Target-date funds, often a type of mutual fund, are a “set it and forget it” investment option. After participants set their contribution from their paycheck and select the funds, the asset mix in the funds automatically adjusts, slowly becoming more conservative as participants get older and...
Several years ago, the concept of target-date funds emerged to complement traditional balanced funds in defined-contribution pension plans. The main idea is to delegate the dynamic allocation with respect to the retirement date of individuals to the portfolio manager. Owing to its long-term horizon...
(FYI this glide path is not out of line with the approach of all the major target date funds used in defined contribution plans.) Hacking the decision There is a simple shortcut, or hack, you can use if you have concerns about the default target date fund in your plan but don’t...
The article offers information on the survey conducted by the Behavioral Research Association to determine the perception of employees on the target date funds (TDF). According to the survey, 70% of the respondents believe that their moneys are at risk when invested in TDF than in money market...
(VTSAX) or the Fidelity 500 Index Fund (FXAIX). For diversification and income, bond index funds like the Fidelity Total Bond Fund (FTBFX) can be a good choice.Target-date retirement funds, which automatically adjust their allocation as your retirement approaches, can also b...
What are target date funds? If you want to passively invest in a traditionally diversified portfolio by age, the easiest solution is to buy atarget date fund (TDF).Your money is invested over a set period of time, with the "target" being the year you expect to retire and start drawing...
an investor nearing retirement age might be planning a working retirement with some income from a small business. Such an investor could select a life-cycle fund with a target date that is 15 years in the future. Accepting highervolatilitycan help to stretch retirement funds over the 20 or mo...
How Would Target-Date Funds Likely Impact Future 401(k) Contributions." Testimony before the joint DOL/SEC Hearing, Target Date Fund Public Hearing, June 2009."How Would Target‐Date Funds Likely Impact Future 401(k) Contributions." Testimony before the joint DOL/SEC...
Target-date fund:These “set it and forget it” funds automatically adjust your assets to a more conservative mix as you approach retirement. Typically,target-date fundsmove from a higher concentration of stocks to a more bond-focused portfolio as you approach your date. ...
Target date funds automatically rebalance your portfolio with the proper mixture of investments based on how many years you are away from retirement. When you’re young, retirement fund administrators will invest heavily in stocks. When you’re older, they’ll reduce your exposure to stocks, hopef...