My biggest problem (and admittedly it's pretty small by itself) is target date/strategy funds have not been static over the years. They have changed their behavior/allocations depending on what "new" information the issuer has come up with. This goes for pretty much all issuers not just funds offered by Vanguard. The other issue I have with target date funds specifically is they are not implemented in similar manners across issuers. The 2 biggest differences are in glide paths implemented as "to the date" meaning they stop adjusting once the date on the fund is reached or "through the date" meaning the fund continues to adjust its allocation after the date on the fund has been reached. You can start to get wildly varying approaches as the target date approaches.
By and large I don't consider these "problems" truly terminal. If someone wants a hands off approach they are great and will help people reach their goals at low cost. However, I think they are better used either as a strategy while learning about asset allocation and portfolio construction or as a component of the portfolio and not the whole once education is achieved.
By and large I don't consider these "problems" truly terminal. If someone wants a hands off approach they are great and will help people reach their goals at low cost. However, I think they are better used either as a strategy while learning about asset allocation and portfolio construction or as a component of the portfolio and not the whole once education is achieved.
Statistics: Posted by PersonalFinanceJam — Sun Sep 15, 2024 11:05 pm — Replies 15 — Views 1119