People about to retire shouldn’t be that exposed anyway. Target day funds exist for a reason.
Most research about safe withdrawal rates finds having 50-75% equities is necessary for retirement periods of thirty years:
* https://en.wikipedia.org/wiki/William_Bengen
* https://en.wikipedia.org/wiki/Trinity_study
* https://en.wikipedia.org/wiki/Retirement_spend-down
Of course you could have less, but then your initial withdrawal rates becomes quite low, and so you need a much large portfolio to begin with: this would mean much more saving and much less spending (i.e., enjoyment of life) during your working life.
Yes - to make a lot of money on the expense ratio.
I guess if you really didn't want to learn a damn thing about modern portfolio construction a taget date fund is your best bet. However, it is incredibly easy to buy 4-6 ETFs that give you the same thing at a lower cost. Yes, you have to do a little work to re-balance these funds, but that is also an advantage to this approach as you have control over the re-balancing and can do it in a way that is more tailored to your specific situation.
I highly recommend the Risk Parity Radio podcast.
Here are 4 common funds that are used in risk parity portfolios:
VTI = .03% VXUS = .06% VGLT = .03% GLDM = .1%
(edit) I am not arguing that that investing in TDFs is inferior solely due to expense ratio cost - the biggest issue is that they lock you in to a specific allocation and re-balancing strategy that might not align with your specific situation.
At some point you are being penny-wise, pound-foolish: saving even 10bps (0.10%) on a $1e6 portfolio is saving $1000 dollars per year on management fees. If that kind of difference makes or breaks your retirement plans you have bigger problems (and most regular folks don't have that kind of portfolio, so the savings would be even smaller).
Certainly fees are important:
* http://larrybates.ca/t-rex-score/
but once you're <50bps, there are probably more important factors (like behaviour stuff: not panicking, actually putting money away monthly/regularly (especially in an automated fashion)).
Just saving the time-cost / hassling of rebalancing is worth something, and probably worth the fees you pay for an all-in-one / asset allocation solution.
For most people, it probably makes more sense to recommend something like a vanguard target fund, so that they don't have to think too much about it or remember to rebalance as they near retirement (or actively choose not to rebalance b/c the market is currently good and then get walloped by a crash).