I believe these will eventually become standard fare for retirees.  Unfortunately it is going to take a while for the field to settle down and figure out exactly how these should be configured.  I currently like Vanguard’s funds the best with the following caveats.

  • Their distributions are too high.  The 7% should be 5% and the 5% should be 4%.  Which means if you use them you should reinvest some of the distribution back into the fund.
  • The high commodities allocation is problematic considering the bubble commodities is currently going through.
  • They are a little too aggressive.  The most conservative fund only has 40% in bonds.

For the time being, unless you are extremely investment phobic, it is better to roll your own, but these should mature into very nice products.