Part 1: Target Date Funds vs. do-it-yourself portfolios

You’ve enrolled in your workplace retirement plan. Now comes the decision: Should professionals manage your investments through a target-date fund (TDF), or will you build your own portfolio?

This two-part series helps you choose:

• Part 1: What TDFs and do-it-yourself (DIY) portfolios are
• Part 2: Key tradeoffs and how to take action

Two approaches, same goal

Meet Marcus, a marketing manager working 50-hour weeks with two young kids. He picks a Target Date 2055 Fund and checks it once a year. The hands-off approach fits his busy life.
Meet Sarah, a software engineer who enjoys reading investment forums. She spends a few hours quarterly rebalancing her portfolio and prefers direct control.

Both approaches can help build the retirement they want. The “best” strategy isn’t about which one wins on paper. It’s about which one fits your life.

TDFs: Autopilot investing

Pick the fund closest to your retirement year (like “Target 2050”), and you’re done.

What happens:

• Professionals handle everything.
• There are automatic adjustments as you age.
• No ongoing decisions are needed.

Works well for those who:

• Have busy lives and limited free time
• Are new to investing
• Want a simple solution
• Value “set it and forget it” for now

DIY portfolios: Full control

You pick the funds, decide allocations and manage rebalancing.

What it means:

• You research and select investments.
• You monitor markets and performance.
• You rebalance quarterly or annually.
• You adjust risk as needed.

Works well for those who:

• Have more time to dedicate per quarter
• Enjoy learning about investing
• Want maximum control
• Have unique circumstances

Both are valid

TDF investors: “I set it up once and focused my energy on career, family and passions.”
DIY investors: “I actively managed my portfolio and had direct control.”

Neither is superior. The challenge comes when you pick one but secretly wish you’d chosen the other, or when indecision keeps you from starting.

Next: Part 2 explores the real tradeoffs and provides action steps to get started.