Based on your financial expertise, provide your response or viewpoint on the given financial question or topic. The response format is open.

Should I “hedge” my IRA portfolio with a life cycle / target date mutual fund?
First of all, it's great you're now taking full advantage of your employer match – i.e. free money. Next, on the question of the use of a life cycle / target date fund as a "hedge": Life cycle funds were introduced for hands-off, one-stop-shopping investors who don't like a hassle or don't understand.  Such funds are gaining in popularity: employers can use them as a default choice for automatic enrollment, which results in more participation in retirement savings plans than if employees had to opt-in.  I think life cycle funds are a good innovation for that reason. But, the added service and convenience typically comes with higher fees.  If you are going to be hands-off, make sure you're cost-conscious:  Fees can devastate a portfolio's performance. In your case, it sounds like you are willing to do some work for your portfolio.  If you are confident that you've chosen a good equity glide path – that is, the initial and final stock/bond allocations and the rebalancing plan to get from one to the other  – then you're not going to benefit much by having a life cycle fund in your portfolio duplicating your own effort with inferior components.  (I assume you are selecting great low-cost, liquid index funds for your own strategy!)  Life cycle are neat, but replicating them isn't rocket science. However, I see a few cases in which life cycle funds may still be useful even if one has made a decision to be more involved in portfolio construction: Similar to your case: You have a company savings plan that you're taking advantage of because of a matching contribution.  Chances are your company plan doesn't offer a wide variety of funds.  Since a life cycle fund is available, it can be a good choice for that account.  But make sure fees aren't out of hand.  If much lower-cost equity and bond funds are available, consider them instead. Let's say you had another smaller account that you were unable to consolidate into your main account.  (e.g. a Traditional IRA vs. your Roth, and you didn't necessarily want to convert it.)  Even if that account had access to a wide variety of funds, it still might not be worth the added hassle or trading costs of owning and rebalancing multiple funds inside the smaller account.  There, perhaps, the life cycle fund can help you out, while you use your own strategy in your main account. Finally, let's assume you had a single main account and you buy partially into the idea of a life cycle fund and you find a great one with low fees. Except: you want a bit of something else in your portfolio not provided by the life cycle fund, e.g. some more emerging markets, international, or commodity stock exposure.  (Is this one reason you're doing it yourself?) In that case, where the life cycle fund doesn't quite have everything you want, you could still use it for the bulk of the portfolio (e.g. 85-95%) and then select one or two specific additional ETFs to complement it.  Just make sure you factor in those additional components into the overall equity weighting and adjust your life cycle fund choice accordingly (e.g. perhaps go more conservative in the life cycle, to compensate.) I hope that helps! Additional References: