Keeping Your Eye on Your Target-Date Fund

It would certainly be nice if saving for retirement were as simple as setting a date, pointing your investment account in the right direction, and walking away for a few decades, returning to find everything ready when you needed it.

Target-date funds have rapidly gained popularity because they promise to take investors to retirement and beyond, while removing the hassles of dealing with asset allocation, portfolio rebalancing and interest rate risk. But can they really make things that simple?

Yes, but only to a point. While these funds have their uses, investors need to stay active in planning for their retirement. One-size-fits-all will never fit any one person quite as well as something tailored, whether it’s a three-piece-suit or a retirement plan.

You can think of a target-date fund as a wrapper that holds investments in several underlying mutual funds or exchange-traded funds (ETFs) within a single security. The fund is tied to a date in the future, usually presumed to be the fund holder’s projected year of retirement. At regular intervals, the fund is automatically adjusted between different holdings to reflect market behavior and to reduce exposure to riskier assets (usually stocks) as the retirement date approaches. This change in allocation is called the fund’s “glide path” and is designed to reduce the potential harm of a big market downswing close to an investor’s retirement date that leaves too little time to recover.

There are several reasons these funds have become popular so quickly. First, target-date funds are convenient, because they allow investors to gain access to several asset classes within a single fund. A level of diversification is built in. These funds can take some of the stress out of having to actively manage a portfolio, which can make them attractive investments for those who do not have the time or the inclination to manage their own portfolio but who lack the resources to hire an investment adviser directly.

Another contributing factor to the funds’ popularity is the safe harbor rules created under the 2006 Pension Protection Act, which made target-date funds a qualified default investment for 401(k) plans with automatic enrollment. Many companies now use the funds as the default choice for their employees, who often find inertia simpler than making an active decision about their investments.

Target-date funds are not a panacea, however. Many of these funds come with features that should make investors should be wary. One is cost. The overall expense ratio may simply be a weighted average of the management fees of the underlying funds, or the fund operator may charge an additional fee on top of the underlying funds. A major factor in the overall cost is whether the fund is made up of index or actively managed funds. Index funds tend to charge lower costs than actively managed funds because they just track a benchmark and require less oversight. Managers of actively managed funds strive to beat their respective benchmarks by adjusting the fund’s portfolio based on their interpretation of market conditions. Because of more manager oversight, these funds tend to have higher management and administrative costs. As with other 401(k) or investment account fees, investors should be sure they know what they are paying for.

Some investors also perceive target-date funds as inherently safe investments, or worse, as guarantees of having enough for retirement. In reality, different funds offer very different levels of risk. Further, many target-date funds take as a given that bonds are safer than equities, and so will weight bonds more heavily as the investor approaches the fund’s target date. Given the current low interest rate environment, the margin of safety offered by bonds over equities is not so clear-cut. Future rises in interest rates will mean lower bond prices. The impact of the changing rates will depend on the duration of the bonds in the fund. In general, bonds with a longer time to maturity will see greater price declines as rates rise.

How much damage investors will suffer as a result of rising rates will depend on how quickly and how high rates rise, as well as the composition of the particular fund’s bond investments. Funds with higher allocations to long-term bonds will see larger losses than funds that have shorter-term bond holdings. Those who happened to retire during 2008 or 2009 faced a stock portfolio battered by the recession; retirees who invest in target-date funds that take the safety of bonds as a given may soon find themselves in a similar situation.

Besides understanding the general risks of target-date funds, investors should be aware that not all such funds are the same, even if they have the same target year. Each fund family has its own philosophy regarding which asset classes (for example, commodities or real estate) should be included in its target-date fund lineup, how frequently the fund will rebalance, and when and how quickly the fund will shift to investments that are more conservative. If investors do not understand their fund family’s strategy, they could easily find themselves invested in a fund that is not appropriate for their situation.

Investors should also understand that the proper fund for them might not be the one targeted for the year they expect to retire. For example, individuals with a higher risk tolerance might prefer to maintain a higher weighting to stocks through retirement. They should consider investing in target-date funds with a date later than their expected retirement year (such as 2030 instead of 2020). Target-date funds typically have higher exposure to stocks the further they are from their target year, so choosing a date farther in the future tends to preserve a higher level of stocks and potentially higher returns. It is also important to realize that some funds aim to reach their most conservative level at their target dates, while other funds may not shift to their most conservative allocation until years later. This all depends on the philosophy of the fund operator. It is essential to ensure the selected fund matches the investor’s goals.

Selecting a target-date fund should involve the same sort of due diligence involved in selecting any other investment. It may be helpful to examine a company’s fund for current retirees to obtain some idea of what a portfolio close to retirement might look like. This exercise is most useful for someone looking to invest in a fund with a date closer to the present. The further away the target date is, the more likely it is that the fund operator could change the fund’s strategy before the date is reached.

Beyond the questions discussed above, investors should also consider:

  • How the allocation of the fund fits with the other investments in their portfolio
  • Their risk tolerance, both in the present and in the future
  • Whether the fund uses actively managed investments or index funds
  • How much tactical freedom the fund manager has to depart from the glide path if market conditions change
  • How often the fund rebalances

All of this is not to say target-date funds are never useful. There are many logical reasons for this. Gone are the days of defined benefit plans, and investors must now save for their own retirement. Investors often have little else in their portfolio outside their retirement account(s), many of which are likely to contain target-date funds by default. Also, many investors do not feel comfortable managing their own portfolios. These funds guarantee a certain default level of professional expertise, which some investors find comforting.

However, investors in target-date funds shouldn’t think they can simply “set it and forget it.” Few investors would give money to an investment adviser and then neglect to check in for 10, 20 or 30 years. Why do the same with a target-date fund? Investors should review their fund’s asset allocation and expenses regularly. In addition, while an investor may have selected a fund that was right for his or her needs at the time, those needs can subsequently change. Inflation, rising interest rates, a new job, a changed family situation or new plans for retirement can all factor into making a formerly good fit an uncomfortable one. Even if the investor’s personal situation has not changed, the fund family’s philosophy may have.

When deciding to invest in a target-date fund, investors need to know more than just the year that they plan to retire. And, as with any other investment, investors should monitor their fund’s objectives and investment strategy over time, to let them make adjustments when necessary. Those who don’t may find that their target-date fund ultimately missed its mark.

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Article Source: http://EzineArticles.com/expert/ReKeithen_Miller/712290

 

Online Dating Safety Tips To Successful Dating

Dating services have been around for decades, but it’s only been in the past 6 or 7 years that they’ve really taken off online. Here are a few tips we’ve cobbled together that should help you safely navigate what is, for many, new online terrain.

Staying Anonymous for Awhile

Most online dating services use a double-blind system to allow members to exchange correspondence between each other. This allows members to communicate, but without knowing each other’s email addresses or other identifying personal information. It’s best to use the dating service’s internal, secure messaging system until you feel as though you know the person to some degree. This ensures that when you do run into the inevitable creep online, you remain anonymous and safe.

Be Realistic

Prince (or Princess) Charming may very well indeed be waiting for you online, but you should also set your expectations just a little bit lower. Most of your dates will turn out to be duds. That’s just the statistics! So it helps prepare yourself if you remember that going into the online dating process. Don’t believe that everyone who shows interest in you is worth your time. And don’t get disenchanted if your first date decides they don’t want a second. It’s easy to believe they are rejecting you personally, but it’s for the best. After all, you’re looking for a good, mutual match, not someone to swoon over. (But hey, if you find someone to swoon over, that’s cool too!)

Being realistic also means setting realistic expectations about geography. The Internet allows us to search for and communicate with people from all over the world, regardless of their proximity to us. Unfortunately, that makes a real dating relationship difficult once you have to translate it into the real world. So if you’re not willing to fly to Paris to meet Mr. Frenchie, then don’t look for anybody outside of your local community. Keep in mind, that 50 mile drive for the first date might seem like no big deal, but imagine doing that multiple times a week if things got serious. It can (and has) been done, but know what you’re getting yourself into beforehand.

Use Common Sense

It’s funny I have to write those words, but they are just so important. We sometimes feel like we’ve made an “instant connection” online with someone we’ve only just met. Some of that feeling is a result of the disinhibition that’s a part of being anonymous on the Internet today. So go slowly with new contacts and get to know the person via messaging and emails first. Then proceed to phone calls if you still feel safe, attracted, and curious. Finally, setup a first date when the time is right.

Don’t agree to do something just because it sounds like fun or exciting if it’s really not you. The point of online dating isn’t to reinvent yourself or to try out everything new under the sun. It’s to find someone you’re most compatible with, which means being yourself. So while it may sound romantic to agree to fly off to the Bahamas on a moment’s notice with someone you barely know, it isn’t very good common sense to do so. Keep your wits and instincts about you.

Proceed Slowly and Listen to Your Instinct

As I wrote above, you need to take things slowly, even when it seems or feels right immediately, or the other person is pressuring you into meeting more fast than you are comfortable with. Take things at your pace. If the other person is a good match for you, then they will not only understand your pace, but will often mirror it! Always talk to the other person by telephone at least once before agreeing to meet for your first date. Ask for a photo (if they didn’t provide one in their profile) so that you can be assured of meeting the right person. Be on the lookout for inconsistencies in their history or any stories they tell you of their life, background, or growing up. Ask informative questions of the other person to ensure they match what and who they say they are in their profile.

Don’t feel the need to give out your phone number if you’re not comfortable doing so. Instead, ask for theirs and remember to put in the code for blocking caller ID before making the call. There’s no need to be paranoid about your privacy, but at the same time, it is wise to take simple precautions that will ensure you remain safe until you are completely comfortable. Some people also use a cell phone or even a public pay phone to ensure their potential match can’t get their home telephone number. Do what feels best and right for you.

Remember, you don’t have to meet everyone you communicate with online. Some people will obviously not be right for you and you can politely say so before ever progressing to a phone call or first date. Online dating empowers you to make choices that are right for you. So feel free to make those choices, even if you are typically unuse to doing so.

First Dates Should Be in Public

This is a no-brainer, but sometimes, even the obvious needs to be said. Never agree to meet at the other person’s place or to pick them up. Agree to meet in a public place. Most people find a restaurant is ideal, as it gives you both something else to concentrate on from time to time to break up the awkward moments. It also ensures that both parties are on their best behavior, while still allowing you the opportunity to see how your match behaves in a public situation. Be an astute observer during that first date, and don’t drink too much (if you drink at all). The purpose of a first date is to not only see if there is a mutual attraction, but to learn more about the other person in their own words and see how they communicate their intentions non-verbally. By paying attention to all of these cues and information, you will learn a lot more about your match.

If you need to travel to another location on the date, always take your own car or transportation. Always arrange for backup transportation (e.g., a friend) if you’ve relied on public transportation for a meeting. Let a friend or two know that you’ll be out on a date and if possible, have your cell phone with you at all times, on and charged. (If you don’t own a cell phone, ask to borrow a friend’s for the evening, or purchase an inexpensive pay-as-go type from your local Wal-Mart or Best Buy). You hope these are mostly unnecessary precautions, but better safe than sorry.

Be on the Lookout for Red Flags

Not everyone has similar morals or outlooks on life as you do. Some folks can do a pretty good job at hiding their true agenda, even if you’ve followed most of these tips. First dates (and second dates and even third dates) are for people to be on their best behavior, so you may not always see the “true self” behind the person you’re sitting across from. Sometimes, though, people can’t be on their good behavior for that long and signs begin to appear. Look for:

*Avoids answering directly to questions, especially those about issues that are important to you. It’s okay if people joke about their answer, but eventually they need to get around to answering the question or explain why they feel uncomfortable doing so.

*Demeaning or disrespectful comments about you or other people. How your match treats others can be a telling sign into their future behaviors.

*Inconsistent information about any basics, especially anything within their profile. This especially includes marital status, children, employment, where they are living, but also things such as age, appearance, education, career or the like

*Is nothing like the way they describe themselves in their online profile.

*Physically inappropriate or unwanted behavior (e.g., touching, kissing).

*Pushes quickly to meet in person.

*Avoids phone contact.

Be Sexually Responsible

Inevitably, some online dating is going to lead to a sexual relationship. This is not the time to start being coy. Know your partners’ sexual background by asking direct, frank questions about the number of partners he or she has been with, whether protection was always used, how well they knew the people (was it mostly serious relationships or just one night flings?), and whether they have any known sexually transmitted diseases. Yes, it’s not easy to talk about these sorts of things, but it’s important to do so before your first night in bed. When in doubt, definitely use a condom.

Long-Distance Dating

If you’ve made the decision to date long-distance, make a note of it in your profile. Since travel is usually expensive for most people, be realistic about your ability to see the other person. Ensure you feel completely comfortable with the other person before making your first trip to see them. If possible, make all of your travel plans yourself and arrange to stay at a hotel. Get a rental car if you need to get around town with your date. Avoid making dates at your hotel’s restaurant or having your match meet you at your hotel. Only after you’ve met and feel completely comfortable should you share such information with the other person. While some of this may seem a bit silly at first, you need to protect yourself until you are certain the other person is legitimate and you are comfortable with them.

Remember, you’re the only person you have to answer to at the end of the day. If you don’t feel comfortable in any particular situation, that doesn’t mean you’re a bad person or you’re not ready for dating. It simply means that you’re not comfortable with the other person in this situation. You don’t need to apologize for needing to leave a date or anytime you feel you are in a threatening situation. Your safety should always be something that is on your mind throughout the entire dating process. Relax your guard when you’ve met the person face-to-face and feel entirely comfortable with who they are and how they relate to you and those around you.

As the old saying goes, there are plenty of fish in the sea. Don’t pin all of your hopes on one person, until you’re sure your feelings are returned. Keep an open mind, an open heart, and most of all, your common sense.

Article Source: http://EzineArticles.com/expert/John_Michel_Adam/1687314

 

Dating Etiquette for Second Date Success

So you’ve scored a second date, good for you. You’ve definitely made a good impression. Before the relief washes over you, you have to think ahead on what your date’s expectations are and how you could possibly keep the good thing you have going on. Here are a few good tips to further your connection on the second date.

#1 Go together.
During your first date, you may have agreed to just meet on a specific place and time. But now that you are heading into your second one, it would be best to walk into your date together. Pick her up or get picked up.

#2 Never be late.
This is applicable to ALL dates. Don’t let your date get sour because you kept them waiting.

#3 Get touchy-feely.
Flirty touches always has that magic “touch” of bringing people together, so find excuses to keep close with your date. Build the chemistry with gentle caresses. But don’t overdo it!

#4 Bring a simple gift.
Although not mandatory, bring a simple token lets your date know that you’ve put careful thought into giving them something just because you want to. It shows that you’ve been thinking about them. Pick up something inexpensive and personal.

#5 Touch up on the first date.
Talk lightly about the first date to refresh each other’s memory. Talk about your feelings and the things you enjoyed about the date. It will remind you both how much you have enjoyed the first date and why you both decided to have the second one.

#6 Ask more.
The first date is an avenue to know someone on the surface. The second date allows you to know them more deeply, so it is appropriate to ask questions and clarify doubts on the second date.

#7 Don’t get too personal.
In relation to #6, avoid asking too many personal questions though. Although the chemistry may be electrifying, your date may still be uncomfortable raveling his/her entire life on just your second time together.

#8 Show interest.
Hey, you agreed to see them the second time around. Surely, something about your date piqued your interest. Give them your full attention and they should do the same to you- it’s what you both deserve.

#9 Go dutch.
The norm is, whoever initiated the first date can be expected to pay. But going out on a second date is a conscious agreement that you both want to continue seeing each other. It is just but right to split the bill on the second date, so offer to pay your half.

#10 End the date with honesty.
You feel like you’ll miss your date once you’ve gone your separate ways? Say “I’ll miss you” or “I can’t wait to see you again”. End the date by hinting on your true feelings, especially if it’s something you can’t really hide.

Article Source: http://EzineArticles.com/expert/Samantha_Jayne/4171

 

10 First Date Tips You Don’t Want to Miss

Does the idea of a first date give you sweaty palms and a racing heart?! Well, it shouldn’t. A first date is no more than an introduction. It’s a chance to meet someone new, expand your horizons, have a good time, even wear that new dress or try out that new shade of blush! Don’t over think it. You might ask yourself, “Is he cute enough?” “Does he make enough money?” “Is he solid, stable, commitment centered, generous and faithful?” Forget about all this! Go out and enjoy your time together, but remember these pointers for a successful first (and second, third, fourth and so on) date:

1. Look your best. Consider wearing a dress or a skirt, wear color and add some feminine touches to your outfit! Try wearing long dangly earrings, sexy stilettos or wedges that show off your pedicured toes, beautiful makeup that suits you and isn’t overly done, and let your hair down and make sure its brushed and shiny. You want to look on point. You want to look feminine. And you want to accentuate your best features.

2. Smell good. Wear perfume. Men notice how women smell, and you’ll make a lasting impression if you smell good! If you’re allergic to perfume, try body spray. VS makes a great line of body sprays. Even your local CVS or Walgreens carries body sprays that smell great!

3. It’s an introduction, not a therapy session. A first date is not the time to get to know a man’s entire life story, his every woe, heart break and disappointment! This is actually the quickest way to put out the sizzle. Keep it light. Don’t reveal too much on your first date. You shouldn’t be discussing your health problems, your greatest fears, your family problems and other personal matters. Go with his lead. Talk about current events, weather, travel, sports, there is a whole world out there to discuss! If your date starts to get too personal with you, remember you don’t have to answer any questions you feel are intrusive. You can ignore the question, or just tell him “That’s private!” (Followed by a smile). If your date divulges personal things about his life or goes into long winded stories about him and his ex, listen but then change the subject the first chance you get. A first date should be light.

4. Listen more. If you are the chatty type, avoid talking too much. Tone it down. A first date gives you the chance to learn a lot about your date. Most of the time, you can learn what a man wants out of a relationship with you on the very first date. His comments that tell you the most will be made in jest (meaning casually spoken). Listen! If he tells you he’s had a girl friend for nine years but has never been engaged (and he’s in his thirties), listen! If he tells you he’s had four girlfriends in the past month, listen! If he says he has no plans to marry, doesn’t want to have kids, doesn’t know how his married friends with children can stand their lives, listen! You will not be the one to change him. People tell you a lot about themselves through their stories, their appearance and how they carry themselves. Actually, language is just one way how people express themselves. If you study their body language, pick up on their energies, and notice their walk and talk, you can learn quite a lot about them.

5. Don’t try too hard. Trying too hard is the kiss of death, and a man can always tell when a woman is trying too hard. Be yourself, be confident. If a man doesn’t like you for YOU he’s not going to like the overly animated, overly flirty, overly funny, overly anything of you! Be yourself. There is someone out there for every body!

6. Keep calm. On the first date things might go wrong. The food might be over cooked, undercooked or just plain horrible! Someone might run late, you might forget and lock your keys in your car, the movie might turn out to be a total dud. The point is, just accept that not everything is going to go perfectly or how you wanted it to! Don’t be overly dramatic. If your food is horrible, if the movie wasn’t funny, if the musical show is delayed, don’t say anything. Give zero comment to the things on the date that are not to your liking, and comment on the positive only. Greatly limit your negative comments, and appreciate and comment on the things going well on the date. The weather, the ambiance, the company, etc.

7. End the date first. If it’s been six hours or more (Dinner dates can be 4-6 hours, drinks dates are between two to three hours) and your date wants to take you to a club and go dancing, decline politely. He can ask you out again if he wants to see you. Remember, men like to rush things in the beginning, especially if they like you, but they also tire easily. It’s like a kid around candy. He will eat as much as he possibly can, but guaranteed he will get sick afterwards. Leave your date wanting more. Smoothly transition into ending the date. Tell him something like, “I have a really big day tomorrow, I have to get my beauty rest!” No need to go into details. Simply express your enjoyment of the date, and nicely excuse yourself.

8. Say thank you at the end of the date. There is no need to send a text message that same night or the next day to thank your date. It’s unnecessary. Avoid unnecessary actions at all costs (because nine times out of 10 they will back fire). Say thank you and mean it sincerely at the end of the date. Fini.

9. Wait for the man to contact you. Again, no thank you texts, Facebook adds or messages, emails or phone calls. Be patient. Wait for him to be in touch with you. If he’s interested, he’ll be in touch.

10. Be responsive. If he contacts you for another date and you like him, you can accept. If it’s last minute (less than 2-3 days in advance), tell him “I’d love to go out with you, but I already have plans for [x] day.” Wait until he counteroffers with another day, and then accept! It’s best when dates are made in advance (this is gone over in my book) because a man treats you as precious when you treat your time as precious. He also doesn’t get bored easily of you. He looks forward to seeing you! If your schedule is impossible, then you must clear it up (especially Saturday nights) if you want to date a man and move forward with a relationship.

Have a dating question? Visit http://NancyTheDatingDiva.com, subscribe to our newsletter, submit your question via the dating Q&A form on the website and get Q&As, videos, blog posts and more sent to your inbox once a week.

Article Source: http://EzineArticles.com/expert/Nancy_Salim/1690039

 

10 Advantages of Online Dating

Online dating has definitely changed the way thousands of people meet every day. There are a lot of advantages of online dating. We list the 10 best advantages of finding your date online before you meet.

1. Easy to use

Using a dating site is usually very easy and straight forward. Even for people who are a bit tech-challenged. The basic process normally consists of signing up with an email address, filling out your profile and searching for your potential match. When you find a profile that intrigues you, it’s very easy to start a conversation. From here you can determine if you would eventually like to meet up or not. If not, simply search for another profile which tickles your fancy.

2. Huge variety

When you go to a club, coffee shop or library do you have 100’s of even 1000’s of single people there also looking for a relationship? Probably not. Even at a coffee shop you have no idea who’s single or not. Online dating however presents you with a huge variety of possible soul mate matches.

3. Better chance of finding someone compatible

Finding your best compatible other half is what it’s all about isn’t it? Well, with the huge advantage online dating has with everybody being single and looking, we can use all your information provided by you in your profile and match you with other singles based on similar interest, hobbies etc. This will narrow down your search results to the people you’ll most likely have a good connection with.

4. Less risk of rejection

Going on a blind date or out with someone you barely know there is a lot of pressure to make a good impression. This can, for some people, be quite nerve wrecking. No-one likes to be rejected even if it comes in the form of an awkward, quiet date or no phone call the following day – being rejected is not pleasant. Some can handle it better than others but to first ‘screen’ other member online and see if there’s a spark might take off a lot of pressure when it comes to the actual date. Although this is not a fool-proof solution it greatly reduces the chances of an uncomfortable dating experience.

5. Cost

Dating can be expensive – well a proper date I might add. From transport, to eating, seeing a movie, bowling or whatever you might end up doing – it all adds up. This is not a bad thing at all if you end up connecting it is definitely worth it! But as mentioned earlier in this article, you might not always go on a first date with your perfect match. So to get to the point: Weaving through your match results on a proper online dating site can lessen the change of you ‘wasting’ your hard-earned cash on dates that will not end up in an ideal relationship.

6. Quick results

This one is quite self-explanatory. With a few clicks you can instantly get 100’s of potential dates in the comfort of your own home. From here you can start multiple conversations with your future Mr of Ms Right. It’s that simple.

7. No need to dress up

Dressing up for your date isn’t necessarily all that hard or uncomfortable but we feel that if you can chat with some new people online while sitting in your PJs, why not?

8. Refine your search

Most proper dating sites offer you the option to dig a little deeper in your search criteria when seeking potential partners. This is usually done by specifying an age group, for example between 25 and 35 years old, location or distance from where you reside, height, race, habits and more depending on which dating service you use. This definitely make searching for your soul mate much easier.

9. Convenient

Anything that makes our life more convenient is a plus. Online dating as you can imagine isn’t hard as you sit and click through profiles looking for someone who interests you.

10. Saves time

In this fast-paced and there’s-never-enough-time world we live in today, going on blind dates can be very time-consuming especially if you’re very picky about the type of person you’re looking for. It’s nice to know that online dating has helped millions of people worldwide to find their perfect match. This is usually accomplished with minimal dates thus saving you precious time to enjoy with your better half.

Why not try an online dating site that offers all the above and more. You can visit the dating site right now.

Article Source: http://EzineArticles.com/expert/Herman_Dempers/1900562