Fidelity Freedom Funds

Fidelity is a very large and active on-line brokerage. Fidelity has developed products for people who want a care-free, cheap, professionally managed, diversified portfolio that is tailored to the number of years before retirement. Other brokers such as Vanguard, and Schwab also offer target date funds.

The funds attempt to give you an age-appropriate asset-allocation mix and then gradually make it more conservative as the years go by. Fidelity calls its retirement funds “Fidelity Freedom Funds”. The funds are composed of domestic stock funds, international funds, commodity funds and bond funds just as a diversified portfolio should be.

As you can see from looking at the components of of their 2050 Freedom Fund, the funds are highly diversified.

Here are their own published results

Fidelity Freedom Fund Performance

Lets translate those numbers into a chart. Here is a comparison of the 2040 Freedom Fund to VTI.

FUND      DATE1    PRICE     DATE2       PRICE    GAIN
FFFFX      6/1/01       $ 7.98        9/1/17           $10.31       29%
VTI            6/1/01      $56.50        9/1/17        $128.40     127%

 

 

Need I say more? VTI outperforms Fidelity Freedom Fund by 4 to 1!

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One Response to Fidelity Freedom Funds

  1. As a financial planner, I totally understand where you’re coming from.
    I read your site fairly often and I enjoy your posts. I shared this
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    Kepp up the good work!

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