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Target Date Funds

BY NAPA Net Staff | 10/16/2015
It’s been a busy time for target date funds, according to a new report.About 1 in 10 plan sponsors replaced their target date fund/balanced fund manager in 2014, while the proportion of plans that... Read More
BY Fred Barstein | 8/5/2015
Pendulums tend to swing to extremes before they stabilize. It seems that everyone is advocating a move towards professionally managed investments like target-date funds (TDFs) for most participants.... Read More
BY Michael Bushnell | 8/4/2015
Roth IRAs are growing in popularity, particularly among younger workers, and the use of target date funds in those plans is also rising, according to a new study from the Investment Company Institute... Read More
BY Fred Barstein | 7/20/2015
A knock on the current crop of TDF providers is that many have underlying investments largely comprised of proprietary funds.It seems to make sense to be able to select best of breed for each asset... Read More
BY NAPA Net Staff | 7/20/2015
Target-date funds continued to draw a plurality of new contributions, while participants continued to transfer funds from company stock, according to a new report.TDFs received the most new money in... Read More
BY Nevin E. Adams, JD | 7/7/2015
In a remarkably short period of time, target-date funds have become an integral component of the typical 401(k) menu, and a growing share of 401(k) plan assets — particularly those of newly hired 401... Read More
BY NAPA Net Staff | 6/12/2015
Last year, four-in-ten contribution dollars were directed to target-date funds, according to a new report.Eighty-eight percent of plan sponsors recordkept by Vanguard offered target-date funds at... Read More
BY Michael Bushnell | 6/3/2015
As target-date funds grow in popularity, plan advisors need to focus on educating plan sponsors about much more than basic fiduciary duties, Don Trone believes. In his Spring 2015 column in NAPA Net... Read More
BY Fred Barstein | 5/15/2015
Though the big three target-date fund providers (Vanguard, Fidelity and T. Rowe Price) have over 70% market share, the percentage of plans using their record keeper’s proprietary TDF is slipping.... Read More
BY NAPA Net Staff | 4/29/2015
Target-date funds continued to receive the majority of new contributions into individuals’ accounts last month, according to the AonHewitt 401(k) Index.In March that meant that $498 million, or... Read More
BY Fred Barstein | 4/24/2015
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... Read More
BY NAPA Net Staff | 4/20/2015
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... Read More
BY Fred Barstein | 4/16/2015
When it comes to analyzing investments, TDFs are different. Yet many people make the mistake of rating them like any other investment. TDFs are different because they are a portfolio of... Read More
BY NAPA Net Staff | 4/9/2015
Morningstar’s 2015 Target-Date Fund Landscape report is out — and the news is good for retirement savings plans. The report notes that the annualized asset-weighted investor return... Read More
BY John Iekel | 3/23/2015
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.PIMCO Executive Vice President and National Retirement Sales Manager Sean... Read More
BY Rocco DiBruno | 3/18/2015
In 1985, Back to the Future, starring Michael J. Fox and Christopher Lloyd, was a box office hit. Fox’s character, Marty McFly, went back in time to 1955 when his parents were in high school,... Read More
BY Michael Bushnell | 3/2/2015
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... Read More
BY NAPA Net Staff | 1/23/2015
While it’s not always true, what happens in the large market usually migrates down market. So, according to a recently released study by Callan Associates of nearly 150 larger plans (most of... Read More
BY NAPA Net Staff | 12/3/2014
By 2019, 88% of all new contributions will go to target-date funds, according to a recent report from Cerulli (free registration required). The report also predicts that the market share of custom... Read More
BY Fred Barstein | 11/26/2014
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... Read More
BY Jerry Bramlett | 11/20/2014
“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... Read More
BY Jerry Bramlett | 10/21/2014
A recent Fidelity study found that in the 20 to 30 age group, 44% of all DC participants are cashing out after leaving employment. If financial hardships and subsequent cash outs from rollovers into... Read More
BY Nevin E. Adams, JD | 10/11/2014
Before target-date funds were “cool” (or widely available), I had steered my mother toward an asset-allocation fund as a good place to invest her retirement plan rollover balance. The... Read More
BY Jerry Bramlett | 9/29/2014
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... Read More
BY Jerry Bramlett | 9/23/2014
The conventional wisdom — as is evident from the mainstream glide paths imbedded in the most popular target date funds (TDFs) — is that DC investors should be invested in... Read More