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80% · Q8/10
Question 8 of 10

What is a 'target-date fund' in the context of retirement investing?

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Explanation
Target-date funds (e.g., 'Target 2045 Fund') automatically rebalance their asset allocation over time, moving from growth-oriented stocks when you're young to more conservative bonds as you approach the target retirement year. They are a popular all-in-one option in 401(k) plans.
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Tax-advantaged accounts like 401k plans and IRAs allow your investments to grow either tax-deferred or tax-free, depending on the account type.