What is a glidepath?

  • If you're thinking about investing in a target date fund, you're probably going to hear the word "glidepath." A glidepath is as an investment roadmap that a target date fund uses to take you from the beginning of your career all the way into retirement.

    Along the way, the glidepath maps out the mix of stocks, bonds and other investments that is appropriate for you based on your age. When you're young, retirement is decades away, so it may make sense to be a more aggressive investor. That's why the glidepath maps you into a diversified mix of stocks with only a small allocation to bonds.

    As you get older, the glidepath automatically reduces your stock mix and adds in more conservative investments designed to preserve your hard earned savings. As you arrive at the funds' target date, the glidepath also arrives at an investment mix that's designed to help you on the next part of your retirement journey.