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Article: Experts say life cycle funds work best by themselves
- Article from:
- Daily Breeze
- Article date:
- July 10, 2006
- Author:
CopyrightCopyright 2006 Daily Breeze. Provided by ProQuest LLC. (Hide copyright information)
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NEW YORK -- Life cycle funds that are becoming increasingly
popular are meant to make retirement planning easy. But that's not
how investors have been using them, mutual fund companies say.
The funds are aimed at a specific retirement year. Fidelity
Investments' life cycle Freedom Funds, for instance, start with a
fund for people who retired before 1998, then progress to a fund for
people who plan to retire in 2050.
The funds are an aggregation of many other mutual funds, sometimes
as many as 25. The idea behind life cycle funds is that investors
tend to do a poor job of diversifying and rebalancing their
portfolios as they approach retirement, so the fund will do it for
you, starting with ...