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What Is The Best Target Date Fund?

best-target-date-fund

The best target-date fund (TDA) can be a hard choice. You have 10 to 60 years of savings in front of you so you absolutely need to pick the right target-date fund. You only get one shot at retirement so picking the right fund means retiring in style instead of looking over your shoulder for bill collectors!

What Is The Best Target Date Fund?

Updated with 2018 returns.

Why you need a target-date fund

Target date funds offer an easy way to manage your money. Investment companies offer them often as a 1-fund-solution. The date mentioned in the fund is the date (year) in the future where you are planning to retire. Let us take the example of Vanguard. Their 2050 target date fund is called:  Vanguard Target Retirement 2050 Fund. This means that if you are planning to retire at 65 years old in the year 2050 you should buy this fund.

All target-date funds have one characteristic feature. They all make use of a glide path to guide the asset allocation within the fund. All target-date funds make use of two main components in order to build their assets allocation and the glide path. The two components are risky assets and safe assets. These two components can be broken down into individual asset classes.

The risky assets include the following asset classes:

  • Equities (stocks) (large-cap, small-cap, value, growth, etc.)
  • High yield bonds
  • REITs
  • Private equity
  • Emerging market bonds
  • Commodities

The safe assets include the following asset classes:

  • Government bonds (from developed economies)
  • High-grade bonds (investment-grade corporate bonds)
  • Cash (money market accounts)
  • Municipal bonds
  • TIPS

The glide path determines the ratio of risky assets to safe assets in the fund. The longer you have until retirement the more risky assets should be in your portfolio. For example, if you plan on retiring in 2060 you will have many risky assets in your portfolio (at least 90 % will be in risky assets). They offer the best returns over long periods but are more volatile. On the other hand, if you plan on retirement in 2030 you will have less in risky assets and more in safe assets (maybe closer to 50% in each).

Now here is the smart thing about target-date funds: They all balance their ratio of a risky and safe asset for each year you grow closer to retirement. You don’t have to do a thing, it all happens automatically. This is the glide path feature.

Target-date-funds-glidepath
Source: JPMorgan

Now that you know what a target date fund is, let us have a look at the contenders for the best target-date fund.

These are the best target-date fund, contenders

Below are the contending portfolios. The list includes both individual funds from fund companies and portfolios using a glide path approach. The difference is that at a mutual fund company you can buy one fund and be done (the 1-fund-solution). In the DIY portfolios, you need to maintain the portfolio yourself and rebalance every year. This is not any different or any more difficult than a standard rebalancing. We have a post and a spreadsheet describing it.

  • Vanguard Target Date Funds (1 fund solution)
  • Paul Merriman’s Target Date Portfolios (DIY portfolio)
  • iShares LifePath Index Funds (1 fund solution)
  • Fidelity Freedom Index Funds (1 fund solution)
  • Schwab Target Date Funds (1 fund solution)
  • Morningstar Lifetime Indices (DIY portfolio)
  • Dimensional 2030 Target Date Retirement Income Fund (1 fund solution)
  • TIAA-CREF Lifecycle Funds (1 fund solution)

Our methodology

The basis for our measurement is the portfolios that are tracked by portfolioeinstein.com. As per 13/09/2018, we are tracking 235 portfolios. All the portfolios are buy-and-hold and assume a lump sum investing in 1989 along with yearly rebalances.

The years tracked are from 1989 to 2018.

We are only looking at the compound annual growth rate of the investments (CAGR). This is the standard way of measuring returns of investments on portfolios. CAGR takes interest-on-interest into account.

For example, $1 earning 10 percent interest this year would be worth $1.10 by the end of the year. ($1 times 1.1)  Next year the $1.10 grows to $1.21.  ($1.1 times 1.1). In ten years that $1 grows to $2.5. This is the compounding effect in action.

All the portfolios are using the same data. Here are the sources for the data.

The individual target-date funds all list their asset allocations on their web pages. These are benchmarked against our historical asset class database.

The funds all start in 1989 with an initial $10,000 investment.

The best target-date fund

We are listing 4 target dates and compare the portfolios. The 4 target dates are:

  • 2060 (25 years old)
  • 2050 (35 years old)
  • 2040 (45 years old)
  • 2030 (55 years old)

Here are the results grouped by target date:

2060 Target Date Retirement Portfolios

Portfolio nameAsset class count1 year return (2019)Year to date10 year returnCAGR since 1989DrawdownRisk LevelExpense ratioYield
BlackRock LifePath Index 2060 Fund (25 year old)527.58%2.17%10.63%9.02%-38.83%5 - very high risk0.07%2.44%
Fidelity Freedom Index 2060 (25 year old and younger)525.93%2.06%10.10%8.77%-34.81%5 - very high risk0.06%2.14%
Vanguard Target Retirement 2060 (25 year old)425.22%1.86%9.58%8.33%-35.33%5 - very high risk0.05%2.21%
Schwab Target Date Index Fund 2060726.63%1.81%10.16%9.27%-38.18%5 - very high risk0.07%2.27%
Morningstar Lifetime Allocation Index Aggressive, 20601625.57%0.60%9.23%9.29%-39.62%5 - very high risk0.11%2.32%
Morningstar Lifetime Allocation Index Moderate, 20601624.97%0.64%9.10%9.26%-37.83%5 - very high risk0.11%2.30%
Morningstar Lifetime Allocation Index Conservative, 20601623.76%0.78%8.88%9.19%-34.26%4 - high risk0.11%2.30%
Dimensional 2060 Target Date Retirement Income Fund726.49%1.94%10.02%9.05%-37.66%5 - very high risk0.05%2.23%
TIAA-CREF Lifecycle 2060426.95%2.17%10.66%9.40%-36.60%5 - very high risk0.04%2.14%

2050 Target Date Retirement Portfolios

Portfolio nameAsset class count1 year return (2019)Year to date10 year returnCAGR since 1989DrawdownRisk LevelExpense ratioYield
BlackRock LifePath Index 2050 Fund (35 year old)627.60%2.19%10.65%9.03%-38.75%5 - very high risk0.07%2.44%
Fidelity Freedom Index 2050 (35 year old)525.93%2.06%10.10%8.77%-34.81%5 - very high risk0.06%2.14%
Vanguard Target Retirement 2050 (35 year old)425.21%1.87%9.59%8.34%-35.27%5 - very high risk0.05%2.21%
Schwab Target Date Index Fund 2050825.75%1.80%9.88%9.14%-36.08%5 - very high risk0.07%2.26%
Morningstar Lifetime Allocation Index Aggressive, 20501625.86%0.73%9.48%9.34%-39.37%5 - very high risk0.11%2.28%
Morningstar Lifetime Allocation Index Moderate, 20501625.14%0.77%9.29%9.30%-37.36%5 - very high risk0.11%2.28%
Morningstar Lifetime Allocation Index Conservative, 20501623.46%0.89%8.88%9.16%-32.78%4 - high risk0.10%2.27%
Dimensional 2050 Target Date Retirement Income Fund726.49%1.94%10.02%9.05%-37.66%5 - very high risk0.05%2.23%
TIAA-CREF Lifecycle 2050426.50%2.15%10.51%9.35%-35.52%5 - very high risk0.04%2.14%

2040 Target Date Retirement Portfolios

Portfolio nameAsset class count1 year return (2019)Year to date10 year returnCAGR since 1989DrawdownRisk LevelExpense ratioYield
BlackRock LifePath Index 2040 Fund (45 year old)725.80%2.11%10.05%8.87%-34.50%5 - very high risk0.06%2.35%
Fidelity Freedom Index 2040 (45 year old)525.93%2.06%10.10%8.77%-34.81%5 - very high risk0.06%2.14%
Vanguard Target Retirement 2040 (45 year old)424.32%1.85%9.31%8.29%-33.10%4 - high risk0.05%2.18%
Schwab Target Date Index Fund 2040824.33%1.81%9.42%8.95%-32.48%4 - high risk0.06%2.24%
Morningstar Lifetime Allocation Index Aggressive, 20401825.97%0.86%9.66%9.39%-38.72%5 - very high risk0.11%2.25%
Morningstar Lifetime Allocation Index Moderate, 20401824.40%0.89%9.19%9.24%-34.80%5 - very high risk0.11%2.23%
Morningstar Lifetime Allocation Index Conservative, 20401821.08%0.99%8.16%8.82%-26.55%3 - medium risk0.10%2.21%
Dimensional 2040 Target Date Retirement Income Fund723.94%1.83%9.04%8.65%-32.21%4 - high risk0.05%2.20%
TIAA-CREF Lifecycle 2040425.19%2.09%10.04%9.20%-32.56%4 - high risk0.04%2.14%

2030 Target Date Retirement Portfolios

Portfolio nameAsset class count1 year return (2019)Year to date10 year returnCAGR since 1989DrawdownRisk LevelExpense ratioYield
BlackRock LifePath Index 2030 Fund (55 year old)722.03%1.87%8.71%8.42%-26.15%3 - medium risk0.06%2.20%
Fidelity Freedom Index 2030 (55 year old)623.00%1.91%9.05%8.48%-28.19%4 - high risk0.06%2.11%
Vanguard Target Retirement 2030 (55 year old)421.54%1.77%8.43%8.05%-26.38%3 - medium risk0.05%2.09%
Schwab Target Date Index Fund 2030821.51%1.79%8.49%8.49%-25.62%3 - medium risk0.06%2.18%
Morningstar Lifetime Allocation Index Aggressive, 20301824.27%0.98%9.24%9.23%-33.93%4 - high risk0.11%2.18%
Morningstar Lifetime Allocation Index Moderate, 20301821.12%0.98%8.17%8.79%-26.61%3 - medium risk0.10%2.12%
Morningstar Lifetime Allocation Index Conservative, 20301817.22%1.01%6.83%8.12%-17.47%2 - low risk0.10%2.06%
Dimensional 2030 Target Date Retirement Income Fund818.80%1.26%7.29%8.07%-22.61%3 - medium risk0.05%1.51%
TIAA-CREF Lifecycle 2030622.01%1.94%8.89%8.77%-25.50%3 - medium risk0.04%2.10%

Target Date Retirement Income Portfolios 

These are for when you have already entered retirement and need a steady safe income stream.

Portfolio nameAsset class count1 year return (2019)Year to date10 year returnDrawdownRisk LevelMarket correlationExpense ratioYield
S&P 500 (Benchmark)131.46%3.69%13.52%-37.63%5 - very high risk0.990.04%1.79%
Paul Merriman's Target Date Portfolio (65 year old)1415.04%0.14%6.81%-14.21%2 - low risk0.850.10%1.84%
David Booth (DFA) Fixed Income Portfolio46.94%1.25%2.29%-0.18%1 - very low risk0.010.06%1.73%
Vanguard LifeStrategy Income Fund (20/80)412.19%1.53%5.22%-3.73%1 - very low risk0.780.05%1.77%
Schwab Managed Portfolio, Conservative Income68.44%0.86%3.55%-1.95%1 - very low risk0.380.11%1.71%
Morningstar Lifetime Allocation Index Aggressive, Income1817.40%0.97%6.97%-18.40%2 - low risk0.910.10%1.73%
Morningstar Lifetime Allocation Index Moderate, Income1815.07%0.87%6.04%-13.65%2 - low risk0.850.09%1.63%
Morningstar Lifetime Allocation Index Conservative, Income1812.50%0.76%5.00%-8.44%1 - very low risk0.710.09%1.51%
Dimensional Retirement Income Fund711.03%0.64%4.45%-7.73%1 - very low risk0.690.06%1.00%
TIAA-CREF Lifecycle Index Retirement Income615.90%1.49%6.52%-13.27%2 - low risk0.930.04%1.86%
PWL Capital Toronto (CA) 100% Stocks424.87%1.41%8.57%-38.15%n/a0.90.03%1.60%
PWL Capital Toronto (CA) 90% Stocks622.99%1.91%8.15%-33.63%n/a0.90.03%1.44%
PWL Capital Toronto (CA) 80% Stocks521.20%1.42%7.79%-29.07%n/a0.90.03%1.26%
PWL Capital Toronto (CA) 70% Stocks519.41%1.43%7.41%-24.59%n/a0.90.02%1.12%
PWL Capital Toronto (CA) 60% Stocks517.53%1.40%6.95%-20.07%n/a0.890.02%0.96%
PWL Capital Toronto (CA) 50% Stocks515.74%1.46%6.54%-15.51%n/a0.880.02%0.78%
PWL Capital Toronto (CA) 40% Stocks513.94%1.49%6.11%-11.03%n/a0.840.01%0.64%
PWL Capital Toronto (CA) 30% Stocks512.05%1.35%5.58%-6.62%n/a0.760.01%0.48%
PWL Capital Toronto (CA) 20% Stocks510.25%1.48%5.13%-3.44%n/a0.630.01%0.31%
PWL Capital Toronto (US) 100% Stocks327.76%2.07%10.78%-39.44%n/a0.970.04%2.18%
PWL Capital Toronto (US) 90% Stocks425.83%2.00%10.11%-34.98%n/a0.970.04%2.18%
PWL Capital Toronto (US) 80% Stocks423.99%1.96%9.50%-30.48%n/a0.970.04%2.17%
PWL Capital Toronto (US) 70% Stocks422.06%1.88%8.80%-26.02%n/a0.970.04%2.17%
PWL Capital Toronto (US) 60% Stocks420.13%1.81%8.09%-21.56%n/a0.960.04%2.16%
PWL Capital Toronto (US) 50% Stocks418.29%1.77%7.45%-17.06%n/a0.950.04%2.15%
PWL Capital Toronto (US) 40% Stocks416.36%1.69%6.71%-12.61%n/a0.930.04%2.15%
PWL Capital Toronto (US) 30% Stocks414.41%1.60%5.94%-8.27%n/a0.870.04%2.15%
PWL Capital Toronto (US) 20% Stocks412.57%1.56%5.25%-3.77%n/a0.740.04%2.13%
PWL Capital Layton-Guay Portfolios (CA) 30/70 Conservative713.41%1.48%5.73%-10.38%n/a0.850.03%1.14%
PWL Capital Layton-Guay Portfolios (CA) 40/60 Cautious715.25%1.47%6.28%-14.78%n/a0.890.03%1.28%
PWL Capital Layton-Guay Portfolios (CA) 50/50 Balanced717.09%1.47%6.81%-19.19%n/a0.910.03%1.43%
PWL Capital Layton-Guay Portfolios (CA) 60/40 Assertive718.93%1.47%7.33%-23.60%n/a0.910.03%1.57%
PWL Capital Layton-Guay Portfolios (CA) 70/30 Aggressive720.77%1.47%7.83%-28.00%n/a0.920.04%1.72%
PWL Capital Layton-Guay Portfolios (US) 30/70 Conservative614.98%1.56%5.92%-11.48%n/a0.910.05%2.28%
PWL Capital Layton-Guay Portfolios (US) 40/60 Cautious616.83%1.60%6.62%-15.83%n/a0.940.05%2.30%
PWL Capital Layton-Guay Portfolios (US) 50/50 Balanced618.68%1.65%7.32%-20.18%n/a0.950.05%2.32%
PWL Capital Layton-Guay Portfolios (US) 60/40 Assertive620.54%1.69%8.00%-24.53%n/a0.950.05%2.34%
PWL Capital Layton-Guay Portfolios (US) 70/30 Aggressive622.39%1.73%8.67%-28.88%n/a0.960.05%2.36%
PWL Capital Nancy And Her Team (CA), Conservative712.49%1.23%4.58%-12.84%n/a0.890.05%1.93%
PWL Capital Nancy And Her Team (CA), Cautious714.29%1.28%5.23%-16.36%n/a0.90.05%1.93%
PWL Capital Nancy And Her Team (CA), Balanced716.09%1.34%5.88%-19.87%n/a0.910.05%1.92%
PWL CPWL Capital Nancy And Her Team (CA), Assertive717.88%1.40%6.51%-23.39%n/a0.910.04%1.91%
PWL Capital Nancy And Her Team (CA), Aggressive719.68%1.46%7.14%-26.91%n/a0.910.04%1.91%
PWL Capital Nancy And Her Team (US), Conservative613.28%1.43%5.19%-13.18%n/a0.950.05%2.09%
PWL Capital Nancy And Her Team (US), Cautious615.34%1.54%6.04%-16.82%n/a0.960.05%2.14%
PWL Capital Nancy And Her Team (US), Balanced617.40%1.65%6.89%-20.45%n/a0.970.05%2.18%
PWL Capital Nancy And Her Team (US), Assertive619.46%1.76%7.72%-24.09%n/a0.970.05%2.23%
PWL Capital Nancy And Her Team (US), Aggressive621.51%1.87%8.54%-27.73%n/a0.970.05%2.28%
PWL Capital Passmore & Felix (CA), 40/60615.16%1.58%5.69%-13.25%n/a0.920.05%1.80%
PWL Capital Passmore & Felix (CA), 50/50616.79%1.62%6.31%-16.94%n/a0.930.05%1.78%
PWL Capital Passmore & Felix (CA), 60/40618.50%1.66%6.93%-20.90%n/a0.930.04%1.77%
PWL Capital Passmore & Felix (CA), 70/30620.17%1.70%7.49%-24.84%n/a0.930.04%1.75%
PWL Capital Passmore & Felix (CA), 80/20621.87%1.74%8.05%-28.86%n/a0.920.04%1.73%
PWL Capital Passmore & Felix (CA), 100/0425.32%1.85%9.09%-37.19%n/a0.920.03%1.69%
PWL Capital Passmore & Felix (US), 40/60516.25%1.81%6.53%-13.74%n/a0.970.05%2.03%
PWL Capital Passmore & Felix (US), 50/50518.16%1.90%7.36%-17.55%n/a0.980.05%2.06%
PWL Capital Passmore & Felix (US), 60/40520.15%1.99%8.19%-21.63%n/a0.980.05%2.10%
PWL Capital Passmore & Felix (US), 70/30522.09%2.07%8.96%-25.69%n/a0.980.05%2.14%
PWL Capital Passmore & Felix (US), 80/20524.07%2.16%9.73%-29.83%n/a0.980.04%2.18%
PWL Capital Passmore & Felix (US), 100/0328.07%2.34%11.18%-38.42%n/a0.980.04%2.25%
Jim Lowell's Sower's Growth Portfolio726.96%1.09%10.46%-40.16%n/a0.950.06%2.24%
Bogle Tax Sheltered518.01%1.95%7.87%-14.24%n/a0.960.05%1.52%
Ben Stein's 2007622.71%1.02%8.91%-33.06%n/a0.930.08%2.23%
Ben Stein Retirement229.31%3.22%12.47%-35.43%n/a0.750.09%2.56%
Coffeehouse Three ETF318.62%0.99%7.23%-25.37%n/a0.940.15%2.80%
Aronson Lazy Portfolio1122.08%0.84%8.50%-32.92%n/a0.860.11%2.15%
Mad Money Machine MMM Do it Yourself Funds823.39%-0.64%9.89%-40.27%n/a0.880.23%2.35%
MMM SMILER Funds624.14%-0.17%9.62%-40.57%n/a0.830.20%2.39%
Bob Clyatt The Sandwich Portfolio918.20%1.20%7.37%-20.55%n/a0.910.07%2.07%
Bob Clyatt The Sandwich Portfolio Value Tilt917.07%0.60%7.17%-20.34%n/a0.890.07%2.25%
Bob Clyatt Rational Investing Portfolio1518.70%0.36%7.17%-24.26%n/a0.870.13%2.20%
Gyroscopic Desert Portfolio316.32%2.13%6.76%-7.46%n/a0.860.06%1.81%
Portfoliocharts Golden Butterfly518.90%2.29%7.93%-7.40%n/a0.830.12%1.31%
Paul Boyer Permanent Portfolio (MMM)514.47%1.43%5.18%-6.16%n/a0.420.15%1.45%
Canadian Portfolio Manager Model Portfolios (CA) 20% Stocks510.34%1.67%5.20%-3.36%n/a0.640.01%0.32%
Canadian Portfolio Manager Model Portfolios (CA) 30% Stocks512.23%1.67%5.73%-6.54%n/a0.780.01%0.49%
Canadian Portfolio Manager Model Portfolios (CA) 40% Stocks514.11%1.67%6.25%-11.04%n/a0.850.01%0.65%
Canadian Portfolio Manager Model Portfolios (CA) 50% Stocks515.99%1.67%6.75%-15.53%n/a0.890.02%0.81%
Canadian Portfolio Manager Model Portfolios (CA) 60% Stocks517.87%1.67%7.23%-20.03%n/a0.910.02%0.97%
Canadian Portfolio Manager Model Portfolios (CA) 70% Stocks519.76%1.67%7.70%-24.52%n/a0.920.02%1.13%
Canadian Portfolio Manager Model Portfolios (CA) 80% Stocks521.63%1.67%8.15%-29.02%n/a0.920.03%1.29%
Canadian Portfolio Manager Model Portfolios (CA) 90% Stocks523.52%1.67%8.59%-33.50%n/a0.920.03%1.46%
Canadian Portfolio Manager Model Portfolios (CA) 100% Stocks425.40%1.67%9.01%-38.00%n/a0.910.03%1.62%
Canadian Portfolio Manager Model Portfolios (US) 20% Stocks412.58%1.57%5.26%-3.71%n/a0.740.04%2.13%
Canadian Portfolio Manager Model Portfolios (US) 30% Stocks414.50%1.65%6.02%-8.15%n/a0.870.04%2.14%
Canadian Portfolio Manager Model Portfolios (US) 40% Stocks416.44%1.72%6.78%-12.58%n/a0.930.04%2.14%
Canadian Portfolio Manager Model Portfolios (US) 50% Stocks418.36%1.80%7.51%-17.02%n/a0.960.04%2.14%
Canadian Portfolio Manager Model Portfolios (US) 60% Stocks420.30%1.88%8.24%-21.44%n/a0.970.04%2.14%
Canadian Portfolio Manager Model Portfolios (US) 70% Stocks422.23%1.96%8.95%-25.88%n/a0.970.04%2.14%
Canadian Portfolio Manager Model Portfolios (US) 80% Stocks424.16%2.04%9.65%-30.31%n/a0.970.04%2.14%
Canadian Portfolio Manager Model Portfolios (US) 90% Stocks426.09%2.12%10.34%-34.73%n/a0.970.04%2.15%
Canadian Portfolio Manager Model Portfolios (US) 100% Stocks328.03%2.20%11.01%-39.17%n/a0.970.04%2.15%
Canadian Couch Potato Model Portfolios (CA) Conservative312.17%1.53%5.52%-6.92%n/a0.770.02%0.45%
Canadian Couch Potato Model Portfolios (CA) Cautious314.97%1.53%6.18%-13.85%n/a0.870.03%0.68%
Canadian Couch Potato Model Portfolios (CA) Balanced317.76%1.53%6.80%-20.78%n/a0.890.04%0.91%
Canadian Couch Potato Model Portfolios (CA) Assertive320.56%1.53%7.39%-27.71%n/a0.890.05%1.14%
Canadian Couch Potato Model Portfolios (CA) Aggressive323.35%1.53%7.94%-34.64%n/a0.890.05%1.36%
Canadian Couch Potato Model Portfolios (US) Conservative314.54%1.63%5.88%-8.56%n/a0.880.05%2.12%
Canadian Couch Potato Model Portfolios (US) Cautious317.45%1.75%6.93%-15.42%n/a0.950.05%2.12%
Canadian Couch Potato Model Portfolios (US) Balanced320.36%1.86%7.95%-22.28%n/a0.960.06%2.11%
Canadian Couch Potato Model Portfolios (US) Assertive323.28%1.97%8.94%-29.13%n/a0.960.06%2.11%
Canadian Couch Potato Model Portfolios (US) Aggressive326.19%2.08%9.90%-35.99%n/a0.960.07%2.11%
Canadian Couch Potato The Über–Tuber Portfolio916.16%0.19%6.13%-22.29%n/a0.830.12%2.26%
Canadian Couch Potato The Über–Tuber Portfolio (US)816.99%0.26%7.32%-22.85%n/a0.90.13%2.73%
Robo Advisor Wealthsimple Risk Level 10524.41%1.82%9.34%-32.87%n/a0.910.08%2.37%
Robo Advisor Wealthsimple Risk Level 9523.85%2.00%9.27%-29.71%n/a0.910.09%2.35%
Robo Advisor Wealthsimple Risk Level 08523.28%2.17%9.18%-26.56%n/a0.910.09%2.33%
Robo Advisor Wealthsimple Risk Level 07622.46%2.23%8.98%-24.22%n/a0.90.09%2.29%
Robo Advisor Wealthsimple Risk Level 06620.84%2.35%8.55%-19.49%n/a0.890.10%2.22%
Robo Advisor Wealthsimple Risk Level 05620.02%2.41%8.33%-17.15%n/a0.880.10%2.18%
Robo Advisor Wealthsimple Risk Level 04618.40%2.53%7.88%-12.42%n/a0.840.10%2.10%
Robo Advisor Wealthsimple Risk Level 03616.16%2.40%7.24%-9.74%n/a0.820.10%1.96%
Robo Advisor Wealthsimple Risk Level 02615.03%2.34%6.92%-8.28%n/a0.810.10%1.89%
Robo Advisor Wealthsimple Risk Level 01614.21%2.38%6.65%-6.08%n/a0.750.10%1.86%
The Global Couch Potato Portfolio (CA Edition)417.61%1.64%7.05%-19.50%n/a0.910.02%0.95%
The Global Couch Potato Portfolio (US Edition)320.22%1.90%8.19%-20.99%n/a0.980.04%2.16%
Ram Balakrishnan Sleepy Portfolio (CA Edition)820.01%1.11%7.14%-27.92%n/a0.90.05%1.77%
Ram Balakrishnan Sleepy Portfolio (US Edition)721.76%1.57%8.49%-28.70%n/a0.960.05%2.12%
The Canonical Portfolio (CA) 90% Stocks423.13%1.64%8.31%-32.72%n/a0.910.02%1.43%
The Canonical Portfolio (CA) 80% Stocks421.30%1.64%7.91%-28.31%n/a0.920.02%1.27%
The Canonical Portfolio (CA) 70% Stocks419.45%1.64%7.48%-23.90%n/a0.920.02%1.11%
The Canonical Portfolio (CA) 60% Stocks417.61%1.64%7.05%-19.50%n/a0.910.02%0.95%
The Canonical Portfolio (CA) 50% Stocks415.78%1.64%6.60%-15.09%n/a0.90.01%0.79%
The Canonical Portfolio (CA) 40% Stocks413.93%1.64%6.12%-10.68%n/a0.860.01%0.63%
The Canonical Portfolio (CA) 30% Stocks412.10%1.64%5.64%-6.28%n/a0.780.01%0.48%
The Canonical Portfolio (US) 90% Stocks325.97%2.15%10.25%-34.06%n/a0.980.04%2.17%
The Canonical Portfolio (US) 80% Stocks324.05%2.07%9.58%-29.70%n/a0.980.04%2.16%
The Canonical Portfolio (US) 70% Stocks322.14%1.99%8.89%-25.35%n/a0.980.04%2.16%
The Canonical Portfolio (US) 60% Stocks320.22%1.90%8.19%-20.99%n/a0.980.04%2.16%
The Canonical Portfolio (US) 50% Stocks318.30%1.82%7.47%-16.64%n/a0.960.04%2.15%
The Canonical Portfolio (US) 40% Stocks316.39%1.74%6.75%-12.28%n/a0.940.04%2.15%
The Canonical Portfolio (US) 30% Stocks314.47%1.66%6.00%-7.92%n/a0.880.04%2.14%
Charles Ellis Portfolio Under 40 Years Old126.79%1.53%9.04%-42.34%n/a0.910.09%2.27%
Charles Ellis Portfolio 40 - 50 Years Old224.99%1.52%8.57%-37.60%n/a0.910.09%2.26%
Charles Ellis Portfolio 50 - 60 Years Old223.18%1.51%8.09%-32.85%n/a0.910.08%2.24%
Charles Ellis Portfolio 60 - 70 Years Old219.56%1.48%7.07%-23.35%n/a0.920.07%2.21%
Charles Ellis Portfolio 70 - 80 Years Old217.75%1.47%6.55%-18.60%n/a0.920.07%2.20%
Robo Advisor Fidelity GO Taxable Conservative79.80%1.31%4.61%-6.76%n/a0.850.07%1.47%
Robo Advisor Fidelity GO Taxable Moderate With Income712.37%1.47%5.63%-11.07%n/a0.920.07%1.58%
Robo Advisor Fidelity GO Taxable Moderate714.72%1.58%6.50%-15.19%n/a0.950.07%1.67%
Robo Advisor Fidelity GO Taxable Balanced717.07%1.68%7.35%-19.31%n/a0.970.07%1.76%
Robo Advisor Fidelity GO Taxable Growth With Income719.42%1.79%8.19%-23.43%n/a0.970.07%1.85%
Robo Advisor Fidelity GO Taxable Growth721.55%1.85%8.88%-27.35%n/a0.980.07%1.91%
Robo Advisor Fidelity GO Taxable Aggressive Growth624.99%2.00%10.05%-33.38%n/a0.980.06%2.02%
Robo Advisor Fidelity GO Tax-advantaged Conservative710.73%1.26%4.49%-4.15%n/a0.810.05%1.77%
Robo Advisor Fidelity GO Tax-advantaged Moderate With Income713.30%1.42%5.51%-8.46%n/a0.90.05%1.89%
Robo Advisor Fidelity GO Tax-advantaged Moderate715.55%1.54%6.38%-12.84%n/a0.950.05%1.95%
Robo Advisor Fidelity GO Tax-advantaged Balanced717.81%1.65%7.25%-17.22%n/a0.970.05%2.01%
Robo Advisor Fidelity GO Tax-advantaged Growth With Income720.07%1.76%8.10%-21.60%n/a0.970.05%2.07%
Robo Advisor Fidelity GO Tax-advantaged Growth722.01%1.83%8.81%-26.05%n/a0.980.06%2.06%
Robo Advisor Fidelity GO Tax-advantaged Aggressive Growth625.26%1.99%10.00%-32.62%n/a0.980.06%2.11%
Robo Advisor SigFig Taxable 15523.95%0.96%8.33%-38.39%n/a0.870.07%2.51%
Robo Advisor SigFig Taxable 14622.67%0.93%7.92%-35.43%n/a0.870.07%2.46%
Robo Advisor SigFig Taxable 13722.05%0.93%7.79%-33.74%n/a0.870.07%2.38%
Robo Advisor SigFig Taxable 12720.96%1.08%7.65%-29.69%n/a0.890.06%2.29%
Robo Advisor SigFig Taxable 11720.71%1.13%7.63%-28.65%n/a0.890.06%2.28%
Robo Advisor SigFig Taxable 10719.95%1.26%7.57%-25.68%n/a0.910.06%2.18%
Robo Advisor SigFig Taxable 09719.70%1.31%7.55%-24.63%n/a0.910.06%2.16%
Robo Advisor SigFig Taxable 08719.44%1.34%7.52%-23.67%n/a0.920.06%2.12%
Robo Advisor SigFig Taxable 07718.84%1.39%7.38%-21.74%n/a0.920.06%2.10%
Robo Advisor SigFig Taxable 06718.28%1.37%7.18%-20.40%n/a0.920.06%2.07%
Robo Advisor SigFig Taxable 05717.80%1.39%7.06%-19.01%n/a0.920.06%2.04%
Robo Advisor SigFig Taxable 04817.06%1.40%6.85%-17.28%n/a0.910.06%2.01%
Robo Advisor SigFig Taxable 03815.68%1.30%6.30%-14.77%n/a0.90.06%1.96%
Robo Advisor SigFig Taxable 02814.10%1.27%5.78%-12.04%n/a0.880.06%1.92%
Robo Advisor SigFig Taxable 01812.97%1.21%5.37%-10.21%n/a0.840.06%1.88%
Robo Advisor SigFig Tax Sheltered 17624.09%0.91%8.40%-39.20%n/a0.860.08%2.68%
Robo Advisor SigFig Tax Sheltered 16723.46%0.91%8.22%-37.69%n/a0.860.08%2.64%
Robo Advisor SigFig Tax Sheltered 15722.89%0.92%8.06%-36.20%n/a0.860.08%2.61%
Robo Advisor SigFig Tax Sheltered 14722.53%1.00%8.05%-34.57%n/a0.870.08%2.59%
Robo Advisor SigFig Tax Sheltered 13722.17%1.00%7.94%-33.69%n/a0.870.08%2.58%
Robo Advisor SigFig Tax Sheltered 12821.35%1.00%7.73%-31.46%n/a0.870.08%2.50%
Robo Advisor SigFig Tax Sheltered 11820.61%0.96%7.45%-29.93%n/a0.860.08%2.52%
Robo Advisor SigFig Tax Sheltered 10820.24%1.03%7.43%-28.39%n/a0.860.08%2.47%
Robo Advisor SigFig Tax Sheltered 09819.88%1.03%7.32%-27.51%n/a0.860.08%2.46%
Robo Advisor SigFig Tax Sheltered 08819.38%1.00%7.15%-26.37%n/a0.860.08%2.46%
Robo Advisor SigFig Tax Sheltered 07819.02%1.00%7.03%-25.48%n/a0.850.08%2.46%
Robo Advisor SigFig Tax Sheltered 06818.16%0.98%6.75%-23.45%n/a0.840.08%2.45%
Robo Advisor SigFig Tax Sheltered 05817.22%1.02%6.50%-20.60%n/a0.830.08%2.40%
Robo Advisor SigFig Tax Sheltered 04816.28%1.15%6.37%-17.51%n/a0.860.08%2.28%
Robo Advisor SigFig Tax Sheltered 03815.58%1.15%6.14%-15.71%n/a0.850.08%2.25%
Robo Advisor SigFig Tax Sheltered 02814.16%1.21%5.74%-11.47%n/a0.820.08%2.16%
Robo Advisor SigFig Tax Sheltered 01813.57%1.15%5.51%-10.40%n/a0.780.08%2.10%
Ellevest Wealthbuilding Portfolio 11316.37%1.15%6.83%-20.29%n/a0.930.07%1.92%
Ellevest Wealthbuilding Portfolio 21417.44%1.17%7.20%-22.36%n/a0.930.07%1.99%
Ellevest Wealthbuilding Portfolio 31518.40%1.13%7.54%-24.55%n/a0.930.07%2.08%
Ellevest Wealthbuilding Portfolio 41421.43%1.11%8.54%-30.60%n/a0.930.07%2.20%
Ellevest Wealthbuilding Portfolio 51322.40%1.11%8.85%-32.58%n/a0.930.07%2.23%
Ellevest Wealthbuilding Portfolio 61323.57%1.18%9.28%-34.54%n/a0.940.06%2.27%
Ellevest Wealthbuilding Portfolio 71322.40%1.11%8.85%-32.58%n/a0.930.07%2.23%
Ellevest Wealthbuilding Portfolio 81323.57%1.18%9.28%-34.54%n/a0.940.06%2.27%
Ellevest Wealthbuilding Portfolio 91224.59%1.17%9.59%-36.54%n/a0.940.06%2.32%
Ellevest Wealthbuilding Portfolio 101323.57%1.18%9.28%-34.54%n/a0.940.06%2.27%
Ellevest Wealthbuilding Portfolio 111224.59%1.17%9.59%-36.54%n/a0.940.06%2.32%
Ellevest Wealthbuilding Portfolio 121225.60%1.17%9.87%-38.50%n/a0.940.06%2.35%
Axos Invest 100% Stocks327.17%1.85%10.27%-39.56%n/a0.950.04%2.27%
Axos Invest 90% Stocks925.54%1.79%9.79%-35.81%n/a0.960.06%2.25%
Axos Invest 80% Stocks923.87%1.73%9.29%-32.10%n/a0.960.06%2.24%
Axos Invest 70% Stocks922.12%1.67%8.74%-28.22%n/a0.950.07%2.20%
Axos Invest 60% Stocks920.42%1.60%8.20%-24.55%n/a0.950.08%2.19%
Axos Invest 50% Stocks918.68%1.53%7.62%-20.74%n/a0.930.09%2.18%
Axos Invest 40% Stocks916.89%3.29%6.99%-16.69%n/a0.890.10%2.12%
Axos Invest 30% Stocks915.03%2.24%6.31%-12.64%n/a0.830.10%2.02%
Axos Invest 20% Stocks912.78%2.02%5.46%-8.46%n/a0.720.09%1.92%
Axos Invest 0% Stocks57.56%0.97%3.31%-2.42%n/a0.250.07%1.70%
Gretchen Tai's Portfolio921.35%1.19%8.01%-29.26%n/a0.910.10%2.51%
The Rip Van Winkle Portfolio John Bogle's Tax Sheltered519.13%2.03%8.27%-17.42%n/a0.960.06%1.67%
The Rip Van Winkle Portfolio William Bernstein Taxable519.94%1.72%8.84%-23.66%n/a0.970.11%1.85%
Mark Hebner's iShares Portfolio 25% Stocks911.78%0.69%5.13%-6.79%n/a0.830.08%1.94%
Mark Hebner's iShares Portfolio 50% Stocks916.71%0.55%7.13%-19.23%n/a0.910.11%2.25%
Mark Hebner's iShares Portfolio 75% Stocks921.63%0.41%9.05%-31.67%n/a0.920.13%2.56%
Mark Hebner's iShares Portfolio 100% Stocks723.86%-0.41%9.97%-38.97%n/a0.90.15%2.51%
Fidelity Target Allocation Index-Focused Model Portfolios 20% Stocks611.37%1.33%4.73%-3.64%n/a0.770.05%2.09%
Fidelity Target Allocation Index-Focused Model Portfolios 40% Stocks715.85%1.56%6.49%-12.64%n/a0.940.05%2.10%
Fidelity Target Allocation Index-Focused Model Portfolios 60% Stocks720.14%1.78%8.12%-21.56%n/a0.970.05%2.11%
Fidelity Target Allocation Index-Focused Model Portfolios 70% Stocks722.08%1.82%8.82%-26.03%n/a0.980.06%2.10%
Fidelity Target Allocation Index-Focused Model Portfolios 80% Stocks625.16%1.96%9.96%-32.68%n/a0.980.06%2.10%
SoFi Model Portfolios Taxable Conservative37.08%1.36%3.64%-1.98%n/a0.260.08%1.77%
SoFi Model Portfolios Taxable Moderately Conservative612.63%1.34%5.46%-11.80%n/a0.870.07%1.93%
SoFi Model Portfolios Taxable Moderate618.80%1.34%7.24%-24.64%n/a0.920.07%2.24%
SoFi Model Portfolios Taxable Moderately Aggressive522.52%1.38%8.38%-32.90%n/a0.920.06%2.30%
SoFi Model Portfolios Taxable/Retirement Aggressive325.94%1.29%9.17%-40.75%n/a0.920.05%2.43%
SoFi Model Portfolios Retirement Conservative48.86%1.13%3.54%-2.58%n/a0.380.06%2.22%
SoFi Model Portfolios Retirement Moderately Conservative612.63%1.34%5.46%-11.80%n/a0.870.07%1.93%
SoFi Model Portfolios Retirement Moderate618.80%1.34%7.24%-24.64%n/a0.920.07%2.24%
SoFi Model Portfolios Retirement Moderately Aggressive522.52%1.38%8.38%-32.90%n/a0.920.06%2.30%
Robo Advisor Betterment 2020 Taxable 100% Stocks624.41%0.28%8.83%-40.33%n/a0.90.07%2.63%
Robo Advisor Betterment 2020 Taxable 90% Stocks1023.03%0.44%8.54%-36.09%n/a0.910.08%2.56%
Robo Advisor Betterment 2020 Taxable 80% Stocks1021.68%0.58%8.23%-31.95%n/a0.910.08%2.49%
Robo Advisor Betterment 2020 Taxable 70% Stocks1020.24%0.73%7.86%-27.68%n/a0.920.08%2.42%
Robo Advisor Betterment 2020 Taxable 60% Stocks1018.88%0.87%7.54%-23.54%n/a0.920.09%2.34%
Robo Advisor Betterment 2020 Taxable 50% Stocks1117.39%0.96%7.11%-19.39%n/a0.910.09%2.22%
Robo Advisor Betterment 2020 Taxable 40% Stocks1215.80%1.01%6.59%-15.35%n/a0.890.09%2.07%
Robo Advisor Betterment 2020 Taxable 30% Stocks1213.40%0.92%5.62%-10.53%n/a0.860.08%1.89%
Robo Advisor Betterment 2020 Taxable 20% Stocks1210.86%0.82%4.53%-5.62%n/a0.760.07%1.73%
Robo Advisor Betterment 2020 Taxable 10% Stocks128.04%0.68%3.30%-1.43%n/a0.530.07%1.58%
Robo Advisor Betterment 2020 Taxable 0% Stocks13.51%0.31%1.14%0.00%n/a-0.030.05%1.49%
Robo Advisor Betterment 2020 Retirement 100% Stocks624.64%0.40%8.87%-40.53%n/a0.90.07%2.62%
Robo Advisor Betterment 2020 Retirement 90% Stocks1022.88%0.44%8.53%-36.24%n/a0.910.08%2.54%
Robo Advisor Betterment 2020 Retirement 80% Stocks1021.37%0.58%8.21%-32.27%n/a0.910.08%2.45%
Robo Advisor Betterment 2020 Retirement 70% Stocks1019.76%0.72%7.83%-28.17%n/a0.910.08%2.35%
Robo Advisor Betterment 2020 Retirement 60% Stocks1018.23%0.85%7.49%-24.22%n/a0.910.09%2.24%
Robo Advisor Betterment 2020 Retirement 50% Stocks1116.60%0.94%7.05%-20.24%n/a0.910.09%2.10%
Robo Advisor Betterment 2020 Retirement 40% Stocks1214.92%0.99%6.51%-16.30%n/a0.890.09%1.93%
Robo Advisor Betterment 2020 Retirement 30% Stocks1212.60%0.91%5.55%-11.42%n/a0.860.08%1.76%
Robo Advisor Betterment 2020 Retirement 20% Stocks1210.17%0.81%4.47%-6.38%n/a0.770.08%1.61%
Robo Advisor Betterment 2020 Retirement 10% Stocks127.51%0.67%3.25%-1.21%n/a0.540.07%1.49%
Robo Advisor Betterment 2020 Retirement 0% Stocks13.51%0.31%1.14%0.00%n/a-0.030.05%1.49%
Dimensional Fund Advisors Model Portfolios 0% Stocks Fixed46.94%1.25%2.29%-0.18%n/a0.010.06%1.73%
Dimensional Fund Advisors Model Portfolios 20% Stocks Conservative1510.41%0.99%3.97%-3.12%n/a0.780.08%1.89%
Dimensional Fund Advisors Model Portfolios 40% Stocks Moderate1513.88%0.72%5.59%-12.31%n/a0.910.10%2.06%
Dimensional Fund Advisors Model Portfolios 60% Stocks Normal1517.35%0.46%7.16%-21.50%n/a0.910.12%2.22%
Dimensional Fund Advisors Model Portfolios 80% Stocks Agressive1520.82%0.19%8.66%-30.69%n/a0.910.14%2.38%
Dimensional Fund Advisors Model Portfolios 100% Stocks Equity1124.29%-0.08%10.11%-39.88%n/a0.910.16%2.55%
Bogleheads Guide to Investing - A Young Investor’s Asset Allocation226.39%3.02%11.57%-28.56%n/a10.03%1.84%
Bogleheads Guide to Investing - A Middle-Aged Investor’s Asset Allocation520.89%1.96%8.82%-22.15%n/a0.970.04%1.70%
Bogleheads Guide to Investing - An Investor in Early Retirement416.51%1.46%6.90%-14.51%n/a0.910.04%1.48%
Bogleheads Guide to Investing - An Investor in Late Retirement312.91%1.28%5.59%-6.45%n/a0.690.05%1.22%
Quit like a millionaire (CA) Portfolio418.47%1.53%6.85%-20.21%n/a0.920.03%1.80%
Quit like a millionaire (US) Portfolio320.22%1.90%8.19%-20.99%n/a0.980.04%2.16%
Quit like a millionaire (US) Yield Shield Portfolio720.64%1.46%8.03%-27.26%n/a0.910.15%2.99%
J.P. Morgan You Invest Conservative724.67%1.48%9.24%-35.70%n/a0.940.06%2.32%
Robo Advisor J.P. Morgan You Invest Moderate721.86%1.43%8.31%-28.96%n/a0.950.06%2.28%
Robo Advisor J.P. Morgan You Invest Growth717.29%1.40%6.79%-17.60%n/a0.930.05%2.22%
Robo Advisor J.P. Morgan You Invest Aggressive712.73%1.35%5.15%-6.28%n/a0.820.05%2.16%
Robo Advisor Morgan Stanley Acces Investing Wealth Conservation511.38%1.23%4.55%-4.03%n/a0.740.04%2.18%
Robo Advisor Morgan Stanley Acces Investing Market Growth819.18%1.08%7.09%-23.90%n/a0.920.05%2.31%
Robo Advisor Morgan Stanley Acces Investing Opportunistic Growth822.12%1.11%7.99%-31.21%n/a0.920.05%2.36%
Robo Advisor Merrill Guided Investing Taxable Aggressive825.23%1.86%10.38%-33.65%n/a0.980.06%2.09%
Robo Advisor Merrill Guided Investing Taxable Moderately Aggressive822.24%1.92%9.48%-27.44%n/a0.980.07%1.98%
Robo Advisor Merrill Guided Investing Taxable Moderate1019.06%1.85%8.41%-21.22%n/a0.970.08%1.90%
Robo Advisor Merrill Guided Investing Taxable Moderately Conservative1115.32%1.39%6.69%-14.90%n/a0.920.07%1.98%
Robo Advisor Merrill Guided Investing Taxable Conservative1011.54%1.48%5.34%-6.19%n/a0.870.10%1.58%
Robo Advisor Merrill Guided Investing Aggressive1025.22%1.80%10.18%-33.76%n/a0.970.06%2.19%
Robo Advisor Merrill Guided Investing Moderate1020.20%1.76%8.50%-21.72%n/a0.970.08%2.17%
Robo Advisor Merrill Guided Investing Conservative1011.10%1.32%4.92%-4.77%n/a0.820.10%1.78%
William Bernstein's The Small Investor's Coward's Portfolio (SICEI)824.50%0.26%8.88%-41.54%n/a0.90.12%2.61%
William Bernstein's The Academic Coward's Portfolio (ACEI)421.69%-1.57%9.28%-38.39%n/a0.830.29%3.03%
Institute of Business and Finance Income Portfolio410.62%0.95%4.62%-4.07%n/a0.470.16%2.39%
American Institute of Individual Investors (AAII) Portfolio525.59%-0.09%12.20%-40.85%n/a0.840.24%2.23%
Jonathan Clements' Three Fund Global Portfolio320.66%2.08%8.56%-20.78%n/a0.980.04%2.10%
Jonathan Clements' Eight Asset Class Index Fund722.55%1.10%7.88%-30.71%n/a0.930.10%2.08%
Middleton Monitored “Play It Safe” Portfolio922.10%1.01%8.29%-29.40%n/a0.960.11%2.06%
Standard & Poor’s Outlook Portfolio819.14%1.53%7.63%-21.11%n/a0.970.05%2.02%
John Wasik’s Autopilot Nano Investment519.73%1.49%7.89%-22.57%n/a0.880.06%2.05%
Richard Jenkins Simple ETF Strategy523.37%1.09%8.31%-31.73%n/a0.920.12%2.39%
Kiplinger’s Five-Fund ETF Portfolio for Growth623.99%1.59%9.82%-31.31%n/a0.970.08%2.00%
Kiplinger’s Five-Fund ETF Portfolio for Income518.75%1.69%7.85%-18.92%n/a0.970.08%2.02%
J. D. Steinhilber Conservative
Growth
1013.83%1.11%5.24%-12.25%n/a0.920.09%1.76%
J. D. Steinhilber Moderate
Growth
1116.43%1.32%6.09%-17.23%n/a0.920.09%1.82%
J. D. Steinhilber Aggressive
Growth
1219.54%1.45%7.34%-23.06%n/a0.940.09%1.85%
David Jackson Low-Maintenance Five-Fund ETF Portfolio522.16%1.06%7.97%-32.57%n/a0.830.07%2.67%
David Jackson Ten-Fund ETF Core Portfolio1020.11%1.26%8.13%-22.50%n/a0.870.09%2.04%
Larry Swedroe Model Portfolios Conservative1012.05%0.24%5.02%-11.68%n/a0.890.08%1.90%
Larry Swedroe Model Portfolios Moderate1016.32%0.20%6.87%-20.82%n/a0.910.09%2.11%
Larry Swedroe Model Portfolios Moderately Aggressive1020.59%0.17%8.68%-29.96%n/a0.910.11%2.32%
Larry Swedroe Model Portfolios Highly Aggressive924.86%0.13%10.43%-39.10%n/a0.90.12%2.52%
Steven Schoenfeld’s Model ETF Portfolio Conservative818.56%2.05%7.98%-13.87%n/a0.810.09%1.87%
Steven Schoenfeld’s Model ETF Portfolio Moderate923.72%2.22%10.00%-25.17%n/a0.930.08%1.99%
Steven Schoenfeld’s Model ETF Portfolio Aggressive727.29%2.11%11.05%-34.82%n/a0.950.07%2.28%
Dr. Marvin Appel’s One-Decision Portfolio516.74%1.36%7.40%-16.38%n/a0.850.10%2.02%
Goldman Sachs Target Date Retirement Income Portfolio516.06%0.84%7.11%-16.50%n/a0.850.14%2.08%
Rob Arnott ETF.com model portfolio1016.79%1.27%5.99%-16.70%n/a0.750.22%2.31%

Comments on the best target-date fund

Measuring the performance of target-date funds are literally shooting at a moving target. When benchmarking a target date fund you must remember that you will not get the returns for the entire period. Instead, the glide path feature of the fund ensures that the fund is decreasing the risk of the fund over time. That is the entire point of the target date fund! The number of risky assets will decrease over time lowering your return but decreasing your risk as well.  Most target-date funds rebalance their allocations each year (some each month).

So what stands out from the above comparison? 3 things surprised me when comparing the target date funds:

  1. The Paul Merriman target-date portfolios blew everyone else out of the water. Paul Merriman’s target-date retirement portfolios are heavily weighted towards small-cap and small-cap value. Historically two of the best performing asset classes.
  2. I was surprised that the Vanguard funds came in last. However, I am equally surprised that the Morningstar Lifetime Allocation Index did so well. The difference between the two comes down to slicing and dicing the portfolio. Vanguard takes a simple approach to portfolio construction. Vanguard typically only have 4 funds in their target-date funds:
  • US Total Stock Market   (VTI)
  • International All-World ex-US     (VEU)
  • Total US Bond Market    (BND)
  • Non-US Bonds   (BNDX)

Compare that to Morningstar Lifetime Allocation Indices:

  • US Large Cap Value         (VTV)
  • US Large Cap      (VV)
  • US Large Cap Growth     (VUG)
  • US Mid Cap Value            (JKI)
  • US Mid Cap         (IJH)
  • US Mid Cap Growth        (IJK)
  • US Small Cap Value         (VIOV)
  • US Small Cap      (VIOO)
  • US Small Cap Growth     (IJT)
  • REITs     (VNQ)
  • International Developed Blend      (VEA)
  • Emerging Markets           (VWO)
  • Total US Bond Market    (BND)
  • Commodities     (DBC / GSG)

They are both massively diversified, but the Morningstar Lifetime Allocation Indices can make better use of rebalancing because of its slicing and dicing.

  1. There is a VERY LARGE difference among the target date funds, which are magnified by the compounding effect. Here is the difference in dollar amounts between the best performing and worst performing in each bracket:
  • 2030 Target Date Retirement Portfolios – $95,637 vs. $130,666 or a 37% difference
  • 2040 Target Date Retirement Portfolios – $101,611 vs. $194,370 or a 93% difference
  • 2050 Target Date Retirement Portfolios – $102,950 $230,855 or a 124% difference
  • 2060 Target Date Retirement Portfolios – $102,758 vs. $245,490 or a 139% difference

The reason for the difference is partly the amount of slicing and dicing of the portfolios but mostly due to the number of bonds in proportion to stocks the target date fund is holding. Very often the target date funds are too conservative and not aggressive enough which hurts their performance. Quite simply, they hold too many bonds for too long. A good rule of thumb is for each 10% bonds in proportion to stocks you are giving up 0.5% return each year.

Do you need a target date fund?

That depends. Do you want it easy or do you want to pick up a few extra thousands of dollars when you retire?

In my opinion, managing your own portfolio by following one of the portfolios on portfolioeinstein.com is very easy and you will come out ahead of the target date fund. It only requires a few hours of work every year as well as setting up the initial portfolio. That’s a fantastic hourly wage!

A target-date fund is a great starting point and for some a great endpoint. It automates your investing and makes it easy. If you want to pick up a couple more percentage points you could tilt towards historically stronger performing asset classes like value stocks, small-caps, and small-cap value.

Summary and next steps

A target-date fund is an easy solution when investing for retirement. There are large differences in the performance of the portfolios of the funds so make sure you carefully research the fund you want to invest in. The best target-date fund is Paul Merriman’s portfolios that rely on small-caps and small-cap value.

If you have come across a target date fund that you want a second opinion on, let me know in the comments!

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