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Target-Date Retirement Funds in U.S. Recover 2008 Losses
Finding this here a bit hard to follow. Appears to say 2010 target funds are 5% above where the S&P was in Oct. '07, which would be comparing apples and oranges. But, the gist is that 2010 target retirement funds have now recovered the losses suffered in the bear market from late '07 until early '09. That's a bit surprising as would wager that most who post here recovered much earlier. These funds promise a set-it and forget-it style of investing and have become the default vehicle in many company plans. Not a bad option as some young people could care less about investing and may be more concerned about their career, buying a home, raising kids, caring for the parents or grandparents. For them these funds may still be preferable to sticking the money in cash or worse yet not investing at all. Over a 30 or 40 year time horizon they should do fine. Even with a 2010 retirement date, they'll likely continue to invest for another 20 or so years However, if they had the time and inclination when young to read this board and pursue just about any of the many approaches discussed, got a feeling they would do much better than what target date funds can provide.
with TDF glide paths, one need to be careful if their offering is designed as the "to" retirement, or "through" retirement. different houses make different promises.
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