American Funds Target Date R6 Retirement Savings Strategy

The American Funds Target Date R6 Retirement Savings Strategy is designed to help you save for retirement in a straightforward and efficient way. This strategy is a type of target date fund that automatically adjusts its asset allocation based on your retirement date.

One of the key features of the American Funds Target Date R6 is its glide path, which is a gradual shift from more aggressive investments to more conservative ones as your retirement date approaches. The fund's asset allocation will become more conservative over time, typically between 10 to 15 years before your retirement date.

The American Funds Target Date R6 is a low-cost option, with an expense ratio of 0.64%, which is lower than many other target date funds. This can help you keep more of your hard-earned money in your retirement account.

The fund's allocation strategy is managed by investment professionals, who move the portfolio from a more growth-oriented strategy to a more income-oriented focus as the target date gets closer. This means that the fund will have a higher emphasis on bonds as you near your retirement date, helping to manage the risk of market declines.

Significant stock investments throughout the lifetime of your fund can help manage the risk of outliving your savings in retirement. This is because stocks have historically provided higher returns over the long term, but they also come with higher risk.

As the target date gets closer, the fund's allocation will shift to prioritize income generation over growth. This is done to help manage the risk of market declines and ensure that your savings can keep up with your retirement expenses.

Here's a rough idea of how the fund's allocation changes over time:

Keep in mind that the fund's allocation strategy is subject to change, and the Portfolio Oversight Committee has the discretion to adjust the allocation percentages and underlying funds as needed.