How To Stop COVID-19 From Derailing Your Retirement
Justin Kuepper
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Let’s take a look at a few key pieces of advice to stop...
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While TDFs work out well as qualified default investments in these plans, they still lack a personal touch when it comes to an individual investor’s needs and objectives. This article explores how a TDF in combination with an individually managed account might produce superior risk-adjusted returns.
Click here to help better understand the importance of how your TDF’s allocation changes over time.
The Pension Protection Act of 2006 stipulates that a QDIA can be a target-date fund, balanced or individually managed account, although TDFs are the most popular choice by far. This is mainly due to TDFs changing their asset allocations to become more conservative as retirement approaches, but consideration must be given to the fact that investor assets must be managed not just to retirement, but through retirement.
To learn more about how customized target-date funds can be advantageous, click here.
This type of setup could take a few different forms. It could be age-based, where an investor could use a TDF in the early years and switch over, either partially or totally, to a managed account once a certain age is reached. It could also be asset-based, where once an account has accumulated enough assets to meet anticipated retirement needs, a managed account would be used to help keep things on track from there. It’s the combination of a low-cost, risk-appropriate investment option with individualized attention that could reap the greatest benefits.
To learn more about target-date funds, in general, check out our Target-Date Funds section.
In addition, the hybrid QDIA can be used successfully by investors at any point in the life cycle. Early stage investors get invested in a low-cost, broadly diversified portfolio. Near-retirees can use the managed account aspect to ensure that their accumulated wealth will meet their retirement needs. Retirees received individualized attention to make sure that all personal financial needs are being addressed.
One challenge of setting up a hybrid QDIA is that, for most, it won’t be a viable option as managed accounts have been adopted by fewer than 10% of plan sponsors. Investor engagement will be key in the success of any hybrid QDIA. If a lack of engagement is what led to selecting a TDF in the first place, investors might fail to leverage the full advantages of an individually managed account.
Be sure to check our News section to keep track of recent fund performances.
Receive email updates about best performers, news, CE accredited webcasts and more.
Justin Kuepper
|
Let’s take a look at a few key pieces of advice to stop...
News
Iuri Struta
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While tax-gains harvesting takes some planning to implement, it can help save investors...
Find out why $30 trillon is invested in mutual funds.
Download our free report
Find out why $30 trillon is invested in mutual funds.
Download our free report
Find out why $30 trillon is invested in mutual funds.
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While TDFs work out well as qualified default investments in these plans, they still lack a personal touch when it comes to an individual investor’s needs and objectives. This article explores how a TDF in combination with an individually managed account might produce superior risk-adjusted returns.
Click here to help better understand the importance of how your TDF’s allocation changes over time.
The Pension Protection Act of 2006 stipulates that a QDIA can be a target-date fund, balanced or individually managed account, although TDFs are the most popular choice by far. This is mainly due to TDFs changing their asset allocations to become more conservative as retirement approaches, but consideration must be given to the fact that investor assets must be managed not just to retirement, but through retirement.
To learn more about how customized target-date funds can be advantageous, click here.
This type of setup could take a few different forms. It could be age-based, where an investor could use a TDF in the early years and switch over, either partially or totally, to a managed account once a certain age is reached. It could also be asset-based, where once an account has accumulated enough assets to meet anticipated retirement needs, a managed account would be used to help keep things on track from there. It’s the combination of a low-cost, risk-appropriate investment option with individualized attention that could reap the greatest benefits.
To learn more about target-date funds, in general, check out our Target-Date Funds section.
In addition, the hybrid QDIA can be used successfully by investors at any point in the life cycle. Early stage investors get invested in a low-cost, broadly diversified portfolio. Near-retirees can use the managed account aspect to ensure that their accumulated wealth will meet their retirement needs. Retirees received individualized attention to make sure that all personal financial needs are being addressed.
One challenge of setting up a hybrid QDIA is that, for most, it won’t be a viable option as managed accounts have been adopted by fewer than 10% of plan sponsors. Investor engagement will be key in the success of any hybrid QDIA. If a lack of engagement is what led to selecting a TDF in the first place, investors might fail to leverage the full advantages of an individually managed account.
Be sure to check our News section to keep track of recent fund performances.
Receive email updates about best performers, news, CE accredited webcasts and more.
Justin Kuepper
|
Let’s take a look at a few key pieces of advice to stop...
News
Iuri Struta
|
Most equities have continued their rally these past two weeks, along with investment-grade...
Aaron Levitt
|
While tax-gains harvesting takes some planning to implement, it can help save investors...
Find out why $30 trillon is invested in mutual funds.
Download our free report
Find out why $30 trillon is invested in mutual funds.
Download our free report
Find out why $30 trillon is invested in mutual funds.
Mutual Fund Education
Justin Kuepper
|
Let's take a closer look at how ESG investments have outperformed during the...
Mutual Fund Education
Daniel Cross
|
While CITs and mutual funds share many similarities, there are some key differences...
Mutual Fund Education
Sam Bourgi
|
The phrase ‘bear market’ has been thrown around a lot lately, but it...