From target date savings to retirement income

Michelle J. Black Jeb Bent Kelly Campbell Rich Lang

As defined contribution plans have proliferated over recent decades, a big question facing many plan participants now is not just “how do I save for retirement?” but also “how do I turn my retirement savings into income?” Many participants will rely on target date funds for retirement income, especially as more elect to stay in-plan after they stop working. Using several research and modeling approaches, we evaluated two withdrawal strategies — fixed and variable — and identified ranges that could help support income and account balances over a 30-year retirement horizon.

 

This analysis seeks to illustrate the tradeoffs between these two withdrawal approaches in terms of dollars and durability — and to support plan sponsor, financial professional and consultant conversations about practical withdrawal behavior. 

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Michelle Black is a solutions portfolio manager with 31 years of industry experience as of December 31, 2025. She holds a bachelor’s degree in business administration from the University of Southern California.

Jeb Bent is a multi-asset investment director with 17 years of industry experience as of December 31, 2025. He holds a bachelor’s degree in urban studies from Fordham University. 

Kelly Campbell is a multi-asset solutions business lead with 25 years of industry experience as of December 31, 2025. She holds a bachelor’s degree in economics from Harvard, graduating cum laude. 

Rich Lang is a multi-asset investment director with 32 years of investment industry as of December 31, 2025. He holds both a master’s and bachelor’s degree in finance from Loyola Marymount University. 

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The management process behind our target date solutions

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Although the target date portfolios are managed for investors on a projected retirement date time frame, the allocation strategy does not guarantee that investors' retirement goals will be met. Investment professionals manage the portfolio, moving it from a more growth-oriented strategy to a more income-oriented focus as the target date gets closer. The target date is the year that corresponds roughly to the year in which an investor is assumed to retire and begin taking withdrawals. Investment professionals continue to manage each portfolio for approximately 30 years after it reaches its target date.
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