by Chris Karam, Chief Investment Officer
The target date selection process has dramatically changed over the last five years, aided by government regulations, an increase in the number of target date suites and the availability of new products and glide paths. Many plan sponsors, working with record keepers offering a proprietary target date suite, may have had only a handful — sometimes just one — of options available during the initial selection process. This white paper offers a road map to help plan sponsors determine whether the current target solution is the appropriate choice.
The most recent stock market downturn put target date funds under a microscope and caught the eye of the Securities and Exchange Commission and the Department of Labor (DOL). The increased scrutiny culminated in DOL “tips” for plan sponsors to evaluate the appropriateness of their target date funds.
This white paper is a guide for plan sponsors to establish the necessary framework to successfully select a target date suite for their participants. Target date funds are not created equal, and plan sponsors should approach the manager selection process with open eyes. With the strong process in place that we outline in the following pages, plan sponsors can best determine which target date fund glide paths meet their goals and objectives.