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TDF Investors More Confident, Less Stressed

According to research by ING, plan participants who use TDFs are more confident about meeting their retirement goals. They also defer more and are less stressed. In an online survey of more than 1,000 plans conducted last September by ING (which will be known as Voya starting in May), 54 percent of investors who chose TDFs said they are confident about meeting their retirement goals — compared with 41 percent of those who do not use TDFs. Sixty-eight percent of TDF investors said they are less stressed about retirement; and 42 percent of them defer more than 11 percent, compared with just 23 percent of those who don’t use TDFs.

The study showed that 67 percent of TDF investors said they are comfortable deciding how much to invest in each investment option in their 403(b), 457, or 401(k) plan. And 64 percent of TDF investors believe they can turn savings from their 403(b), 457 or 401(k) plan into retirement income, versus 43 percent of those without TDFs. 

Other highlights of the study include:

  • 92 percent of investors approaching retirement favor wealth preservation over growth
  • TDF investors prefer multi-manager funds and expect broad diversification
  • Most favor “to” over “through” TDFs
  • Broad support for TDFs as a QDIA in a 403(b), 457 or 401(k) plan

The report also reviews why people using TDFs like them, as well as why people choose not to use them. The fact that the report comes from a firm that is not known to be a big TDF provider, as well as ING’s wide base of clients, makes this report even more credible.

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Fred Barstein is NAPA Net's Editor in Chief.