TDFs Increase Retirement Confidence

Investing in target-date funds has shown to increase retirement participants’ confidence, according to a survey released Thursday by Voya Investment Management, the asset management business of Voya Financial Inc.

The report, “Ready, Set, Retire: How Target Date Funds Amplify Participant Confidence,” found that 71% of employed TDF investors reported confidence in reaching their retirement goals, compared with only 58% of non-invested employees.

This confidence follows years of TDFs becoming central to many workplace retirement plans. In Voya’s separate 2025 retirement landscape survey, three-quarters of defined contribution specialists said they include TDFs in the plans they advise, while about 60% of plan sponsors said they had already added TDFs. On the investor side, 83% of employees with TDF options in their employer-sponsored retirement plan and 86% of retirees said they were currently invested in TDFs.

Voya’s target-date-fund survey also showed reduced stress among employees invested in TDFs: 91% of employed TDF investors said investing in TDFs alleviated stress derived from retirement planning, as compared with 73% of those who are not invested. When asked if investing in TDFs increased their confidence in making good investment decisions, 95% of employed TDF investors agreed, including 39% who strongly agreed.

Additionally, 92% of employed TDF investors agreed that having a TDF would increase their confidence in having a successful retirement, compared with 75% of non-investors.

“Confident participants are engaged participants,” said Barbara Reinhard, chief investment officer of multi-asset strategies and solutions at Voya IM, in a statement. “They’re more likely to increase contributions, stay the course during market volatility and make sound decisions about their retirement timeline. By contrast, participants who lack confidence often exhibit behaviors that can derail their plans—such as withdrawing too early, taking loans against their balance or simply disengaging from retirement planning altogether.”

The most cited reasons why surveyed investors chose TDFs were: ease of use, built-in diversification, professional management and automatic rebalancing. These results reinforce the idea that TDFs remain a ‘set-it-and-forget-it’ option for plan participants.

“For plan sponsors and defined contribution specialists, this finding underscores the importance of offering solutions that simplify retirement planning and empower participants,” Reinhard said in the statement.

Of prospective retirees surveyed who were invested in TDFs, 61% said they were contributing more than 5% of their salary annually to their current employer-sponsored retirement plan, compared with 50% of non-invested employees contributing more than the same threshold. A higher portion of employed TDF investors also reported contributing to their plans at higher rates (defined as between 11% and 25%) than non-invested employees.

The findings were based on Voya IM’s comprehensive survey of 1,100 retirement plan participants, including both employed participants and retirees, conducted in March and April 2025.

Voya IM managed approximately $360 billion in assets as of December 31, 2025, across public and private fixed income; equities; multi-asset solutions; and alternative strategies for institutions, financial intermediaries and individual investors.