[Jarriel]

There’s nothing wrong with index target date retirement funds. The additional expense ratio for the automatic rebalancing and adjusting your glide path is negligible.

Your portfolios are fine. Don’t let this group add more complexity to your life.

[J.C.]

I’ve recently began losing my enthusiasm for TDFs, but especially in non-retirement accounts. They can throw off considerable capital gains (like when they rebalance) which can lead to significant tax obligation even if you don’t withdraw those gains. Never hold a TDF outside of a retirement account.

Now, as to their general performance, I’m not so sure that they are worth the extra fees.

You can just purchase a couple of low cost, highly diversified, passively managed index funds like VTSAX (Total Stock Market), or VFIAX (S&P 500), and an international fund like VTIAX, then counter-balance it with VBTLX (Total Bond Fund) or maybe a TIPs fund like VAIPX for the added inflation protection. And then just rebalance periodically (annually?)

or use guard rails (like I do) of 5% move in either direction to rebalance back to your desired Asset Allocation. And save the TDF fees. Your call.

Don’t miss: Should I purchase VMFXX through my taxable account, Roth IRA, traditional IRA?

[Tony]

Personally speaking, the only two funds I plan on owning for the rest of my life are VTSAX and VBTLX. The percentages of each will depend on my age and risk tolerance.

I read “The Simple Path to Wealth”, and I’m not going back to having many funds ever again.

[Author]

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