Default Investment Funds for Retirement Plans

If you’re a current participant in Penn’s retirement plans, but never actively selected specific investments for your retirement funds, a change is in store for you! Click here for more details.

Whether you contribute your own money to a Penn retirement plan, receive University contributions, or both, you’re in charge of your own destiny when it comes to deciding how to invest that money. Countless investment options exist, from stock and bond funds to money markets and real estate funds.

So what happens if you’re a participant in a Penn retirement plan, but you haven’t made your investment selections yet?

Perhaps you were overwhelmed by the number of choices available, or maybe it just slipped your mind. Whatever the reason, the result is that money put into a retirement account with no investment selection will be placed in a default investment fund where it can begin earning interest. As of June 1, 2008, the default accounts are the TIAA-CREF Lifecycle Fund or Vanguard Target Retirement Fund. These are managed funds that automatically adjust your investment mix based on how close you are to retirement age—taking a more aggressive stance when you are still far from retirement, and becoming more conservative over time.

The appropriate investment mix is selected for you after taking into account your projected retirement date based on your age. Over time, the investment selections within the fund automatically change as you get closer to retirement age, adjusting to a mix that should be more appropriate for your needs at different stages in life.

If you’ve elected to participate with Vanguard but didn’t elect any specific funds, your money will be invested in the Vanguard Target Fund. The TIAA-CREF Lifecycle Fund will be the default fund for everyone else.

Please keep in mind that you can change your investment selection at any time simply by contacting your investment provider. Penn encourages you to make the choices that are best for you when it comes to saving for your retirement!

If you’d like to get in touch with a representative from either TIAA-CREF or Vanguard to talk about an investment plan that meets your needs, you can book an appointment by phone or online:

TIAA-CREF: 1-800-842-2010 (www.tiaa-cref.org/moc)
Vanguard: 1-800-662-0106 x 14500 (www.meetvanguard.com)