In general, target-date funds have been a hit with 401(k) plans, but the losses suffered during the 2008 market meltdown by some funds designed for participants close to retirement have given companies a reason to reconsider their use of the funds. The losses "enlightened plan sponsors to the differences in the glidepath," says Mark Ruloff, director of asset allocation for Towers Watson Investment Services, referring to the evolution of the funds' asset allocation over the years. Ruloff notes that the equity allocation at retirement age can range from 20% to more than 60%.

The disparity reflects a philosophical difference. Some fund companies say that because participants could live for decades after retiring, they still need a more aggressive asset allocation. Others emphasize the need for a more conservative weighting.

The Department of Labor has proposed regulations that require more disclosure of the funds' glidepaths and investments. Of course, 401(k) participants are not known for their close reading of plan documents, so it's not clear such disclosures will make much difference.