According to Vanguard Group, 64% of dollars flowing into 401k plans go into target-date funds—for good reasons.

1. Companies are auto-enrolling new participants into target date funds, and this has successfully reduced the number of accounts investing nothing in stocks from 13% in 2005 to 3% today.
2. Target-date funds require no ongoing attention - the fund manager takes care of periodic rebalancing and reducing equity exposure as they get closer to the target date.

Still, there are several significant downsides.

1. The average expense ratio is .68%, much higher than index funds that often have less than .1% expense ratios.
2. Using target date or other funds of funds in taxable accounts can reduce or eliminate the opportunity for tax loss harvesting in years when some asset classes are up and others are down.
3. Target date funds often have bond fund components with long average durations, which is a big and hidden risk in a volatile interest rate environment.