Target Date Index Funds: Good if targeting an early retirement?

Hey Jeremy, quick question for you about TDIF. I know you highly recommend them, and so do I. Currently my investments are “all in” on the Vanguard 2055 for my 401K, Roth IRA and brokerage. In the year 2055 I’ll be 63.

The question I have is that I’m investing pretty aggressively right now and although nothing is guaranteed, I am definitely shooting for a retirement anywhere from 5-15 years before this if all continues as planned (shooting for anywhere between age 48-55 based on your calculator).

If that is the case, are TDIF a poor choice, and should I instead be buying ETFs/index funds and manually rebalancing as I go to make adjustments based on my updated retirement goal? Or do you believe the TDIF is still a great choice regardless?

Thanks! This one has really got me stuck :sweat_smile:


I’m still a fan of TDIFs. I think it has more to do with your life expectancy than your retirement date. i.e. if you retire at 50, you’ll want that money to last another 40+ years so it’s not time to be super conservative. But when you’re 75, ok maybe now it’s time to keep it mostly in cash and bonds and spend it down. If you find at 75 that you still have millions, cool. Let it ride and switch over to a equity-heavy portfolio for your heirs. For picking a year, I say take your birth year add 65 and round up to the next level.

And I think you know that the year you choose has nothing to do with when you can access the money. You can trade and withdraw from TDIFs like any other mutual fund. (Withdrawals are dependent on the type of account it’s in of course)


Thanks Jeremy! So in your opinion, should I swap out the 2055 for the 2060? Or are these minor details we’re talking about here? The 2060 is a better fit based on your rationale

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Definitely minor details as those two funds will always be nearly identical (in fact, some TDIFs are only offered by the decade, not the 5 years). But the one fair critique people make of TDIFs is that they get too conservative too soon. You can combat that by simply pushing the date back to keep it more aggressive for longer.


What do you mean by pushing the date back? As in, swapping out for the later TDIF, or there’s a feature within the funds where you can do that?

I just mean selling all your shares of your 2055 TDIF and using the proceeds to buy a 2060 TDIF (or whatever).

Okay one more follow up here since clearly I’m now overthinking this :slight_smile:

In your opinion, would you sell the 2055 shares and buy 2060 because it’ll be more aggressive and a better target date given my age? Or am I splitting hairs now? Just want to make sure if I am going all in with TDIF I don’t get caught being too conservative when I’m older

Thanks as always!

You’re splitting hairs because those two funds are extremely close to each other, plus they’re actually identical for the next many years until they start the progression towards bonds. Plus you can always change later if you find yourself in a dramatically different financial situation. But that said, yeah if it were me I would switch to the later year.

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No you don’t want to be in a TDF if you’re investing aggressively to retire early, you want all your money in the market and zero in bonds/cash.

Search youtube for Our Rich Journey and watch their videos, they even have one specific to TDFs and why you don’t want to use them.

Yeah this was a while back. I’m invested in 70% VTI and 30% VXUS across all my accounts. But I’ll for sure check out that YT channel, thanks!


is this the couple that retired and moved to Portugal?

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Yes they moved to Portugal