November 2017 – Pathways to Retirement Success: A Review of Target Date Funds

Target date funds (TDFs) are a popular investment vehicle for retirement investing, with FINRA noting that nearly 90% of employer-sponsored defined contribution plans offer them. According to Morningstar, assets for TDFs surpassed $880 billion by the end of 2016. This Asset Management Monitor – Advisor Report profiles coverage group firms that sell proprietary TDFs, exploring how they market these investment vehicles to financial professionals. Our review benchmarks how asset managers promote products and summarize resources to educate advisors and clients about the complexities of TDFs.

Sixty percent of coverage group firms sell proprietary TDFs, and many host a dedicated page to promote their offerings, which typically include glide path models, corresponding product page links and fund documents. Asset managers place high importance on educating advisors about glide path models and offer numerous white papers, graphs and brochures covering the subject. Two firms notably offer tools that help advisors assist plan sponsors with screening, comparing and selecting TDFs for employee retirement plans.