Understanding Age Intuitive Path
Key Takeaway
Many plan participants don’t have the time or knowledge to manage their retirement savings accounts, selecting and monitoring investments can be confusing and intimidating. Nearly 71% of plan participants indicate that access to investing help is important1. The Age Intuitive Path program provides participants with multiple levels of support in managing their investment options. Not all plans offer age intuitive path, see your enrollment materials or contact your plan sponsor for details about your plan.
More Options
The Age Intuitive Path (AIP) is a participant account feature designed to help alleviate the complexities of navigating a participant’s path to a comfortable retirement. The AIP will “unroll” the current Investment Program Models (IPMs) in a plan lineup, taking each IPM from a single fund and breaking it down into the underlying core funds for each model.
The AIP then provides participants with the opportunity to select from three options in managing their retirement accounts. Participants can opt to invest in an Automatic, Age-based Glide Path (Do It for Me); a Risk-based Managed Portfolio (Do It Together); or a Custom Individual Portfolio comprised of the funds available in the plan (Do It Myself).
Automatic Age-Based Glide Path: Do It For Me
This option automatically selects a managed portfolio based on participant age. The portfolios seek varying degrees of long-term appreciation and capital preservation through a mix of the equity and fixed-income investments available in the plan. These allocations will rebalance quarterly and become more conservative over time, as the participant nears retirement. See the sample below.
| Managed Portfolio Name | Current Age Range |
|---|---|
| Aggressive | <40 |
| Moderate | 40-55 |
| Conservative | >55 |
Risk-Based Managed Portfolios: Do It Together
The plan will continue to offer five risk-based, professionally managed portfolios constructed by the plan’s investment manager. Independently, or with help from the plan’s advisor, participants can choose which managed portfolio best suits them considering their ability, willingness, and need to take risk with their retirement savings. The portfolios are constructed from the mutual fund investments available in the plan and are automatically rebalanced quarterly.
Custom Individual Portfolio: Do It Myself
Participants may choose among the individual mutual fund investment options offered within the plan to create their own custom portfolio. These funds were carefully selected and are regularly monitored by the plan’s investment manager. Custom investment allocations are not automatically rebalanced each quarter, but participants have the option to schedule an automated account realignment.
1Fidelity Investments Help and Advice Survey, April 2017