Don't get me wrong. There's an inherent problem with that approach. Sure, most people in their 70s tend to take less risk than most people in their 30s. But I know plenty of people with pierced eyebrows who like nothing better than a good muni bond fund. And I know a surprising number of day traders who got their first kiss in the back seat of a Studebaker.
Taxes are another problem.
And when you finally trade down into the most conservative choice, you lock yourself out of one of the last great loopholes in the estate-tax rules. Thanks a lot, Grampa. If you want a simple, one-decision fund, buy the moderate version of one of the lifecycle funds and keep it till you keel over. Or, go for a fund that doesn't pretend to care how old you are. Also, at Brinson and Vanguard, that mix will change over time based on what the fund managers think of the markets.