How safe are the retirement funds offered by various mutual fund companies?
- Siva Subramaniam
All the retirement funds offered by mutual fund companies are hybrid funds, as some equity allocation is important during retirement as well as at the time of accumulating for retirement. So, all these funds come with two-three varied allocations - less equity, more equity and a balanced allocation. So, they are just as safe as any other mutual fund but they're not insulated from market risk. If the markets go down, these funds would decline in value.
But if you are methodical about your investments in retirement-specific mutual funds, broadly these will turn out to be reasonably safe and could be quite useful.