With more than $1 trillion in assets under management, Vanguard manages the largest target date fund and is the largest manager overall of target date funds.
Target date funds are a type of mutual fund that adjusts its mix of securities -- and, as a result, the overall risk profile of the fund -- based on its time horizon. As the target date approaches, investments shift toward less volatile assets.
When investing for retirement through a 401(k) or an individual retirement account (IRA), target- date funds are commonly offered and are a popular choice.
It’s no surprise then that the largest target date fund is Vanguard’s Target Retirement fund.
For a deeper dive into the largest target date funds and largest managers of target date funds, read on.
Key findings
- Vanguard is the largest target date fund manager, with about $1 trillion in assets managed in target date funds as of the end of 2022.
- The Vanguard Target Retirement fund is the largest target date fund. It is Vanguard’s only target date fund and holds the entire $1 trillion worth of target date funds the company manages.
- Fidelity, T. Rowe Price, BlackRock, and American Funds round out the top five largest target date fund managers.
The largest target date funds
The Vanguard Target Retirement fund is the largest target date fund, with just over $1 trillion in assets under management at the end of 2022, according to Morningstar.
Vanguard dominates the target date fund space from an assets-under-management point of view.
The next largest target date fund is the T. Rowe Price Retirement fund, with $297 billion in assets under management.
The BlackRock LifePath Index and the American Funds Target Date Retirement fund are the only other target date funds with more than $200 billion in assets under management as of the end of 2022.
| Manager | Fund | Assets (billions) |
|---|---|---|
| Vanguard | Vanguard Target Retirement | $1,056 |
| T. Rowe Price | T. Rowe Price Retirement | $297 |
| BlackRock | BlackRock LifePath Index | $247 |
| American Funds | American Funds Target Date Retirement | $225 |
| Fidelity | Fidelity Freedom | $177 |
| Fidelity | Fidelity Freedom Index | $145 |
| State Street | State Street Target Retirement | $121 |
| Fidelity | Fidelity Freedom Blend | $60 |
| Principal | Principal LifeTime Hybrid | $50 |
| JPMorgan | JPMorgan SmartRetirement Blend | $45 |
| Nuveen | TIAA-CREF Lifecycle Index | $42 |
| Nuveen | TIAA-CREF Lifecycle | $32 |
| JPMorgan | JPMorgan SmartRetirement | $28 |
| Principal | Principal LifeTime | $23 |
| Fidelity | Fidelity Advisor Freedom | $17 |
| T. Rowe Price | T. Rowe Price Retirement Hybrid | $14 |
| Schwab | Schwab Target | $14 |
| JPMorgan | JPMorgan SmartRetirement (Direct Real Estate) | $12 |
| Schwab | Schwab Target Index | $12 |
| T. Rowe Price | T. Rowe Price Retirement Blend | $7 |
| T. Rowe Price | T. Rowe Price Target | $5 |
| BlackRock | BlackRock LifePath Dynamic | $2 |
| JPMorgan | JPMorgan SmartRetirement Blend (DRE) | $2 |
| Fidelity | Fidelity Flex Freedom Blend | <$1 |
| Fidelity | Fidelity Managed Retirement | <$1 |
| BlackRock | BlackRock LifePath ESG Index | <$1 |
| Nuveen | Nuveen TIAA Lifecycle Blend | <$1 |
The largest target date fund managers
| Manager | Assets (billions) | Market share, 2022 | Market share, 2021 |
|---|---|---|---|
| Vanguard | $1,056 | 37.5% | 36.4% |
| Fidelity | $399 | 14.2% | 14.1% |
| T. Rowe Price | $321 | 11.4% | 11.5% |
| BlackRock | $249 | 8.8% | 8.8% |
| American Funds | $224 | 8% | 7.6% |
| State Street | $120 | 4.3% | 3.7% |
| JPMorgan | $88 | 3.1% | 3.4% |
| Nuveen | $74 | 2.6% | 2.7% |
| Principal | $73 | 2.6% | 2.6% |
| Schwab | $26 | 0.9% | 0.9% |
1. Vanguard
Target date fund assets: $1.056 trillion
Market share: 37.5%
Vanguard is the largest target date fund manager, with more than $1 trillion worth of assets under management. Vanguard is considered a part of the Big Three index fund managers alongside BlackRock and State Street.
2. Fidelity
Target date fund assets: $399 billion
Market share: 14.2%
With two target date funds having assets valued at more than $100 billion each at the end of 2022, Fidelity is the second largest manager of target date funds. Fidelity’s flagship target date fund is the Fidelity Freedom Fund.
3. T. Rowe Price
Target date fund assets: $321 billion
Market share: 11.4%
T. Rowe Price is known for being a believer in active investing as opposed to passive investing and for its namesake founder who pioneered investing in growth stocks. The T. Rowe Price Retirement fund accounts for $297 billion of the $321 billion in target date funds under management by the company as of the end of 2022.
4. BlackRock
Target date fund assets: $249 billion
Market share: 8.8%
Of the $249 billion in target date fund assets under BlackRock management, the BlackRock LifePath Index accounts for the lion’s share at some $247 billion. Its LifePath Dynamic and LifePath ESG Index funds have attracted far less interest.
5. American Funds
Target date fund assets: $224 billion
Market share: 8%
Owned by Capital Group, American Funds’ flagship target date fund is the American Funds Target Date Retirement fund. It’s the fourth largest target date fund, with $225 billion in assets under management.
6. State Street
Target date fund assets: $120 billion
Market share: 4.3%
One of the Big Three index fund managers, State Street managed $120 billion in target date fund assets for 32 million clients as of the end of 2022.
7. JPMorgan
Target date fund assets: $88 billion
Market share: 3.1%
While JPMorgan is the largest bank in the United States, it ranks seventh in assets managed in target date funds.
8. Nuveen
Target date fund assets: $74 billion
Market share: 2.6%
Owned by TIAA, Nuveen manages TIAA-CREF target date funds, with the Lifecycle and Lifecycle Index funds being the largest.
9. Principal
Target date fund assets: $73 billion
Market share: 2.6%
Principal offers a target date fund that takes a hybrid active-passive investing approach as well as a more actively managed option. The company had $73 billion in assets managed under target date funds as of the end of 2022.
10. Schwab
Target date fund assets: $26 billion
Market share: 0.9%
The 10th largest bank also has the 10th most assets managed under target date funds. The Schwab Target Index fund mainly invests in Schwab exchange-traded funds (ETFs), while the Schwab Target fund invests largely in other Schwab funds.
When to invest in a target date fund
Target date funds are managed with the intention to maximize returns for a particular end date. That makes them most suitable for investing for retirement or college -- events that are guided by a timeline with a desired financial return attached.
Target date funds do come with fees -- known as expense ratios -- for the automatic rebalancing that occurs as the target date approaches. Those fees can reach 1%, although funds that invest primarily in ETFs can have lower expense ratios.
While it’s possible to manually rebalance your portfolio over time, target date funds allow investors to set it and forget it, which can be appealing for those who don’t want to worry about managing their retirement portfolio every year.
Sources
- Morningstar (2023). “2023 Target-Date Funds and CITs Landscape.”
