Target retirement funds offer one-stop shopping for investors who want a "set it and forget it" retirement strategy. Instead of wading through scores of funds, investors can leave the portfolio strategy to someone else.

Think you might retire 15 years from now? Just pick the target retirement fund geared for those retiring between 2026 and 2030. Now you're all set.

But is this a smart strategy?

The good

Target retirement funds offer a simple choice. When you have 20 investment options, paralysis can set in. Fearful of making the incorrect choice, the decision is deferred. With target retirement funds, you just estimate your retirement date and then select the appropriate fund.

These funds build in a high degree of diversification in their portfolios. Target retirement funds are usually "funds of funds." So by purchasing a Fidelity Freedom 2030 Fund (ticker: FFFEX), you are purchasing their all-sector equity fund and twenty other Fidelity funds. Each of these funds holds hundreds to thousands of different individual stocks or bonds.

So not only do you avoid the risks in betting on a single company or sector, but you also get the benefit of spreading your assets between domestic and international markets, and alternative asset classes including commodities and commercial real estate.

Finally these funds regularly rebalance their holdings. They sell the winners within their fund mix and purchase those that haven't done as well. Most individual investors do not regularly rebalance their portfolio, which costs them total returns over time. Target retirement funds allow you to offload this chore.

The bad

By investing in target retirement funds, you're making a decision that a cookie cutter investment approach will be effective. When we design a recommended portfolio for a client, we not only ask about their risk tolerance but also about their financial goals and come up with the best path forward considering their current assets and future savings. Target retirement funds don't incorporate any information that is specific to your situation.

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Dave Gardner: Target retirement funds -- The good, the bad and the ugly