Skip to content

Retirement Corner

Options for One-Stop Shopping - Lifecycle Funds

The University of Texas Retirement Program offers a variety of mutual fund and annuity products in the UTSaver 403(b) Tax Sheltered Annuity, the UTSaver 457(b) Deferred Compensation Program and the Optional Retirement Program. The easiest choice among these funds, however, is the Lifecycle, or Lifestyle Funds.

What is a Lifecycle Fund?

A lifecycle fund is a diversified mutual fund that automatically shifts towards a more conservative mix of investments as it approaches a particular year in the future, known as its "target date." A target date is typically the year closest to the personís anticipated retirement year. An employee picks a fund with the right target date based on his or her particular investment goal.

The professional fund managers then make all decisions about asset allocation, diversification, and rebalancing. It's easy to identify a lifecycle fund because its name will likely refer to its target date or include the words Lifestyle or Lifecycle in the name: examples include the Lincoln LVIP Wilshite 2010 Profile Fund, the Fidelity Freedom 2020 Fund, the ING Solution 2025 Portfolio, MetLifeís T. Rowe Price Retirement 2020 fund, the TIAA-CREF Institution Lifecycle 2020 Retirement, or in the case of AIG Retirement, the Aggressive Growth Lifestyle Fund.

Is a Lifecycle Fund right for me?

If you want to keep things simple for yourself and have a one-stop shop for your investments, then a Lifecycle fund may be right for you. If you want to take a more active role in your investments, or you have a professional assisting you with your investment strategies, the Lifecycle may not be your first choice; however, the Lifecycle funds offered by all six of the authorized providers in the UTRetirement Program remain a single, easy-to-use option for your retirement investment needs.

Contact Us

If you would like a specific topic discussed or have a question you would like answered in a future issue of this newsletter, please send your suggestions to benefits@utsystem.edu.

UT System Employee Benefits Website: www.utsystem.edu/benefits/
UT System Retirement Programs Website: www.utretirement.utsystem.edu
Your Local Benefits Office: www.utsystem.edu/benefits/contacts.asp#1