Target-Date Funds Are Getting Riskier. Should You Worry?
Target-date funds are supposed to help novice investors take an appropriate amount of risk when building their nest eggs.Over the past decade, target-fund managers have been taking a much more aggressive stance, Morningstar found. Morningstar attributed the change to several factors, including low interest rates, stocks’ higher historical returns, and increasing life expectancies. Target-date funds, at the center of millions of Americans’ retirement savings, have been getting a lot more aggressive in terms of their mix between stocks and bonds, according to a new Morningstar report.