Target date strategies: Evolution and outlook
Target date strategies have evolved from a default solution into a strategic cornerstone of defined contribution (DC) plans.
Since the passage of the Pension Protection Act of 2006, their role has expanded well beyond simple age-based asset allocation. With assets reaching approximately $4.7 trillion as of year-end 20251, target date strategies remain the dominant Qualified Default Investment Alternative (QDIA).
But beneath that scale, we believe meaningful shifts could be underway. Passive and blended implementations continue to gain traction, collective investment trusts (CITs) are accelerating adoption due to cost efficiency and regulatory advantages, and glidepaths have trended more aggressive to address evolving participant needs. At the same time, plan sponsors are evaluating new dimensions — ranging from embedded lifetime income solutions to the careful introduction of private markets — while navigating fee compression and increasing fiduciary scrutiny.
This paper explores how target date strategies arrived at this inflection point, and what may come next. We analyze key trends across asset growth, glidepath design, implementation approaches, fees, and performance. We also examine critical questions shaping today’s decisions: What’s driving the shift toward passive strategies? Why are glidepaths evolving? And ultimately, are target date strategies delivering on their promise?
Looking ahead, innovation will be essential. Advances in technology, including AI, alongside an evolving regulatory environment, are set to further transform how target date solutions are designed and delivered. For plan sponsors, the challenge lies in balancing growth, risk, and fee considerations to deliver solutions that effectively meet diverse participant outcomes.
Explore the full paper to gain deeper insights into the evolution of target date strategies and what we believe is shaping their future.
