TRP Retirement 2050 or 2055?

[alleniverson]

I'm planning to open a Roth IRA account with either T Rowe Price's Retirement 2050 or 2055. Another member in this forum, noppenbd, gave me advice that I should go with Retirement 2055 based on my age (18 for those wondering) and due to the fact that it will be more volatile. However, I was wondering what other members' opinions were on this topic (not that I don't appreciate noppenbd's advice). I want to get some more insight regarding this before I actually open the account. Thanks.

[humandraydel]

Both 2050 and 2055 have the same asset allocation currently (92% stocks). I doubt their asset allocation will differ meaningfully for 10-20 years, and even then only slightly. Either one is sufficient.

[disneysteve]

I think the previous poster is correct and it won't make much difference. That said, at age 18, the more aggressive the better. You will be 65 in 2055, so that makes sense at this point, even if the funds aren't much different right now.

[Broken Arrow]

Ah, Steve touched on what I was thinking as well.

In cases like these, I would say to just go ahead and pick the right target date for yourself. As mentioned above, there's usually next to no difference between the two... at first. However, as time moves along, the portfolio between the two should start to differ, and having such a large time frame will only amplify that difference....

The only factor I would consider here is your risk tolerance.... If you are certain that you are a conservative investor, I would go with 2050. If not, I would go with 2055. If you have no preference or are not sure, I say go with 2055.

But all this is just hair-splitting. The most important obstacle is already surmounted, and that is to get started in the first place (especially at such a young age). Big congrats to you!!

[jIM_Ohio]

2055 or 2060- be more aggressive for these reasons:

1) the biggest risks are market risk, return risk and inflation risk. The longer the money is invested, the less market risk you actually have, which means you can invest as aggressively as possible for next 20-25 years with a 40 year horizion to needing the money.

2) I doubt age 65 is a retirement age for someone in your position unless you invest heavily NOW. I think people your age now will be retiring at 70 or 75.

[alleniverson]

Thanks for the great advice.