An investment in knowledge pays the best dividends. Benjamin Franklin
When it comes to target date funds, individual investors have an advantage over the professionals. Simply put, do-it-yourself TDFs are built to your unique specifications, so they’re not burdened by the deficiencies that plague the 401(k) versions.
At $2 trillion and growing, TDFs are where the smart institutional retirement money is going, but individual investors can be even smarter. Institutional investors tolerate several known deficiencies in TDFs that individual investors don’t have to put up with.
Do-it-yourself investors can outdo the professionals by overcoming these serious TDF deficiencies:
- One size fits all
- High fees
- Excessive risks that lost more than 30% in 2008
A computer application called Age Sage gives you the ability to: (1) customize your glide path, (2) pay very low fees and (3) manage your risk much more effectively than it is managed in traditional TDFs. These benefits are not available to 401(k) plan participants or to those who purchase TDF mutual funds.
Customize your glide path
You choose your risk level: low, middle or high. And you can change this level anytime you’d like. Life’s surprises often require adjustments.
Very low cost
You pay as little as 3 basis points (.03%) as compared to an average TDF mutual fund fee of 66 basis points (.66%) – 22 times higher
Protect your savings
There is a Risk Zone that spans the 5 years before and after retirement. Losses sustained during this period can have debilitating effects on standard of living in retirement. Age Sage’s patented Low Risk glide path has 80% less risk than mutual fund TDFs in the Risk Zone.