On this episode of the Ready for Retirement podcast, James discusses target date funds and explains what they are, how they work, what the fees are, and how to know if a target date fund is the best option for you. 

He tells listeners that when creating a 401k, you’re given a list of fund options to choose from as you invest money. One option is to build your portfolio on your own. Another option is to select a target date fund, which is simply a portfolio that is built for you based on the year you think you might retire.

James then discusses the differences that can exist between target date funds such as the peripheral asset classes and fees. You’ll also learn how to decide if a target date fund is right for you. It takes the decision-making pressure off of you and it may have exposure to asset classes you wouldn’t have access to with individual funds in your 401k. 

However, if you know what you’re doing, replicating the blend of a target date fund and creating a portfolio that’s unique to your own personal goals could be more beneficial. 

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