This investment option represents a target-date fund designed for individuals anticipating retirement around the year 2060. It offers a diversified portfolio of underlying funds encompassing domestic and international stocks, bonds, and other asset classes. The asset allocation is automatically adjusted over time, becoming more conservative as the target retirement date approaches. This “glide path” aims to manage risk as the investor nears retirement.
Such funds offer a simplified approach to retirement investing, eliminating the need for investors to select and manage individual holdings. The automatic rebalancing feature ensures the portfolio remains aligned with the target date, even as market conditions change. This hands-off approach can be particularly beneficial for individuals who lack the time or expertise to actively manage their investments. Furthermore, these funds often benefit from lower expense ratios due to their large scale and passive management strategies.