About this episode
Tom takes a break from vacationing to join Don in a deep dive on target date funds—the good, the mediocre, and the fee-loaded ugly. They break down performance data, highlight major fund differences, and remind listeners why understanding your own risk tolerance still matters. Listener questions spark advice on Roth IRAs for young investors and strategies for holding large tax payments. All with classic banter, bad jokes, and a quick jab at the Raiders. 0:04 Tom’s back (briefly), and the banter’s already off the rails 1:42 Target date funds: the set-it-and-forget-it investing strategy 3:06 $4 trillion invested—do they actually work? 4:29 Performance since 2010: solid but not spectacular 4:52 Fees dropping, but some funds still gouge 6:06 Comparing returns: Vanguard, Hancock, American Funds, Voya 7:39 Hidden loads and fees—legal, but not ethical 7:59 Target date trouble: they don’t know you 9:03 Asset allocation assumptions can misfit your real risk 9:44 Most funds overweight large U.S. companies 11:14 What Vanguard 2025 actually holds (spoiler: little value) 12:43 Better than nothing—but not better than customized 13:38 Final take: decent for novices, but beware high fees and mismatched risk 16:15 Listener Q1: Roth IRAs in only VFIAX—good idea for young investors? 17:36 Why global small-cap value ETFs are a better long-term choice 19:04 Comparing AVGE, DFAW, and VT—size and cost matter 19:36 Listener Q2: Where to hold tax money without exceeding FDIC limits 21:30 FDIC realities and alternative safe options like government money markets 22:23 Tax math: fed + Illinois = close to 50% if income, less if capital gains 23:52 Hidden state tax traps and EV drivers dodging gas taxes 24:13 Pre-DOGE Teslas and pre-Elon excuses Learn more about your ad choices. Visit megaphone.fm/adchoices