WASHINGTON, May 28, 2026 /PRNewswire/ — Target date funds (TDFs) have cemented their position as a core investment option in 401(k) plans, offering age-appropriate, asset allocation, diversification, and automatic rebalancing. New research from the Employee Benefit Research Institute (EBRI) and Investment Company Institute (ICI), A Closer Look at 401(k) Plan Target Date Fund Investors’ Account Balance Asset Allocations Over Time, found that most participants who were fully invested in TDFs at year-end 2016 remained fully invested over the six-year period studied. This pattern of retention reflects the staying power of TDFs and offers a closer look at how participants use them over time.
The study looks at the behavior of 700,000 participants who were fully invested in TDFs at year-end 2016, and follows them through year-end 2022. The results offer a clearer picture of the durability and flexibility of TDF investing.
It finds that full-TDF investors with mid-level job tenure were the most likely to maintain their allocations over the six-year period, with retention reaching 88% through year-end 2022.
“The durability of target date funds reflects the value participants place on their intuitive, age-based investment approach,” said Shelly Antoniewicz, ICI Chief Economist. “Their ability to simplify long-term investing has made TDFs a standard option in many 401(k) plan investment lineups.”
“Target date funds have evolved with the goal of helping employees save and invest for their retirement,” said Craig Copeland, EBRI Director of Wealth Benefits Research. “As more individuals invest in TDFs in their 401(k) plans, our research shows that most remain invested in them over time, helping them continue to have a diversified investment strategy while accounting for income needs as they move closer to and into retirement.”
About the Study
This paper follows a group of consistent 401(k) plan participants over a six-year period to explore the persistence or flexibility of their TDF use. By focusing on observed investment behavior over an extended period, this analysis provides new insight into how TDFs are used in practice.
The EBRI/ICI project is unique because of its inclusion of data provided by a wide variety of plan recordkeepers, permitting the analysis of the activity of participants in 401(k) plans of varying sizes—from very large corporations to small businesses—with a variety of investment options.
Full results of the annual EBRI/ICI 401(k) database update are posted on each organization’s website, at www.ebri.org and www.ici.org/ResearchDefinedContributionPlans401ks/EBRIICI401kInvestorDatabase.
Contact: media@ici.org
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SOURCE Investment Company Institute
