While I am on board with the idea of modest use of alternatives I have never been a fan of target date funds. Each provider tends to have different ideas about how to move along the glide path from more equities to more fixed income and those differences led to a lot of surprises during the great recession and it is a good bet there will be a lot of surprises whenever the next bear market comes along.

Target funds delegate too much in my opinion. My starting point is to believe in active management even if that means using passive products in an active fashion and the idea of a glide path that could be based solely on 20 years to retirement, ok now it’s 19 years seems intuitively like a bad idea and again led to a lot of negative surprises in the last bear market.

But the conclusion about fixed income and wanting to supplement it somehow is worth listening to as we are seeing more of it, CALsters recently made an announcement to the effect.

The takeaway is something that we have been talking about for a long time which is that fixed income investing has become more difficult as yields have become so low and it is likely to remain difficult whenever they start to go back up.

One unrelated item from a recent article about retiring overseas at MarketWatch from the reader comments; amidst all of the comments of why no one will ever retire again and the blame pointed at both political parties was one anecdotal observation that people who manage to retire the way they want tend to be out of debt by the time they are 40 and then accumulate wealth between the ages of 40 and 60. This struck me as being very insightful with a big component to this path to success being living below your means.

This article was written by Roger Nusbaum, AdvisorShares ETF Strategist.