Happy Friday, readers! So far in 2018 there has been something of a resurgence of the target-date fund research topic in the financial services trade media. As the Great Recession of 2008 and 2009 retreats further into the rear-view mirror, providers are increasingly concerned about investor complacency—and on the optimal way to shape their risk glide paths for TDF product users who are approaching and entering retirement. Providers are also more prone to discuss the way workplace demographic shifts are morphing their approach to risk management and product presentation. Find the latest retirement investing news and analysis below.
As new data shared by Vanguard shows, when constructing their own retirement portfolios, about 10% of participants still tend to hold extreme allocations—defined here as holding either 0% or 100% equities in a retirement-focused portfolio.
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The latest though leadership from the firm asks an increasingly important question: “What should the TDF glide path look like as participants move from accumulating asset balances to spending down those balances in retirement?”
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Professional investment assistance helps DC plan participants’ outcomes; however, an analysis from Alight Solutions found users of managed accounts see higher returns, are more diversified and save more in their DC plans.
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A broad new Investment Company Institute analysis shows the expense ratios of target-date mutual funds have fallen 34% since 2008, alongside the expense ratios of most other types of long-term funds.
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In a Q&A with BlackRock Managing Director Anne Ackerley, PLANADVISER hears about emerging opportunities to deliver retirement income solutions to DC plan participants, including through TDFs.
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