Target date funds—also called lifecycle funds—are an important innovation in retirement savings. They provide an efficient way for a shareholder to invest in a mix of asset classes through a single investment product that rebalances its asset allocation periodically to become more conservative over time.
Target date funds operate under the same regulatory framework as other funds regulated by the U.S. Securities and Exchange Commission under the Investment Company Act of 1940. Among other things, they are overseen by a board of directors that has a fiduciary duty to the fund and promotes the interests of fund shareholders.
For more information, see Board Oversight of Target Retirement Date Funds.