This report highlights the various features, benefits, and potential inefficiencies of TDFs, which are among the fastest growing options being offered as a Qualified Default Investment Alternative (QDIA) in many retirement plans.

Due to their unique structure, risks, costs, and limitations, TDFs have certain inefficiencies that may impact investors’ ability to meet their retirement goals. As an alternative approach, incorporating managed solutions that are individualized and customized to investors’ needs, goals, and life situations can be an attractive opportunity to enhance retirement plan investing choices and manage the limitations of TDFs.

By integrating managed solutions that utilize low-cost investments such as Exchange Traded Funds (ETFs) as part of the QDIA continuum, advisors, plan sponsors, and investors will have more choice, flexibility, and personalized solutions available to help meet retirement goals.

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