DOL Again Seeks Comments on TDFs

Target-date funds (TDFs) are again put in the Department of Labor (DOL) spotlight for comments. Widely held in retirement accounts, TDFs may not be fully understood by investors.


The Employee Benefits Security Administration (EBSA), a DOL division, is reopening the period for public comment on proposed regulatory amendments on disclosures for target date or similar investments, originally proposed in 2010. The proposal contained an asset-allocation glide path illustration requirement. (See “EBSA Unveils Target-Date Disclosure Proposal.”)  

The proposal includes more specific disclosure requirements for target date or similar funds (TDFs), based on evidence that plan participants and beneficiaries would benefit from more information about these investments.

Specifically, the DOL outlined the need for an explanation of the TDF’s asset allocation, how the asset allocation will change over time (the glide path of the TDF), and the point in time when the TDF will reach its most conservative asset allocation. A chart, table, or other graphical representation that illustrates such change in asset allocation were among the suggestions for additional support. The proposal would also require information about the relevance of the TDF’s “target date;” any assumptions about participants’ and beneficiaries’ contribution and withdrawal intentions following the target date; and a statement that TDFs do not guarantee adequate retirement income and that participants and beneficiaries may lose money by investing in them, which can include losses in or near retirement.

In 2013, the Securities and Exchange Commission’s Investor Advisory Committee recommended that the Commission develop a glide path illustration for target date funds based on a standardized measure of fund risk as a replacement for, or supplement to, an asset-allocation glide path illustration. (See “SEC Reconsiders TDF Glide Path Illustrations.”)

Comments identified by RIN 1210–AB38 can be submitted online, or by email ( or in writing (Office of Regulations and Interpretations, Employee Benefits Security Administration, Room N–5655, U.S. Department of Labor, 200 Constitution Avenue NW, Washington, DC 20210, Attention: RIN 1210–AB38; Target Date Disclosure).

The comment period reopens June 3 and runs through July 3.