What is Lifecycle Fund (Target-Date Fund)?
A lifecycle fund automatically reduces growth-asset exposure as you age, shifting from growth to balanced to conservative over time.
Detailed Explanation
Lifecycle funds use your date of birth to set an asset-mix glidepath. Younger members get a higher allocation to growth assets; the mix dials down over the years until the member reaches a defensive setting near retirement. Common in larger schemes; the glidepath rules vary by provider.
Example
A 25-year-old in a lifecycle fund might be 90% growth assets. By age 60, the same product might be 30% growth assets, with the change happening gradually each year.
Frequently Asked Questions
Can I override the glidepath?
You can switch to a non-lifecycle fund within the same scheme any time, or to a different provider.