Legal Alert - DOL Releases Fiduciary Tips for Selecting Target Date Funds


In recent years, target date funds (TDFs) have become a popular investment option for many 401(k) plan participants. By investing in a mix of stocks, bonds and other investments, often through investments in other mutual funds, TDFs are designed to provide a one-stop, long-term investment strategy tied to a participant’s anticipated or “target” retirement date. Generally, TDFs invest heavily in stocks and other riskier assets in earlier years and then shift to less risky assets as the target retirement date draws near. This automatic shift in the asset allocation, which is known as the fund’s “glide path,” relieves the participant of the often confusing chores of selecting the proper asset allocation and rebalancing investments.

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