurance that the U.S. government would provide financial support to its agencies or instrumentalities where it was not obligated to do so which can cause an underlying fund to lose money or underperform. The risks of investing in mortgage-backed securities include, among others, interest rate risk, credit risk, prepayment risk and extension risk. Transactions in mortgage pass-through securities often occur through to-be-announced (TBA) transactions. An underlying fund could lose money or underperform if a TBA counterparty defaults or goes bankrupt.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• **Portfolio Turnover Risk.** Certain of the underlying funds may buy and sell portfolio securities actively. If they do, their portfolio turnover rate and transaction costs will rise, which may lower the underlying fund's performance and may increase the likelihood of capital gains distributions.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• **Liquidity Risk.** An underlying fund may be unable to sell certain securities, such as illiquid securities, readily at a favorable time or price, or the underlying fund may have to sell them at a loss.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• **Derivatives Risk.** An underlying fund's use of derivative instruments involves risks different from, or possibly greater than, the risks associated with investing directly in securities and other traditional investments. An underlying fund's use of derivatives could reduce the underlying fund's performance, increase volatility, and could cause the underlying fund to lose more than the initial amount invested. In addition, investments in derivatives may involve leverage, which means a small percentage of assets invested in derivatives can have a disproportionately large impact on an underlying fund.

Schwab VIT Balanced with Growth Portfolio \| Annual Report**20**

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Schwab VIT Balanced with Growth Portfolio

Financial Notes (continued)

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;

**3. Risk Factors (continued):** 

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• **Securities Lending Risk.** Certain underlying funds engage in securities lending, which involves the risk of loss of rights in, or delay in recovery of, the loaned securities if the borrower fails to return the security loaned or becomes insolvent.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• **Management Risk.** An underlying fund may be an actively managed mutual fund. Any actively managed mutual fund is subject to the risk that its investment adviser (or sub-adviser(s)) will make poor security selections. An underlying fund's adviser applies its own investment techniques and risk analyses in making investment decisions for the fund, but there can be no guarantee that they will produce the desired results.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• **Investment Style Risk.** Certain underlying funds seek to track the performance of various segments of the stock market, as measured by their respective indices. Such underlying funds follow these stocks during upturns as well as downturns. Because of their indexing strategy, these underlying funds do not take steps to reduce market exposure or to lessen the effects of a declining market. In addition, because of an underlying fund's expenses, the underlying fund's performance is normally below that of the index. Errors relating to an index may occur from time to time and may not be identified by the underlying fund's index provider for a period of time. In addition, market disruptions could cause delays in an underlying fund's index's rebalancing schedule. Such errors and/or market disruptions may result in losses for an underlying fund.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• **Tracking Error Risk.** An underlying fund may seek to track the performance of its benchmark index, although it may not be successful in doing so. The divergence between the performance of a fund and its benchmark index, positive or negative, is called "tracking error." Tracking error can be caused by many factors and it may be significant.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• **Concentration Risk.** To the extent that an underlying fund's portfolio is concentrated in the securities of issuers in a particular market, industry, group of industries, sector or asset class, the underlying fund may be adversely affected by the performance of those securities, may be subject to increased price volatility and may be more vulnerable to adverse economic, market, political, or regulatory occurrences affecting that market, industry, group of industries, sector or asset class.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• **Commodity Risk.** To the extent that an underlying fund invests in commodity-linked derivative instruments, it may subject the underlying fund to greater volatility than investments in traditional securities. Also, commodity-linked investments may be more volatile and less liquid than the underlying commodity. The value of commodity-linked derivative instruments may be affected by changes in overall market movements, commodity index volatility, changes in interest rates, or factors affecting a particular industry or commodity, such as drought, floods, weather, livestock disease, embargoes, tariffs and international economic, political and other regulatory and market developments. The use of leveraged commodity-linked derivatives creates an opportunity for increased return, but also creates the possibility for a greater loss.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• **Money Market Fund Risk.** The fund may invest in underlying money market funds that either seek to maintain a stable $1.00 net asset value ("stable share price money market funds") or that have a share price that fluctuates ("variable share price money market funds"). Although an underlying stable share price money market fund seeks to maintain a stable $1.00 net asset value, it is possible to lose money by investing in such a money market fund. Because the share price of an underlying variable share price money market fund will fluctuate, when the fund sells the shares it owns they may be worth more or less than what the fund originally paid for them. In addition, neither type of money market fund is designed to offer capital appreciation. Certain underlying money market funds may impose a fee upon the sale of shares or may temporarily suspend the ability to sell shares if such fund's liquidity falls below required minimums.

Please refer to the fund's prospectus for a more complete description of the principal risks of investing in the fund.

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<br>**4. Affiliates and Affiliated Transactions:**

**Investment Adviser**

Charles Schwab Investment Management Inc., dba Schwab Asset Management, a wholly owned subsidiary of The Charles Schwab Corporation, serves as the fund's investment adviser and administrator pursuant to an Investment Advisory and Administration Agreement between the investment adviser and the trust.

For its advisory and administrative services to the fund, the investment adviser is entitled to receive an annual fee, accrued daily and payable monthly, equal to 0.45% of the fund's average daily net assets.

**21**Schwab VIT Balanced with Growth Portfolio \| Annual Report

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Schwab VIT Balanced with Growth Portfolio

Financial Notes (continued)

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;

**4. Affiliates and Affiliated Transactions (continued):** 

**Expense Limitation**

The investment adviser and its affiliates have agreed with the fund, for so long as the investment adviser serves as the investment adviser to the fund, which may only be amended or terminated with approval of the fund's Board, to limit the total annual fund operating expenses charged, excluding interest, taxes and certain non-routine expenses to 0.58%.

The agreement to limit the fund's total expenses charged is limited to the fund's direct operating expenses and, therefore, does not apply to acquired fund fees and expenses, which are indirect expenses incurred by the fund through its investments in the underlying funds.

**Investments in Affiliates**

The fund may engage in certain transactions involving related parties. Pursuant to an exemptive order issued by the SEC, the fund may invest in other related ETFs and mutual funds. As of December 31, 2022, the Schwab VIT Balanced with Growth Portfolio's ownership percentages of other related funds' shares are:

---

| | |
|:---|:---|
| Schwab Emerging Markets Equity ETF | 0.1% |
| Schwab International Equity ETF | 0.1% |
| Schwab International Small-Cap Equity ETF | 0.1% |
| Schwab Short-Term U.S. Treasury ETF | 0.1% |
| Schwab U.S. Aggregate Bond ETF | 0.6% |
| Schwab U.S. Large-Cap ETF | 0.1% |
| Schwab U.S. REIT ETF | 0.2% |
| Schwab U.S. Small-Cap ETF | 0.1% |
| Schwab U.S. TIPS ETF | 0.0%\* |
| Schwab Variable Share Price Money Fund, Ultra Shares | 0.1% |

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;

\* Less than 0.05%

**Interfund Transactions**

The fund may engage in transactions with certain other funds in the Fund Complex (for definition refer to the Trustees and Officers section) in accordance with procedures adopted by the Board pursuant to Rule 17a-7 under the 1940 Act. When one fund is seeking to sell a security that another is seeking to buy, an interfund transaction can allow both funds to benefit by reducing transaction costs. This practice is limited to funds that share the same investment adviser, trustees and/or officers. For the period ended December 31, 2022, the fund's purchases and sales of securities with other funds in the Fund Complex was $465,527 and $62,080 respectively, and includes realized losses of $17,846.

**Interfund Borrowing and Lending**

Pursuant to an exemptive order issued by the SEC, the fund may enter into interfund borrowing and lending transactions with other funds in the Fund Complex (for definition refer to the Trustees and Officers section). All loans are for temporary or emergency purposes and the interest rate to be charged will be the average of the overnight repurchase agreement rate and the short-term bank loan rate. All loans are subject to numerous conditions designed to ensure fair and equitable treatment of all participating funds. The interfund lending facility is subject to the oversight and periodic review by the Board. The fund had no interfund borrowing or lending activity during the period.

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<br>**5. Board of Trustees:**

The Board may include people who are officers and/or directors of the investment adviser or its affiliates. Federal securities law limits the percentage of such "interested persons" who may serve on a trust's board, and the trust was in compliance with these limitations throughout the report period. The fund did not pay any of these interested persons for their services as trustees, but it did pay non-interested persons (independent trustees), as noted on the fund's Statement of Operations. For information regarding the trustees, please refer to the Trustees and Officers table at the end of this report.

Schwab VIT Balanced with Growth Portfolio \| Annual Report**22**

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Schwab VIT Balanced with Growth Portfolio

Financial Notes (continued)

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;

**6. Borrowing from Banks:**

During the period, the fund was a participant with other funds in the Fund Complex in a joint, syndicated, committed $850 million line of credit (the Syndicated Credit Facility), which matured on September 29, 2022. On September 29, 2022, the Syndicated Credit Facility was amended to run for a new 364 day period with the line of credit amount increasing to $1 billion, maturing on September 28, 2023. Under the terms of the Syndicated Credit Facility, in addition to the interest charged on any borrowings by the fund, the fund paid a commitment fee of 0.15% per annum on the fund's proportionate share of the unused portion of the Syndicated Credit Facility.

During the period, the fund was a participant with other funds in the Fund Complex in a joint, unsecured, uncommitted $400 million line of credit (the Uncommitted Credit Facility), with State Street Bank and Trust Company, which matured on September 29, 2022. On September 29, 2022, the Uncommitted Credit Facility was amended to run for a new 364 day period with the line of credit amount remaining unchanged, maturing on September 28, 2023. Under the terms of the Uncommitted Credit Facility, the fund pays interest on the amount the fund borrows. There were no borrowings from either line of credit during the period.

The fund also has access to custodian overdraft facilities. The fund may have utilized the overdraft facility and incurred an interest expense, which is disclosed on the fund's Statement of Operations, if any. The interest expense is determined based on a negotiated rate above the current Federal Funds Rate.

------

<br>**7. Purchases and Sales of Investment Securities:**

For the period ended December 31, 2022, purchases and sales of securities (excluding short-term obligations) were as follows:

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| | |
|:---|:---|
| PURCHASES <br>OF SECURITIES <br>| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; SALES <br>OF SECURITIES <br>|
| $20832176 | $20580823 |

---

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<br>**8. Federal Income Taxes:**

As of December 31, 2022, the tax basis cost of the fund's investments and gross unrealized appreciation and depreciation were as follows:

---

| | | | |
|:---|:---|:---|:---|
| TAX COST  | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; GROSS UNREALIZED <br>APPRECIATION <br>| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; GROSS UNREALIZED <br>DEPRECIATION <br>| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; NET UNREALIZED <br>APPRECIATION <br>&nbsp;&nbsp;&nbsp;&nbsp;(DEPRECIATION)<br>|
| $128326440 | $29632478 | ($8010435)  | $21622043 |

---

As of December 31, 2022, the components of distributable earnings on a tax basis were as follows:

---

| | | | |
|:---|:---|:---|:---|
| UNDISTRIBUTED <br>ORDINARY <br>INCOME <br>| &nbsp;&nbsp;&nbsp;&nbsp; NET UNREALIZED <br>APPRECIATION <br>&nbsp;&nbsp;&nbsp;&nbsp;(DEPRECIATION) <br>ON INVESTMENTS <br>| &nbsp;&nbsp;&nbsp;&nbsp; CAPITAL LOSS <br>CARRYFORWARDS AND OTHER LOSSES<br>| TOTAL  |
| $2581631 | $21622043 | ($585828) | $23617846 |

---

The primary difference between book basis and tax basis unrealized appreciation or unrealized depreciation of investments is the tax deferral of losses on wash sales. The tax cost of the fund's investments, disclosed above, have been adjusted from their book amounts to reflect these unrealized appreciation or depreciation differences, as applicable.

Capital loss carryforwards have no expiration and may be used to offset future realized capital gains for federal income tax purposes. As of December 31, 2022, the fund had capital loss carryforwards of $585,828.

The tax basis components of distributions paid during the current and prior fiscal years were as follows:

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| | | | |
|:---|:---|:---|:---|
| CURRENT FISCAL YEAR END DISTRIBUTIONS | CURRENT FISCAL YEAR END DISTRIBUTIONS | PRIOR FISCAL YEAR END DISTRIBUTIONS | PRIOR FISCAL YEAR END DISTRIBUTIONS |
| ORDINARY <br>INCOME <br>| &nbsp;&nbsp; LONG-TERM <br>CAPITAL <br>GAINS <br>| &nbsp;&nbsp; ORDINARY <br>INCOME <br>| &nbsp;&nbsp; LONG-TERM <br>CAPITAL <br>GAINS <br>|
| $2673357 | $3153820 | $2357386 | $— |

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**23**Schwab VIT Balanced with Growth Portfolio \| Annual Report

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Schwab VIT Balanced with Growth Portfolio

Financial Notes (continued)

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;

**8. Federal Income Taxes (continued):** 

Distributions paid to shareholders are based on net investment income and net realized gains determined on a tax basis, which may differ from net investment income and net realized gains for financial reporting purposes. These differences reflect the differing character of certain income items and net realized gains and losses for financial statement and tax purposes, and may result in reclassification among certain capital accounts on the financial statements. The fund may also designate a portion of the amount paid to redeeming shareholders as a distribution for tax purposes.

Permanent book and tax basis differences may result in reclassifications between components of net assets as required. The adjustments will have no impact on net assets or the results of operations.

As of December 31, 2022, management has reviewed the tax positions for open periods (for federal purposes, three years from the date of filing and for state purposes, four years from the date of filing) as applicable to the fund, and has determined that no provision for income tax is required in the fund's financial statements. The fund recognizes interest and penalties, if any, related to unrecognized tax benefits as income tax expense in the Statement of Operations. During the fiscal year ended December 31, 2022, the fund did not incur any interest or penalties.

------

<br>**9. Subsequent Events:**

Management has determined there are no subsequent events or transactions through the date the financial statements were issued that would have materially impacted the financial statements as presented.

Schwab VIT Balanced with Growth Portfolio \| Annual Report**24**

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Schwab VIT Balanced with Growth Portfolio

Report of Independent Registered Public Accounting Firm

------

To the Board of Trustees of Schwab Annuity Portfolios and Shareholders of Schwab VIT Balanced with Growth Portfolio

***Opinion on the Financial Statements and Financial Highlights***

We have audited the accompanying statement of assets and liabilities, including the portfolio holdings, of Schwab VIT Balanced with Growth Portfolio (the "Fund"), one of the funds constituting Schwab Annuity Portfolios, as of December 31, 2022, the related statement of operations for the year then ended, the statements of changes in net assets for each of the two years in the period then ended, the financial highlights for each of the three years in the period then ended, and the related notes. In our opinion, the financial statements and financial highlights present fairly, in all material respects, the financial position of the Fund as of December 31, 2022, and the results of its operations for the year then ended, the changes in its net assets for each of the two years in the period then ended, and the financial highlights for each of the three years in the period then ended in conformity with accounting principles generally accepted in the United States of America. The financial highlights for each of the two years in the period ended December 31, 2019 were audited by other auditors, whose report, dated February 18, 2020, expressed an unqualified opinion on such financial highlights.

***Basis for Opinion***

These financial statements and financial highlights are the responsibility of the Fund's management. Our responsibility is to express an opinion on the Fund's financial statements and financial highlights based on our audits. We are a public accounting firm registered with the Public Company Accounting Oversight Board (United States) (PCAOB) and are required to be independent with respect to the Fund in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.

We conducted our audits in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements and financial highlights are free of material misstatement, whether due to error or fraud. The Fund is not required to have, nor were we engaged to perform, an audit of its internal control over financial reporting. As part of our audits, we are required to obtain an understanding of internal control over financial reporting but not for the purpose of expressing an opinion on the effectiveness of the Fund's internal control over financial reporting. Accordingly, we express no such opinion.

Our audits included performing procedures to assess the risks of material misstatement of the financial statements and financial highlights, whether due to error or fraud, and performing procedures that respond to those risks. Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the financial statements and financial highlights. Our audits also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the financial statements and financial highlights. Our procedures included confirmation of securities owned as of December 31, 2022, by correspondence with the custodian and transfer agent. We believe that our audits provide a reasonable basis for our opinion.

**Deloitte & Touche LLP** <br>Denver, Colorado <br>February 16, 2023

We have served as the auditor of one or more investment companies in the Schwab Funds Complex since 2020.

**25**Schwab VIT Balanced with Growth Portfolio \| Annual Report

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Schwab VIT Balanced with Growth Portfolio

Other Federal Tax Information (unaudited)

------

The fund may elect to pass through, under section 853(a) of the Internal Revenue Code, the foreign tax credit of $100,086 to its shareholders for the fiscal year ended December 31, 2022. The respective foreign source income on the fund is $1,052,269.

For corporate shareholders, 26.27% of the fund's dividend distributions paid during the fiscal year ended December 31, 2022, qualify for the corporate dividends received deduction.

Under section 852(b)(3)(C) of the Internal Revenue Code, the fund hereby designates $3,153,820 as long-term capital gain dividends for the fiscal year ended December 31, 2022.

For the fiscal year ended December 31, 2022, the fund designates 48.55% of dividend income as business interest income under section 163(j) of the Internal Revenue Code.

Schwab VIT Balanced with Growth Portfolio \| Annual Report**26**

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Schwab VIT Balanced with Growth Portfolio

Liquidity Risk Management Program (unaudited)

------

The fund has adopted and implemented a liquidity risk management program (the "program") as required by Rule 22e-4 under the Investment Company Act of 1940, as amended. The fund's Board of Trustees (the "Board") has designated the fund's investment adviser, Charles Schwab Investment Management, Inc., dba Schwab Asset Management, as the administrator of the program. Personnel of the investment adviser or its affiliates conduct the day-to-day operation of the program.

Under the program, the investment adviser manages a fund's liquidity risk, which is the risk that the fund could not meet shareholder redemption requests without significant dilution of remaining shareholders' interests in the fund. The program is reasonably designed to assess and manage a fund's liquidity risk, taking into consideration the fund's investment strategy and the liquidity of its portfolio investments during normal and reasonably foreseeable stressed conditions; its historical redemption history and shareholder concentrations; and its cash holdings and access to other funding sources, including the custodian overdraft facility and lines of credit. The investment adviser's process of determining the degree of liquidity of each fund's investments is supported by third-party liquidity assessment vendors.

The fund's Board reviewed a report at its meeting held on September 19, 2022 prepared by the investment adviser regarding the operation and effectiveness of the program for the period June 1, 2021, through May 31, 2022, which included individual fund liquidity metrics. No significant liquidity events impacting the fund were noted in the report. In addition, the investment adviser provided its assessment that the program had been operating effectively in managing the fund's liquidity risk.

**27**Schwab VIT Balanced with Growth Portfolio \| Annual Report

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Schwab VIT Balanced with Growth Portfolio

Trustees and Officers

------

The tables below give information about the trustees and officers of Schwab Annuity Portfolios, which includes the fund covered in this report. The "Fund Complex" includes The Charles Schwab Family of Funds, Schwab Capital Trust, Schwab Investments, Schwab Annuity Portfolios, Schwab Strategic Trust and Laudus Trust. The Fund Complex includes 105 funds.

The address for all trustees and officers is 211 Main Street, San Francisco, CA 94105. You can find more information about the trustees and officers in the fund's Statement of Additional Information, which is available free by calling 1-877-824-5615.

---

| | | | |
|:---|:---|:---|:---|
| **Independent Trustees** | **Independent Trustees** | **Independent Trustees** | **Independent Trustees** |
| Name, Year of Birth, and <br> Position(s) with the trust <br> (Terms of office, and <br> length of Time Served<sup>1</sup>)<br>| Principal Occupations<br> During the Past Five Years<br>| Number of<br> Portfolios in<br> Fund Complex<br> Overseen by<br> the Trustee<br>| Other Directorships |
| **Michael J. Beer**<br> 1961<br> Trustee<br> (Trustee of The Charles Schwab <br> Family of Funds, Schwab <br> Investments, Schwab Capital Trust, <br> Schwab Annuity Portfolios, Schwab <br> Strategic Trust and Laudus Trust <br> since 2022)<br>| Retired. Director, President and Chief Executive Officer <br> (Dec. 2016 – Sept. 2019), Principal Funds (investment management).<br>| 105 | Director (2016 – 2019), <br> Principal Funds, Inc.<br>|
| **Robert W. Burns**<br> 1959<br> Trustee<br> (Trustee of Schwab Strategic Trust <br> since 2009; The Charles Schwab <br> Family of Funds, Schwab <br> Investments, Schwab Capital Trust, <br> Schwab Annuity Portfolios and <br> Laudus Trust since 2016)<br>| Retired/Private Investor. | 105 |  |
| **Nancy F. Heller**<br> 1956<br> Trustee<br> (Trustee of The Charles Schwab <br> Family of Funds, Schwab <br> Investments, Schwab Capital Trust, <br> Schwab Annuity Portfolios, Schwab <br> Strategic Trust and Laudus Trust <br> since 2018)<br>| Retired. | 105 |  |
| **David L. Mahoney**<br> 1954<br> Trustee<br> (Trustee of The Charles Schwab <br> Family of Funds, Schwab <br> Investments, Schwab Capital Trust, <br> Schwab Annuity Portfolios and <br> Laudus Trust since 2011; Schwab <br> Strategic Trust since 2016)<br>| Private Investor. | 105 | Director <br> (2004 – present), <br> Corcept Therapeutics <br> Incorporated <br> Director (2009 – 2021), <br> Adamas <br> Pharmaceuticals, Inc.<br> Director (2003 – 2019), <br> Symantec Corporation<br>|
| **Jane P. Moncreiff**<br> 1961<br> Trustee<br> (Trustee of The Charles Schwab <br> Family of Funds, Schwab <br> Investments, Schwab Capital Trust, <br> Schwab Annuity Portfolios, Schwab <br> Strategic Trust and Laudus Trust <br> since 2019)<br>| Consultant (2018 – present), Fulham Advisers LLC (management <br> consulting); Chief Investment Officer (2009 – 2017), CareGroup <br> Healthcare System, Inc. (healthcare).<br>| 105 |  |

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Schwab VIT Balanced with Growth Portfolio \| Annual Report**28**

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Schwab VIT Balanced with Growth Portfolio

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| | | | |
|:---|:---|:---|:---|
| **Independent Trustees (continued)** | **Independent Trustees (continued)** | **Independent Trustees (continued)** | **Independent Trustees (continued)** |
| Name, Year of Birth, and <br> Position(s) with the trust <br> (Terms of office, and <br> length of Time Served<sup>1</sup>)<br>| Principal Occupations<br> During the Past Five Years<br>| Number of<br> Portfolios in<br> Fund Complex<br> Overseen by<br> the Trustee<br>| Other Directorships |
| **Kimberly S. Patmore**<br> 1956<br> Trustee<br> (Trustee of The Charles Schwab <br> Family of Funds, Schwab <br> Investments, Schwab Capital Trust, <br> Schwab Annuity Portfolios, Schwab <br> Strategic Trust and Laudus Trust <br> since 2016)<br>| Consultant (2008 – present), Patmore Management Consulting <br> (management consulting).<br>| 105 |  |
| **J. Derek Penn**<br> 1957<br> Trustee<br> (Trustee of The Charles Schwab <br> Family of Funds, Schwab <br> Investments, Schwab Capital Trust, <br> Schwab Annuity Portfolios, Schwab <br> Strategic Trust and Laudus Trust <br> since 2021)<br>| Head of Equity Sales and Trading (2006 – 2018), BNY Mellon (financial <br> services).<br>| 105 |  |

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**29**Schwab VIT Balanced with Growth Portfolio \| Annual Report

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Schwab VIT Balanced with Growth Portfolio

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;

---

| | | | |
|:---|:---|:---|:---|
| **Interested Trustees** | **Interested Trustees** | **Interested Trustees** | **Interested Trustees** |
| Name, Year of Birth, and <br> Position(s) with the trust <br> (Terms of office, and <br> length of Time Served<sup>1</sup>)<br>| Principal Occupations<br> During the Past Five Years<br>| Number of<br> Portfolios in<br> Fund Complex<br> Overseen by<br> the Trustee<br>| Other Directorships |
| **Walter W. Bettinger II**<sup>2</sup> 1960<br> Chairman and Trustee<br> (Trustee of The Charles Schwab <br> Family of Funds, Schwab <br> Investments, Schwab Capital Trust <br> and Schwab Annuity Portfolios since <br> 2008; Schwab Strategic Trust since <br> 2009; Laudus Trust since 2010)<br>| Co-Chairman of the Board (July 2022 – present), Director and Chief <br> Executive Officer (Oct. 2008 – present) and President <br> (Feb. 2007 – Oct. 2021), The Charles Schwab Corporation; President and <br> Chief Executive Officer (Oct. 2008 – Oct. 2021) and Director <br> (May 2008 – Oct. 2021), Charles Schwab & Co., Inc.; Director <br> (Apr. 2006 – present), Charles Schwab Bank, SSB; Director <br> (Nov. 2017 – present), Charles Schwab Premier Bank, SSB; Director <br> (July 2019 – present), Charles Schwab Trust Bank; Director <br> (May 2008 – present), Chief Executive Officer (Aug. 2017 – present) and <br> President (Aug. 2017 – Nov. 2021), Schwab Holdings, Inc.; Director <br> (Oct. 2020 – present), TD Ameritrade Holding Corporation; Director <br> (July 2016 – Oct. 2021), Charles Schwab Investment Management, Inc.<br>| 105 | Director <br> (2008 – present), The <br> Charles Schwab <br> Corporation <br>|
| **Richard A. Wurster**<sup>2</sup> 1973<br> Trustee<br> (Trustee of The Charles Schwab <br> Family of Funds, Schwab <br> Investments, Schwab Capital Trust, <br> Schwab Annuity Portfolios, Schwab <br> Strategic Trust and Laudus Trust <br> since 2022)<br>| President (Oct. 2021 – present) and Executive Vice President – Schwab <br> Asset Management Solutions (Apr. 2019 – Oct. 2021), The Charles <br> Schwab Corporation; President, Director (Oct. 2021 – present), Executive <br> Vice President – Schwab Asset Management Solutions <br> (July 2019 – Oct. 2021) and Senior Vice President – Advisory <br> (May 2016 – July 2019), Charles Schwab & Co., Inc.; President <br> (Nov. 2021 – present), Schwab Holdings, Inc.; Director <br> (Oct. 2021 – present) and Chief Executive Officer (Nov. 2019 – Jan. 2022), <br> Charles Schwab Investment Management, Inc.; Director, Chief Executive <br> Officer and President (Mar. 2018 – Oct. 2022), Charles Schwab Investment <br> Advisory, Inc.; Chief Executive Officer (July 2016 – Apr. 2018) and <br> President (Mar. 2017 – Apr. 2018), ThomasPartners, Inc.; Chief Executive <br> Officer (July 2016 – Apr. 2018), Windhaven Investment Management, Inc.<br>| 105 |  |

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;

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| | |
|:---|:---|
| **Officers of the Trust** | **Officers of the Trust** |
| Name, Year of Birth, and Position(s) with the trust <br> (Terms of office, and length of Time Served<sup>3</sup>)<br>| Principal Occupations During the Past Five Years |
| **Jonathan de St. Paer**<br> 1973<br> President and Chief Executive Officer<br> (Officer of The Charles Schwab Family of Funds, Schwab <br> Investments, Schwab Capital Trust, Schwab Annuity <br> Portfolios, Schwab Strategic Trust and Laudus Trust since <br> 2018)<br>| Director (Apr. 2019 – present), President (Oct. 2018 – present), Chief Operating Officer <br> (Jan. 2021 – present), and Chief Executive Officer (Apr. 2019 – Nov. 2019), Charles Schwab <br> Investment Management, Inc.; Senior Vice President (June 2020 – Mar. 2022) and Chief <br> Operating Officer (Jan. 2021 – Mar. 2022), Charles Schwab Investment Advisory, Inc.; Chief <br> Executive Officer (Apr. 2019 – present), President (Nov. 2018 – present) and Trustee <br> (Apr. 2019 – Dec. 2020), Schwab Funds, Laudus Trust and Schwab ETFs; Managing Director <br> (May 2022 – present), Senior Vice President (Apr. 2019 – May 2022) and Senior Vice <br> President – Strategy and Product Development (CSIM) (Jan. 2014 – Mar. 2019), Charles <br> Schwab & Co., Inc.<br>|
| **Mark Fischer**<br> 1970<br> Chief Operating Officer<br> (Officer of The Charles Schwab Family of Funds, Schwab <br> Investments, Schwab Capital Trust, Schwab Annuity <br> Portfolios, Schwab Strategic Trust and Laudus Trust since <br> 2013)<br>| Chief Operating Officer (Dec. 2020 – present) and Treasurer and Chief Financial Officer <br> (Jan. 2016 – Dec. 2022), Schwab Funds, Laudus Trust and Schwab ETFs; Chief Financial <br> Officer (Mar. 2020 – present) and Vice President (Oct. 2013 – present), Charles Schwab <br> Investment Management, Inc.<br>|
| **Dana Smith**<br> 1965<br> Treasurer and Chief Financial Officer<br> (Officer of The Charles Schwab Family of Funds, Schwab <br> Investments, Schwab Capital Trust, Schwab Annuity <br> Portfolios, Schwab Strategic Trust and Laudus Trust since <br> 2023)<br>| Treasurer and Chief Financial Officer (Jan. 2023 – present) and Assistant Treasurer <br> (Dec. 2015 – Dec. 2022), Schwab Funds, Laudus Trust and Schwab ETFs; Vice President <br> (Mar. 2022 – present) and Director (Oct. 2015 – Mar. 2022), Charles Schwab Investment <br> Management, Inc.<br>|

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Schwab VIT Balanced with Growth Portfolio \| Annual Report**30**

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Schwab VIT Balanced with Growth Portfolio

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| | |
|:---|:---|
| **Officers of the Trust (continued)** | **Officers of the Trust (continued)** |
| Name, Year of Birth, and Position(s) with the trust <br> (Terms of office, and length of Time Served<sup>3</sup>)<br>| Principal Occupations During the Past Five Years |
| **Omar Aguilar**<br> 1970<br> Vice President and Chief Investment Officer<br> (Officer of The Charles Schwab Family of Funds, Schwab <br> Investments, Schwab Capital Trust, Schwab Annuity <br> Portfolios, Schwab Strategic Trust and Laudus Trust since <br> 2011)<br>| Chief Executive Officer (Jan. 2022 – present), Chief Investment Officer (Apr. 2011 – present) <br> and Senior Vice President (Apr. 2011 – Dec. 2021), Charles Schwab Investment <br> Management, Inc.; Director, Chief Executive Officer and President (Oct. 2022 – present), <br> Charles Schwab Investment Advisory, Inc.; Vice President and Chief Investment Officer <br> (June 2011 – present), Schwab Funds, Laudus Trust and Schwab ETFs.<br>|
| **Brett Wander**<br> 1961<br> Vice President and Chief Investment Officer<br> (Officer of The Charles Schwab Family of Funds, Schwab <br> Investments, Schwab Capital Trust, Schwab Annuity <br> Portfolios, Schwab Strategic Trust and Laudus Trust since <br> 2011)<br>| Senior Vice President and Chief Investment Officer (Apr. 2011 – present), Charles Schwab <br> Investment Management, Inc.; Vice President and Chief Investment Officer <br> (June 2011 – present), Schwab Funds, Laudus Trust and Schwab ETFs.<br>|
| **William P. McMahon, Jr.**<br> 1972<br> Vice President and Chief Investment Officer<br> (Officer of The Charles Schwab Family of Funds, Schwab <br> Investments, Schwab Capital Trust, Schwab Annuity <br> Portfolios, Schwab Strategic Trust and Laudus Trust since <br> 2021)<br>| Senior Vice President and Chief Investment Officer (Jan. 2020 – present), Charles Schwab <br> Investment Management, Inc.; Vice President and Chief Investment Officer <br> (June 2021 – present), Schwab Funds, Laudus Trust and Schwab ETFs; Senior Vice President <br> and Chief Investment Officer – ThomasPartners Strategies (Apr. 2018 – Dec. 2019), Charles <br> Schwab Investment Advisory, Inc.; Senior Vice President and Chief Investment Officer <br> (May 2001 – Apr. 2018), ThomasPartners, Inc.<br>|
| **Catherine MacGregor**<br> 1964<br> Chief Legal Officer and Secretary, Schwab Funds and <br> Schwab ETFs<br> Chief Legal Officer, Vice President and Clerk, Laudus Trust<br> (Officer of The Charles Schwab Family of Funds, Schwab <br> Investments, Schwab Capital Trust, Schwab Annuity <br> Portfolios and Laudus Trust since 2005; Schwab Strategic <br> Trust since 2009)<br>| Chief Legal Officer (Mar. 2022 – present) and Vice President (Sept. 2005 – present), Charles <br> Schwab Investment Management, Inc.; Managing Director (May 2022 – present) and Vice <br> President (July 2005 – May 2022), Charles Schwab & Co., Inc.; Vice President <br> (Dec. 2005 – present) and Chief Legal Officer and Clerk (Mar. 2007 – present), Laudus Trust; <br> Chief Legal Officer and Secretary (Oct. 2021 – present), Vice President <br> (Nov. 2005 – Oct. 2021) and Assistant Secretary (June 2007 – Oct. 2021), Schwab Funds; <br> Chief Legal Officer and Secretary (Oct. 2021 – present), Vice President and Assistant <br> Secretary (Oct. 2009 – Oct. 2021), Schwab ETFs.<br>|

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<sup>1</sup>

Each Trustee shall hold office until the election and qualification of his or her successor, or until he or she dies, resigns or is removed. The retirement policy requires that each independent trustee retire by December 31 of the year in which the Trustee turns 74 or the Trustee's twentieth year of service as an independent trustee on any trust in the Fund Complex, whichever occurs first.

<sup>2</sup>

Mr. Bettinger and Mr. Wurster are Interested Trustees. Mr. Bettinger and Mr. Wurster are Interested Trustees because each owns stock of The Charles Schwab Corporation (CSC), the parent company of Charles Schwab Investment Management, Inc., the investment adviser for the trusts in the Fund Complex, and is an employee of Charles Schwab & Co., Inc. (Schwab), the principal underwriter for The Charles Schwab Family of Funds, Schwab Investments, Schwab Capital Trust, Schwab Annuity Portfolios and Laudus Trust.

<sup>3</sup>

The President, Treasurer and Secretary/Clerk hold office until their respective successors are chosen and qualified or until he or she sooner dies, resigns, is removed or becomes disqualified. Each of the other officers serves at the pleasure of the Board.

**31**Schwab VIT Balanced with Growth Portfolio \| Annual Report

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Schwab VIT Balanced with Growth Portfolio

Glossary

------

**Bloomberg US Aggregate Bond Index** An index that is a broad-based benchmark measuring the performance of the U.S. investment grade, taxable bond market, including U.S. Treasuries, government-related and corporate bonds, mortgage pass-through securities, commercial mortgage-backed securities, and asset-backed securities that are publicly available for sale in the United States. To be eligible for inclusion in the index, securities must be fixed rate, non-convertible, U.S. dollar-denominated with at least $300 million or more of outstanding face value and have one or more years remaining to maturity. The index excludes certain types of securities, including tax-exempt state and local government series bonds, structured notes embedded with swaps or other special features, private placements, floating rate securities, inflation-linked bonds and Eurobonds. The index is market capitalization weighted and the securities in the index are updated on the last business day of each month.

**Bloomberg US Treasury 1–3 Year Index** An index which includes all publicly-issued U.S. Treasury securities that have a remaining maturity of greater than or equal to one year and less than three years, are rated investment grade, and have $300 million or more of outstanding face value. The securities in the index must be denominated in U.S. dollars and must be fixed-rate and non-convertible. The index excludes state and local government series bonds and coupon issues that have been stripped from bonds. The index is market capitalization weighted and the securities in the index are updated on the last business day of each month.

**Bloomberg US Treasury 3–10 Year Index** An index which includes all publicly-issued U.S. Treasury securities that have a remaining maturity of greater than or equal to three years and less than ten years, are rated investment grade, and have $300 million or more of outstanding face value. The securities in the index must be denominated in U.S. dollars and must be fixed-rate and non-convertible. The index excludes state and local government series bonds and coupon issues that have been stripped from bonds. The index is market capitalization weighted and the securities in the index are updated on the last business day of each month.

**Bloomberg US Treasury Bills 1–3 Month Index** An index that includes all publicly issued zero-coupon U.S. Treasury Bills that have a remaining maturity of less than 3 months but more than 1 month, are rated investment grade and have $300 million or more of outstanding face value. It excludes zero-coupon STRIPS.

**Bloomberg US Treasury Inflation-Linked Bond Index (Series-L)** An index which includes all publicly-issued U.S. Treasury Inflation-Protected Securities (TIPS) that have at least one year remaining to maturity, are rated investment grade and have $500 million or more of outstanding face value. The TIPS in the index must be denominated in U.S. dollars and must be fixed-rate and non-convertible. The index is market capitalization weighted and the TIPS in the index are updated on the last business day of each month. TIPS are publicly issued, dollar denominated U.S. Government securities issued by the U.S. Treasury that have principal and interest payments linked to an official inflation measure (as measured by the Consumer Price Index, or CPI) and their payments are supported by the full faith and credit of the United States.

**Dow Jones Equity All REIT Capped Index** A float-adjusted market cap weighted index that is designed to measure all equity real estate investment trusts (REITs) in the Dow Jones U.S. Total Stock Market Index, as defined by the S&P Dow Jones Indices REIT/RESI Industry Classification Hierarchy, that meet the minimum float market capitalization (FMC) and liquidity thresholds. The aggregate weight of

all companies weighing more than 4.5% cannot exceed 22.5%, and no single company's weight can exceed 10%. The index is reviewed daily based on each company's capped market capitalization weight. Daily capping is only performed when the sum of companies with weights great than 5% exceeds 25%.

**Dow Jones U.S. Large-Cap Total Stock Market Index** An index that is a subset of the Dow Jones U.S. Total Stock Market Index, and is designed to measure the performance of large-cap U.S. equity securities. The index is a float-adjusted market capitalization weighted index.

**Dow Jones U.S. Select REIT Index** An index that is a float-adjusted market-capitalization weighted index comprised of income-producing commercial and/or residential real estate investment trusts (REITs). The index excludes mortgage REITs, net-lease REITs, real estate finance companies, mortgage brokers and bankers, commercial and residential real estate brokers and estate agents, homebuilders, large landowners and sub-dividers of unimproved land, hybrid REITs, timber REITs and companies that have more than 25% of their assets in direct mortgage investments.

**Dow Jones U.S. Small-Cap Total Stock Market Index** An index that is a subset of the Dow Jones U.S. Total Stock Market Index, and is designed to measure the performance of small-cap U.S. equity securities. The index is a float-adjusted market capitalization weighted index.

**Dow Jones U.S. Total Stock Market Index** An index which includes all U.S. equity issues with readily available prices. The index is a float-adjusted market capitalization weighted index that reflects the shares of securities actually available to investors in the marketplace.

**FTSE Developed ex US Index (Net)** An index that is comprised of large- and mid-capitalization companies in developed countries outside the United States, as defined by the index provider. The index defines the large- and mid-capitalization universe as approximately the top 90% of the eligible universe. The Net version of the index reflects reinvested dividends net of withholding taxes, but reflects no deductions for expenses or other taxes.

**FTSE Developed Small Cap ex US Liquid Index (Net)** An index comprised of small-capitalization companies in developed countries outside the United States, as defined by the index provider. The index defines the small-capitalization universe as approximately the bottom 10% of the eligible universe with a minimum free float capitalization of $150 million. The Net version of the index reflects reinvested dividends net of withholding taxes, but reflects no deductions for expenses or other taxes.

**FTSE Emerging Index (Net)** An index that is comprised of large- and mid-capitalization companies in emerging market countries, as defined by the index provider. The index defines the large- and mid-capitalization universe as approximately the top 90% of the eligible universe. The Net version of the index reflects reinvested dividends net of withholding taxes, but reflects no deductions for expenses or other taxes.

**FTSE non-US Dollar World Government Bond Index** A market capitalization index that measures the total rate of return performance for the government bonds of 22 countries, excluding the U.S., with a remaining maturity of at least 1 year.

Schwab VIT Balanced with Growth Portfolio \| Annual Report**32**

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Schwab VIT Balanced with Growth Portfolio

**MSCI EAFE Index (Net)** A free float-adjusted market capitalization index that is designed to measure the equity market performance of developed markets in Europe, Australasia, and the Far East. The Net version of the index reflects reinvested dividends net of withholding taxes, but reflects no deductions for expenses or other taxes; returns are calculated applying dividend withholding rates applicable to non-resident persons who do not benefit from double taxation treaties.

**MSCI Emerging Markets Index (Net)** A free float-adjusted market capitalization weighted index that is designed to measure equity market performance in the global emerging markets. This series approximates the minimum possible dividend reinvestment. The returns are calculated applying dividend withholding rates applicable to non-resident persons who do not benefit from double taxation treaties.

**Russell 2000 Index** An index that measures the performance of the 2,000 smallest companies in the Russell 3000 Index. The Russell 3000 Index measures the performance of the largest 3,000 U.S. companies representing approximately 98% of the investable U.S. equity market.

**S&P 500 Index** An index that is designed to measure the performance of 500 leading publicly traded companies from a broad range of industries.

**VIT Balanced with Growth Composite Index** A custom blended index developed by Schwab Asset Management based on a comparable portfolio asset allocation and calculated using the following portion allocations effective July 1, 2020: 26.1% Bloomberg US Aggregate Bond Index, 3.9% Bloomberg US Treasury 1-3 Year Index, 4.0% Bloomberg US Treasury Bills 1-3 Month Index, 1.0% Bloomberg US Treasury Inflation-Linked Bond Index (Series-L), 6.0% Dow Jones Equity All REIT Capped Index, 27.0% Dow Jones U.S. Large-Cap Total Stock Market Index, 6.0% Dow Jones U.S. Small-Cap Total Stock Market Index, 6.0% FTSE All Emerging Index (Net), 17.0% FTSE

Developed ex US Index (Net), 3.0% FTSE Developed Small Cap ex US Liquid Index (Net). From April 29, 2020 through June 30, 2020, the blended index was derived using the following allocations: 26.1% Bloomberg US Aggregate Bond Index, 3.9% Bloomberg US Treasury 1-3 Year Index, 4.0% Bloomberg US Treasury Bills 1-3 Month Index, 1.0% Bloomberg US Treasury Inflation-Linked Bond Index (Series-L), 6.0% Dow Jones U.S. Select REIT Index, 27.0% Dow Jones U.S. Large-Cap Total Stock Market Index, 6.0% Dow Jones U.S. Small-Cap Total Stock Market Index, 6.0% FTSE All Emerging Index (Net), 17.0% FTSE Developed ex US Index (Net), 3.0% FTSE Developed Small Cap ex US Liquid Index (Net). From June 8, 2016 through April 28, 2020, the blended index was derived using the following allocations: 1% Bloomberg Global Treasury ex-US Capped Index, 27% Bloomberg US Aggregate Bond Index, 5% Bloomberg US Treasury Bills 1-3 Month Index, 2% Bloomberg US Treasury Inflation-Linked Bond Index (Series-L), 4% Bloomberg Commodity Index, 6% Dow Jones U.S. Select REIT Index, 22% Dow Jones U.S. Large-Cap Total Stock Market Index, 6% Dow Jones U.S. Small-Cap Total Stock Market Index, 6% FTSE All Emerging Index (Net), 17% FTSE Developed ex US Index (Net), 3% FTSE Developed Small Cap ex US Liquid Index (Net), and 1% Russell Microcap Index. Prior to June 8, 2016, the composite index was derived using the following allocations: 22% Dow Jones U.S. Large-Cap Total Stock Market Index, 6% Dow Jones U.S. Small-Cap Total Stock Market Index, 1% Russell Microcap Index, 17% FTSE Developed ex US Index (Net), 3% FTSE Developed Small Cap ex US Liquid Index (Net), 6% FTSE Emerging Index (Net), 6% Dow Jones U.S. Select REIT Index, 4% Dow Jones UBS Commodity Index, 2% Bloomberg US Treasury Inflation-Linked Bond Index (Series-L), 9% Bloomberg US Treasury 3-10 Year Index, 2% Bloomberg US Aggregate: Agencies Index, 4% Bloomberg US Credit Index, 11% Bloomberg US Mortgage Backed Securities Index, 1% Bloomberg Global Treasury ex-US Capped Index, 1% Bloomberg High Yield Bond Very Liquid Index, and 5% Bloomberg US Treasury Bills 1-3 Month Index.

**33**Schwab VIT Balanced with Growth Portfolio \| Annual Report

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;

Notes

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;

Notes

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![(CHARLES SCHWAB ASSET MANAGMENT LOGO)](g110794img74f8f7781.jpg)

**Annual Report** \| December 31, 2022

Schwab VIT Growth Portfolio

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**Proxy Voting Policies, Procedures and Results**

A description of the proxy voting policies and procedures used to determine how to vote proxies on behalf of the funds is available without charge, upon request, by visiting the Schwab Fund's website at www.schwabassetmanagement.com/schwabfunds_prospectus, the SEC's website at www.sec.gov, or by contacting Schwab Funds at 1-877-824-5615.

Information regarding how a fund voted proxies relating to portfolio securities during the most recent twelve-month period ended June 30 is available, without charge, by visiting Schwab's website at www.schwabassetmanagement.com/schwabfunds_prospectus or the SEC's website at www.sec.gov.

**Investment Adviser:** Charles Schwab Investment Management, Inc., dba Schwab Asset Management<sup>TM</sup>

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Schwab VIT Growth Portfolio

The Investment Environment

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For the 12-month reporting period ended December 31, 2022, several key U.S. stock indices posted their largest calendar year drop since the 2008 recession and the Bloomberg US Aggregate Bond Index suffered its worst calendar year performance since its inception in 1976, with longer-term bonds underperforming shorter-term bonds. Inflation spiked, interest rates rose, and economic growth around the world slowed. The ongoing war between Russia and Ukraine and the continuing, albeit uneven, fallout from the COVID-19 pandemic weighed on economies and markets around the world. Oil prices peaked at over $120 per barrel in early March as sanctions were imposed on Russian imports—and again in June on supply-and-demand imbalances—but retreated through most of the rest of the reporting period, ending it at just over $80 per barrel. The U.S. dollar strengthened against a basket of international currencies over the reporting period, generally decreasing the returns on overseas investments in U.S. dollar terms. For the reporting period, the S&P 500<sup>®</sup> Index, a bellwether for the overall U.S. stock market, returned -18.11%. The MSCI EAFE<sup>®</sup> Index (Net)\*, a broad measure of developed international equity performance, returned -14.45%. Emerging market equities were weaker, with the MSCI Emerging Markets Index (Net)\* returning -20.09%. Among U.S. and international bonds, the Bloomberg US Aggregate Bond Index returned -13.01% and the FTSE non-US Dollar World Government Bond Index returned -22.07%.

As inflation continued to rise and U.S. Federal Reserve (Fed) monetary policy shifted, bond yields began to climb early in 2022, for the most part maintaining that trajectory through the first three quarters of the year, exerting downward pressure on bond prices. (Bond yields and bond prices typically move in opposite directions.) In the final quarter, longer-term yields became more volatile and prices rebounded slightly, leading to an inversion of certain parts of the yield curve. Over the reporting period, the yield on the 10-year U.S. Treasury rose from 1.52% to 3.88%. Short-term rates also rose sharply, with the yield on the three-month U.S. Treasury climbing from 0.06% to 4.42% over the reporting period, ending the year just slightly off its one-year high.

**Asset Class Performance Comparison % returns during the 12 months ended December 31, 2022**![](g110794img62921b312.jpg)

Index figures assume dividends and distributions were reinvested. Index figures do not include trading and management costs, which would lower performance. Indices are unmanaged and cannot be invested in directly. Performance results less than one year are not annualized. Past performance is not an indication of future results.

For index definitions, please see the Glossary.

Data source: Index provider websites and Schwab Asset Management.

Nothing in this report represents a recommendation of a security by the investment adviser.

Management views may have changed since the report date.

\*

The net version of the index reflects reinvested dividends net of withholding taxes but reflects no deductions for expenses or other taxes.

Schwab VIT Growth Portfolio \| Annual Report**2**

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Schwab VIT Growth Portfolio

The Investment Environment (continued)

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In the United States, amid fading government stimuli, ongoing supply chain disruptions, persisting inflation, and a widening U.S. trade deficit, gross domestic product (GDP) contracted for the first two quarters of 2022, decreasing at an annualized rate of -1.6% and -0.6% for the first and second quarters, respectively. GDP grew at an annualized rate of 3.2% for the third quarter of 2022, driven primarily by energy exports and consumer spending. Inflation rose steadily in the first half of the year, hitting a 40-year high in June, before declining through the end of the reporting period as certain consumer and energy prices began to recede. The unemployment rate remained low despite inflationary pressures, ending the reporting period at pre-pandemic lows.

Outside the United States, conditions were similar. The eurozone, despite considerable headwinds, managed to maintain positive, albeit waning, GDP growth for the first, second, and third quarters of 2022 on easing COVID-19 restrictions and an increase in tourism in response to pent-up demand. The United Kingdom posted small gains in GDP growth for the first two quarters of 2022, in part driven by increases in COVID-19 testing and tracing and an expansion of its vaccination program but contracted slightly in the third quarter of 2022 on reduced household spending. Among emerging markets, China's GDP growth turned negative for the second quarter as it dealt with numerous headwinds including lockdowns and quarantines, declining domestic consumption, and a severe property downturn, but by the third quarter, GDP growth was again positive, buoyed by a series of policies and stimuli implemented to revive economic activity. India's GDP growth remained positive throughout the reporting period, and was particularly strong in the second quarter, but third-quarter GDP growth waned as high prices and rising interest rates weighed on demand.

Monetary policy around the world varied as central banks responded to the rapidly changing conditions. In the United States, after maintaining the federal funds rate in a range of 0.00% to 0.25% through mid-March 2022, the Fed shifted its stance as inflation continued to rise and indicators of economic activity and employment continued to strengthen. After issuing successively stronger signals that interest rates could begin to rise sooner in 2022 than previously anticipated, the Fed raised the federal funds rate seven times during the reporting period—by 0.25% in mid-March, 0.50% in early May, 0.75% in mid-June, 0.75% in late July, 0.75% in late September, 0.75% in early November, and 0.50% in mid-December. The federal funds rate ended the reporting period in a range of 4.25% to 4.50%. The Fed wrapped up its bond-buying program in March, and in June began to reduce the $9 trillion in assets held on its balance sheet, vowing to be even more aggressive than during its last round of quantitative tightening between 2017 and 2019. In developed international countries, central banks wrestled with similar issues. After holding its policy rate unchanged since March 2016, at 0.00%, the European Central Bank raised its interest rate four times over the reporting period in an effort to dampen demand and control inflation, which in October rose into double-digits. The Bank of England raised its key official bank rate eight times during the reporting period, bringing borrowing costs to a 14-year high as the Bank of England wrestled with soaring inflation. In contrast, the Bank of Japan continued to uphold its short-term interest rate target of -0.1%, unchanged since 2016, but in late December unexpectedly announced that it would widen the band around the yield target on its 10-year government bond, which pushed the yen higher and effectively marked the end of an extended period in which Japan was the only major developed country to resist raising rates. Monetary policy rates in emerging markets for the most part rose, with a few exceptions. Central banks in India, Indonesia, Brazil, Mexico, and Pakistan all raised their rates multiple times over the reporting period to counteract the impacts of inflation. In contrast, China cut its prime rate twice during the period, in part following a resurgence of COVID-19 cases and a lingering property downturn. Russia, which had raised its benchmark policy rate to 20% in late February amid the broadening fallout of Western sanctions in retaliation against Russia's invasion of Ukraine, subsequently reduced it multiple times by the end of the reporting period.

**3**Schwab VIT Growth Portfolio \| Annual Report

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Schwab VIT Growth Portfolio

Portfolio Management

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;

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| | |
|:---|:---|
| ![](g110794img804cbce43.jpg)<br>| &nbsp;&nbsp;&nbsp;&nbsp; **Zifan Tang, Ph.D., CFA,** Senior Portfolio Manager for Schwab Asset Management, is responsible for the <br> co-management of the fund. Prior to joining Schwab in 2012, Ms. Tang was a product manager at Thomson <br> Reuters and from 1997 to 2009 worked as a portfolio manager at Barclays Global Investors (now known as <br> BlackRock).<br>|

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| | |
|:---|:---|
| ![(DREW HAYES PHOTO)](g110794img17c522d64.jpg)<br>| &nbsp;&nbsp;&nbsp;&nbsp; **Drew Hayes, CFA,** Portfolio Manager for Schwab Asset Management, is responsible for the co-management <br> of the fund. Mr. Hayes has been with Schwab since 2006. Before becoming a portfolio manager, he spent <br> seven years as a senior fixed income specialist for Schwab Wealth Advisory, Inc. Prior to that, he worked as a <br> bond investment specialist for two years and as a registered representative for two years for Charles <br> Schwab & Co., Inc.<br>|

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;

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| | |
|:---|:---|
| ![](g110794img13f35e9c5.jpg)<br>| &nbsp;&nbsp;&nbsp;&nbsp; **Patrick Kwok, CFA,** Portfolio Manager for Schwab Asset Management, is responsible for the co-management <br> of the fund. Previously, Mr. Kwok served as an associate portfolio manager from 2012 to 2016. Prior to that, he <br> worked as a fund administration manager, where he was responsible for oversight of sub-advisers, trading, <br> cash management, and fund administration supporting the Charles Schwab Trust Bank Collective Investment <br> Trusts and multi-asset Schwab Funds. Prior to joining Schwab Asset Management in 2008, Mr. Kwok spent <br> two years as an asset operations specialist at Charles Schwab Trust Company. He also worked for one year at <br> State Street Bank & Trust as a portfolio accountant and pricing specialist.<br>|

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Schwab VIT Growth Portfolio \| Annual Report**4**

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Schwab VIT Growth Portfolio as of December 31, 2022

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**The Schwab VIT Growth Portfolio** (the fund) seeks to provide long-term capital appreciation. To pursue its goal, the fund aims to provide diversification across major asset classes, including domestic equity securities, international equity securities, real assets, fixed-income securities, and money market investments, as well as diversification across a range of sub-asset classes within the major asset classes.

The fund is considered a "fund-of-funds" in that it gains exposure to these asset classes by primarily investing in affiliated exchange-traded funds (ETFs) from Schwab Funds. The fund may also invest in affiliated mutual funds from Schwab Funds and unaffiliated third-party ETFs and mutual funds. The fund uses the internally calculated VIT Growth Composite Index (the composite index) as a performance gauge. The components that make up the composite index may vary over time. For index definition, please see the Glossary.

**Market Highlights.** For the 12-month reporting period ended December 31, 2022, several key U.S. stock indices posted their largest calendar year drop since the 2008 recession and the Bloomberg US Aggregate Bond Index suffered its worst calendar year performance since its inception in 1976, with longer-term bonds underperforming shorter-term bonds. Inflation spiked, interest rates rose, and economic growth around the world slowed. The ongoing war between Russia and Ukraine and the continuing, albeit uneven, fallout from the COVID-19 pandemic weighed on economies and markets around the world. Oil prices peaked at over $120 per barrel in early March as sanctions were imposed on Russian imports—and again in June on supply-and-demand imbalances—but retreated through most of the rest of the reporting period, ending it at just over $80 per barrel. The U.S. dollar strengthened against a basket of international currencies over the reporting period, generally decreasing the returns on overseas investments in U.S. dollar terms. As inflation continued to rise and U.S. Federal Reserve monetary policy shifted, bond yields began to climb early in 2022, for the most part maintaining that trajectory through the first three quarters of the year, exerting downward pressure on bond prices. (Bond yields and bond prices typically move in opposite directions.)

**Performance.** For the 12-month reporting period ended December 31, 2022, the fund returned -17.24%. The Dow Jones U.S. Total Stock Market Index and the Bloomberg US Aggregate Bond Index, reflecting broad-based U.S. stock and bond market performance, returned -19.53% and -13.01%, respectively. The composite index, described above, returned -16.84%.

**Positioning and Strategies**. The fund's allocations were broadly in line with those of the composite index.

The fund's U.S. equity exposure detracted the most from the total return of the fund. The Schwab U.S. Large-Cap ETF was the largest detractor from the total return of the fund, returning approximately -19% for the reporting period and generally tracking its comparative index components. The Schwab U.S. Small-Cap ETF also detracted from the total return of the fund, returning approximately -20% for the reporting period and generally tracking its comparative index component.

The fund's international equity exposure detracted from the total return of the fund. The Schwab International Equity ETF and the Schwab Emerging Markets Equity ETF detracted from the total return of the fund, returning approximately -15% and -18%, respectively, for the reporting period and generally tracking their respective comparative index components. The Schwab International Small-Cap Equity ETF was the smallest detractor from the total return of the fund, returning approximately -22% for the reporting period and generally tracking its comparative index component.

The fund's fixed-income exposure, the Schwab U.S. Aggregate Bond ETF, detracted from the total return of the fund, returning approximately -13% for the reporting period and generally tracking its comparative index component.

The fund's real estate exposure, the Schwab U.S. REIT ETF, also detracted from the total return of the fund, returning approximately -25% for the reporting period and generally tracking its comparative index component.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;

Management views and portfolio holdings may have changed since the report date.

**5**Schwab VIT Growth Portfolio \| Annual Report

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Schwab VIT Growth Portfolio

Performance and Fund Facts as of December 31, 2022

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**The performance data quoted represents past performance. Past performance does not guarantee future results. Investment returns and principal value will fluctuate so that an investor's shares may be worth more or less than their original cost. Current performance may be lower or higher than performance data quoted. To obtain performance information current to the most recent month end, please visit www.schwabassetmanagement.com/schwabfunds_prospectus.** 

**Performance of Hypothetical $10,000 Investment (December 31, 2012 – December 31, 2022)**<sup>1</sup>

![](g110794lg_2mq9.jpg)

**Average Annual Total Returns**<sup>1</sup>

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| | | | |
|:---|:---|:---|:---|
| **Fund and Inception Date** | **1 Year** | **5 Years** | **10 Years** |
| Fund: Schwab VIT Growth Portfolio (07/25/12) | -17.24% | 3.19% | &nbsp;&nbsp; 5.59% |
| S&P 500<sup>®</sup> Index | -18.11% | 9.42% | 12.56% |
| Bloomberg US Aggregate Bond Index | -13.01% | 0.02% | &nbsp;&nbsp; 1.06% |
| VIT Growth Composite Index | -16.84% | 3.76% | &nbsp;&nbsp; 6.26% |
| Fund Category: Morningstar Allocation – 70% to 85% Equity<sup>2</sup> <br>| -16.48% | 3.96% | &nbsp;&nbsp; 6.92% |
| *Fund Expense Ratio*<sup>3</sup>*: 0.55%* | *Fund Expense Ratio*<sup>3</sup>*: 0.55%* | *Fund Expense Ratio*<sup>3</sup>*: 0.55%* | *Fund Expense Ratio*<sup>3</sup>*: 0.55%* |

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;

All total return figures on this page assume dividends and distributions were reinvested. Index figures do not include trading and management costs, which would lower performance. Indices are unmanaged and cannot be invested in directly. Performance results less than one year are not annualized.

The components that make up the composite index may vary over time. For index definitions, please see the Glossary.

<sup>1</sup>

Fund expenses may have been partially absorbed by the investment adviser and its affiliates. Without these reductions, the fund's returns would have been lower. Fund performance does not reflect the additional fees and expenses imposed by the insurance company under the variable insurance product contract. If those contract fees and expenses were included, the performance would be less than that shown. Please refer to the variable insurance product prospectus for a complete listing of these expenses.

<sup>2</sup>

Source for category information: Morningstar, Inc. The Morningstar Category return represents all active and index mutual funds and ETFs within the category as of the report date.

<sup>3</sup>

As stated in the prospectus. Includes 0.06% of acquired fund fees and expenses (AFFE), which are indirect expenses incurred by the fund through its investments in the underlying funds. Reflects the total annual fund operating expenses without contractual fee waivers. For actual expense ratios during the period, not including AFFE, refer to the Financial Highlights section of the financial statements.

Schwab VIT Growth Portfolio \| Annual Report**6**

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Schwab VIT Growth Portfolio

Performance and Fund Facts as of December 31, 2022 (continued)

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;

**Statistics**

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| | |
|:---|:---|
| Number of Holdings | &nbsp;&nbsp;&nbsp;&nbsp; 8 |
| Portfolio Turnover Rate | 13% |

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**Asset Class Weightings % of Investments**<sup>1,2</sup> <br>

![](g110794img8aecd0b86.jpg)

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;

**Top Holdings % of Net Assets**<sup>1,3</sup> <br>

![](g110794img6450445f7.jpg)

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;

Portfolio holdings may have changed since the report date.

<sup>1</sup>

The fund intends to primarily invest in affiliated Schwab ETFs and may also invest in affiliated Schwab Funds and unaffiliated third-party ETFs and mutual funds (all such ETFs and mutual funds referred to as "underlying funds"). The fund may also invest directly in equity, fixed-income, or other securities or investments, as appropriate, consistent with its investment objectives, strategies, and policies.

<sup>2</sup>

The percentage may differ from the Portfolio Holdings because the above calculation is based on a percentage of total investments, whereas the calculation in the Portfolio Holdings is based on a percentage of net assets.

<sup>3</sup>

This list is not a recommendation of any security by the investment adviser.

**7**Schwab VIT Growth Portfolio \| Annual Report

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Schwab VIT Growth Portfolio

Fund Expenses (Unaudited)

**Examples for a $1,000 Investment**

As a fund shareholder, you may incur two types of costs: (1) transaction costs; and (2) ongoing costs, including management fees, transfer agent fees, and other fund expenses.

The expense examples below are intended to help you understand your ongoing cost (in dollars) of investing in the fund and to compare this cost with the ongoing cost of investing in other mutual funds. These examples are based on an investment of $1,000 invested for six months beginning July 1, 2022 and held through December 31, 2022.

**The Actual Return** line in the table below provides information about actual account values and actual expenses. You may use this information, together with the amount you invested, to estimate the expenses that you paid over the period. To do so, simply divide your account value by $1,000 (for example, an $8,600 account value ÷ $1,000 = 8.6), then multiply the result by the number given for the fund under the heading entitled "Expenses Paid During Period."

**The Hypothetical Return** line in the table below provides information about hypothetical account values and hypothetical expenses based on the fund's actual expense ratio and an assumed return of 5% per year before expenses. Because the return used is not an actual return, it may not be used to estimate the actual ending account value or expenses you paid for the period.

You may use this information to compare the ongoing costs of investing in the fund and other funds. To do so, compare this 5% hypothetical example with the 5% hypothetical examples that appear in the shareholder reports of the other funds.

Please note that the expenses shown in the table are meant to highlight your ongoing costs only, and do not reflect any transactional costs. Therefore, the hypothetical return lines of the table are useful in comparing ongoing costs only, and will not help you determine the relative total costs of owning different funds. In addition, if these transactional costs were included, your costs would have been higher.

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| | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|
|  | &nbsp;&nbsp; EXPENSE RATIO <br>(ANNUALIZED)<sup>1,2</sup> <br>| &nbsp;&nbsp; EFFECTIVE <br>EXPENSE RATIO <br>(ANNUALIZED)<sup>3,4</sup> <br>| &nbsp;&nbsp; BEGINNING <br>ACCOUNT VALUE <br>AT 7/1/22<br>| &nbsp;&nbsp; ENDING <br>ACCOUNT VALUE <br>(NET OF EXPENSES) <br>AT 12/31/22<sup>2</sup> <br>| &nbsp;&nbsp; EXPENSES PAID <br>DURING PERIOD <br>7/1/22-12/31/22<sup>2,5</sup> <br>| &nbsp;&nbsp; EFFECTIVE <br>EXPENSES PAID <br>DURING PERIOD <br>7/1/22-12/31/22<sup>4,5</sup> <br>|
| **Schwab VIT Growth Portfolio** |  |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; Actual Return | 0.49% | 0.55% | $1000.00 | $1008.40 | $2.48 | $2.78 |
| &nbsp;&nbsp;&nbsp;&nbsp; Hypothetical 5% Return | 0.49% | 0.55% | $1000.00 | $1022.74 | $2.50 | $2.80 |

---

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;

<sup>1</sup> Based on the most recent six-month expense ratio; may differ from the expense ratio provided in the Financial Highlights.

<sup>2</sup> Excludes acquired fund fees and expenses, which are indirect expenses incurred by the fund through its investments in underlying funds.

<sup>3</sup> Based on the most recent six-month acquired fund fees and expenses and the expense ratio; may differ from the acquired fund fees and expenses and the expense ratio in the prospectus. 

<sup>4</sup> Includes acquired fund fees and expenses, which are indirect expenses incurred by the fund through its investments in underlying funds.

<sup>5</sup> Expenses for the fund are equal to its annualized expense ratio, multiplied by the average account value over the period, multiplied by 184 days in the period, and divided by 365 days in the fiscal year. 

Schwab VIT Growth Portfolio \| Annual Report**8**

------

Schwab VIT Growth Portfolio

Financial Statements

**FINANCIAL HIGHLIGHTS**

---

| | | | | | |
|:---|:---|:---|:---|:---|:---|
|  | 1/1/22– <br>12/31/22<br>| 1/1/21– <br>12/31/21<br>| 1/1/20– <br>12/31/20<br>| 1/1/19– <br>12/31/19<br>| 1/1/18– <br>12/31/18<br>|
| **Per-Share Data** | **Per-Share Data** | **Per-Share Data** | **Per-Share Data** | **Per-Share Data** | **Per-Share Data** |
| Net asset value at beginning of period | &nbsp;&nbsp;&nbsp; $19.83 | &nbsp;&nbsp;&nbsp; $17.52 | &nbsp;&nbsp;&nbsp; $16.24 | &nbsp;&nbsp;&nbsp; $13.75 | &nbsp;&nbsp;&nbsp; $15.28 |
| Income (loss) from investment operations: |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; Net investment income (loss)<sup>1</sup> <br>| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 0.25 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 0.29 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 0.24 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 0.30 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 0.27 |
| &nbsp;&nbsp;&nbsp;&nbsp; Net realized and unrealized gains (losses) | &nbsp;&nbsp;&nbsp;&nbsp; (3.68) | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 2.27 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 1.51 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 2.54 | &nbsp;&nbsp;&nbsp;&nbsp; (1.53) |
| &nbsp;&nbsp;&nbsp;&nbsp; Total from investment operations | &nbsp;&nbsp;&nbsp;&nbsp; (3.43) | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 2.56 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 1.75 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 2.84 | &nbsp;&nbsp;&nbsp;&nbsp; (1.26) |
| Less distributions: |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; Distributions from net investment income | &nbsp;&nbsp;&nbsp;&nbsp; (0.29) | &nbsp;&nbsp;&nbsp;&nbsp; (0.25) | &nbsp;&nbsp;&nbsp;&nbsp; (0.32) | &nbsp;&nbsp;&nbsp;&nbsp; (0.27) | &nbsp;&nbsp;&nbsp;&nbsp; (0.22) |
| &nbsp;&nbsp;&nbsp;&nbsp; Distributions from net realized gains | &nbsp;&nbsp;&nbsp;&nbsp; (0.42) | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; — | &nbsp;&nbsp;&nbsp;&nbsp; (0.15) | &nbsp;&nbsp;&nbsp;&nbsp; (0.08) | &nbsp;&nbsp;&nbsp;&nbsp; (0.05) |
| &nbsp;&nbsp;&nbsp;&nbsp; Total distributions | &nbsp;&nbsp;&nbsp;&nbsp; (0.71) | &nbsp;&nbsp;&nbsp;&nbsp; (0.25) | &nbsp;&nbsp;&nbsp;&nbsp; (0.47) | &nbsp;&nbsp;&nbsp;&nbsp; (0.35) | &nbsp;&nbsp;&nbsp;&nbsp; (0.27) |
| Net asset value at end of period | &nbsp;&nbsp;&nbsp; $15.69 | &nbsp;&nbsp;&nbsp; $19.83 | &nbsp;&nbsp;&nbsp; $17.52 | &nbsp;&nbsp;&nbsp; $16.24 | &nbsp;&nbsp;&nbsp; $13.75 |
| Total return | &nbsp;&nbsp;&nbsp;&nbsp; (17.24%) | &nbsp;&nbsp;&nbsp;&nbsp; 14.67% | &nbsp;&nbsp;&nbsp;&nbsp; 11.34% | &nbsp;&nbsp;&nbsp;&nbsp; 20.84% | &nbsp;&nbsp;&nbsp;&nbsp; (8.35%) |
| **Ratios/Supplemental Data** | **Ratios/Supplemental Data** | **Ratios/Supplemental Data** | **Ratios/Supplemental Data** | **Ratios/Supplemental Data** | **Ratios/Supplemental Data** |
| Ratios to average net assets: |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; Net operating expenses<sup>2</sup> <br>| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 0.49%<sup>3</sup> <br>| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 0.49% | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 0.50% | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 0.51% | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 0.50% |
| &nbsp;&nbsp;&nbsp;&nbsp; Gross operating expenses<sup>2</sup> <br>| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 0.49%<sup>3</sup> <br>| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 0.49% | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 0.50% | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 0.51% | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 0.50% |
| &nbsp;&nbsp;&nbsp;&nbsp; Net investment income (loss) | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 1.50% | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 1.53% | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 1.55% | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 1.98% | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 1.78% |
| Portfolio turnover rate | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 13% | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 13% | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 18% | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 5% | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 9% |
| Net assets, end of period (x 1,000) | $147720 | $187038 | $165495 | $160381 | $139844 |

---

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;

<sup>1</sup> Calculated based on the average shares outstanding during the period.

<sup>2</sup> Ratio excludes acquired fund fees and expenses, which are indirect expenses incurred by the fund through its investments in underlying funds.

<sup>3</sup> Ratio includes less than 0.005% of non-routine proxy expenses.

*See financial notes*

**9**Schwab VIT Growth Portfolio \| Annual Report

------

Schwab VIT Growth Portfolio

Portfolio Holdings as of December 31, 2022

------

This section shows all the securities in the fund's portfolio and their values as of the report date, including a summary of the fund's transactions with its affiliated underlying funds during the period.

The fund files its complete schedule of portfolio holdings with the U.S. Securities and Exchange Commission (SEC) for the first and third quarters of each fiscal year on Form N-PORT Part F. The fund's Form N-PORT Part F is available on the SEC's website at www.sec.gov. The fund also makes available its complete schedule of portfolio holdings on the fund's website at www.schwabassetmanagement.com/schwabfunds_prospectus, typically 60-80 days after the end of the fund's fiscal quarter.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;

---

| | | | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|:---|:---|
| SECURITY | VALUE AT<br> 12/31/21<br>| PURCHASES | SALES | REALIZED<br> GAINS (LOSSES)<br>| NET CHANGE IN<br> UNREALIZED<br> APPRECIATION<br> (DEPRECIATION)<br>| VALUE AT<br> 12/31/22<br>| BALANCE<br> OF SHARES<br> HELD AT<br> 12/31/22<br>| DISTRIBUTIONS<br> RECEIVED<sup>(a)</sup> <br>|
| **AFFILIATED UNDERLYING FUNDS** 99.3% OF NET ASSETS | **AFFILIATED UNDERLYING FUNDS** 99.3% OF NET ASSETS | **AFFILIATED UNDERLYING FUNDS** 99.3% OF NET ASSETS | **AFFILIATED UNDERLYING FUNDS** 99.3% OF NET ASSETS | **AFFILIATED UNDERLYING FUNDS** 99.3% OF NET ASSETS | **AFFILIATED UNDERLYING FUNDS** 99.3% OF NET ASSETS | **AFFILIATED UNDERLYING FUNDS** 99.3% OF NET ASSETS | **AFFILIATED UNDERLYING FUNDS** 99.3% OF NET ASSETS | **AFFILIATED UNDERLYING FUNDS** 99.3% OF NET ASSETS |
| **U.S. Stocks 42.0%** | **U.S. Stocks 42.0%** | **U.S. Stocks 42.0%** | **U.S. Stocks 42.0%** | **U.S. Stocks 42.0%** | **U.S. Stocks 42.0%** | **U.S. Stocks 42.0%** | **U.S. Stocks 42.0%** | **U.S. Stocks 42.0%** |
| **Large-Cap 35.0%** | **Large-Cap 35.0%** | **Large-Cap 35.0%** | **Large-Cap 35.0%** | **Large-Cap 35.0%** | **Large-Cap 35.0%** | **Large-Cap 35.0%** | **Large-Cap 35.0%** | **Large-Cap 35.0%** |
| Schwab U.S. Large-Cap ETF  | &nbsp;&nbsp; $65622693 | &nbsp;&nbsp; $6531845 | &nbsp;&nbsp; ($6986958) | &nbsp;&nbsp; $801950 | ($14241130) | &nbsp;&nbsp; $51728400 | 1145701 | &nbsp;&nbsp;&nbsp; $846588 |
| **Small-Cap 7.0%** | **Small-Cap 7.0%** | **Small-Cap 7.0%** | **Small-Cap 7.0%** | **Small-Cap 7.0%** | **Small-Cap 7.0%** | **Small-Cap 7.0%** | **Small-Cap 7.0%** | **Small-Cap 7.0%** |
| Schwab U.S. Small-Cap ETF  | &nbsp;&nbsp;&nbsp;&nbsp; 13081088 | &nbsp;&nbsp;&nbsp;&nbsp; 1804761 | &nbsp;&nbsp;&nbsp;&nbsp; (1830539) | &nbsp;&nbsp; (227798) | &nbsp;&nbsp;&nbsp;&nbsp; (2516461) | &nbsp;&nbsp;&nbsp;&nbsp; 10311051 | &nbsp;&nbsp; 254531 | &nbsp;&nbsp;&nbsp;&nbsp; 141732 |
|  |  |  |  |  |  | &nbsp;&nbsp;&nbsp;&nbsp; 62039451 |  |  |
| **International Stocks 34.0%** | **International Stocks 34.0%** | **International Stocks 34.0%** | **International Stocks 34.0%** | **International Stocks 34.0%** | **International Stocks 34.0%** | **International Stocks 34.0%** | **International Stocks 34.0%** | **International Stocks 34.0%** |
| **Developed Markets 26.0%** | **Developed Markets 26.0%** | **Developed Markets 26.0%** | **Developed Markets 26.0%** | **Developed Markets 26.0%** | **Developed Markets 26.0%** | **Developed Markets 26.0%** | **Developed Markets 26.0%** | **Developed Markets 26.0%** |
| Schwab International Equity ETF  | &nbsp;&nbsp;&nbsp;&nbsp; 39478393 | &nbsp;&nbsp;&nbsp;&nbsp; 2810656 | &nbsp;&nbsp;&nbsp;&nbsp; (4664441) | &nbsp;&nbsp; (593202) | &nbsp;&nbsp;&nbsp;&nbsp; (6010374) | &nbsp;&nbsp;&nbsp;&nbsp; 31021032 | &nbsp;&nbsp; 963087 | &nbsp;&nbsp;&nbsp;&nbsp; 872145 |
| &nbsp;&nbsp;&nbsp;&nbsp; Schwab International Small-Cap Equity <br> ETF <br>| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 9337320 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 794811 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (550381) | &nbsp;&nbsp; (156699) | &nbsp;&nbsp;&nbsp;&nbsp; (1992970) | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 7432081 | &nbsp;&nbsp; 236164 | &nbsp;&nbsp;&nbsp;&nbsp; 132464 |
|  |  |  |  |  |  | &nbsp;&nbsp;&nbsp;&nbsp; 38453113 |  |  |
| **Emerging Markets 8.0%** | **Emerging Markets 8.0%** | **Emerging Markets 8.0%** | **Emerging Markets 8.0%** | **Emerging Markets 8.0%** | **Emerging Markets 8.0%** | **Emerging Markets 8.0%** | **Emerging Markets 8.0%** | **Emerging Markets 8.0%** |
| Schwab Emerging Markets Equity ETF  | &nbsp;&nbsp;&nbsp;&nbsp; 14764415 | &nbsp;&nbsp;&nbsp;&nbsp; 2510461 | &nbsp;&nbsp;&nbsp;&nbsp; (2621540) | &nbsp;&nbsp; (422149) | &nbsp;&nbsp;&nbsp;&nbsp; (2427810) | &nbsp;&nbsp;&nbsp;&nbsp; 11803377 | &nbsp;&nbsp; 498664 | &nbsp;&nbsp;&nbsp;&nbsp; 334911 |
|  |  |  |  |  |  | &nbsp;&nbsp;&nbsp;&nbsp; 50256490 |  |  |
| **Real Estate 6.0%** | **Real Estate 6.0%** | **Real Estate 6.0%** | **Real Estate 6.0%** | **Real Estate 6.0%** | **Real Estate 6.0%** | **Real Estate 6.0%** | **Real Estate 6.0%** | **Real Estate 6.0%** |
| **U.S. REITs 6.0%** | **U.S. REITs 6.0%** | **U.S. REITs 6.0%** | **U.S. REITs 6.0%** | **U.S. REITs 6.0%** | **U.S. REITs 6.0%** | **U.S. REITs 6.0%** | **U.S. REITs 6.0%** | **U.S. REITs 6.0%** |
| Schwab U.S. REIT ETF  | &nbsp;&nbsp;&nbsp;&nbsp; 11638115 | &nbsp;&nbsp;&nbsp;&nbsp; 1714700 | &nbsp;&nbsp;&nbsp;&nbsp; (1565494) | &nbsp;&nbsp;&nbsp; 213446 | &nbsp;&nbsp;&nbsp;&nbsp; (3153582) | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 8847185 | &nbsp;&nbsp; 458641 | &nbsp;&nbsp;&nbsp;&nbsp; 212287 |
| **Fixed Income 14.1%** | **Fixed Income 14.1%** | **Fixed Income 14.1%** | **Fixed Income 14.1%** | **Fixed Income 14.1%** | **Fixed Income 14.1%** | **Fixed Income 14.1%** | **Fixed Income 14.1%** | **Fixed Income 14.1%** |
| **Intermediate-Term Bond 14.1%** | **Intermediate-Term Bond 14.1%** | **Intermediate-Term Bond 14.1%** | **Intermediate-Term Bond 14.1%** | **Intermediate-Term Bond 14.1%** | **Intermediate-Term Bond 14.1%** | **Intermediate-Term Bond 14.1%** | **Intermediate-Term Bond 14.1%** | **Intermediate-Term Bond 14.1%** |
| Schwab U.S. Aggregate Bond ETF  | &nbsp;&nbsp;&nbsp;&nbsp; 25639152 | &nbsp;&nbsp;&nbsp;&nbsp; 3957293 | &nbsp;&nbsp;&nbsp;&nbsp; (4897517) | &nbsp;&nbsp; (599943) | &nbsp;&nbsp;&nbsp;&nbsp; (3311892) | &nbsp;&nbsp;&nbsp;&nbsp; 20787093 | &nbsp;&nbsp; 455358 | &nbsp;&nbsp;&nbsp;&nbsp; 553659 |
| **Money Market Funds 3.2%** | **Money Market Funds 3.2%** | **Money Market Funds 3.2%** | **Money Market Funds 3.2%** | **Money Market Funds 3.2%** | **Money Market Funds 3.2%** | **Money Market Funds 3.2%** | **Money Market Funds 3.2%** | **Money Market Funds 3.2%** |
| &nbsp;&nbsp;&nbsp;&nbsp; Schwab Variable Share Price Money Fund, <br> Ultra Shares, 4.42% <sup>(b)</sup> <br>| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 4635380 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 77367 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; — | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; — | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 10 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 4712757 | 4711344 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 77773 |
| **Total Affiliated Underlying Funds** <br>**(Cost $113,304,214)**<br>| **$184196556** | **$20201894** | **($23116870)** | **($984395)** | **($33654209)** | **$146642976** |  | **$3171559** |
| **Total Investments in Securities** <br>**(Cost $113,304,214)**<br>|  |  |  |  |  | **$146642976** |  |  |

---

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;

<sup>(a)</sup> Distributions received include distributions from net investment income and capital gains, if any, from the underlying funds. Amounts shown are only presented for affiliated underlying funds, which are presented in the corresponding line-item in the Statement of Operations, if applicable (see financial note 2(d) for additional information). 

<sup>(b)</sup> The rate shown is the annualized 7-day yield.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;

ETF — Exchange traded fund <br> REIT — Real Estate Investment Trust

At December 31, 2022, all of the fund's investment securities were classified as Level 1. Fund investments in underlying mutual funds and ETFs are classified as Level 1, without consideration to the classification level of the investments held by the underlying

mutual funds and ETFs, which could be Level 1, Level 2 or Level 3 (see financial note 2(a) for additional information).

*See financial notes*

Schwab VIT Growth Portfolio \| Annual Report**10**

------

Schwab VIT Growth Portfolio

Statement of Assets and Liabilities

------

As of December 31, 2022

---

| | | |
|:---|:---|:---|
| **Assets** | **Assets** | **Assets** |
| Investments in securities, at value - affiliated (cost $113,304,214) |  | $146642976 |
| Cash |  | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 1324070 |
| Receivables: |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; Investments sold |  | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 1268318 |
| &nbsp;&nbsp;&nbsp;&nbsp; Dividends |  | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 25691 |
| Prepaid expenses | + | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 359 |
| **Total assets** |  | **149261414** |
| **Liabilities** | **Liabilities** | **Liabilities** |
| Payables: |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; Investments bought |  | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 1409487 |
| &nbsp;&nbsp;&nbsp;&nbsp; Investment adviser and administrator fees |  | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 60961 |
| &nbsp;&nbsp;&nbsp;&nbsp; Fund shares redeemed |  | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 36238 |
| &nbsp;&nbsp;&nbsp;&nbsp; Independent trustees' fees |  | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 31 |
| Accrued expenses | + | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 34709 |
| **Total liabilities** |  | **1541426** |
| **Net assets** |  | **$147719988** |
| **Net Assets by Source** | **Net Assets by Source** | **Net Assets by Source** |
| Capital received from investors |  | $114063172 |
| Total distributable earnings | + | &nbsp;&nbsp;&nbsp;&nbsp; 33656816 |
| **Net assets** |  | **$147719988** |

---

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;

---

| | | | | |
|:---|:---|:---|:---|:---|
| **Net Asset Value (NAV)**  | **Net Asset Value (NAV)**  | **Net Asset Value (NAV)**  | **Net Asset Value (NAV)**  | **Net Asset Value (NAV)**  |
| **Net Assets**  | **÷** | &nbsp;&nbsp;&nbsp;&nbsp; **Shares**<br> **Outstanding**<br>| **=** | **NAV** |
| $147719988 |  | 9413837 |  | $15.69 |

---

*See financial notes*

**11**Schwab VIT Growth Portfolio \| Annual Report

------

Schwab VIT Growth Portfolio

Statement of Operations

------

---

| | | |
|:---|:---|:---|
| For the period January 1, 2022 through December 31, 2022 | For the period January 1, 2022 through December 31, 2022 | For the period January 1, 2022 through December 31, 2022 |
| **Investment Income**  | **Investment Income**  | **Investment Income**  |
| Dividends received from securities - affiliated |  | &nbsp;&nbsp;&nbsp; $3171559 |
| Interest received from securities - unaffiliated | + | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 7906 |
| **Total investment income**  |  | **3179465** |
| **Expenses** | **Expenses** | **Expenses** |
| Investment adviser and administrator fees |  | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 716873 |
| Professional fees |  | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 23628 |
| Independent trustees' fees |  | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 13635 |
| Portfolio accounting fees |  | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 13060 |
| Shareholder reports |  | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 9611 |
| Proxy fees<sup>1</sup> <br>|  | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 2426 |
| Custodian fees |  | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 2290 |
| Transfer agent fees  |  | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 424 |
| Other expenses | + | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 3925 |
| **Total expenses** | – | **785872** |
| **Net investment income** |  | **2393593** |
| **REALIZED AND UNREALIZED GAINS (LOSSES)** | **REALIZED AND UNREALIZED GAINS (LOSSES)** | **REALIZED AND UNREALIZED GAINS (LOSSES)** |
| **Net realized losses on sales of securities - affiliated** |  | **(984395)** |
| **Net change in unrealized appreciation (depreciation) on securities - affiliated** | + | **(33654209)** |
| **Net realized and unrealized losses** |  | **(34638604)** |
| **Decrease in net assets resulting from operations** |  | **($32245011)** |

---

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;

<sup>1</sup> Proxy fees are non-routine expenses (see financial note 4 for additional information).

*See financial notes*

Schwab VIT Growth Portfolio \| Annual Report**12**

------

Schwab VIT Growth Portfolio

Statement of Changes in Net Assets

------

For the current and prior report periods

---

| | | | |
|:---|:---|:---|:---|
| **OPERATIONS** | **OPERATIONS** | **OPERATIONS** | **OPERATIONS** |
|  | 1/1/22-12/31/22 | 1/1/22-12/31/22 | 1/1/21-12/31/21 |
| Net investment income |  | &nbsp;&nbsp;&nbsp; $2393593 | &nbsp;&nbsp; $2698202 |
| Net realized gains (losses) |  | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (984395) | &nbsp;&nbsp;&nbsp;&nbsp; 4656115 |
| Net change in unrealized appreciation (depreciation) | + | &nbsp;&nbsp; (33654209) | &nbsp;&nbsp; 16406347 |
| **Increase (decrease) in net assets resulting from operations** |  | **($32245011)** | **$23760664** |
| **DISTRIBUTIONS TO SHAREHOLDERS** | **DISTRIBUTIONS TO SHAREHOLDERS** | **DISTRIBUTIONS TO SHAREHOLDERS** | **DISTRIBUTIONS TO SHAREHOLDERS** |
| **Total distributions** |  | **($6624352)** | **($2315222)** |

---

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;

---

| | | | | | |
|:---|:---|:---|:---|:---|:---|
| **TRANSACTIONS IN FUND SHARES** | **TRANSACTIONS IN FUND SHARES** | **TRANSACTIONS IN FUND SHARES** | **TRANSACTIONS IN FUND SHARES** | **TRANSACTIONS IN FUND SHARES** | **TRANSACTIONS IN FUND SHARES** |
|  | 1/1/22-12/31/22 | 1/1/22-12/31/22 | 1/1/22-12/31/22 | 1/1/21-12/31/21 | 1/1/21-12/31/21 |
|  |  | SHARES | VALUE | SHARES | VALUE |
| Shares sold |  | &nbsp;&nbsp;&nbsp; 618939 | &nbsp;&nbsp; $11110432 | 1044962 | &nbsp;&nbsp; $19957820 |
| Shares reinvested |  | &nbsp;&nbsp;&nbsp; 425729 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 6624352 | &nbsp;&nbsp;&nbsp; 121089 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 2315222 |
| Shares redeemed | + | (1060800) | &nbsp;&nbsp;&nbsp; (18183469) | (1184544) | &nbsp;&nbsp;&nbsp; (22175070) |
| **Net transactions in fund shares**  |  | **(16132)** | **($448685)** | **(18493)** | **$97972** |
| **SHARES OUTSTANDING AND NET ASSETS** | **SHARES OUTSTANDING AND NET ASSETS** | **SHARES OUTSTANDING AND NET ASSETS** | **SHARES OUTSTANDING AND NET ASSETS** | **SHARES OUTSTANDING AND NET ASSETS** | **SHARES OUTSTANDING AND NET ASSETS** |
|  | 1/1/22-12/31/22 | 1/1/22-12/31/22 | 1/1/22-12/31/22 | 1/1/21-12/31/21 | 1/1/21-12/31/21 |
|  |  | SHARES | NET ASSETS | SHARES | NET ASSETS |
| Beginning of period |  | 9429969 | $187038036 | 9448462 | $165494622 |
| Total increase (decrease) | + | &nbsp;&nbsp;&nbsp;&nbsp; (16132) | &nbsp;&nbsp;&nbsp; (39318048) | &nbsp;&nbsp;&nbsp;&nbsp; (18493) | &nbsp;&nbsp;&nbsp;&nbsp; 21543414 |
| **End of period** |  | **9413837** | **$147719988** | **9429969** | **$187038036** |

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*See financial notes*

**13**Schwab VIT Growth Portfolio \| Annual Report

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Schwab VIT Growth Portfolio

Financial Notes

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**1. Business Structure of the Fund:**

Schwab VIT Growth Portfolio (the fund) is a series of Schwab Annuity Portfolios (the trust), a no-load, open-end management investment company. The trust is organized as a Massachusetts business trust and is registered under the Investment Company Act of 1940, as amended (the 1940 Act). The list below shows all the funds in the trust as of the end of the period, including the fund discussed in this report, which is highlighted:

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| |
|:---|
| **SCHWAB ANNUITY PORTFOLIOS (ORGANIZED JANUARY 21, 1994)** |
| Schwab Government Money Market Portfolio |
| Schwab S&P 500 Index Portfolio |
| Schwab VIT Balanced Portfolio |
| Schwab VIT Balanced with Growth Portfolio |
| **Schwab VIT Growth Portfolio** |

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The fund is a "fund of funds" which primarily invests in affiliated Schwab Exchange-Traded Funds (ETFs). The fund may also invest in affiliated mutual funds from Schwab Funds and unaffiliated third-party ETFs and mutual funds (all such ETFs and mutual funds referred to as "underlying funds"). The fund may also invest directly in equity or fixed-income securities, including bonds, cash equivalents, money market funds and money market investments, to achieve its investment objectives.

The fund in this report offers one share class. Shares are bought and sold at closing net asset value per share (NAV), which is the price for all outstanding shares of the fund. Each share has a par value of 1/1,000 of a cent, and the fund's Board of Trustees (the Board) may authorize the issuance of as many shares as necessary.

The fund is available exclusively as an investment vehicle for variable annuity and variable life insurance contracts offered by separate accounts of participating life insurance companies, and in the future may be offered to pension and retirement plans qualified under the Internal Revenue Code of 1986, as amended. At December 31, 2022, 100% of the fund's shares were held through separate accounts of five insurance companies. Subscriptions and redemptions of these insurance separate accounts could have a material impact on the fund.

The fund maintains its own account for purposes of holding assets and accounting, and is considered a separate entity for tax purposes. Within its account, the fund may also keep certain assets in segregated accounts, as required by securities law.

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<br>**2. Significant Accounting Policies:**

The following is a summary of the significant accounting policies the fund uses in its preparation of financial statements. The fund follows the investment company accounting and reporting guidance of the Financial Accounting Standards Board (FASB) Accounting Standard Codification *Topic 946 Financial Services — Investment Companies*. The accounting policies are in conformity with accounting principles generally accepted in the United States of America (GAAP).

The financial statements of the fund should be read in conjunction with the underlying funds' financial statements. For more information about the underlying funds' operations and policies, please refer to those funds' semiannual and annual reports, which are filed with the U.S. Securities and Exchange Commission (SEC) and are available on the SEC's website at www.sec.gov.

**(a) Security Valuation:**

Pursuant to Rule 2a-5 under the 1940 Act, the Board has designated authority to a Valuation Designee, the fund's investment adviser, to make fair valuation determinations under adopted procedures, subject to Board oversight. The investment adviser has formed a Pricing Committee to administer the pricing and valuation of portfolio securities and other assets and liabilities and to ensure that prices used for internal purposes or provided by third parties reasonably reflect fair value. The Valuation Designee may utilize independent pricing services, quotations from securities and financial instrument dealers and other market sources to determine fair value.

Securities held in the fund's portfolio are valued every business day. The following valuation policies and procedures are used by the Valuation Designee to value various types of securities:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• **Securities traded on an exchange or over-the-counter:** Traded securities are valued at the closing value for the day, or, on days when no closing value has been reported, at the mean of the most recent bid and ask quotes.

• **Mutual funds:** Mutual funds are valued at their respective NAVs.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• **Cash management sweep time deposits:** Balances held in cash management sweep time deposits are accounted for on a cost basis, which approximates fair value.

Schwab VIT Growth Portfolio \| Annual Report**14**

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Schwab VIT Growth Portfolio

Financial Notes (continued)

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;

**2. Significant Accounting Policies (continued):** 

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• **Securities for which no quoted value is available:** The Valuation Designee has adopted procedures to fair value the fund's securities when market prices are not "readily available" or are unreliable. For example, a security may be fair valued when it's de-listed or its trading is halted or suspended; when a security's primary pricing source is unable or unwilling to provide a price; or when a security's primary trading market is closed during regular market hours. Fair value determinations are made in good faith in accordance with adopted valuation procedures. The Valuation Designee considers a number of factors, including unobservable market inputs, when arriving at fair value. The Valuation Designee may employ methods such as the review of related or comparable assets or liabilities, related market activities, recent transactions, market multiples, book values, transactional back-testing, disposition analysis and other relevant information. Due to the subjective and variable nature of fair value pricing, there can be no assurance that the fund could obtain the fair value assigned to the security upon the sale of such security.

In accordance with the authoritative guidance on fair value measurements and disclosures under GAAP, the fund discloses the fair value of its investments in a hierarchy that prioritizes the significant inputs to valuation methods used to measure the fair value. The hierarchy gives the highest priority to valuations based upon unadjusted quoted prices in active markets for identical assets or liabilities (Level 1 measurements) and the lowest priority to valuations based upon unobservable inputs that are significant to the valuation (Level 3 measurements). If inputs used to measure the financial instruments fall within different levels of the hierarchy, the categorization is based on the lowest level input that is significant to the valuation. If it is determined that either the volume and/or level of activity for an asset or liability has significantly decreased (from normal conditions for that asset or liability) or price quotations or observable inputs are not associated with orderly transactions, increased analysis and the Valuation Designee's judgment will be required to estimate fair value.

The three levels of the fair value hierarchy are as follows:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• Level 1 — quoted prices in active markets for identical investments — Investments whose values are based on quoted market prices in active markets, and whose values are therefore classified as Level 1 prices, include active listed equities and underlying funds. Underlying funds are classified as Level 1 prices, without consideration to the classification level of the underlying securities held.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• Level 2 — other significant observable inputs (including quoted prices for similar securities, interest rates, prepayment speeds, credit risk, etc.) — Investments that trade in markets that are not considered to be active, but whose values are based on quoted market prices, dealer quotations or valuations provided by alternative pricing sources supported by observable inputs are classified as Level 2 prices. These generally include U.S. government and sovereign obligations, most government agency securities, investment-grade corporate bonds, certain mortgage products, less liquid listed equities, and state, municipal and provincial obligations.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• Level 3 — significant unobservable inputs (including the Valuation Designee's assumptions in determining the fair value of investments) — Investments whose values are classified as Level 3 prices have significant unobservable inputs, as they may trade infrequently or not at all. When observable prices are not readily available for these securities, one or more valuation methods are used for which sufficient and reliable data is available. The inputs used in estimating the value of Level 3 prices may include the original transaction price, quoted prices for similar securities or assets in active markets, completed or pending third-party transactions in the underlying investment or comparable issuers, and changes in financial ratios or cash flows. Level 3 prices may also be adjusted to reflect illiquidity and/or non-transferability, with the amount of such discount estimated in the absence of market information. Assumptions used due to the lack of observable inputs may significantly impact the resulting fair value and therefore the fund's results of operations.

The inputs or methodology used for valuing securities are not necessarily an indication of the risk associated with investing in those securities.

The levels associated with valuing the fund's investments as of December 31, 2022 are disclosed in the Portfolio Holdings.

**(b) Accounting Policies for certain Portfolio Investments (if held):**

**Securities Lending:** Under the trust's Securities Lending Program, a fund (lender) may make short-term loans of its securities to another party (borrower) to generate additional revenue for the fund. The borrower pledges collateral in the form of cash, securities issued or fully guaranteed by the U.S. government or foreign governments, or letters of credit issued by a bank. Collateral at the individual loan level is required to be maintained on a daily marked-to-market basis in an amount at least equal to the current value of the securities loaned. The lending agent provides the fund with indemnification against borrower default (the borrower fails to return the security on loan) reducing the risk of loss as a result of default. The cash collateral of securities loaned is currently invested in money market portfolios operating pursuant to Rule 2a-7 under the 1940 Act. The fund bears the risk of loss with

**15**Schwab VIT Growth Portfolio \| Annual Report

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Schwab VIT Growth Portfolio

Financial Notes (continued)

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;

**2. Significant Accounting Policies (continued):** 

respect to the investment of cash collateral. The terms of the securities lending agreement allow the fund or the lending agent to terminate any loan at any given time and the securities must be returned within the earlier of the standard trade settlement period or the specified time period under the relevant securities lending agreement. Securities lending income, as disclosed in the fund's Statement of Operations, if applicable, represents the income earned from the investment of the cash collateral plus any fees paid by borrowers, less the fees paid to the lending agent and broker rebates which are subject to adjustments pursuant to the securities lending agreement. On loans not collateralized by cash, a fee is received from the borrower, and is allocated between the fund and the lending agent. The aggregate fair value of securities loaned will not at any time exceed one-third of the total assets of the fund, including collateral received from the loan. Securities lending fees paid to the unaffiliated lending agents start at 9% of gross lending revenue, with subsequent breakpoints to a low of 5%. In this context, the gross lending revenue equals the income received from the investment of cash collateral and fees paid by borrowers less any rebates paid to the borrowers. Any expenses charged by the cash collateral fund are in addition to these fees. All remaining revenue is retained by the fund, as applicable. No portion of lending revenue is paid to or retained by the investment adviser or any of its affiliates.

As of December 31, 2022, the fund had no securities on loan. <br>

<br>**Cash Management Transactions:** Effective May 23, 2022 Brown Brothers Harriman & Co. (BBH) was replaced by Citibank, N.A as custodian of the fund. The fund no longer subscribes to the BBH Cash Management Service Sweep (CMS Sweep). The BBH CMS Sweep was an investment product that automatically swept the fund's cash balances into overnight offshore time deposits with either the BBH Grand Cayman branch or a branch of a pre-approved commercial bank. This fully automated program allowed the fund to earn interest on cash balances. Excess cash invested with deposit institutions domiciled outside of the U.S., as with any offshore deposit, was subject to sovereign actions in the jurisdiction of the deposit institution including, but not limited to, freeze, seizure or diminution. The fund assumed the risk associated with the repayment of principal and payment of interest on such instruments by the institution with which the deposit was ultimately placed. The fund terminated the CMS Sweep program and cash was returned to the fund prior to terminating services with BBH.

**Cash Investments:** The fund may invest a portion of its assets in cash. Cash includes cash bank balances in an interest-bearing demand deposit account with maturity on demand by the fund.

**(c) Security Transactions:** 

Security transactions are recorded as of the date the order to buy or sell the security is executed. Realized gains and losses from security transactions are based on the identified costs of the securities involved.

**(d) Investment Income:**

Interest income is recorded as it accrues. Dividends and distributions from portfolio securities and underlying funds are recorded on the date they are effective (the ex-dividend date). Any distributions from underlying funds are recorded in accordance with the character of the distributions as designated by the underlying funds.

**(e) Expenses:**

Expenses that are specific to the fund are charged directly to the fund. Expenses that are common to more than one fund in the trusts generally are allocated among those funds in proportion to their average daily net assets. The fund bears its share of the acquired fund fees and expenses of the underlying funds, which are indirect expenses incurred by the fund through its investments in the underlying funds. Such expenses are reflected in the net asset values of the underlying funds.

**(f) Distributions to Shareholders:**

The fund makes distributions from net investment income and net realized capital gains, if any, once a year. To receive a distribution, you must be a registered shareholder on the record date. Distributions are paid to shareholders on the payable date.

**(g) Accounting Estimates:**

The accounting policies described in this report conform to GAAP. Notwithstanding this, shareholders should understand that in order to follow these principles, fund management has to make estimates and assumptions that affect the information reported in the financial statements. It's possible that once the results are known, they may turn out to be different from these estimates and these differences may be material.

Schwab VIT Growth Portfolio \| Annual Report**16**

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Schwab VIT Growth Portfolio

Financial Notes (continued)

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;

**2. Significant Accounting Policies (continued):** 

**(h) Federal Income Taxes:**

The fund intends to meet federal income and excise tax requirements for regulated investment companies under subchapter M of the Internal Revenue Code, as amended. Accordingly, the fund distributes substantially all of its net investment income and net realized capital gains, if any, to the participating insurance company's (shareholders) separate accounts each year. As long as the fund meets the tax requirements, it is not required to pay federal income tax.

**(i) Indemnification:**

Under the fund's organizational documents, the officers and trustees are indemnified against certain liabilities arising out of the performance of their duties to the fund. In addition, in the normal course of business the fund enters into contracts with its vendors and others that provide general indemnifications. The fund's maximum exposure under these arrangements is unknown as this would involve future claims that may be made against the fund. However, based on experience, the fund expects the risk of loss attributable to these arrangements to be remote.

**(j) Regulatory Update:** 

Effective January 24, 2023, the SEC adopted rule and form amendments to require mutual funds and ETFs to transmit concise and visually engaging streamlined annual and semiannual reports to shareholders that highlight key information deemed important for retail investors to assess and monitor their fund investments. Other information, including financial statements, will no longer appear in a streamlined shareholder report but must be available online, delivered free of charge upon request, and filed on a semiannual basis on Form N-CSR. The rule and form amendments have a compliance date of July 24, 2024. At this time, management is evaluating the impact of these rule and form amendment changes on the content of the current shareholder report and the newly created annual and semiannual streamlined shareholder reports.

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<br>**3. Risk Factors:**

Investing in the fund may involve certain risks, as discussed in the fund's prospectus, including, but not limited to, those described below. Any of these risks could cause an investor to lose money.

**Asset Allocation Risk.** The fund is subject to the risk that the selection of the underlying funds and the allocation of the fund's assets among the various asset classes and market segments may cause the fund to underperform other funds with a similar investment objective.

**Conflicts of Interest Risk.** The investment adviser's authority to select and substitute underlying funds from a variety of affiliated and unaffiliated mutual funds and ETFs may create a conflict of interest because the fees paid to it and its affiliates by some underlying funds are higher than the fees paid by other underlying funds. The investment adviser also may have an incentive to select an affiliated underlying fund for other reasons, including to increase assets under management or to support new investment strategies. In addition, other conflicts of interest may exist where the best interests of the affiliated underlying fund may not be aligned with those of the fund. However, the investment adviser is a fiduciary to the fund and is legally obligated to act in the fund's best interests when selecting underlying funds.

**Market Risk.** Financial markets rise and fall in response to a variety of factors, sometimes rapidly and unpredictably. Markets may be impacted by economic, political, regulatory and other conditions, including economic sanctions and other government actions. In addition, the occurrence of global events, such as war, terrorism, environmental disasters, natural disasters and epidemics may also negatively affect the financial markets. As with any investment whose performance is tied to these markets, the value of an investment in the fund will fluctuate, which means that an investor could lose money over short or long periods.

**Securities Lending Risk.** Securities lending involves the risk of loss of rights in, or delay in recovery of, the loaned securities if the borrower fails to return the security loaned or becomes insolvent.

**ETF Risk.** When the fund invests in an ETF, it will bear a proportionate share of the ETF's expenses. In addition, lack of liquidity in the market for an ETF's shares can result in its value being more volatile than the underlying portfolio of securities.

**Direct Investment Risk.** The fund may invest directly in cash, cash equivalents and equity and fixed-income securities, including money market securities, to maintain its allocations. The fund's direct investment in these securities is subject to the same or similar risks as an underlying fund's investment in the same securities.

**Underlying Fund Investment Risk.** Before investing in the fund, investors should assess the risks associated with the underlying funds in which the fund may invest, which include any combination of the risks described below.

**17**Schwab VIT Growth Portfolio \| Annual Report

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Schwab VIT Growth Portfolio

Financial Notes (continued)

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;

**3. Risk Factors (continued):** 

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• **Equity Risk.** The prices of equity securities rise and fall daily. These price movements may result from factors affecting individual companies, industries or the securities market as a whole. In addition, equity markets tend to move in cycles, which may cause stock prices to fall over short or extended periods of time.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• **Market Capitalization Risk.** Securities issued by companies of different market capitalizations tend to go in and out of favor based on market and economic conditions. During a period when securities of a particular market capitalization fall behind other types of investments, an underlying fund's performance could be impacted.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• **Foreign Investment Risk.** An underlying fund's investments in securities of foreign issuers involve certain risks that may be greater than those associated with investments in securities of U.S. issuers. These include risks of adverse changes in foreign economic, political, regulatory and other conditions; changes in currency exchange rates or exchange control regulations (including limitations on currency movements and exchanges); the imposition of economic sanctions or other government restrictions; differing accounting, auditing, financial reporting and legal standards and practices; differing securities market structures; and higher transaction costs. These risks may negatively impact the value or liquidity of an underlying fund's investments, and could impair the underlying fund's ability to meet its investment objective or invest in accordance with its investment strategy. There is a risk that investments in securities denominated in, and/or receiving revenues in, foreign currencies will decline in value relative to the U.S. dollar or, in the case of hedging positions, that the U.S. dollar will decline in value relative to the currency hedged, resulting in the dollar value of an underlying fund's investment being adversely affected.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• **Emerging Markets Risk.** Emerging market countries may be more likely to experience political turmoil or rapid changes in market or economic conditions than more developed countries. Emerging market countries often have less uniformity in accounting, auditing, financial reporting and recordkeeping requirements and greater risk associated with the custody of securities. In addition, the financial stability of issuers (including governments) in emerging market countries may be more precarious than in developed countries. As a result, there may be an increased risk of illiquidity and price volatility associated with an underlying fund's investments in emerging market countries, which may be magnified by currency fluctuations relative to the U.S. dollar, and, at times, it may be difficult to value such investments.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• **Growth Investing Risk.** Certain of the underlying funds pursue a "growth style" of investing. Growth investing focuses on a company's prospects for growth of revenue and earnings. If a company's earnings or revenues fall short of expectations, its stock price may fall dramatically. Growth stocks also can perform differently from the market as a whole and other types of stocks and can be more volatile than other types of stocks. Since growth companies usually invest a high portion of earnings in their business, they may lack the dividends of value stocks that can cushion stock prices in a falling market. Growth stocks may also be more expensive relative to their earnings or assets compared to value or other stocks.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• **Value Investing Risk.** Certain of the underlying funds may pursue a "value style" of investing. Value investing focuses on companies whose stocks appear undervalued in light of factors such as the company's earnings, book value, revenues or cash flow. If an underlying fund's investment adviser's (or sub-adviser's) assessment of a company's value or prospects for exceeding earnings expectations or market conditions is wrong, the underlying fund could suffer losses or produce poor performance relative to other funds. In addition, "value stocks" can continue to be undervalued by the market for long periods of time.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• **Fixed-Income Risk.** Interest rates rise and fall over time, which will affect an underlying fund's yield and share price. A change in a central bank's monetary policy or economic conditions, among other things, may result in a change in interest rates. A rise in interest rates could cause an underlying fund's share price to fall. The credit quality of a portfolio investment could also cause an underlying fund's share price to fall. An underlying fund could lose money if the issuer or guarantor of a portfolio investment or the counterparty to a derivatives contract fails to make timely principal or interest payments or otherwise honor its obligations. Fixed-income securities may be paid off earlier or later than expected. Either situation could cause an underlying fund to hold securities paying lower-than-market rates of interest, which could hurt an underlying fund's yield or share price. Below investment-grade bonds (junk bonds) involve greater credit risk, are more volatile, involve greater risk of price declines and may be more susceptible to economic downturns than investment-grade securities.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• **Interest Rate Risk.** Interest rates rise and fall over time. As with any investment whose yield reflects current interest rates, an underlying fund's yield will change over time. During periods when interest rates are low, an underlying fund's yield (and total return) also may be low. Changes in interest rates also may affect an underlying fund's share price: a rise in interest rates generally causes an underlying fund's share price to fall. The longer an underlying fund's portfolio duration, the more sensitive to interest rate movements its share price is likely to be. Also, a change in a central bank's monetary policy or economic conditions, among other things, may result in a change in interest rates, which could have sudden and unpredictable effects on the markets and significantly impact the value of fixed-income securities in which the underlying fund invests.

Schwab VIT Growth Portfolio \| Annual Report**18**

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Schwab VIT Growth Portfolio

Financial Notes (continued)

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;

**3. Risk Factors (continued):** 

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• **Credit Risk.** A decline in the credit quality of an issuer or guarantor of a portfolio investment could cause an underlying fund to lose money or underperform. An underlying fund could lose money if the issuer or guarantor of a portfolio investment fails to make timely principal or interest payments or otherwise honor its obligations.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• **Prepayment and Extension Risk.** Certain fixed income securities are subject to the risk that the securities may be paid off earlier or later than expected, especially during periods of falling or rising interest rates, respectively. Prepayments of obligations could cause an underlying fund to forgo future interest income on the portion of the security's principal repaid early and force the underlying fund to reinvest that money at the lower prevailing interest rates. Extensions of obligations could cause the fund to exhibit additional volatility and hold securities paying lower-than-market rates of interest. Either case could hurt the underlying fund's performance.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• **U.S. Government Securities Risk.** Some of the U.S. government securities that the underlying funds invest in are not backed by the full faith and credit of the U.S. government, which means they are neither issued nor guaranteed by the U.S. Treasury. Issuers such as the Federal Home Loan Banks (FHLB) maintain limited access to credit lines from the U.S. Treasury. Certain securities, such as obligations issued by the Federal Farm Credit Banks Funding Corporation, are supported solely by the credit of the issuer. There can be no assurance that the U.S. government will provide financial support to securities of its agencies and instrumentalities if it is not obligated to do so under law. Also, any government guarantees on securities the underlying funds own do not extend to shares of the underlying funds themselves.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• **Real Estate Investment Risk.** An underlying fund in which the fund may invest may have a policy of concentrating its investments in real estate companies and companies related to the real estate industry. As such, an underlying fund is subject to risks associated with the direct ownership of real estate securities and the fund's investment in such an underlying fund is subject to risks associated with the direct ownership of real estate securities and an investment in the underlying fund will be closely linked to the performance of the real estate markets. These risks include, among others, declines in the value of real estate; risks related to general and local economic conditions; possible lack of availability of mortgage funds or other limits to accessing the credit or capital markets; defaults by borrowers or tenants, particularly during an economic downturn; and changes in interest rates.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• **Real Estate Investment Trusts (REITs) Risk**. An underlying fund may invest in REITs. An underlying fund's investments in REITs will be subject to the risks associated with the direct ownership of real estate, including fluctuations in the value of underlying properties, defaults by borrowers or tenants, changes in interest rates and risks related to general or local economic conditions. REITs are also subject to certain additional risks. For example, equity REITs may be affected by changes in the value of the underlying properties owned by the trusts, and mortgage REITs may be affected by the quality of any credit extended. Further, REITs may have their investments in relatively few properties, a small geographic area or a single property type. In addition, REITs have their own expenses, and the underlying fund will bear a proportionate share of those expenses.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• **Mortgage-Backed and Mortgage Pass-Through Securities Risk.** Mortgage-backed securities tend to increase in value less than other debt securities when interest rates decline, but are subject to similar or greater risk of decline in fair value during periods of rising interest rates. Certain of the mortgage-backed securities in which an underlying fund may invest are issued or guaranteed by agencies or instrumentalities of the U.S. government but are not backed by the full faith and credit of the U.S. government. There can be no assurance that the U.S. government would provide financial support to its agencies or instrumentalities where it was not obligated to do so which can cause an underlying fund to lose money or underperform. The risks of investing in mortgage-backed securities include, among others, interest rate risk, credit risk, prepayment risk and extension risk. Transactions in mortgage pass-through securities often occur through to-be-announced (TBA) transactions. An underlying fund could lose money or underperform if a TBA counterparty defaults or goes bankrupt.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• **Portfolio Turnover Risk.** Certain of the underlying funds may buy and sell portfolio securities actively. If they do, their portfolio turnover rate and transaction costs will rise, which may lower the underlying fund's performance and may increase the likelihood of capital gains distributions.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• **Liquidity Risk.** An underlying fund may be unable to sell certain securities, such as illiquid securities, readily at a favorable time or price, or the underlying fund may have to sell them at a loss.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• **Derivatives Risk.** An underlying fund's use of derivative instruments involves risks different from, or possibly greater than, the risks associated with investing directly in securities and other traditional investments. An underlying fund's use of derivatives could reduce the underlying fund's performance, increase volatility, and could cause the underlying fund to lose more than the initial amount invested. In addition, investments in derivatives may involve leverage, which means a small percentage of assets invested in derivatives can have a disproportionately large impact on an underlying fund.

**19**Schwab VIT Growth Portfolio \| Annual Report

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Schwab VIT Growth Portfolio

Financial Notes (continued)

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;

**3. Risk Factors (continued):** 

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• **Securities Lending Risk.** Certain underlying funds engage in securities lending, which involves the risk of loss of rights in, or delay in recovery of, the loaned securities if the borrower fails to return the security loaned or becomes insolvent.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• **Management Risk.** An underlying fund may be an actively managed mutual fund. Any actively managed mutual fund is subject to the risk that its investment adviser (or sub-adviser(s)) will make poor security selections. An underlying fund's adviser applies its own investment techniques and risk analyses in making investment decisions for the fund, but there can be no guarantee that they will produce the desired results.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• **Investment Style Risk.** Certain underlying funds seek to track the performance of various segments of the stock market, as measured by their respective indices. Such underlying funds follow these stocks during upturns as well as downturns. Because of their indexing strategy, these underlying funds do not take steps to reduce market exposure or to lessen the effects of a declining market. In addition, because of an underlying fund's expenses, the underlying fund's performance is normally below that of the index. Errors relating to an index may occur from time to time and may not be identified by the underlying fund's index provider for a period of time. In addition, market disruptions could cause delays in an underlying fund's index's rebalancing schedule. Such errors and/or market disruptions may result in losses for an underlying fund.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• **Tracking Error Risk.** An underlying fund may seek to track the performance of its benchmark index, although it may not be successful in doing so. The divergence between the performance of a fund and its benchmark index, positive or negative, is called "tracking error." Tracking error can be caused by many factors and it may be significant.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• **Concentration Risk.** To the extent that an underlying fund's portfolio is concentrated in the securities of issuers in a particular market, industry, group of industries, sector or asset class, the underlying fund may be adversely affected by the performance of those securities, may be subject to increased price volatility and may be more vulnerable to adverse economic, market, political, or regulatory occurrences affecting that market, industry, group of industries, sector or asset class.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• **Commodity Risk.** To the extent that an underlying fund invests in commodity-linked derivative instruments, it may subject the underlying fund to greater volatility than investments in traditional securities. Also, commodity-linked investments may be more volatile and less liquid than the underlying commodity. The value of commodity-linked derivative instruments may be affected by changes in overall market movements, commodity index volatility, changes in interest rates, or factors affecting a particular industry or commodity, such as drought, floods, weather, livestock disease, embargoes, tariffs and international economic, political and other regulatory and market developments. The use of leveraged commodity-linked derivatives creates an opportunity for increased return, but also creates the possibility for a greater loss.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• **Money Market Fund Risk.** The fund may invest in underlying money market funds that either seek to maintain a stable $1.00 net asset value ("stable share price money market funds") or that have a share price that fluctuates ("variable share price money market funds"). Although an underlying stable share price money market fund seeks to maintain a stable $1.00 net asset value, it is possible to lose money by investing in such a money market fund. Because the share price of an underlying variable share price money market fund will fluctuate, when the fund sells the shares it owns they may be worth more or less than what the fund originally paid for them. In addition, neither type of money market fund is designed to offer capital appreciation. Certain underlying money market funds may impose a fee upon the sale of shares or may temporarily suspend the ability to sell shares if such fund's liquidity falls below required minimums.

Please refer to the fund's prospectus for a more complete description of the principal risks of investing in the fund.

------

<br>**4. Affiliates and Affiliated Transactions:**

**Investment Adviser**

Charles Schwab Investment Management Inc., dba Schwab Asset Management, a wholly owned subsidiary of The Charles Schwab Corporation, serves as the fund's investment adviser and administrator pursuant to an Investment Advisory and Administration Agreement between the investment adviser and the trust.

For its advisory and administrative services to the fund, the investment adviser is entitled to receive an annual fee, accrued daily and payable monthly, equal to 0.45% of the fund's average daily net assets.

Schwab VIT Growth Portfolio \| Annual Report**20**

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Schwab VIT Growth Portfolio

Financial Notes (continued)

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;

**4. Affiliates and Affiliated Transactions (continued):** 

**Expense Limitation**

The investment adviser and its affiliates have agreed with the fund, for so long as the investment adviser serves as the investment adviser to the fund, which may only be amended or terminated with approval of the fund's Board, to limit the total annual fund operating expenses charged, excluding interest, taxes and certain non-routine expenses to 0.58%.

The agreement to limit the fund's total expenses charged is limited to the fund's direct operating expenses and, therefore, does not apply to acquired fund fees and expenses, which are indirect expenses incurred by the fund through its investments in the underlying funds.

**Investments in Affiliates**

The fund may engage in certain transactions involving related parties. Pursuant to an exemptive order issued by the SEC, the fund may invest in other related ETFs and mutual funds. As of December 31, 2022, the Schwab VIT Growth Portfolio's ownership percentages of other related funds' shares are:

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| | |
|:---|:---|
| Schwab Emerging Markets Equity ETF | 0.1% |
| Schwab International Equity ETF | 0.1% |
| Schwab International Small-Cap Equity ETF | 0.2% |
| Schwab U.S. Aggregate Bond ETF | 0.3% |
| Schwab U.S. Large-Cap ETF | 0.2% |
| Schwab U.S. REIT ETF | 0.2% |
| Schwab U.S. Small-Cap ETF | 0.1% |
| Schwab Variable Share Price Money Fund, Ultra Shares | 0.1% |

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**Interfund Transactions**

The fund may engage in transactions with certain other funds in the Fund Complex (for definition refer to the Trustees and Officers section) in accordance with procedures adopted by the Board pursuant to Rule 17a-7 under the 1940 Act. When one fund is seeking to sell a security that another is seeking to buy, an interfund transaction can allow both funds to benefit by reducing transaction costs. This practice is limited to funds that share the same investment adviser, trustees and/or officers. For the period ended December 31, 2022, the fund's purchases and sales of securities with other funds in the Fund Complex was $482,727 and $334,629 respectively, and includes realized losses of $26,809.

**Interfund Borrowing and Lending**

Pursuant to an exemptive order issued by the SEC, the fund may enter into interfund borrowing and lending transactions with other funds in the Fund Complex (for definition refer to the Trustees and Officers section). All loans are for temporary or emergency purposes and the interest rate to be charged will be the average of the overnight repurchase agreement rate and the short-term bank loan rate. All loans are subject to numerous conditions designed to ensure fair and equitable treatment of all participating funds. The interfund lending facility is subject to the oversight and periodic review by the Board. The fund had no interfund borrowing or lending activity during the period.

------

<br>**5. Board of Trustees:**

The Board may include people who are officers and/or directors of the investment adviser or its affiliates. Federal securities law limits the percentage of such "interested persons" who may serve on a trust's board, and the trust was in compliance with these limitations throughout the report period. The fund did not pay any of these interested persons for their services as trustees, but did pay non-interested persons (independent trustees), as noted on the fund's Statement of Operations. For information regarding the trustees, please refer to the Trustees and Officers table at the end of this report.

**21**Schwab VIT Growth Portfolio \| Annual Report

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Schwab VIT Growth Portfolio

Financial Notes (continued)

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;

**6. Borrowing from Banks:**

During the period, the fund was a participant with other funds in the Fund Complex in a joint, syndicated, committed $850 million line of credit (the Syndicated Credit Facility), which matured on September 29, 2022. On September 29, 2022, the Syndicated Credit Facility was amended to run for a new 364 day period with the line of credit amount increasing to $1 billion, maturing on September 28, 2023. Under the terms of the Syndicated Credit Facility, in addition to the interest charged on any borrowings by the fund, the fund paid a commitment fee of 0.15% per annum on the fund's proportionate share of the unused portion of the Syndicated Credit Facility.

During the period, the fund was a participant with other funds in the Fund Complex in a joint, unsecured, uncommitted $400 million line of credit (the Uncommitted Credit Facility), with State Street Bank and Trust Company, which matured on September 29, 2022. On September 29, 2022, the Uncommitted Credit Facility was amended to run for a new 364 day period with the line of credit amount remaining unchanged, maturing on September 28, 2023. Under the terms of the Uncommitted Credit Facility, the fund pays interest on the amount the fund borrows. There were no borrowings from either line of credit during the period.

The fund also has access to custodian overdraft facilities. The fund may have utilized the overdraft facility and incurred an interest expense, which is disclosed on the fund's Statement of Operations, if any. The interest expense is determined based on a negotiated rate above the current Federal Funds Rate.

------

<br>**7. Purchases and Sales of Investment Securities:**

For the period ended December 31, 2022, purchases and sales of securities (excluding short-term obligations) were as follows:

---

| | |
|:---|:---|
| PURCHASES <br>OF SECURITIES <br>| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; SALES <br>OF SECURITIES <br>|
| $20201894 | $23116870 |

---

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<br>**8. Federal Income Taxes:**

As of December 31, 2022, the tax basis cost of the fund's investments and gross unrealized appreciation and depreciation were as follows:

---

| | | | |
|:---|:---|:---|:---|
| TAX COST  | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; GROSS UNREALIZED <br>APPRECIATION <br>| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; GROSS UNREALIZED <br>DEPRECIATION <br>| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; NET UNREALIZED <br>APPRECIATION <br>&nbsp;&nbsp;&nbsp;&nbsp;(DEPRECIATION)<br>|
| $115338293 | $36514949 | ($5210266)  | $31304683 |

---

As of December 31, 2022, the components of distributable earnings on a tax basis were as follows:

---

| | | | |
|:---|:---|:---|:---|
| UNDISTRIBUTED <br>ORDINARY <br>INCOME <br>| &nbsp;&nbsp;&nbsp;&nbsp; NET UNREALIZED <br>APPRECIATION <br>&nbsp;&nbsp;&nbsp;&nbsp;(DEPRECIATION) <br>ON INVESTMENTS <br>| &nbsp;&nbsp;&nbsp;&nbsp; CAPITAL LOSS <br>CARRYFORWARDS AND OTHER LOSSES<br>| TOTAL  |
| $2392373 | $31304683 | ($40240) | $33656816 |

---

The primary difference between book basis and tax basis unrealized appreciation or unrealized depreciation of investments is the tax deferral of losses on wash sales. The tax cost of the fund's investments, disclosed above, have been adjusted from their book amounts to reflect these unrealized appreciation or depreciation differences, as applicable.

Capital loss carryforwards have no expiration and may be used to offset future realized capital gains for federal income tax purposes. As of December 31, 2022, the fund had capital loss carryforwards of $40,240.

The tax basis components of distributions paid during the current and prior fiscal years were as follows:

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| | | | |
|:---|:---|:---|:---|
| CURRENT FISCAL YEAR END DISTRIBUTIONS | CURRENT FISCAL YEAR END DISTRIBUTIONS | PRIOR FISCAL YEAR END DISTRIBUTIONS | PRIOR FISCAL YEAR END DISTRIBUTIONS |
| ORDINARY <br>INCOME <br>| &nbsp;&nbsp; LONG-TERM <br>CAPITAL <br>GAINS <br>| &nbsp;&nbsp; ORDINARY <br>INCOME <br>| &nbsp;&nbsp; LONG-TERM <br>CAPITAL <br>GAINS <br>|
| $2845703 | $3778649 | $2315222 | $— |

---

Schwab VIT Growth Portfolio \| Annual Report**22**

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Schwab VIT Growth Portfolio

Financial Notes (continued)

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;

**8. Federal Income Taxes (continued):** 

Distributions paid to shareholders are based on net investment income and net realized gains determined on a tax basis, which may differ from net investment income and net realized gains for financial reporting purposes. These differences reflect the differing character of certain income items and net realized gains and losses for financial statement and tax purposes, and may result in reclassification among certain capital accounts on the financial statements. The fund may also designate a portion of the amount paid to redeeming shareholders as a distribution for tax purposes.

Permanent book and tax basis differences may result in reclassifications between components of net assets as required. The adjustments will have no impact on net assets or the results of operations.

As of December 31, 2022, management has reviewed the tax positions for open periods (for federal purposes, three years from the date of filing and for state purposes, four years from the date of filing) as applicable to the fund, and has determined that no provision for income tax is required in the fund's financial statements. The fund recognizes interest and penalties, if any, related to unrecognized tax benefits as income tax expense in the Statement of Operations. During the fiscal year ended December 31, 2022, the fund did not incur any interest or penalties.

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<br>**9. Subsequent Events:**

Management has determined there are no subsequent events or transactions through the date the financial statements were issued that would have materially impacted the financial statements as presented.

**23**Schwab VIT Growth Portfolio \| Annual Report

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Schwab VIT Growth Portfolio

Report of Independent Registered Public Accounting Firm

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To the Board of Trustees of Schwab Annuity Portfolios and Shareholders of Schwab VIT Growth Portfolio

***Opinion on the Financial Statements and Financial Highlights***

We have audited the accompanying statement of assets and liabilities, including the portfolio holdings, of Schwab VIT Growth Portfolio (the "Fund"), one of the funds constituting Schwab Annuity Portfolios, as of December 31, 2022, the related statement of operations for the year then ended, the statements of changes in net assets for each of the two years in the period then ended, the financial highlights for each of the three years in the period then ended, and the related notes. In our opinion, the financial statements and financial highlights present fairly, in all material respects, the financial position of the Fund as of December 31, 2022, and the results of its operations for the year then ended, the changes in its net assets for each of the two years in the period then ended, and the financial highlights for each of the three years in the period then ended in conformity with accounting principles generally accepted in the United States of America. The financial highlights for each of the two years in the period ended December 31, 2019 were audited by other auditors, whose report, dated February 18, 2020, expressed an unqualified opinion on such financial highlights.

***Basis for Opinion***

These financial statements and financial highlights are the responsibility of the Fund's management. Our responsibility is to express an opinion on the Fund's financial statements and financial highlights based on our audits. We are a public accounting firm registered with the Public Company Accounting Oversight Board (United States) (PCAOB) and are required to be independent with respect to the Fund in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.

We conducted our audits in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements and financial highlights are free of material misstatement, whether due to error or fraud. The Fund is not required to have, nor were we engaged to perform, an audit of its internal control over financial reporting. As part of our audits, we are required to obtain an understanding of internal control over financial reporting but not for the purpose of expressing an opinion on the effectiveness of the Fund's internal control over financial reporting. Accordingly, we express no such opinion.

Our audits included performing procedures to assess the risks of material misstatement of the financial statements and financial highlights, whether due to error or fraud, and performing procedures that respond to those risks. Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the financial statements and financial highlights. Our audits also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the financial statements and financial highlights. Our procedures included confirmation of securities owned as of December 31, 2022, by correspondence with the custodian and transfer agent. We believe that our audits provide a reasonable basis for our opinion.

**Deloitte & Touche LLP** <br>Denver, Colorado <br>February 16, 2023

We have served as the auditor of one or more investment companies in the Schwab Funds Complex since 2020.

Schwab VIT Growth Portfolio \| Annual Report**24**

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Schwab VIT Growth Portfolio

Other Federal Tax Information (unaudited)

------

The fund may elect to pass through, under section 853(a) of the Internal Revenue Code, the foreign tax credit of $128,898 to its shareholders for the fiscal year ended December 31, 2022. The respective foreign source income on the fund is $1,324,169.

For corporate shareholders, 31.35% of the fund's dividend distributions paid during the fiscal year ended December 31, 2022, qualify for the corporate dividends received deduction.

Under section 852(b)(3)(C) of the Internal Revenue Code, the fund hereby designates $3,778,649 as long-term capital gain dividends for the fiscal year ended December 31, 2022.

For the fiscal year ended December 31, 2022, the fund designates 21.95% of dividend income as business interest income under section 163(j) of the Internal Revenue Code.

**25**Schwab VIT Growth Portfolio \| Annual Report

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Schwab VIT Growth Portfolio

Liquidity Risk Management Program (unaudited)

------

The fund has adopted and implemented a liquidity risk management program (the "program") as required by Rule 22e-4 under the Investment Company Act of 1940, as amended. The fund's Board of Trustees (the "Board") has designated the fund's investment adviser, Charles Schwab Investment Management, Inc., dba Schwab Asset Management, as the administrator of the program. Personnel of the investment adviser or its affiliates conduct the day-to-day operation of the program.

Under the program, the investment adviser manages a fund's liquidity risk, which is the risk that the fund could not meet shareholder redemption requests without significant dilution of remaining shareholders' interests in the fund. The program is reasonably designed to assess and manage a fund's liquidity risk, taking into consideration the fund's investment strategy and the liquidity of its portfolio investments during normal and reasonably foreseeable stressed conditions; its historical redemption history and shareholder concentrations; and its cash holdings and access to other funding sources, including the custodian overdraft facility and lines of credit. The investment adviser's process of determining the degree of liquidity of each fund's investments is supported by third-party liquidity assessment vendors.

The fund's Board reviewed a report at its meeting held on September 19, 2022 prepared by the investment adviser regarding the operation and effectiveness of the program for the period June 1, 2021, through May 31, 2022, which included individual fund liquidity metrics. No significant liquidity events impacting the fund were noted in the report. In addition, the investment adviser provided its assessment that the program had been operating effectively in managing the fund's liquidity risk.

Schwab VIT Growth Portfolio \| Annual Report**26**

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Schwab VIT Growth Portfolio

Trustees and Officers

------

The tables below give information about the trustees and officers of Schwab Annuity Portfolios, which includes the fund covered in this report. The "Fund Complex" includes The Charles Schwab Family of Funds, Schwab Capital Trust, Schwab Investments, Schwab Annuity Portfolios, Schwab Strategic Trust and Laudus Trust. The Fund Complex includes 105 funds.

The address for all trustees and officers is 211 Main Street, San Francisco, CA 94105. You can find more information about the trustees and officers in the fund's Statement of Additional Information, which is available free by calling 1-877-824-5615.

---

| | | | |
|:---|:---|:---|:---|
| **Independent Trustees** | **Independent Trustees** | **Independent Trustees** | **Independent Trustees** |
| Name, Year of Birth, and <br> Position(s) with the trust <br> (Terms of office, and <br> length of Time Served<sup>1</sup>)<br>| Principal Occupations<br> During the Past Five Years<br>| Number of<br> Portfolios in<br> Fund Complex<br> Overseen by<br> the Trustee<br>| Other Directorships |
| **Michael J. Beer**<br> 1961<br> Trustee<br> (Trustee of The Charles Schwab <br> Family of Funds, Schwab <br> Investments, Schwab Capital Trust, <br> Schwab Annuity Portfolios, Schwab <br> Strategic Trust and Laudus Trust <br> since 2022)<br>| Retired. Director, President and Chief Executive Officer <br> (Dec. 2016 – Sept. 2019), Principal Funds (investment management).<br>| 105 | Director (2016 – 2019), <br> Principal Funds, Inc.<br>|
| **Robert W. Burns**<br> 1959<br> Trustee<br> (Trustee of Schwab Strategic Trust <br> since 2009; The Charles Schwab <br> Family of Funds, Schwab <br> Investments, Schwab Capital Trust, <br> Schwab Annuity Portfolios and <br> Laudus Trust since 2016)<br>| Retired/Private Investor. | 105 |  |
| **Nancy F. Heller**<br> 1956<br> Trustee<br> (Trustee of The Charles Schwab <br> Family of Funds, Schwab <br> Investments, Schwab Capital Trust, <br> Schwab Annuity Portfolios, Schwab <br> Strategic Trust and Laudus Trust <br> since 2018)<br>| Retired. | 105 |  |
| **David L. Mahoney**<br> 1954<br> Trustee<br> (Trustee of The Charles Schwab <br> Family of Funds, Schwab <br> Investments, Schwab Capital Trust, <br> Schwab Annuity Portfolios and <br> Laudus Trust since 2011; Schwab <br> Strategic Trust since 2016)<br>| Private Investor. | 105 | Director <br> (2004 – present), <br> Corcept Therapeutics <br> Incorporated <br> Director (2009 – 2021), <br> Adamas <br> Pharmaceuticals, Inc.<br> Director (2003 – 2019), <br> Symantec Corporation<br>|
| **Jane P. Moncreiff**<br> 1961<br> Trustee<br> (Trustee of The Charles Schwab <br> Family of Funds, Schwab <br> Investments, Schwab Capital Trust, <br> Schwab Annuity Portfolios, Schwab <br> Strategic Trust and Laudus Trust <br> since 2019)<br>| Consultant (2018 – present), Fulham Advisers LLC (management <br> consulting); Chief Investment Officer (2009 – 2017), CareGroup <br> Healthcare System, Inc. (healthcare).<br>| 105 |  |

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**27**Schwab VIT Growth Portfolio \| Annual Report

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Schwab VIT Growth Portfolio

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| | | | |
|:---|:---|:---|:---|
| **Independent Trustees (continued)** | **Independent Trustees (continued)** | **Independent Trustees (continued)** | **Independent Trustees (continued)** |
| Name, Year of Birth, and <br> Position(s) with the trust <br> (Terms of office, and <br> length of Time Served<sup>1</sup>)<br>| Principal Occupations<br> During the Past Five Years<br>| Number of<br> Portfolios in<br> Fund Complex<br> Overseen by<br> the Trustee<br>| Other Directorships |
| **Kimberly S. Patmore**<br> 1956<br> Trustee<br> (Trustee of The Charles Schwab <br> Family of Funds, Schwab <br> Investments, Schwab Capital Trust, <br> Schwab Annuity Portfolios, Schwab <br> Strategic Trust and Laudus Trust <br> since 2016)<br>| Consultant (2008 – present), Patmore Management Consulting <br> (management consulting).<br>| 105 |  |
| **J. Derek Penn**<br> 1957<br> Trustee<br> (Trustee of The Charles Schwab <br> Family of Funds, Schwab <br> Investments, Schwab Capital Trust, <br> Schwab Annuity Portfolios, Schwab <br> Strategic Trust and Laudus Trust <br> since 2021)<br>| Head of Equity Sales and Trading (2006 – 2018), BNY Mellon (financial <br> services).<br>| 105 |  |

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Schwab VIT Growth Portfolio \| Annual Report**28**

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Schwab VIT Growth Portfolio

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;

---

| | | | |
|:---|:---|:---|:---|
| **Interested Trustees** | **Interested Trustees** | **Interested Trustees** | **Interested Trustees** |
| Name, Year of Birth, and <br> Position(s) with the trust <br> (Terms of office, and <br> length of Time Served<sup>1</sup>)<br>| Principal Occupations<br> During the Past Five Years<br>| Number of<br> Portfolios in<br> Fund Complex<br> Overseen by<br> the Trustee<br>| Other Directorships |
| **Walter W. Bettinger II**<sup>2</sup> 1960<br> Chairman and Trustee<br> (Trustee of The Charles Schwab <br> Family of Funds, Schwab <br> Investments, Schwab Capital Trust <br> and Schwab Annuity Portfolios since <br> 2008; Schwab Strategic Trust since <br> 2009; Laudus Trust since 2010)<br>| Co-Chairman of the Board (July 2022 – present), Director and Chief <br> Executive Officer (Oct. 2008 – present) and President <br> (Feb. 2007 – Oct. 2021), The Charles Schwab Corporation; President and <br> Chief Executive Officer (Oct. 2008 – Oct. 2021) and Director <br> (May 2008 – Oct. 2021), Charles Schwab & Co., Inc.; Director <br> (Apr. 2006 – present), Charles Schwab Bank, SSB; Director <br> (Nov. 2017 – present), Charles Schwab Premier Bank, SSB; Director <br> (July 2019 – present), Charles Schwab Trust Bank; Director <br> (May 2008 – present), Chief Executive Officer (Aug. 2017 – present) and <br> President (Aug. 2017 – Nov. 2021), Schwab Holdings, Inc.; Director <br> (Oct. 2020 – present), TD Ameritrade Holding Corporation; Director <br> (July 2016 – Oct. 2021), Charles Schwab Investment Management, Inc.<br>| 105 | Director <br> (2008 – present), The <br> Charles Schwab <br> Corporation <br>|
| **Richard A. Wurster**<sup>2</sup> 1973<br> Trustee<br> (Trustee of The Charles Schwab <br> Family of Funds, Schwab <br> Investments, Schwab Capital Trust, <br> Schwab Annuity Portfolios, Schwab <br> Strategic Trust and Laudus Trust <br> since 2022)<br>| President (Oct. 2021 – present) and Executive Vice President – Schwab <br> Asset Management Solutions (Apr. 2019 – Oct. 2021), The Charles <br> Schwab Corporation; President, Director (Oct. 2021 – present), Executive <br> Vice President – Schwab Asset Management Solutions <br> (July 2019 – Oct. 2021) and Senior Vice President – Advisory <br> (May 2016 – July 2019), Charles Schwab & Co., Inc.; President <br> (Nov. 2021 – present), Schwab Holdings, Inc.; Director <br> (Oct. 2021 – present) and Chief Executive Officer (Nov. 2019 – Jan. 2022), <br> Charles Schwab Investment Management, Inc.; Director, Chief Executive <br> Officer and President (Mar. 2018 – Oct. 2022), Charles Schwab Investment <br> Advisory, Inc.; Chief Executive Officer (July 2016 – Apr. 2018) and <br> President (Mar. 2017 – Apr. 2018), ThomasPartners, Inc.; Chief Executive <br> Officer (July 2016 – Apr. 2018), Windhaven Investment Management, Inc.<br>| 105 |  |

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;

---

| | |
|:---|:---|
| **Officers of the Trust** | **Officers of the Trust** |
| Name, Year of Birth, and Position(s) with the trust <br> (Terms of office, and length of Time Served<sup>3</sup>)<br>| Principal Occupations During the Past Five Years |
| **Jonathan de St. Paer**<br> 1973<br> President and Chief Executive Officer<br> (Officer of The Charles Schwab Family of Funds, Schwab <br> Investments, Schwab Capital Trust, Schwab Annuity <br> Portfolios, Schwab Strategic Trust and Laudus Trust since <br> 2018)<br>| Director (Apr. 2019 – present), President (Oct. 2018 – present), Chief Operating Officer <br> (Jan. 2021 – present), and Chief Executive Officer (Apr. 2019 – Nov. 2019), Charles Schwab <br> Investment Management, Inc.; Senior Vice President (June 2020 – Mar. 2022) and Chief <br> Operating Officer (Jan. 2021 – Mar. 2022), Charles Schwab Investment Advisory, Inc.; Chief <br> Executive Officer (Apr. 2019 – present), President (Nov. 2018 – present) and Trustee <br> (Apr. 2019 – Dec. 2020), Schwab Funds, Laudus Trust and Schwab ETFs; Managing Director <br> (May 2022 – present), Senior Vice President (Apr. 2019 – May 2022) and Senior Vice <br> President – Strategy and Product Development (CSIM) (Jan. 2014 – Mar. 2019), Charles <br> Schwab & Co., Inc.<br>|
| **Mark Fischer**<br> 1970<br> Chief Operating Officer<br> (Officer of The Charles Schwab Family of Funds, Schwab <br> Investments, Schwab Capital Trust, Schwab Annuity <br> Portfolios, Schwab Strategic Trust and Laudus Trust since <br> 2013)<br>| Chief Operating Officer (Dec. 2020 – present) and Treasurer and Chief Financial Officer <br> (Jan. 2016 – Dec. 2022), Schwab Funds, Laudus Trust and Schwab ETFs; Chief Financial <br> Officer (Mar. 2020 – present) and Vice President (Oct. 2013 – present), Charles Schwab <br> Investment Management, Inc.<br>|
| **Dana Smith**<br> 1965<br> Treasurer and Chief Financial Officer<br> (Officer of The Charles Schwab Family of Funds, Schwab <br> Investments, Schwab Capital Trust, Schwab Annuity <br> Portfolios, Schwab Strategic Trust and Laudus Trust since <br> 2023)<br>| Treasurer and Chief Financial Officer (Jan. 2023 – present) and Assistant Treasurer <br> (Dec. 2015 – Dec. 2022), Schwab Funds, Laudus Trust and Schwab ETFs; Vice President <br> (Mar. 2022 – present) and Director (Oct. 2015 – Mar. 2022), Charles Schwab Investment <br> Management, Inc.<br>|

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**29**Schwab VIT Growth Portfolio \| Annual Report

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Schwab VIT Growth Portfolio

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| | |
|:---|:---|
| **Officers of the Trust (continued)** | **Officers of the Trust (continued)** |
| Name, Year of Birth, and Position(s) with the trust <br> (Terms of office, and length of Time Served<sup>3</sup>)<br>| Principal Occupations During the Past Five Years |
| **Omar Aguilar**<br> 1970<br> Vice President and Chief Investment Officer<br> (Officer of The Charles Schwab Family of Funds, Schwab <br> Investments, Schwab Capital Trust, Schwab Annuity <br> Portfolios, Schwab Strategic Trust and Laudus Trust since <br> 2011)<br>| Chief Executive Officer (Jan. 2022 – present), Chief Investment Officer (Apr. 2011 – present) <br> and Senior Vice President (Apr. 2011 – Dec. 2021), Charles Schwab Investment <br> Management, Inc.; Director, Chief Executive Officer and President (Oct. 2022 – present), <br> Charles Schwab Investment Advisory, Inc.; Vice President and Chief Investment Officer <br> (June 2011 – present), Schwab Funds, Laudus Trust and Schwab ETFs.<br>|
| **Brett Wander**<br> 1961<br> Vice President and Chief Investment Officer<br> (Officer of The Charles Schwab Family of Funds, Schwab <br> Investments, Schwab Capital Trust, Schwab Annuity <br> Portfolios, Schwab Strategic Trust and Laudus Trust since <br> 2011)<br>| Senior Vice President and Chief Investment Officer (Apr. 2011 – present), Charles Schwab <br> Investment Management, Inc.; Vice President and Chief Investment Officer <br> (June 2011 – present), Schwab Funds, Laudus Trust and Schwab ETFs.<br>|
| **William P. McMahon, Jr.**<br> 1972<br> Vice President and Chief Investment Officer<br> (Officer of The Charles Schwab Family of Funds, Schwab <br> Investments, Schwab Capital Trust, Schwab Annuity <br> Portfolios, Schwab Strategic Trust and Laudus Trust since <br> 2021)<br>| Senior Vice President and Chief Investment Officer (Jan. 2020 – present), Charles Schwab <br> Investment Management, Inc.; Vice President and Chief Investment Officer <br> (June 2021 – present), Schwab Funds, Laudus Trust and Schwab ETFs; Senior Vice President <br> and Chief Investment Officer – ThomasPartners Strategies (Apr. 2018 – Dec. 2019), Charles <br> Schwab Investment Advisory, Inc.; Senior Vice President and Chief Investment Officer <br> (May 2001 – Apr. 2018), ThomasPartners, Inc.<br>|
| **Catherine MacGregor**<br> 1964<br> Chief Legal Officer and Secretary, Schwab Funds and <br> Schwab ETFs<br> Chief Legal Officer, Vice President and Clerk, Laudus Trust<br> (Officer of The Charles Schwab Family of Funds, Schwab <br> Investments, Schwab Capital Trust, Schwab Annuity <br> Portfolios and Laudus Trust since 2005; Schwab Strategic <br> Trust since 2009)<br>| Chief Legal Officer (Mar. 2022 – present) and Vice President (Sept. 2005 – present), Charles <br> Schwab Investment Management, Inc.; Managing Director (May 2022 – present) and Vice <br> President (July 2005 – May 2022), Charles Schwab & Co., Inc.; Vice President <br> (Dec. 2005 – present) and Chief Legal Officer and Clerk (Mar. 2007 – present), Laudus Trust; <br> Chief Legal Officer and Secretary (Oct. 2021 – present), Vice President <br> (Nov. 2005 – Oct. 2021) and Assistant Secretary (June 2007 – Oct. 2021), Schwab Funds; <br> Chief Legal Officer and Secretary (Oct. 2021 – present), Vice President and Assistant <br> Secretary (Oct. 2009 – Oct. 2021), Schwab ETFs.<br>|

---

<sup>1</sup>

Each Trustee shall hold office until the election and qualification of his or her successor, or until he or she dies, resigns or is removed. The retirement policy requires that each independent trustee retire by December 31 of the year in which the Trustee turns 74 or the Trustee's twentieth year of service as an independent trustee on any trust in the Fund Complex, whichever occurs first.

<sup>2</sup>

Mr. Bettinger and Mr. Wurster are Interested Trustees. Mr. Bettinger and Mr. Wurster are Interested Trustees because each owns stock of The Charles Schwab Corporation (CSC), the parent company of Charles Schwab Investment Management, Inc., the investment adviser for the trusts in the Fund Complex, and is an employee of Charles Schwab & Co., Inc. (Schwab), the principal underwriter for The Charles Schwab Family of Funds, Schwab Investments, Schwab Capital Trust, Schwab Annuity Portfolios and Laudus Trust.

<sup>3</sup>

The President, Treasurer and Secretary/Clerk hold office until their respective successors are chosen and qualified or until he or she sooner dies, resigns, is removed or becomes disqualified. Each of the other officers serves at the pleasure of the Board.

Schwab VIT Growth Portfolio \| Annual Report**30**

------

Schwab VIT Growth Portfolio

Glossary

------

**Bloomberg US Aggregate Bond Index** An index that is a broad-based benchmark measuring the performance of the U.S. investment grade, taxable bond market, including U.S. Treasuries, government-related and corporate bonds, mortgage pass-through securities, commercial mortgage-backed securities, and asset-backed securities that are publicly available for sale in the United States. To be eligible for inclusion in the index, securities must be fixed rate, non-convertible, U.S. dollar-denominated with at least $300 million or more of outstanding face value and have one or more years remaining to maturity. The index excludes certain types of securities, including tax-exempt state and local government series bonds, structured notes embedded with swaps or other special features, private placements, floating rate securities, inflation-linked bonds and Eurobonds. The index is market capitalization weighted and the securities in the index are updated on the last business day of each month.

**Bloomberg US Treasury 3–10 Year Index** An index which includes all publicly-issued U.S. Treasury securities that have a remaining maturity of greater than or equal to three years and less than ten years, are rated investment grade, and have $300 million or more of outstanding face value. The securities in the index must be denominated in U.S. dollars and must be fixed-rate and non-convertible. The index excludes state and local government series bonds and coupon issues that have been stripped from bonds. The index is market capitalization weighted and the securities in the index are updated on the last business day of each month.

**Bloomberg US Treasury Bills 1–3 Month Index** An index that includes all publicly issued zero-coupon U.S. Treasury Bills that have a remaining maturity of less than 3 months but more than 1 month, are rated investment grade and have $300 million or more of outstanding face value. It excludes zero-coupon STRIPS.

**Bloomberg US Treasury Inflation-Linked Bond Index (Series-L)** An index which includes all publicly-issued U.S. Treasury Inflation-Protected Securities (TIPS) that have at least one year remaining to maturity, are rated investment grade and have $500 million or more of outstanding face value. The TIPS in the index must be denominated in U.S. dollars and must be fixed-rate and non-convertible. The index is market capitalization weighted and the TIPS in the index are updated on the last business day of each month. TIPS are publicly issued, dollar denominated U.S. Government securities issued by the U.S. Treasury that have principal and interest payments linked to an official inflation measure (as measured by the Consumer Price Index, or CPI) and their payments are supported by the full faith and credit of the United States.

**Dow Jones Equity All REIT Capped Index** A float-adjusted market cap weighted index that is designed to measure all equity real estate investment trusts (REITs) in the Dow Jones U.S. Total Stock Market Index, as defined by the S&P Dow Jones Indices REIT/RESI Industry Classification Hierarchy, that meet the minimum float market capitalization (FMC) and liquidity thresholds. The aggregate weight of all companies weighing more than 4.5% cannot exceed 22.5%, and no single company's weight can exceed 10%. The index is reviewed daily based on each company's capped market capitalization weight. Daily capping is only performed when the sum of companies with weights great than 5% exceeds 25%.

**Dow Jones U.S. Large-Cap Total Stock Market Index** An index that is a subset of the Dow Jones U.S. Total Stock Market Index, and is designed to measure the performance of large-cap U.S. equity securities. The index is a float-adjusted market capitalization weighted index.

**Dow Jones U.S. Select REIT Index** An index that is a float-adjusted market-capitalization weighted index comprised of income-producing commercial and/or residential real estate investment trusts (REITs). The index excludes mortgage REITs, net-lease REITs, real estate finance companies, mortgage brokers and bankers, commercial and residential real estate brokers and estate agents, homebuilders, large landowners and sub-dividers of unimproved land, hybrid REITs, timber REITs and companies that have more than 25% of their assets in direct mortgage investments.

**Dow Jones U.S. Small-Cap Total Stock Market Index** An index that is a subset of the Dow Jones U.S. Total Stock Market Index, and is designed to measure the performance of small-cap U.S. equity securities. The index is a float-adjusted market capitalization weighted index.

**Dow Jones U.S. Total Stock Market Index** An index which includes all U.S. equity issues with readily available prices. The index is a float-adjusted market capitalization weighted index that reflects the shares of securities actually available to investors in the marketplace.

**FTSE Developed ex US Index (Net)** An index that is comprised of large- and mid-capitalization companies in developed countries outside the United States, as defined by the index provider. The index defines the large- and mid-capitalization universe as approximately the top 90% of the eligible universe. The Net version of the index reflects reinvested dividends net of withholding taxes, but reflects no deductions for expenses or other taxes.

**FTSE Developed Small Cap ex US Liquid Index (Net)** An index comprised of small-capitalization companies in developed countries outside the United States, as defined by the index provider. The index defines the small-capitalization universe as approximately the bottom 10% of the eligible universe with a minimum free float capitalization of $150 million. The Net version of the index reflects reinvested dividends net of withholding taxes, but reflects no deductions for expenses or other taxes.

**FTSE Emerging Index (Net)** An index that is comprised of large- and mid-capitalization companies in emerging market countries, as defined by the index provider. The index defines the large- and mid-capitalization universe as approximately the top 90% of the eligible universe. The Net version of the index reflects reinvested dividends net of withholding taxes, but reflects no deductions for expenses or other taxes.

**FTSE non-US Dollar World Government Bond Index** A market capitalization index that measures the total rate of return performance for the government bonds of 22 countries, excluding the U.S., with a remaining maturity of at least 1 year.

**MSCI EAFE Index (Net)** A free float-adjusted market capitalization index that is designed to measure the equity market performance of developed markets in Europe, Australasia, and the Far East. The Net version of the index reflects reinvested dividends net of withholding taxes, but reflects no deductions for expenses or other taxes; returns are calculated applying dividend withholding rates applicable to non-resident persons who do not benefit from double taxation treaties.

**MSCI Emerging Markets Index (Net)** A free float-adjusted market capitalization weighted index that is designed to measure equity market performance in the global emerging markets. This series approximates the minimum possible dividend reinvestment. The returns are calculated applying dividend withholding rates applicable to non-resident persons who do not benefit from double taxation treaties.

**31**Schwab VIT Growth Portfolio \| Annual Report

------

Schwab VIT Growth Portfolio

**Russell 2000 Index** An index that measures the performance of the 2,000 smallest companies in the Russell 3000 Index. The Russell 3000 Index measures the performance of the largest 3,000 U.S. companies representing approximately 98% of the investable U.S. equity market.

**S&P 500 Index** An index that is designed to measure the performance of 500 leading publicly traded companies from a broad range of industries.

**VIT Growth Composite Index** A custom blended index developed by Schwab Asset Management based on a comparable portfolio asset allocation and calculated using the following portion allocations effective July 1, 2020: 14.0% Bloomberg US Aggregate Bond Index, 4.0% Bloomberg US Treasury Bills 1-3 Month Index, 6.0% Dow Jones Equity All REIT Capped Index, 35.0% Dow Jones U.S. Large-Cap Total Stock Market Index, 7.0% Dow Jones U.S. Small-Cap Total Stock Market Index, 8.0% FTSE All Emerging Index (Net), 21.0% FTSE Developed ex US Index (Net), 5.0% FTSE Developed Small Cap ex US Liquid Index (Net). From April 29, 2020 through June 30, 2020, the blended index was derived using the following allocations: 14.0% Bloomberg US Aggregate Bond Index, 4.0% Bloomberg US Treasury Bills 1-3 Month Index, 6.0% Dow Jones U.S. Select REIT Index, 35.0% Dow Jones U.S. Large-Cap Total Stock Market Index, 7.0% Dow Jones U.S. Small-Cap Total Stock Market Index, 8.0% FTSE All Emerging Index

(Net), 21.0% FTSE Developed ex US Index (Net), 5.0% FTSE Developed Small Cap ex US Liquid Index (Net). From June 8, 2016 through April 28, 2020, the blended index was derived using the following allocations: 12% Bloomberg US Aggregate Bond Index, 5% Bloomberg US Treasury Bills 1-3 Month Index, 1% Bloomberg US Treasury Inflation-Linked Bond Index (Series-L), 4% Bloomberg Commodity Index, 6% Dow Jones U.S. Select REIT Index, 29% Dow Jones U.S. Large-Cap Total Stock Market Index, 7% Dow Jones U.S. Small-Cap Total Stock Market Index, 8% FTSE All Emerging Index (Net), 21% FTSE Developed ex US Index (Net), 5% FTSE Developed Small Cap ex US Liquid Index (Net), and 2% Russell Microcap Index. Prior to June 8, 2016, the composite index was derived using the following allocations: 29% Dow Jones U.S. Large-Cap Total Stock Market Index, 7% Dow Jones U.S. Small-Cap Total Stock Market Index, 2% Russell Microcap Index, 21% FTSE Developed ex US Index (Net), 5% FTSE Developed Small Cap ex US Liquid Index (Net), 8% FTSE Emerging Index (Net), 6% Dow Jones U.S. Select REIT Index, 4% Dow Jones UBS Commodity Index, 1% Bloomberg US Treasury Inflation-Linked Bond Index (Series-L), 5% Bloomberg US Treasury 3-10 Year Index, 2% Bloomberg US Credit Index, 5% Bloomberg US Mortgage Backed Securities Index, and 5% Bloomberg US Treasury Bills 1-3 Month Index.

Schwab VIT Growth Portfolio \| Annual Report**32**

------

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;

Notes

------

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;

Notes

------

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;

Notes

------

**Item 2: Code of Ethics.** 

(a) Registrant has adopted a code of ethics that applies to its principal executive officer, principal financial
officer, and any other persons who perform a similar function, regardless of whether these individuals are employed by Registrant or a third party.

(c) During the period covered by the report, no amendments were made to the provisions of this code of ethics.

(d) During the period covered by the report, Registrant did not grant any waivers, including implicit waivers, from
the provisions of this code of ethics.

(f)(1) Registrant has filed this code of ethics as an exhibit pursuant to Item 13(a)(1) of Form N-CSR.

**Item 3: Audit Committee Financial Expert.** 

Registrant's Board of Trustees has determined that Kimberly S. Patmore and J. Derek Penn, each currently serving on its audit, compliance and valuation committee, are each an "audit committee financial expert," as such term is defined in Item 3 of Form N-CSR. Each member of Registrant's audit, compliance and valuation committee is "independent" under the standards set forth in Item 3 of Form N-CSR.

------

The designation of each of Ms. Patmore and Mr. Penn as an "audit committee financial expert" pursuant to Item 3 of Form N-CSR does not (i) impose upon such individual any duties, obligations, or liability that are greater than the duties, obligations and liability imposed upon such individual as a member of Registrant's audit, compliance and valuation committee or Board of Trustees in the absence of such designation; and (ii) affect the duties, obligations or liability of any other member of Registrant's audit, compliance and valuation committee or Board of Trustees.

**Item 4: Principal Accountant Fees and Services.** 

(a) Below are the aggregate fees billed for each of the last two fiscal years for professional services rendered by the principal accountant for the audit of Registrant's annual financial statements or services that are normally provided by the accountant in connection with statutory and regulatory filings or engagements.

The following table presents fees billed by the principal accountant in each of the last two fiscal years for the services rendered to the Funds:

---

| | | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|:---|
| (a)Audit Fees<sup>1</sup> | (a)Audit Fees<sup>1</sup> | (b)Audit-Related Fees<sup>2</sup> | (b)Audit-Related Fees<sup>2</sup> | (c) Tax Fees<sup>3</sup> | (c) Tax Fees<sup>3</sup> | (d) All Other Fees | (d) All Other Fees |
| Fiscal Year<br> 2022 | Fiscal Year<br>2021 | Fiscal Year 2022 | Fiscal Year 2021 | Fiscal Year 2022 | Fiscal Year 2021 | Fiscal Year 2022 | Fiscal Year 2021 |
| $103520 | $103520 | $9000 | $9000 | $15500 | $15500 | $0 | $0 |

---

<sup>1</sup> The nature of the services includes audit of the registrant's annual financial statements and normally provided services in connection with regulatory filings for those fiscal years.

<sup>2</sup> The nature of the services includes assurance and related services reasonably related to the performance of the audit of financial statements not included in Audit Fees.

<sup>3</sup> The nature of the services includes tax compliance, tax advice and tax planning.

**(e) (1)** Registrant's audit, compliance and valuation committee does not have pre-approval policies and procedures as described in paragraph (c)(7) of Rule 2-01 of Regulation S-X.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(2) There were no services described in each of paragraphs (b) through (d) above that were approved by Registrant's audit, compliance and valuation committee pursuant to paragraph (c)(7)(i)(C) of Rule 2-01 of Regulation S-X.

**(f)** Not applicable.

**(g)** Below are the aggregate non-audit fees billed in each of the last two fiscal years by Registrant's principal accountant for services rendered to Registrant, to Registrant's investment adviser, and to any entity controlling, controlled by, or under common control with Registrant's investment adviser that provides ongoing services to Registrant.

---

| | | |
|:---|:---|:---|
|  2022: $3,031,117 | 2021: $| 3088431.0 |

---

**(h)** During the past fiscal year, all non-audit services provided by Registrant's principal accountant to either Registrant's investment adviser or to any entity controlling, controlled by, or under common control with Registrant's investment adviser that provides ongoing services to Registrant were pre-approved. Included in the audit, compliance and valuation committee's pre-approval was the review and consideration as to whether the provision of these non-audit services is compatible with maintaining the principal accountant's independence.

**(i)** Not applicable.

------

**(j)** Not applicable.

**Item 5: Audit Committee of Listed Registrants.** 

Not applicable.

**Item 6: Schedule of Investments.** 

The schedules of investments are included as part of the report to shareholders filed under Item 1 of this Form.

**Item 7: Disclosure of Proxy Voting Policies and Procedures for Closed-End Management Investment Companies.** 

Not applicable.

**Item 8: Portfolio Managers of Closed-End Management Investment Companies.** 

Not applicable.

**Item 9: Purchases of Equity Securities by Closed-End Management Investment Company and Affiliated Purchasers.** 

Not applicable.

**Item 10: Submission of Matters to a Vote of Security Holders.** 

Not applicable.

**Item 11: Controls and Procedures.** 

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) Based on their evaluation of Registrant's disclosure controls and procedures, as of a date within 90 days
of the filing date, Registrant's Chief Executive Officer, Jonathan de St. Paer and Registrant's Chief Financial Officer, Dana Smith, have concluded that Registrant's disclosure controls and procedures are: (i) reasonably designed
to ensure that information required to be disclosed in this report is appropriately communicated to Registrant's officers to allow timely decisions regarding disclosures required in this report; (ii) reasonably designed to ensure that
information required to be disclosed in this report is recorded, processed, summarized and reported in a timely manner; and (iii) are effective in achieving the goals described in (i) and (ii) above.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) During the period covered by this report, there have been no changes in Registrant's internal control over
financial reporting that the above officers believe to have materially affected, or to be reasonably likely to materially affect, Registrant's internal control over financial reporting.

**Item 12: Disclosure of Securities Lending Activities for Closed-End Management Investment Companies.** 

Not applicable.

------

**Item 13: Exhibits.** 

(a) (1) [Registrant's code of ethics (that is the subject of the disclosure required by Item 2(a)) is attached.](d405473dex99codeeth.htm)

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(2) [Separate certifications for Registrant's principal executive officer and principal financial officer, as required by Rule 30a-2(a) under the 1940 Act, are attached.](d405473dex99cert.htm)

(b) [A certification for Registrant's principal executive officer and principal financial officer, as required by Rule 30a-2(b) under the 1940 Act, is attached. This certification is being furnished to the Securities and Exchange Commission solely pursuant to 18 U.S.C. section 1350 and is not being filed as part of the Form N-CSR with the Commission.](d405473dex99906cert.htm)

Pursuant to the requirements of the Securities Exchange Act of 1934 and the Investment Company Act of 1940, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

(Registrant) <u>Schwab Annuity Portfolios</u>

---

| | |
|:---|:---|
| By: | /s/ Jonathan de St. Paer |
|  | Jonathan de St. Paer<br> Chief Executive Officer |
| Date: | February 16, 2023 |

---

Pursuant to the requirements of the Securities Exchange Act of 1934 and the Investment Company Act of 1940, this report has been signed below by the following persons on behalf of the registrant and in the capacities and on the dates indicated.

---

| | |
|:---|:---|
| By: | /s/ Jonathan de St. Paer |
|  | Jonathan de St. Paer<br> Chief Executive Officer |
| Date: | February 16, 2023 |
| By: | /s/ Dana Smith |
|  | Dana Smith<br> Chief Financial Officer |
| Date: | February 16, 2023 |

---

## Ex-99.Code

---

| | |
|:---|:---|
| **F.II.1.B.** | **CODE OF BUSINESS CONDUCT AND ETHICS** |

---

**CODE OF BUSINESS CONDUCT AND ETHICS FOR PRINCIPAL EXECUTIVE AND SENIOR FINANCIAL OFFICERS** 

**SCHWAB FUNDS:** 

THE CHARLES SCHWAB FAMILY OF FUNDS

SCHWAB INVESTMENTS

SCHWAB CAPITAL TRUST

SCHWAB ANNUITY PORTFOLIOS

LAUDUS TRUST

**SCHWAB ETFS:**

SCHWAB STRATEGIC TRUST

**I. SCOPE** 

This Code of Business Conduct and Ethics (the "Code") for the Schwab Funds and Schwab ETFs (the "Funds") covers the Principal Executive Officer and Principal Financial Officer and any other officers who serve a similar function (each an "Officer") of all of the investment companies within the Funds' complex and applies to their service to the Funds.

**II. INTRODUCTION** 

The Funds are committed to the highest standards of ethical conduct. The Code consists of an outline of policies regarding conduct pertaining to legal compliance, personal conflicts of interest, confidentiality and privacy, and certain business practices. You are responsible for reviewing the Code and for acting in compliance with the Code in your daily activities.

The Code is not exhaustive; it provides guidance for carrying out your responsibilities on behalf of the Funds and observing the highest standards of ethical conduct. Because the Code does not address every possible situation that may arise, you are responsible for exercising good judgment, applying ethical principles, and raising questions when in doubt. Your integrity and good judgment reflect on the Funds' brand and reputation, and are the foundation of trust for our shareholder and business relationships.

If you are unsure of what to do in any situation or how to interpret the provisions of the Code, seek guidance before you act. Use the Funds' resources, including the Chief Legal Officer or the Chief Compliance Officer. If you feel that it is not appropriate to discuss a matter with the Chief Legal Officer or the Chief Compliance Officer, you may contact the Ombudsperson for The Charles Schwab Corporation.

CONTACT INFORMATION

---

| | | |
|:---|:---|:---|
| **Title** | **Name** | **Phone Number** |
| Chief Compliance Officer | Michael F. Hogan | 415-667-1987 |
| Chief Legal Officer of Schwab Funds and Schwab ETFs | Catherine MacGregor | 415-667-0650 |
| The Charles Schwab Corporation Ombudsperson | Scott Ferber, Esq, King & Spalding | (202) 626-9550 |

---

**III. POLICIES** 

In executing your responsibilities on behalf of the Funds, your conduct should reflect positively on the Funds. A strong personal sense of ethics should always play a significant role in guiding you towards a proper course of action. The appearance of impropriety can be as harmful to the Funds' reputation as improper conduct.

---

| | |
|:---|:---|
| **The information contained herein is the property of Charles Schwab and may not be copied, used or disclosed in whole or in part, stored in a retrieval system or transmitted in any form or by any means (electronic, mechanical, reprographic, recording, or otherwise) outside of Charles Schwab without prior permission of the Mutual Fund's Chief Compliance Officer or his/her designee.** | 1 |

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------

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| | |
|:---|:---|
| **F.II.1.B.** | **CODE OF BUSINESS CONDUCT AND ETHICS** |

---

The Funds' business is subject to various laws, rules and regulations, including federal securities and state and local laws. Although you are not expected to know the details of the myriad of laws governing our business, you are expected to be familiar with and comply with policies and procedures that apply to your business unit and complete any required training that applies to you

(e.g., training regarding privacy or anti-money laundering).

A. PERSONAL CONFLICTS OF INTEREST

It is important that you do not place yourself in a position that would cloud your judgment in carrying out the business affairs of the Funds. A "personal conflict of interest" occurs when your private interest interferes in any way — or even appears to interfere — with the interests of the Funds. You have a duty to report any material transaction or relationship to the Chief Compliance Officer that reasonably could be expected to be or to create a conflict of interest with the Funds.

Officers, in addition to their obligation to the Funds, may also be an officer or employee of CSIM or a CSIM affiliate. As a result, this Code recognizes that the Officers will, in the normal course of their duties (whether formally for the Funds, for CSIM, for CSIM's affiliate or for more than one entity), be involved in establishing policies and implementing decisions that will have different effects on CSIM, CSIM's affiliates and the Funds. The participation of the Officers in such activities is inherent in the contractual relationship between the Funds and CSIM and is consistent with the performance by the Officers of their duties as officers of the Funds. Thus, if performed in conformity with the provisions of the Investment Company Act of 1940, as amended (the "1940 Act"), and the Investment Advisers Act of 1940, as amended (the "Advisers Act"), such activities will be deemed under the Code to have been handled ethically. In addition, it is recognized by the Trustees that the Officers may also be officers or employees of one or more other investment companies covered by this or other codes.

B. INSIDE INFORMATION

Do not trade on inside information or disclose inside information to anyone except those who have a need to know it in order to fulfill their responsibilities for the Funds and in accordance with the Funds' policy. This applies to information regarding the Funds, The Charles Schwab Corporation and its subsidiaries, and any other publicly traded company.

Generally, material information is any information that an investor would likely consider important in deciding whether to buy, sell or hold securities or that could affect the market price of the securities. Examples include actual or estimated financial results or change in dividends; significant discoveries or product developments; possible mergers, acquisitions or divestitures; major changes in business strategies; obtaining or losing significant contracts; and threatened major litigation or related developments. If you have or receive information and are unsure whether it is within the definition of inside information or whether its release might be contrary to a fiduciary or other obligation, contact the Chief Compliance Officer prior to disclosing any such information.

You must not use the Funds' non-public holdings or transactions information in any way to influence your trades or the trades of other shareholders, including those of other employees, officers and directors. Trading ahead of shareholder or the Funds' transactions (frontrunning) and following shareholder or the Funds' transactions (piggybacking or shadowing) is prohibited.

C. ACCEPTANCE OF GIFTS OR ENTERTAINMENT

You must not accept gifts or entertainment from shareholders, vendors, suppliers, competitors or other employees where they present a conflict of interest or create the appearance of impropriety.

---

| | |
|:---|:---|
| **The information contained herein is the property of Charles Schwab and may not be copied, used or disclosed in whole or in part, stored in a retrieval system or transmitted in any form or by any means (electronic, mechanical, reprographic, recording, or otherwise) outside of Charles Schwab without prior permission of the Mutual Fund's Chief Compliance Officer or his/her designee.** | 2.0 |

---

------

---

| | |
|:---|:---|
| **F.II.1.B.** | **CODE OF BUSINESS CONDUCT AND ETHICS** |

---

You must adhere to the CSIM and The Charles Schwab Corporation policies regarding gifts and entertainment, and apply the more stringent restrictions. In addition, if you are an employee of another CSIM affiliate you must also adhere to that affiliate's policies regarding gifts and entertainment, and apply the more stringent restrictions.

D. CONFIDENTIALITY OF INFORMATION AND PRIVACY

Information concerning the identity of the Funds' underlying shareholders and their transactions and accounts is confidential. Such information may not be disclosed to persons working on behalf of the Funds except as they may need to know it in order to fulfill their responsibilities to the Funds. You may not disclose such information to anyone or any firm outside the Funds unless (i) the outside firm needs to know the information in order to perform services for the Funds and is bound to maintain its confidentiality; (ii) when the shareholder has consented or been given an opportunity to request that the information not be shared; (iii) as required by law; or (iv) as authorized by the Chief Legal Officer or Chief Compliance Officer.

The Funds are committed to safeguarding their customers' privacy. We do not sell any personally identifiable customer information. Sharing of such information with third parties is limited to situations related to the processing and servicing of customer accounts, and to specifically delineated exceptions in the federal privacy law. We share information with our affiliates to the extent permitted by federal law. You must be familiar with the procedural and systemic safeguards we maintain to protect this information.

You have the responsibility to safeguard the Funds' proprietary information. Proprietary information includes intellectual property (copyrights, trademarks or patents or trade secrets), particular know-how (business or organizational designs, or business, marketing or service plans or ideas) and sensitive information about the Funds (databases, records, salary information or unpublished financial reports).

E. PROTECTION AND USE OF FUNDS' ASSETS

You are obligated to protect the Funds' assets and ensure their efficient use. Theft, carelessness and waste have a direct impact on the Funds. The Funds' equipment should not be used for non-Funds' business, though incidental personal use may be permitted.

F. FINANCIAL DISCLOSURES

The Funds are committed to providing full, fair, accurate, timely and understandable disclosure in reports and documents that the Funds file with, or submit to, the Securities and Exchange Commission and other regulatory agencies and in other public communications made by the Funds. You are required to comply with the Funds' policies and procedures to provide such full, fair, accurate, timely and understandable disclosure.

G. CONDUCT OF AUDITS

Neither you nor any other person acting under your direction shall directly or indirectly take any action to fraudulently influence, coerce, manipulate, or mislead any independent public or certified public accountant engaged in the performance of an audit or review of the Funds' financial statements.

Types of conduct that constitute improper influence include, but are not limited to, directly or indirectly:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• Offering or paying bribes or other financial incentives, including offering future employment or contracts for non-audit services

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• Providing an auditor with inaccurate or misleading legal analysis

---

| | |
|:---|:---|
| **The information contained herein is the property of Charles Schwab and may not be copied, used or disclosed in whole or in part, stored in a retrieval system or transmitted in any form or by any means (electronic, mechanical, reprographic, recording, or otherwise) outside of Charles Schwab without prior permission of the Mutual Fund's Chief Compliance Officer or his/her designee.** | 3.0 |

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------

---

| | |
|:---|:---|
| **F.II.1.B.** | **CODE OF BUSINESS CONDUCT AND ETHICS** |

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• Threatening to cancel or canceling existing non-audit or audit
engagements if the auditor objects to the issuer's accounting

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• Seeking to have a partner removed from the audit engagement because the partner objects to the Funds'
accounting

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• Blackmailing

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• Making physical threats

H. RECORDKEEPING

You must be familiar with the Funds' record retention policies and always retain or destroy records according to them. In the event of litigation, governmental investigation or the threat of such action, you should consult the Chief Legal Officer or the Chief Compliance Officer regarding record retention.

The Funds' books, records and accounts must conform both to applicable legal requirements and to the Funds' internal controls and policies.

Unrecorded or "off-the-books" funds or assets are prohibited unless permitted by applicable law or regulation. Business records must not contain exaggeration, derogatory remarks, guesswork, or inappropriate characterizations of people and companies. This applies equally to email, internal memoranda, formal reports, and all other forms of business records.

I. SALES PRACTICES

If you transact business for shareholders, you are required to know and observe the Funds' specific policies and procedures for shareholder sales and transactions, such as the content and use of sales materials, documentation for transactions, quotations and suitability. Likewise, if you transact business with third parties (such as vendors or suppliers), you will be required to know and observe the Funds' policies and procedures for such transactions, such as marketing policies, procedures for performing due diligence on third parties, and obtaining proper authorizations for any agreements. You must be familiar with any enumerated policies and procedures governing your sales activities and use good judgment in complying with them.

J. COMPETITION AND FAIR DEALING

We operate our business fairly and honestly. We seek competitive advantage through performance and never through unethical or illegal business practices. It is our policy to comply with anti-trust laws. These laws are complex and not easily summarized, but at a minimum require that there be no agreement or understanding between the Funds and their competitors that affect prices, terms or conditions of sale or that unreasonably restrain full and fair competition. You must always respect the rights of and deal fairly with the Funds' shareholders and competitors. You must never take unfair advantage of anyone through manipulation, concealment, abuse of privileged information, misrepresentation of material facts, or any other unfair dealing practice.

K. PROHIBITION OF BRIBERY AND KICKBACKS

Our policies prohibit bribery or kickbacks of any kind and to anyone in the conduct of our business. The U.S. government has a number of laws and regulations applicable specifically to business gratuities that may be offered to or accepted by U.S. and foreign government personnel. The promise, offer or delivery to an official or employee of the U.S. government or an official, employee or candidate of a foreign government of a gift, favor, payment or other gratuity in violation of these rules would not only violate the Funds' policy but could also be a criminal offense. Similarly, federal law, as well as the laws of many states, prohibits engaging in "commercial bribery." Commercial bribery involves soliciting, demanding or agreeing to accept anything of value from any person intending to influence or be rewarded in connection with any business or transaction, and prohibits all such behavior, for example, with respect to vendors, competitors, shareholders, and government employees.

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|:---|:---|
| **The information contained herein is the property of Charles Schwab and may not be copied, used or disclosed in whole or in part, stored in a retrieval system or transmitted in any form or by any means (electronic, mechanical, reprographic, recording, or otherwise) outside of Charles Schwab without prior permission of the Mutual Fund's Chief Compliance Officer or his/her designee.** | 4.0 |

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| | |
|:---|:---|
| **F.II.1.B.** | **CODE OF BUSINESS CONDUCT AND ETHICS** |

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L. WAIVERS

Waivers of the Code may be made only by the Trustees, and will be promptly disclosed publicly as required by law.

M. CODE AMENDMENTS

This Code may not be amended except in written form, which is specifically approved or ratified by a majority of the Trustees including a majority of the independent Trustees. Any amendments will, to the extent required, be disclosed in accordance with law.

N. CONFIDENTIALITY

All reports and records prepared or maintained pursuant to this Code will be considered confidential and shall be maintained and protected accordingly. Except as otherwise required by law or this Code, such matters shall not be disclosed to anyone other than the Trustees, CSIM, The Charles Schwab Corporation and their respective counsel. However, nothing contained in this Code or in any applicable employment or severance agreement(s) should be interpreted as prohibiting employees or former employees from voluntarily communicating with the Securities and Exchange Commission or other authorities regarding possible violations of law or from recovering a whistleblower award.

**IV. ESCALATION AND PROHIBITION AGAINST RETALIATION** 

If you know of, or reasonably believe there is, a violation of this Code, you must report that information immediately to the Funds' Chief Compliance Officer. Depending on the possible violation, you may also be required to report it pursuant to The Charles Schwab Corporation Code of Business Conduct and CSIM and/or CSIM's affiliate's compliance policies and procedures. You should not conduct preliminary investigations unless authorized to do so by the Compliance Department.

No Officer will be retaliated against for making a good faith complaint or for bringing inappropriate conduct to the attention of the Funds' personnel, Ombudsperson of The Charles Schwab Corporation or Trustees, for assisting another employee or applicant in making a good faith report, for cooperating in an investigation, or for filing an administrative claim with a state or federal governmental agency. Any Officer who in good faith raises an issue regarding a possible violation of law, regulation or company policy or any suspected illegal or unethical behavior will be protected from retaliation.

If you have violated the Code, however, making a report will not protect you from the consequences of your actions. You can be subject to discipline up to and including termination of employment if you violate the Code or fail to report violations that come to your attention.

Any employee who engages in retaliatory conduct in violation of our policies will be subject to disciplinary action, up to and including termination of employment. If you reasonably believe retaliatory conduct has occurred, you must report such conduct to the Funds' Chief Compliance Officer.

**V. PROCEDURES** 

A. OFFICERS

• Read and be familiar with conduct rules outlined in the Code, and periodically review them.

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|:---|:---|
| **The information contained herein is the property of Charles Schwab and may not be copied, used or disclosed in whole or in part, stored in a retrieval system or transmitted in any form or by any means (electronic, mechanical, reprographic, recording, or otherwise) outside of Charles Schwab without prior permission of the Mutual Fund's Chief Compliance Officer or his/her designee.** | 5.0 |

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| | |
|:---|:---|
| **F.II.1.B.** | **CODE OF BUSINESS CONDUCT AND ETHICS** |

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• Affirm in writing to the Trustees that you have received, read and understand the Code.

• Annually affirm to the Trustees that you have complied with the requirements of the Code.

• Comply with the conduct standards outlined in this Code in all dealings and actions, including those with
shareholders, the public, and vendors.

• Report any material transaction or relationship to the Chief Compliance Officer that reasonably could be expected
to be or to create a personal conflict of interest with the Funds.

• Report in a timely manner to the Chief Compliance Officer any conduct that may constitute a violation of the
Code, the Funds' policies, or laws, rules and regulations.

• Raise questions or concerns about conduct issues with your supervisor, the Chief Legal Officer or Chief
Compliance Officer, and seek advice when in doubt.

• Cooperate with management during fact-finding investigations and comply with any confidentiality rules imposed.

B. CHIEF COMPLIANCE OFFICER

• The Chief Compliance Officer, upon becoming notified of potential violation of this Code, will conduct,
facilitate or delegate a review of the matter and will report to the Chairperson of the affected Fund's Audit, Compliance and Valuation Committee any violations of this Code that he or she believes to be material.

• The Chief Compliance Officer, upon becoming notified of a personal conflict of interest between an Officer and
the Funds that the Chief Compliance Officer deems to be material, will report the issue to the Chairperson of the affected Fund's Audit, Compliance and Valuation Committee and will work with the Chief Legal Officer and other appropriate parties
to ensure that any required disclosures are made.

C. TRUSTEES

• The Board of Trustees will consider appropriate action to address any violations of the Code that they deem to be
material, which may include review of and appropriate modification to applicable policies and procedures, notification to appropriate personnel of CSIM or its board of directors, notification to appropriate personnel of The Charles Schwab
Corporation or its board of directors, or a recommendation to dismiss the Officer.

**VI. REGULATORY AUTHORITY** 

This Code constitutes the sole code of ethics adopted by the Funds for purposes of Section 406 of the Sarbanes-Oxley Act of 2002 and the rules and forms applicable to registered investment companies thereunder. Insofar as other policies or procedures of the Funds, CSIM, CSIM's affiliates, The Charles Schwab Corporation or other Fund service providers govern or purport to govern the behavior or activities of an Officer who is subject to this Code, they are superseded by this Code to the extent that they conflict with the provisions of this Code. CSIM's, the Funds' and Charles Schwab & Co. Inc.'s (as distributor) joint code of ethics under Rule 17j-1 pursuant to the 1940 Act and Rule 204A-1 of the Advisers Act, and CSIM's, CSIM's affiliates', and The Charles Schwab Corporation's policies and procedures set forth in their respective compliance manuals and elsewhere are separate requirements applying to the Officers and are not part of this Code.

<u>VERSION HISTORY</u> 

Adopted Schwab and Laudus Funds: June 15, 2011, Schwab ETFs: August 4, 2011

Revised August 8, 2013; December 11, 2015; August 25, 2016; December 11, 2017; September 25, 2018 (no changes); December 12, 2019; November 3, 2020; October 7, 2021; December 13, 2022

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| | |
|:---|:---|
| **The information contained herein is the property of Charles Schwab and may not be copied, used or disclosed in whole or in part, stored in a retrieval system or transmitted in any form or by any means (electronic, mechanical, reprographic, recording, or otherwise) outside of Charles Schwab without prior permission of the Mutual Fund's Chief Compliance Officer or his/her designee.** | 6.0 |

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## Ex-99.Cert

**<u>CERTIFICATIONS</u>**

I, Jonathan de St. Paer, certify that:

1. I have reviewed this report on Form N-CSR of Schwab Annuity Portfolios;

2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations, changes in net assets, and cash flows (if the financial statements are required to include a statement of cash flows) of the registrant as of, and for, the periods presented in this report;

4. The registrant's other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Rule 30a-3(c) under the Investment Company Act of 1940) and internal control over financial reporting (as defined in Rule 30a-3(d) under the Investment Company Act of 1940) for the registrant and have:

a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

b) Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

c) Evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of a date within 90 days prior to the filing date of this report based on such evaluation; and

d) Disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the period covered by this report that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting; and

5. The registrant's other certifying officer(s) and I have disclosed to the registrant's auditors and the audit committee of the registrant's Board of Trustees (or persons performing the equivalent functions):

a) All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize, and report financial information; and

b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting.

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| | |
|:---|:---|
| Date: February 16, 2023 | /s/ Jonathan de St. Paer |
|  | Jonathan de St. Paer<br> Chief Executive Officer |

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**<u>CERTIFICATIONS</u>**

I, Dana Smith, certify that:

1. I have reviewed this report on Form N-CSR of Schwab Annuity Portfolios;

2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations, changes in net assets, and cash flows (if the financial statements are required to include a statement of cash flows) of the registrant as of, and for, the periods presented in this report;

4. The registrant's other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Rule 30a-3(c) under the Investment Company Act of 1940) and internal control over financial reporting (as defined in Rule 30a-3(d) under the Investment Company Act of 1940) for the registrant and have:

a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

b) Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

c) Evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of a date within 90 days prior to the filing date of this report based on such evaluation; and

d) Disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the period covered by this report that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting; and

5. The registrant's other certifying officer(s) and I have disclosed to the registrant's auditors and the audit committee of the registrant's Board of Trustees (or persons performing the equivalent functions):

a) All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize, and report financial information; and

b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting.

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| | |
|:---|:---|
| Date: February 16, 2023 | /s/ Dana Smith |
|  | Dana Smith<br> Chief Financial Officer |

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## Exhibit 99.906

CERTIFICATION PURSUANT TO 18 U.S.C. SECTION 1350,

AS ADOPTED PURSUANT TO SECTION 906 OF THE

SARBANES**-**OXLEY ACT OF 2002

In connection with the Annual Report for Schwab Annuity Portfolios (the "Funds") on Form N-CSR for the period ended December 31, 2022 ("periodic report"), each of the undersigned, being the Chief Executive Officer and Chief Financial Officer, respectively, hereby certifies, pursuant to 18 U.S.C. section 1350, as adopted pursuant to section 906 of the Sarbanes**-**Oxley Act of 2002, that to the best of my knowledge:

(1) The periodic report fully complies with the requirements of section 13(a) or 15(d) of the Securities Exchange Act of 1934; and

(2) The information contained in the periodic report fairly presents, in all material respects, the financial condition and results of operations of the Funds for the period presented therein.

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| | | |
|:---|:---|:---|
| /s/ Jonathan de St. Paer | Date: | February 16, 2023 |
| Jonathan de St. Paer |  |  |
| Chief Executive Officer |  |  |

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| | | |
|:---|:---|:---|
| /s/ Dana Smith | Date: | February 16, 2023 |
| Dana Smith |  |  |
| Chief Financial Officer |  |  |

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This certification is being furnished to the Securities and Exchange Commission solely pursuant to 18 U.S.C. section 1350 and is not being filed as part of the Form N-CSR with the Commission.