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Plan Well, Retire Well

Saving and investing your money
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Solutions for Investment Procrastination, Part 3

Target date retirement funds are the third tool that might help you get things done where investing is concerned. Like index mutual funds and


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I attended a SERS retirement seminar recently and a financial planner reported that these types of funds contain about 33% junk funds - funds that don't much income or none at all. He recommended choosing your own producing funds. Places like TIAA-Cref has representatives that can build a self sustaining portfolio based on your age and risk tolerance. A reputable company should have a department to work with customers who aren't financial experts to build a successful portfolio.
by Ellen Corcoran on Wednesday 2/12/2014

Ellen,Thanks for sharing this. There's always more than one way to accomplish a financial objective. I'd be curious what the planner meant by "junk" funds. Certainly, each company that offers target date funds has a slightly different approach. But Vanguard's, for example, are comprised of their low-cost index funds. As you approach and enter retirement, the proportion invested in bond funds increases. Yes, many investors could get guidance from their retirement plan provider. But that would required periodic consultations and adjustments to your investment mix - exactly what the target date funds avoid. As we age, our mental ability to do those these may deteriorate.
by Karen Chan on Monday 2/24/2014