Still the same problem with TDFs

I have always had a problem with target date funds (TDFs). It had to do with glide paths and the fact that there was no uniformity as it pertained to what should be in a 2025 fund or any fund for that matter.

The Morningstar Center for Retirement & Policy Studies found that target-date fund plan sponsors may expose individual investors to increased risk by not tailoring plan glide paths to their behavior.

The center reports that 58% of defined-contribution plan assets are invested in off-the-shelf TDFs, many of which are designed for participants to stay in the plan through their retirement, even when they are likely to roll their money out of the plan at retirement.

While TDFs are a great idea, there are just too many issues that still remain.

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