The American Funds Retirement Income Portfolio Series consists of three managed portfolios — Conservative, Moderate and Enhanced — that can help retirees address their income and longevity needs.
Made up of American Funds, these portfolios:
A recent survey found that the chief concern among retirees is having the ability to maintain their lifestyles in retirement. In addition, investors in retirement want to be assured of asset growth as they take withdrawals from their investments.
The American Funds Retirement Income Portfolio Series strives to:
The Portfolio Solutions Committee used extensive research and modeling to determine the suggested annual withdrawal rate ranges for each of the three portfolios (as of January 1, 2022).
*Risk of loss, in this case, is defined as an increased exposure to equities, which can lead to greater volatility in the portfolio and potentially impact both withdrawal rates and whether overall assets invested will decline over time.
Each retirement income portfolio is designed to address varying income needs and risk tolerances, and each has a suggested annual withdrawal rate range.
These suggested withdrawal rate ranges:
Strives for the accomplishment of three investment objectives: current income, long-term growth of capital and conservation of capital, with an emphasis on income and conservation of capital.
Strives for the balanced accomplishment of three investment objectives: current income, long-term growth of capital and conservation of capital.
Strives for the accomplishment of three investment objectives: current income, long-term growth of capital and conservation of capital, with an emphasis on income and growth of capital.
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 Portfolio Solutions Committee — investment professionals who have a long history of successfully managing funds to pursue investor objectives — monitor the American Funds Retirement Income Portfolio Series.
Retirement income portfolios are complex. At times the need to take withdrawals can conflict with the desire for capital preservation. The historical roles of stocks and bonds have shifted in recent years, making the interplay between markets more difficult to navigate.
That’s why the Portfolio Oversight Committee, the predecessor to the Portfolio Solutions Committee:
The seven seasoned investment professionals in the Portfolio Solutions Committee offer:
The order of the underlying funds is based on the Capital Solutions Group's assessment of each fund's volatility, based on the fund's historical standard deviation, objective and other factors.
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 Retirement Income Portfolio Series' investment allocations may not achieve fund objectives, and adequate income through retirement is not guaranteed. The portfolios' 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.
The use of derivatives involves a variety of risks, which may be different from, or greater than, the risks associated with investing in traditional securities, such as stocks and bonds.
Fund shares of U.S. Government Securities Fund are not guaranteed by the U.S. government.
Lower rated bonds are subject to greater fluctuations in value and risk of loss of income and principal than higher rated bonds.
The return of principal for bond funds and for funds with significant underlying bond holdings is not guaranteed. Fund shares are subject to the same interest rate, inflation and credit risks associated with the underlying bond holdings.
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.
American Funds Strategic Bond Fund may engage in frequent and active trading of its portfolio securities, which may involve correspondingly greater transaction costs, adversely affecting the fund's results.
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.
This material does not constitute legal or tax advice. Investors should consult with their legal or tax advisors.
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American Funds Distributors, Inc., member FINRA.
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.
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