5 Drawbacks of Target-Date Funds for Retirement
Set it and forget it. One of the most popular choices for retirement savers in employer-sponsored retirement plans like a 401(k) are target-date funds. Just pick a retirement year, and the fund manager automatically does the reallocating and rebalancing. Sounds easy, right? Adam Levy notes five drawback of these funds: 1. One-size-fits-all; 2. Stuck with one mutual fund company; 3. No accounting for outside assets; 4. The fees; 5. Poor asset allocation in retirement. Read Levy’s full piece here for more details.
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