Self-Managing IRA Investments
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Business & Economics
How to build your own target-date retirement fund

78% Informative
When 401(k) plan sponsors and state auto-IRA programs automatically enroll workers in a retirement plan, the majority use target-date funds.
These funds are typically made up of a couple of index funds.
You select the year you’d like to retire and buy a mutual fund with that year in its name, like Target 2035 .
In 2023 , index equity mutual funds had an asset-weighted average expense ratio of 0.05% , or just $5 for every $ 10,000 invested.
Target-date funds, however, are a tad pricer than a single equity index fund.
Their fees reflect the asset-allocation monitoring by a fund manager on top of the fund expenses.
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