Managed account options are generating more attention in the retirement savings arena. But, do they make sense (and dollars) for your plan and its participants?
Tailored assistance to investors who want help crafting a well-rounded portfolio sounds like a great idea. But it doesn’t make sense for everyone. Review your plan, participants and other considerations before taking the plunge into more sophisticated and more costly investment options.
Target date funds are popular options for employer-sponsored retirement plans. As the name suggests, target date funds are chosen based on the estimated year you plan to retire. For example, an employee who is about 14 years away from retirement would choose a 2030 target date fund. In this type of fund, the investment strategy is tailored to be more aggressive the further you are from retirement and become more conservative as you get closer to your “target date”.