Ron Lieber writes a great piece pointing out the flaws of most Target-Date mutual funds and why I created a better option many years ago.
The piece starts out with this:
Let’s say you’re 63 years old and trying to figure out how to invest the money you’ve managed to put aside over the years.
One portfolio manager plans to put 63 percent of your retirement money in bonds. Another says that the first manager has it wrong and that a 63-year-old ought to have 63 percent of a retirement portfolio in stocks.
Who’s right? And how did they come up with those wildly divergent estimates?
It couldn’t be more right on…uhh..target! Give it a read and be careful if you are in a target-date fund, they can be good – but you need to do your homework.
Scott Dauenhauer CFP, MSFP, AIF