American Funds Retirement Income Portfolio Series℠
On January 1, 2020, Capital Research and Management Company will be making changes to the Portfolio Oversight Committee (POC), which oversees our multi-asset solutions. The POC will become two distinct teams:
The Portfolio Solutions Committee members will include existing POC members Alan Berro, Wesley Phoa and Andrew Suzman and additional portfolio managers Michelle Black, Samir Mathur, John Queen and Will Robbins.
The Target Date Solutions Committee members will include existing POC members Joanna F. Jonsson, James B. Lovelace, Wesley Phoa and Brad Vogt and additional portfolio managers Michelle Black, David Hoag and Samir Mathur.
Made up of American Funds, these portfolios:
Retirees may be concerned with maintaining their lifestyles in retirement. In addition, they may want to be assured of asset growth as they take withdrawals from their investments. The American Funds Retirement Income Portfolio Series strives to:
Translating Need and Risk Into Withdrawal Rate Ranges The American Funds Portfolio Oversight Committee used extensive research and modeling to determine the suggested annual withdrawal rate ranges for each of the three portfolios (as of November 1, 2018).
Each fund of funds is designed to address varying income needs and risk tolerances, and each has a suggested withdrawal rate range.
The suggested annual withdrawal rate ranges for the portfolios:
With significant allocations to The Bond Fund of America® and U.S. Government Securities Fund®, this portfolio focuses more on preservation of capital, while still seeking to provide current income.
The portfolio includes several fixed-income funds, but the allocation is weighted more toward income-focused funds like Capital Income Builder® and The Income Fund of America®.
With greater allocations to income-focused equity funds, this portfolio has more potential upside over the long term, but will likely result in greater volatility.
We built the American Funds Retirement Income Portfolio Series to help address the needs of investors nearing or in retirement.
These funds of funds are:
The American Funds Retirement Income Portfolio Series is available in F-1, F-2, F-3, A, C and all R share classes (third-party platforms only; not in PlanPremier and RecordkeeperDirect).
The American Funds Retirement Income Portfolio Series was developed and is monitored by the American Funds Portfolio Oversight Committee — investment professionals who have a long history of successfully managing funds to pursue investor objectives.
Retirement income portfolios are complex. The need for withdrawals often conflicts with a desire for capital preservation. Stock and bond market interplay — once reliable for its inverse correlation — has become more difficult to navigate in recent years.
That’s why the committee:
These seven seasoned American Funds portfolio managers offer:
Investments are not FDIC-insured, nor are they deposits of or guaranteed by a bank or any other entity, so they may lose value.
Investors should carefully consider investment objectives, risks, charges and expenses. This and other important information is contained in the fund prospectuses and summary prospectuses, which can be obtained from a financial professional and should be read carefully before investing.
The return of principal for bond portfolios and for portfolios with significant underlying bond holdings is not guaranteed. Investments are subject to the same interest rate, inflation and credit risks associated with the underlying bond holdings. Lower rated bonds are subject to greater fluctuations in value and risk of loss of income and principal than higher rated bonds. Investments in mortgage-related securities involve additional risks, such as prepayment risk. While not directly correlated to changes in interest rates, the values of inflation-linked bonds generally fluctuate in response to changes in real interest rates and may experience greater losses than other debt securities with similar durations.
Bond prices and a bond fund's share price will generally move in the opposite direction of interest rates.
Investing outside the United States involves risks, such as currency fluctuations, periods of illiquidity and price volatility. These risks may be heightened in connection with investments in developing countries.
Interests in Capital Group’s U.S. Government Securities portfolios are not guaranteed by the U.S. government.
The Retirement Income Portfolio Series' investment allocations may not achieve fund objectives, and adequate income through retirement is not guaranteed. There are expenses associated with the underlying funds in addition to fund-of-funds expenses. The funds’ risks are directly related to the risks of the underlying funds. Payments consisting of return of capital will result in a decrease in an investor’s fund share balance. Higher rates of withdrawal and withdrawals during declining markets may result in a more rapid decrease in an investor’s fund share balance. Persistent returns of capital could ultimately result in a zero account balance.
This content, developed by Capital Group, home of American Funds, should not be used as a primary basis for investment decisions and is not intended to serve as impartial investment or fiduciary advice.
Past results are not predictive of results in future periods.