Target Date Funds

Target Date Funds covers the issues, research and resources available for advisors that are looking to improve outcomes by leveraging best practices and funds in this area. Topics include ways to measure results and compare various target date funds and which types of participants can benefit most, as well as new regulations, trends and opportunities for target date investing.

By NAPA Net Staff4/29/2015 • 0 Comments

Target-date funds continued to receive the majority of new contributions into individuals’ accounts last month, according to the AonHewitt 401(k) Index.

By Fred Barstein4/24/2015 • 0 Comments

Custom TDFs are starting to become popular in larger DC plans. But do they make sense for plans with less than $1 billion? According to a report by consultants at Rocaton, the answer is yes, but only in certain circumstances.

By NAPA Net Staff4/20/2015 • 0 Comments

While most participants say they have heard the terms “contribution rate” (82%) and “vesting” (77%), only half (50%) had heard of target-date funds, even fewer (39%) had heard of target-risk funds — and most of those participants don’t understand the terms.

By Fred Barstein4/16/2015 • 0 Comments

When it comes to analyzing investments, TDFs are different. Yet many people make the mistake of rating them like any other investment.

By NAPA Net Staff4/9/2015 • 0 Comments

Morningstar’s 2015 Target-Date Fund Landscape report is out — and the news is good for retirement savings plans.

By John Iekel3/23/2015 • 0 Comments

Tips on how best to serve clients with target-date funds were the focus of a March 23 session at the 2015 NAPA 401(k) Summit.

By Rocco DiBruno3/18/2015 • 0 Comments

Best-of-breed fund lineups, formed by a prudent investment process, have been the norm in our industry, but that is changing before our eyes with the popularity of target date funds. The question is, is anyone noticing?

By Mike Bushnell3/2/2015 • 0 Comments

When Callan Associates surveyed plan sponsors in early 2014, more than a third of the respondents said they would make changes to their target date funds during the coming year. The firm’s just-released 2015 survey shows that many of those sponsors were true to their word.

By Fred Barstein1/23/2015 • 0 Comments

The percentage of plans offering custom TDFs almost doubled in 2014, from 11.5% to 22.3%, according to a recent Callan Associates study of nearly 150 larger plans.

By Jerry Bramlett12/3/2014 • 0 Comments

By 2019, 88% of all new contributions will go to target-date funds, according to a recent report from Cerulli.

By Fred Barstein11/26/2014 • 0 Comments

Cerulli is predicting that TDFs, which seem to dominate DC plans today, will garner as much as 90% of new contributions by 2019. That’s good news for firms with a viable TDF strategy, but potentially devastating news for long-only, active equity managers without a TDF or those still struggling to break the all-important $1 billion barrier.

By Jerry Bramlett11/20/2014 • 0 Comments

Every sweet hath its sour, every good its bad,” Ralph Waldo Emerson wrote in his essay, “Compensation.” So it seems to be the case with the two main asset allocation constructs offered to DC investors: target-date funds and managed accounts.

By Jerry Bramlett10/21/2014 • 0 Comments

Though TDFs are often criticized for not taking into consideration outside assets and other risk factors, the bigger issue may be the cashing out of stocks due to an early withdrawal event.

By Nevin Adams10/11/2014 • 1 Comments

You don’t have to be very old to remember that just prior to the onset of the 2008 financial crisis, several performance-lagging TDF managers made what seemed, at least in hindsight, to be a badly timed equity shift in their portfolios. Is history about to repeat itself?

By Jerry Bramlett9/29/2014 • 0 Comments

In a MarketWatch post, “The No. 1 Flaw in America’s Biggest 401(k) Plans,” author Paul Merriman makes three observations concerning the investment lineups of the 100 largest U.S. companies’ 401(k) plans.

By Jerry Bramlett9/23/2014 • 0 Comments

The conventional wisdom — as is evident from the mainstream glide paths embedded in the most popular target date funds (TDFs) — is that DC investors should be invested in portfolios that decrease investor equity exposure over time.

By Fred Barstein9/9/2014 • 0 Comments

When TDFs first came out, some advisors saw them as a threat — especially when the record keeper only offered one option, usually their own. For advisors who saw their value primarily in the selection and monitoring of investments, the use of TDFs seemed to diminish that value.

By Fred Barstein9/5/2014 • 0 Comments

In a further sign of the difficulties that ETFs are having trying to crack the 401(k) market, BlackRock’s iShares division is shutting down its exchange-traded TDF. The fund had attracted only $308 million since 2008, some of which was seed money from the firm.

By John Iekel8/8/2014 • 0 Comments

Many of the enhancements touted for defined contribution plan design are said to make them operate more like defined benefit plans — but does that apply to target-date fund (TDF) designs?

By John Iekel7/16/2014 • 0 Comments

Target date funds are growing and likely to comprise a larger percentage of 401(k) assets, says Paladin Registry, an independent educational resource for investors. 

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