Terry’s Columns Hidden Risk in Target Date Funds

Hidden Risk in Target Date Funds

By Terry Savage on August 15, 2017

Target date funds slowly reduce equity (stock) exposure as a worker reaches retirement age. It’s called a “glide path.” Still, most target date funds leave people highly invested in stocks — and exposed to stock market risk — in the years approaching retirement. But now some experts argue that stock exposure should be reduced far more sharply in the years before and after entering retirement — especially in light of the recent bull market in stocks.

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