Relying only on target-date mutual funds to provide lifetime income may lead to a financial setback for retirees, according to a new study by Ernst & Young L.L.P.
Retirees that depend on target-date funds, which allocate assets according to a formula tied to a specific retirement date, run the risk of outlasting their money, says Prudential Retirement, a division of Prudential Financial Inc., Newark, N.J.
The research proves retirees need products that provide guaranteed income streams for 20 to 30 years or more of retirement, Prudential claims.