American Funds College Target Date Series | Capital Group

American Funds College Target Date 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, which will oversee American Funds Portfolio Series, American Funds Retirement Income Portfolio Series and other solutions, including model portfolios; and
  • The Target Date Solutions Committee, which will oversee American Funds Target Date Retirement Series and American Funds College Target Date Series.

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.

Our seven target date funds were designed to address the key challenges of saving for the rising cost of education. A single investment provides diversification and a glide path matched to each client’s investing time horizon, making saving for education easier than ever.

The Glide Path

A glide path aligned with college investors’ needs

  • We offer seven target date funds in three-year increments. The target date is meant to roughly correspond to the year the beneficiary will start withdrawing funds to meet education expenses.
  • Our target date funds were built by the Portfolio Oversight Committee, a seasoned group of investment professionals. They conducted a rigorous process to determine the glide path for the Series and the combinations of American Funds in each “fund of funds.”
  • As the fund moves along the glide path toward the enrollment date, managers modify the investment mix so that each fund’s portfolio gradually shifts from helping the assets grow to being more preservation-oriented.

American Funds College Target Date Glide Path

The target allocations shown are as of January 1, 2019, and are subject to the Portfolio Oversight Committee’s discretion. The funds’ investment adviser anticipates that the funds will invest their assets within a range that deviates no more than 10% above or below these allocations. Underlying funds may be added or removed during the year.

 

Changes in the equity allocation within the underlying equity-income and balanced funds may affect the overall equity exposure in the target date funds. The fund allocation strategies for the managed portfolios do not guarantee that investors' education savings goals will be met. American Funds investment professionals manage the target date fund’s portfolio, moving it from a more growth-oriented strategy to a more income-oriented focus as the fund gets closer to its target date. For quarterly updates of fund allocations, visit capitalgroup.com.


Features and Benefits

  • Convenience – Our target date funds provide diversification in a single, easy-to-use, low-cost investment.
  • Designed for educational savings – The funds are designed specifically for educational savings, with two needs in mind:
    1. Keeping pace with, if not exceeding, the rising cost of education.
    2. Preserving capital as the enrollment date approaches.
  • Automatic asset reallocation – Each fund’s portfolio becomes heavily oriented toward bonds as the expected target enrollment date nears, and grows even more preservation-oriented when the date arrives.
  • Time-tested American Funds investments – The American Funds College Target Date Series is the only 529 college savings plan target date option to solely feature the American Funds.
  • Experienced oversight – Members of the Portfolio Oversight Committee average more than two decades of experience managing our funds. They monitor the Series, reviewing results and asset allocations to keep them aligned with each fund’s time horizon.

 


Availability and Management

  • Anyone can invest in the American Funds College Target Date Series. Investors generally choose the fund with the target date closest to the year the student is expected to enroll in college but are not precluded from investing in other funds in the same CollegeAmerica® account.
  • CollegeAmerica is available in 529-A, 529-C, 529-E and 529-F-1 share classes.
  • The underlying American Funds in the American Funds College Target Date Series are managed using The Capital System℠. The allocation percentages and underlying mutual funds within each Series fund are subject to the Portfolio Oversight Committee’s discretion and may evolve over time. Underlying funds may be added or removed at any time.

 


Fund Information


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, summary prospectuses and CollegeAmerica Program Description, which can be obtained from a financial professional and should be read carefully before investing. CollegeAmerica is distributed by American Funds Distributors, Inc. and sold through unaffiliated intermediaries. 

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. 

For more information about the risks associated with each investment, go to its detailed information page or read the prospectus, if applicable. Allocations may not achieve investment objectives. There are expenses associated with the underlying funds in addition to portfolio expenses. The portfolios' risks are directly related to the risks of the underlying funds. 

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. 

Depending on your state of residence, there may be an in-state plan that provides state tax and other state benefits, such as financial aid, scholarship funds and protection from creditors, not available through CollegeAmerica. Before investing in any state's 529 plan, investors should consult a tax advisor. 

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.

Use of this website is intended for U.S. residents only.