If the profile funds are not created from the best funds offered by the mutual fund company, you could end up investing in some real dogs. Some companies will offer a preset mix that can consist of poor-performing and expensive options. If all of the underlying investments are offered by a company whose mutual funds are concentrated in a few stocks, you could also have problems with diversification. Even a seemingly small fee of 0.25 percent could make a significant difference in your balance by retirement age. Also, if the underlying funds are unfamiliar to you, you may want to check to see if their expense ratios are out of line with the other investments in your plan.
All investors have different needs.
Make sure that your own investor profile is in line with that of the fund and that you are comfortable with the level of risk that you are taking. If You Do the Work mPower Minute Read this article at a glance . The views represented above are those of the author, and the information provided here does not constitute any tax, investment or legal advice. The historical data presented are for illustrative purposes only. Past performance is no guarantee of future results.