Target Date Funds: Why and Which?

Mary Brunson
Wednesday, June 28, 2017

Target Date Funds are now a staple in defined contribution plans, with 90% of plans offering them. And, that number is only expected to grow, says Aon Hewitt.

There’s a good, albeit simple, reason for the widespread expansion of target date funds: they’re easy—and easy works best for retirement savers.

Target date funds bring a risk-appropriate, age-appropriate “do-it-for-me” approach to retirement planning. This “do it for me” approach is essential to “producing superior results for the vast majority of people,” according to Fred Reisch, highly regarded retirement expert and ERISA attorney.  

These superior results for the vast majority of people will hopefully play a significant role in overcoming the recent findings from Boston College’s Center for Retirement. Their 2016 study found that 52% of working households are on track to have a lower standard of living in retirement.

So, target date funds are prevalent, effective, and necessary. But, which target date funds are best for your defined contribution plan?

IFC has collaborated with Hand Benefits and Trust, sponsor of the IFC Target Date Collective Investment Funds to produce several in-depth comparative analyses of the IFC Catholic Values Target Date Funds vs. the most commonly used target date funds we see.

Our analyses compare:

  • General asset allocations and standard deviation at various milestones along fund glidepaths
  • Drawdown variances over time and between strategies
  • Percentage frequency of various income replacement rates from 10% income replacement to 100%

This information was instrumental in the development of the IFC Target Date Funds, and the reason why our IFC Funds are so competitive against their non-screened counterparts.

As you explore, you will see the IFC Target Date Funds deliver competitive and largely superior income replacement rates along a similar glidepath and standard deviation as the comparative funds. And, as always, the IFC Target Date Funds are screened for Catholic Values—making them an excellent alternative for qualified defined contribution plans who seek to invest Catholic—and without Compromise. 

To learn more, call 888-815-5025, or visit investingforcatholics.com.

 

 Comparisons of IFC Target Date Series vs. Industry Leaders 


 

 

 

For more information, to view individual Fund Factsheets, or to learn how to get started: click here.

For comparative analysis or more detailed information, please call me at 949-428-0432 or email me at mary@ifa.com.

 


A Little More Information:

Hand Benefits & Trust (HB&T) is Trustee and transfer agent for the IFC series of collective investment funds.  HB&T has hired Investing for Catholics, a division of Index Fund Advisors, Inc. to serve as sub-advisor to this group of our collective investment funds (CIFs).  All of our CIFs are FundSERV eligible, are daily valued, and are available to qualified retirement plans, including 403(b)(9) church plans.  To confirm that your TPA/Recordkeeper’s trading platform has access to the IFC series of funds, have them look for the IFC funds under the Hand Benefits & Trust family of funds and under our NSCC member number 4866.  Should you have any questions or issues regarding availability, please contact Brenda Moctezuma at bmoctezuma@bpas.com or by phone at 713-939-4059.