Frequently Asked Questions

New to target date funds (TDFs)?

Here's some information that might help.

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What’s a TDF?

What’s a TDF?

A target date fund is an individual investment portfolio that can be offered through multiple vehicle types and is designed to provide a one-step approach to investing for retirement. As the name suggests, the goal of a target date fund is to grow your savings over a specified period of time with a specific date in mind (your planned, or targeted, year of retirement). Target date funds that invest through retirement continue to invest your savings during the years after the target date. In the years right after retirement, it is important to still protect your savings from significant market declines, and in the later years of retirement, a TDF can help protect your savings from inflation.

There is no guarantee these goals will be achieved. 

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How do I know if a TDF might be the right retirement investment for me?

How do I know if a TDF might be the right retirement investment for me?

Target date funds might be a good option for you if you prefer not to be directly engaged in the daily management of your portfolio but still desire a professionally managed investment strategy that adjusts according to your specified retirement date, year. You select the target retirement date, year that’s right for you and the investment professionals take care of managing your target date fund for you. Target date funds are designed to automatically rebalance their asset allocation over time, becoming more conservative as the target retirement date approaches.

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How does a TDF work?

How does a TDF work?

A target date fund invests in a mix of investments, such as stocks and bonds, that gradually adjusts over time based on your age and years until retirement—two very important factors in investment decisions. As you move along your journey, the mix of investments in each fund, also referred to as the fund’s glidepath or asset allocation, undergoes progressive changes, moving towards a more conservative blend of investments as you approach your targeted retirement date. The target date fund consistently strives to grow your savings with your specific target date in mind.  

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What are the most important things to think about when investing for retirement and will a TDF help me?

What are the most important things to think about when investing for retirement and will a TDF help me?

We believe the top three things that can affect your retirement savings are: 

  1. not saving enough money,
  2. market fluctuations,
  3. the eroding effects of inflation

Target date funds are inherently designed to re-balance over time taking into account your age and retirement date. The dynamic nature of the investment approach attempts to help the fund navigate through varying market conditions and challenges, including inflation. 

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How do I pick the right TDF?

How do I pick the right TDF?

Target date funds investment approach is driven by your age and horizon to retirement. Chose the fund whose name aligns most closely to your desired retirement date.

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Can I switch from one TDF to another?

Can I switch from one TDF to another?

If your time horizon changes, you can switch to a more applicable fund. For example, if you determine that you are going to work for an additional five years, you can move your money into the target date fund that best reflects your new target retirement year. Prior to switching to another target date fund, you need to consider any applicable fees and expenses.

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How do I get out of a TDF if I no longer desire to be in it? 

How do I get out of a TDF if I no longer desire to be in it?

You can move your money out of a target date fund to any other investment option within your retirement plan at any time based on plan rules and investment criteria eligibility. Prior to moving out of a target date fund, you need to consider any applicable fees and expenses.