Retirees are keeping a lot of their IRA money in equities,rather than in target-date-funds.

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Maria Bruno, a senior retirement strategist in Vanguard’s investment strategy group, bloggedabout the reasons that retirees’ equity allocations are so farremoved from the equity allocations in target-date funds.

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Related: 7 ways fiduciaries should monitor target-datefunds

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Bruno noted that Vanguard’s IRA investors have equity exposuresaveraging 60 percent at age 65 and remaining at about the samelevel through retirement. For Roth IRAs, she wrote, the averagesare even higher: “At age 65, the average equity allocation isroughly 75 percent and dips only slightly lower later inretirement.”

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Professionally managed target-date funds, of course, have onegoal: A glidepath suitable for getting workers into retirement,then allowing them to draw down assets over a 30-year time horizon.But many retirees, wrote Bruno, “have other situations or goals andcould result in a different target asset allocation.”

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So what might some of these other goals be?

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Bruno said retirees might be aiming toward other goals than justretirement — such as “managing the risks of not outliving theirretirement portfolio” or “maximizing wealth transferopportunities.” Such goals, she said, compel retirees “to considerfactors such as market uncertainty, inflation, and increasing lifeexpectancies.’

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Then there are retirees who are using their portfolios more orless as cash cows, using them for spending money rather than tryingto spend them down. Such a mindset, Bruno pointed out, could leadthem to keep the portfolio balanced in an effort to preserve thereal value of their assets.

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There are always some who don’t rebalance, whatever their goals— or who are reluctant to abandon a rising market in the name of“selling winners to buy losers.” A drop in the equity market is ofless concern to many of these than the potential for interest rateincreases, and they’d rather stay where they are thanrebalance.

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And last but not least, Bruno cited affluent retirees who intendto leave their IRAs as an inheritance for children orgrandchildren, and who are therefore determined to grow thebalances as much as possible and to take advantage of longerdrawdowns granted to younger IRA beneficiaries to let equities withthe greatest growth potential simply — grow.

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That could be particularly true in the case of Roth IRAs, sinceRoth IRA owners aren’t subject to required minimum distributionsduring their lifetimes. That means that those assets passincome-tax-free to future generations, making them particularly aptlegacies.

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