The Pension Protection Act of 2006 has spurred sweeping adoption of target date funds (TDFs) as qualified default investment alternatives (QDIAs), and TDFs continue to grow within DC plans. For plan fiduciaries, the Department of Labor (DOL) mandates that achieving the best possible outcomes for your participants includes taking appropriate steps to align your TDF strategy to the needs of your participants.
So in theory, having more TDF options because of advancements in technology and other competitive factors is good news for plan sponsors. But in practice, this proliferation of new options is creating challenges for plan sponsors seeking to understand the various TDF models and compare them to the needs of their plans in accordance with DOL guidance. Read the rest of this blog to learn about the various types of TDF models and more.
Jeffrey Hemker is the national sales director of Invesco’s Retirement Division.
Invesco Distributors, Inc. 11/15
