{"id":32791,"date":"2022-11-16T12:32:03","date_gmt":"2022-11-16T12:32:03","guid":{"rendered":"https:\/\/www.5paisa.com\/finschool\/?post_type=finance-dictionary&#038;p=32791"},"modified":"2023-11-04T17:37:13","modified_gmt":"2023-11-04T12:07:13","slug":"target-date-fund","status":"publish","type":"finance-dictionary","link":"https:\/\/www.5paisa.com\/finschool\/finance-dictionary\/target-date-fund\/","title":{"rendered":"Target Date Fund"},"content":{"rendered":"\t\t<div data-elementor-type=\"wp-post\" data-elementor-id=\"32791\" class=\"elementor elementor-32791\">\n\t\t\t\t\t\t<section class=\"elementor-section elementor-top-section elementor-element elementor-element-c1483ab elementor-section-boxed elementor-section-height-default elementor-section-height-default\" data-id=\"c1483ab\" data-element_type=\"section\">\n\t\t\t\t\t\t<div class=\"elementor-container elementor-column-gap-default\">\n\t\t\t\t\t<div class=\"elementor-column elementor-col-100 elementor-top-column elementor-element elementor-element-3d0d3e5\" data-id=\"3d0d3e5\" data-element_type=\"column\">\n\t\t\t<div class=\"elementor-widget-wrap elementor-element-populated\">\n\t\t\t\t\t\t<div class=\"elementor-element elementor-element-70fb791 elementor-widget elementor-widget-text-editor\" data-id=\"70fb791\" data-element_type=\"widget\" data-widget_type=\"text-editor.default\">\n\t\t\t\t<div class=\"elementor-widget-container\">\n\t\t\t\t\t\t\t\t\t<p><span style=\"font-weight: 400;\">\u200bMutual funds or exchange-traded funds (ETFs) that have been structured with a target date are called target-date funds. The funds are structured to meet an investor&#8217;s capital requirements at a specified date, hence the term &#8220;target date.&#8221; Thus, a target-date fund falls within the category of lifecycle funds, in which the allocation of the portfolio gets more conservative over time.<\/span><\/p><p><span style=\"font-weight: 400;\">Investors would typically choose a target-date fund to contribute to their beginning of retirement. However, investors who are saving for a future expense, like a child&#8217;s college tuition, are more likely to utilize target-date funds.<\/span><\/p><p><span style=\"font-weight: 400;\">When the target date approaches, the asset allocation of a target-date fund is often planned to progressively move to a more conservative profile in order to reduce risk.<\/span><\/p><p><span style=\"font-weight: 400;\">The convenience of placing all of an investor&#8217;s investing actions on autopilot in a single vehicle is what attracts investors to target-date funds.<\/span><\/p><p><span style=\"font-weight: 400;\">Typically, target-date funds mature every five years, for example, in 2035, 2040, and 2045.<\/span><\/p><p><span style=\"font-weight: 400;\">Although target-date funds are still substantially more expensive than other forms of mutual funds, their expense ratios have decreased significantly in recent years.<\/span><\/p><p><span style=\"font-weight: 400;\">To achieve the investment return objective, target date funds use a conventional portfolio management methodology to target asset allocation over the fund&#8217;s period. Target-date funds are said to as exceptionally long-term investments because they are named after the year the investor intends to start using the assets.<\/span><\/p><p>\u00a0<\/p>\t\t\t\t\t\t\t\t<\/div>\n\t\t\t\t<\/div>\n\t\t\t\t\t<\/div>\n\t\t<\/div>\n\t\t\t\t\t<\/div>\n\t\t<\/section>\n\t\t\t\t<\/div>\n\t\t","protected":false},"excerpt":{"rendered":"<p>\u200bMutual funds or exchange-traded funds (ETFs) that have been structured with a target date are called target-date funds. The funds are structured to meet an investor&#8217;s capital requirements at a specified date, hence the term &#8220;target date.&#8221; Thus, a target-date fund falls within the category of lifecycle funds, in which the allocation of the portfolio &#8230; <a title=\"Target Date Fund\" class=\"read-more\" href=\"https:\/\/www.5paisa.com\/finschool\/finance-dictionary\/target-date-fund\/\" aria-label=\"Read more about Target Date Fund\">Read more<\/a><\/p>\n","protected":false},"author":1,"featured_media":32796,"parent":0,"menu_order":101,"comment_status":"closed","ping_status":"closed","template":"","format":"standard","meta":{"_acf_changed":false,"footnotes":""},"class_list":["post-32791","finance-dictionary","type-finance-dictionary","status-publish","format-standard","has-post-thumbnail","hentry","finance-dictionary-terms-t"],"acf":[],"_links":{"self":[{"href":"https:\/\/www.5paisa.com\/finschool\/wp-json\/wp\/v2\/finance-dictionary\/32791","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.5paisa.com\/finschool\/wp-json\/wp\/v2\/finance-dictionary"}],"about":[{"href":"https:\/\/www.5paisa.com\/finschool\/wp-json\/wp\/v2\/types\/finance-dictionary"}],"author":[{"embeddable":true,"href":"https:\/\/www.5paisa.com\/finschool\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/www.5paisa.com\/finschool\/wp-json\/wp\/v2\/comments?post=32791"}],"version-history":[{"count":5,"href":"https:\/\/www.5paisa.com\/finschool\/wp-json\/wp\/v2\/finance-dictionary\/32791\/revisions"}],"predecessor-version":[{"id":32797,"href":"https:\/\/www.5paisa.com\/finschool\/wp-json\/wp\/v2\/finance-dictionary\/32791\/revisions\/32797"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.5paisa.com\/finschool\/wp-json\/wp\/v2\/media\/32796"}],"wp:attachment":[{"href":"https:\/\/www.5paisa.com\/finschool\/wp-json\/wp\/v2\/media?parent=32791"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}