Morningstar’s Annual Target-Date Strategy Landscape
By MorningStar
The coronavirus pandemic presented the biggest challenge for target-date strategies since the financial
crisis of 2008. Target-date strategies play a central role in many Americans’ retirement success by often
serving as the default investment option in their defined-contribution retirement plans. Although targetdate performance rebounded sharply from the first quarter’s bear market, the fallout from the economic
shock continued to weigh on investor contributions throughout the year. In this report, we examine the
impact of the economic uncertainty created by the pandemic on target-date contributions and how that
varied between younger investors and those closest to retirement. We also look at key target-date
trends, like the rise of collective investment trusts, the continued importance of fees, and how regulatory
changes affect the use of sustainable and alternative strategies in target dates.
Read the report here
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