Sizing Up 2 Passive Target-Date Fund Series
Although both earn Analyst Ratings of Silver, BlackRock LifePath and Fidelity Freedom differ in their equity glide paths and asset-class allocations.
Jeff Holt: The BlackRock LifePath Index funds (LIBIX) and the Fidelity Freedom Index funds (FQIFX) are both target-date fund series, both invest in passively managed strategies, and they both earn a Morningstar Analyst Rating of Silver. But there are distinct differences between the two.
One major difference between the two is in the equity glide path. The BlackRock series hits its most conservative equity landing point of 40% in equities at the target date and will continue to hold that much in equities throughout the retirement phase, whereas the Fidelity series will have over 50% in equities at the target date but will continue to become more conservative for another 15 years.
Jeff Holt does not own (actual or beneficial) shares in any of the securities mentioned above. Find out about Morningstar’s editorial policies.