N-CSR 1 primary-document.htm
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, DC 20549
 
FORM N-CSR
 
CERTIFIED SHAREHOLDER REPORT OF REGISTERED MANAGEMENT INVESTMENT COMPANIES
 
Investment Company Act file number
811-07851
        
Franklin Fund Allocator Series
(Exact name of registrant as specified in charter)
 
One Franklin Parkway, San Mateo, CA 94403-1906
(Address of principal executive offices) (Zip code)
 
Craig S. Tyle, One Franklin Parkway, San Mateo, CA 94403-1906
(Name and address of agent for service)
 
Registrant's telephone number, including area code:(650) 312-2000
 
Date of fiscal year end: 12/31
 
Date of reporting period: 12/31/21
 
Item 1. Reports to Stockholders.
 
a.)
 
The following is a copy of the report transmitted to shareholders pursuant to Rule30e-1 under the Investment Company Act of 1940, as amended (the “1940 Act”) (17 CFR 270.30e-1.)


b.)
 
Include a copy of each notice transmitted to stockholders in reliance on Rule 30e-3 under the Act (17 CFR 270.30e-3) that contains disclosures specified by paragraph (c)(3) of that rule.
Not Applicable
.
 
ANNUAL
REPORT
AND
SHAREHOLDER
LETTER
Franklin
Fund
Allocator
Series
December
31,
2021
Sign
up
for
electronic
delivery
at
franklintempleton.com/edelivery
Franklin
LifeSmart
TM
Retirement
Income
Fund
2020
Retirement
Target
Fund
2025
Retirement
Target
Fund
2030
Retirement
Target
Fund
2035
Retirement
Target
Fund
2040
Retirement
Target
Fund
2045
Retirement
Target
Fund
2050
Retirement
Target
Fund
2055
Retirement
Target
Fund
2060
Retirement
Target
Fund
Not
FDIC
Insured
May
Lose
Value
No
Bank
Guarantee
franklintempleton.com
Annual
Report
1
SHAREHOLDER
LETTER
Dear
Shareholder:
During
the
12
months
ended
December
31,
2021,
the
U.S.
economy
continued
to
recover
from
the
COVID-19
pandemic,
benefiting
equities.
Growth
accelerated
in
2021’s
first
half
as
the
reopening
of
businesses,
widespread
COVID-19
vaccinations
and
federal
assistance
programs
continued
to
boost
consumer
spending.
Inflation
increased
during
the
reporting
period
due
to
increased
demand
for
goods
amid
supply-chain
bottlenecks.
During
the
period’s
second
half,
investors
became
concerned
that
new,
swiftly
spreading
COVID-19
variants
could
hinder
the
economic
recovery,
and
growth
slowed
in
2021’s
third
quarter.
During
the
reporting
period,
the
U.S.
Federal
Reserve,
in
its
efforts
to
support
U.S.
economic
activity,
held
the
federal
funds
rate
unchanged
at
0.25%,
and
it
continued
broad
quantitative
easing
measures
to
bolster
credit
markets.
However,
the
Federal
Reserve
began
decreasing
its
asset
purchases
in
November
and
accelerated
its
tapering
in
December,
while
reiterating
its
intention
to
delay
interest
rate
increases
until
reaching
its
goal
of
maximum
U.S.
employment.
Rebounding
global
economies,
ongoing
monetary
and
fiscal
stimulus
measures,
easing
pandemic
restrictions
and
expanding
vaccination
programs
benefited
global
equities,
but
some
business
restrictions
by
China,
the
spread
of
COVID-19
variants
and
higher
inflation
amid
supply-chain
disruptions
hindered
global
stocks
near
period-end.
In
this
environment,
the
prices
of
U.S.
stocks,
as
measured
by
the
Standard
&
Poor’s
®
500
Index
(S&P
500
®
),
returned
+26.89%
(the
index
increasing
from
3,756.07
to
4,766.18).
1,3
The
prices
of
stocks
in
global
developed
markets,
as
measured
by
the
MSCI
World
Index,
returned
+20.14%
(the
index
increasing
from
2,690.044
to
3,231.727).
2,3
Investment-
grade
bonds,
as
measured
by
the
Bloomberg
U.S.
Aggregate
Bond
Index
(Bloomberg
Index),
posted
a
-1.54%
total
return
(an
index
decrease
from
2,392.02
to
2,355.14),
which
includes
reinvestment
of
income
and
distributions,
reflecting
the
rise
in
interest
rates.
4
We
recognize
the
important
role
of
financial
professionals
in
today’s
markets
and
encourage
investors
to
continue
to
seek
their
advice.
Amid
changing
markets
and
economic
conditions,
we
are
confident
investors
with
a
well-diversified
portfolio
and
a
patient,
long-term
outlook
should
be
well-
positioned
for
the
years
ahead.
In
addition,
Franklin
Fund
Allocator
Series’
annual
report
includes
more
detail
about
investment
decisions
during
the
period.
All
securities
markets
fluctuate
in
value,
as
do
mutual
fund
share
prices.
We
thank
you
for
investing
with
Franklin,
welcome
your
questions
and
comments,
and
look
forward
to
serving
your
future
investment
needs.
Sincerely,
Rupert
H.
Johnson,
Jr.
Chairman
Franklin
Fund
Allocator
Series
This
letter
reflects
our
analysis
and
opinions
as
of
December
31,
2021,
unless
otherwise
indicated.
The
information
is
not
a
complete
analysis
of
every
aspect
of
any
market,
country,
industry,
security
or
fund.
Statements
of
fact
are
from
sources
considered
reliable.
1.
Source:
Copyright
©
2022,
S&P
Dow
Jones
Indices
LLC.
All
rights
reserved.
2.
Source:
MSCI.
3.
Source:
Morningstar.
The
changes
in
index
prices
shown
for
the
S&P
500
and
MSCI
World
Index
do
not
include
reinvestments
of
income
and
distributions,
which
are
included
in
their
total
returns,
which
were:
S&P
500
+28.71%
(index
total
return
resulting
in
an
increase
from
7,759.35
to
9,986.70)
and
MSCI
World
Index
+22.35%
(index
total
return
resulting
in
an
increase
from
11,625.199
to
14,223.137).
4.
Sources:
Morningstar
and
Bloomberg
indexes.
For
the
Bloomberg
Index,
only
total
return
as
shown
is
available,
not
price
change
without
the
inclusion
of
reinvested
income
and
distributions.
See
www.franklintempletondatasources.com
for
additional
data
provider
information.
franklintempleton.com
Annual
Report
2
Contents
Annual
Report
Economic
and
Market
Overview
3
Franklin
LifeSmart
Retirement
Income
Fund
4
Franklin
LifeSmart
2020
Retirement
Target
Fund
11
Franklin
LifeSmart
2025
Retirement
Target
Fund
17
Franklin
LifeSmart
2030
Retirement
Target
Fund
23
Franklin
LifeSmart
2035
Retirement
Target
Fund
29
Franklin
LifeSmart
2040
Retirement
Target
Fund
35
Franklin
LifeSmart
2045
Retirement
Target
Fund
41
Franklin
LifeSmart
2050
Retirement
Target
Fund
47
Franklin
LifeSmart
2055
Retirement
Target
Fund
53
Franklin
LifeSmart
2060
Retirement
Target
Fund
59
Financial
Highlights
and
Statements
of
Investments
65
Financial
Statements
133
Notes
to
Financial
Statements
150
Report
of
Independent
Registered
Public
Accounting
Firm
182
Tax
Information
184
Board
Members
and
Officers
186
Shareholder
Information
191
Visit
franklintempleton.com
for
fund
updates,
to
access
your
account,
or
to
find
helpful
financial
planning
tools.
3
franklintempleton.com
Annual
Report
ANNUAL
REPORT
Economic
and
Market
Overview
Global
developed
and
emerging
market
equities,
as
measured
by
the
MSCI
All
Country
World
Index-NR
(net
of
tax
withholding
when
dividends
are
paid),
posted
a
+18.54%
total
return
for
the
12
months
ended
December
31,
2021.
1
Global
equities
benefited
from
monetary
and
fiscal
stimulus
measures,
easing
COVID-19
pandemic
restrictions
in
certain
regions
and
the
development
of
treatments
and
vaccines.
However,
the
Chinese
government’s
imposition
of
additional
restrictions
on
some
businesses
pressured
Asian
and
global
emerging
market
stocks.
Additionally,
the
spread
of
the
Delta
and
Omicron
variants
and
higher
inflation
in
an
environment
of
persistent
supply-chain
disruptions
hindered
global
equities
at
certain
points
during
the
12-month
period.
In
the
U.S.,
the
economy
continued
to
recover
and
equities
rallied
amid
monetary
and
fiscal
stimulus
measures
and
the
continued
progress
of
vaccination
programs.
Gross
domestic
product
(GDP)
growth
was
generally
robust,
as
the
lifting
of
many
COVID-19
restrictions
and
strong
consumer
spending
supported
the
economy.
A
rebound
in
corporate
earnings
and
the
passage
of
a
bipartisan
infrastructure
bill
further
bolstered
investor
sentiment.
In
an
effort
to
support
the
economy,
the
U.S.
Federal
Reserve
(Fed)
kept
the
federal
funds
target
rate
at
a
record-low
range
of
0.00%–0.25%.
While
the
Fed
also
maintained
quantitative
easing
measures
with
U.S.
Treasury
and
mortgage
bond
purchasing,
it
began
to
reduce
the
rate
of
purchases
beginning
in
November
2021
and
accelerated
the
pace
of
tapering
in
December.
The
Fed
also
noted
that
it
expected
easing
supply
constraints
to
help
reduce
inflationary
pressures
and
that
further
employment
progress
was
needed
before
the
Fed
would
consider
raising
the
range
for
the
federal
funds
target
rate.
The
economic
recovery
in
the
eurozone
was
slow,
as
quarter-over-quarter
GDP
growth
contracted
in
2021’s
first
quarter
before
returning
to
growth
in
2021’s
second
and
third
quarters.
GDP
growth
rates
were
initially
sluggish
among
the
region’s
largest
economies,
although
most
showed
signs
of
improvement
later
in
the
12-month
period.
Business
activity
growth
also
helped
European
developed
market
equities,
as
measured
by
the
MSCI
Europe
Index-NR,
to
post
a
+16.30%
total
return
for
the
12
months
under
review.
1
However,
in
November
2021,
the
annual
inflation
rate
in
the
eurozone
reached
the
highest
level
since
the
introduction
of
the
euro,
and
the
prospect
of
energy
shortages
during
the
winter
months
tempered
investor
optimism.
Asian
developed
and
emerging
market
equities,
as
measured
by
the
MSCI
All
Country
Asia
Index-NR,
posted
a
-2.49%
total
return
for
the
12-month
period.
1
While
many
Asian
countries
experienced
improving
economic
conditions,
Japan’s
quarter-over-quarter
GDP
contracted
in
2021’s
third
quarter.
China’s
economic
recovery
continued,
although
the
country’s
quarter-over-quarter
GDP
growth
in
2021’s
first
three
quarters
was
slower
than
in
2020’s
second
half,
pressured
by
higher
commodity
prices.
Unexpected
regulatory
changes
by
the
Chinese
government,
which
negatively
impacted
education-
and
technology-related
businesses,
and
concerns
about
a
large
Chinese
property
developer’s
solvency
pressured
Asian
stocks
during
2021’s
fourth
quarter.
Global
emerging
market
stocks,
as
measured
by
the
MSCI
Emerging
Markets
Index-NR,
posted
a
-2.54%
total
return
for
the
12
months
under
review.
1
Higher
inflation
led
many
central
banks
in
emerging
market
countries
to
raise
interest
rates,
which
dampened
economic
growth.
The
Omicron
variant
of
COVID-19
also
negatively
impacted
global
emerging
markets,
as
some
countries
reimplemented
restrictions
in
an
effort
to
counter
rising
infections.
The
foregoing
information
reflects
our
analysis
and
opinions
as
of
December
31,
2021.
The
information
is
not
a
complete
analysis
of
every
aspect
of
any
market,
country,
industry,
security
or
fund.
Statements
of
fact
are
from
sources
considered
reliable.
1.
Source:
Morningstar.
See
www.franklintempletondatasources.com
for
additional
data
provider
information.
4
franklintempleton.com
Annual
Report
Franklin
LifeSmart
Retirement
Income
Fund
This
annual
report
for
Franklin
LifeSmart
TM
Retirement
Income
Fund
covers
the
fiscal
year
ended
December
31,
2021.
Your
Fund’s
Goal
and
Main
Investments
The
Fund
seeks
to
make
monthly
distributions,
while
preserving
the
investors’
capital
over
the
long
term.
The
Fund
employs
an
asset
allocation
strategy,
combined
with
an
income
generation
strategy,
designed
for
investors
in
retirement.
Under
normal
market
conditions,
the
investment
manager
allocates
the
Fund’s
assets
among
the
broad
asset
classes
of
equity
and
fixed
income
investments
and
strategies
by
investing
primarily
in
a
distinctly-weighted
combination
of
other
funds
(underlying
funds),
predominantly
other
Franklin
Templeton
and
Legg
Mason
mutual
funds
and
exchange
traded
funds
(ETFs)
and
third-party
ETFs,
based
on
each
underlying
fund’s
predominant
asset
class
and
strategy.
Performance
Overview
The
Fund’s
Class
A
shares
posted
a
+5.41%
cumulative
total
return
for
the
12
months
ended
December
31,
2021.
In
comparison,
the
Fund’s
new
equity
benchmark,
the
MSCI
All
Country
World
Index
(ACWI)-NR,
which
measures
equity
market
performance
in
global
developed
and
emerging
markets,
posted
a
+18.54%
cumulative
total
return.
The
Fund’s
prior
equity
benchmark,
the
MSCI
ACWI,
posted
a
+19.04%
cumulative
total
return.
1
The
Fund’s
fixed
income
benchmark,
the
Bloomberg
Multiverse
Index,
a
broad-based
measure
of
the
global
fixed
income
bond
market,
posted
a
-4.51%
cumulative
total
return.
1
You
can
find
the
Fund’s
long-term
performance
data
in
the
Performance
Summary
beginning
on
page
6.
Performance
data
represent
past
performance,
which
does
not
guarantee
future
results.
Investment
return
and
principal
value
will
fluctuate,
and
you
may
have
a
gain
or
loss
when
you
sell
your
shares.
Current
performance
may
differ
from
figures
shown.
For
most
recent
month-end
performance,
go
to
franklintempleton.com
or
call
(800)
342-5236
.
Investment
Strategy
Under
normal
market
conditions,
40%
of
the
Fund’s
assets
are
allocated
to
equity
investments
and
60%
of
the
Fund’s
assets
are
allocated
to
fixed-income
investments.
The
underlying
funds
and
the
percentage
allocations
to
each
asset
class
may
be
changed
from
time
to
time
by
the
Fund’s
investment
manager
without
the
approval
of
shareholders,
and,
under
normal
market
conditions,
the
percentage
allocations
for
equity
and
fixed-income
funds
may
vary
up
to
10%
from
the
stated
allocations.
When
selecting
equity
funds,
the
investment
manager
considers
the
underlying
funds’
foreign
and
domestic
exposure,
market
capitalization
ranges,
and
investment
style
(growth
vs.
value).
When
selecting
fixed-income
funds,
the
investment
manager
considers
the
need
for
reduced
market
risks
and
lower
volatility,
appropriate
to
the
Fund’s
risk
profile,
and
considers
the
credit
quality,
duration
and
maturity
of
the
underlying
funds’
portfolios.
*The
portfolio
composition
is
based
on
the
Statement
of
Investments
(SOI),
which
classifies
each
underlying
fund
and
other
fund
investments
into
a
broad
asset
class
based
on
its
predominant
investments
under
normal
market
conditions.
Manager’s
Discussion
The
Fund’s
performance
can
be
attributed
largely
to
its
allocation
among
equities
and
fixed-income
securities
and
to
the
actual
performance
of
the
fund
investments.
The
Fund
was
able
to
successfully
meet
its
monthly
distributions
without
the
return
of
capital.
At
period-end,
our
largest
domestic
fixed
income
fund
holding,
Franklin
U.S.
Government
Securities
Fund
Class
R6,
performed
better
than
the
Fund’s
fixed
income
benchmark,
the
Bloomberg
Multiverse
Index.
Our
foreign
fixed
income
fund
holding,
Brandywine
GLOBAL
-
Global
Opportunities
Bond
Fund
-
USD
Hedged
Class
IS,
performed
better
than
the
Fund’s
fixed
income
benchmark,
the
Bloomberg
Multiverse
Index.
Our
largest
domestic
equity
fund
holding,
Global
X
U.S.
Preferred
ETF,
underperformed
the
Fund’s
equity
benchmark,
the
MSCI
ACWI-NR
and
our
largest
foreign
equity
fund
holding,
iShares
International
Portfolio
Composition*
12/31/21
%
of
Total
Net
Assets
Domestic
Fixed
Income
51.8%
Domestic
Equity
23.6%
Index-Linked
Notes
11.3%
Foreign
Equity
7.4%
Foreign
Fixed
Income
4.9%
Short-Term
Investments
&
Other
Net
Assets
1.0%
1.
Source:
Morningstar.
The
indexes
are
unmanaged
and
include
reinvestment
of
any
income
or
distributions.
They
do
not
reflect
any
fees,
expenses
or
sale
charges.
One
cannot
invest
directly
in
an
index,
and
an
index
is
not
representative
of
the
Fund’s
portfolio.
Net
Returns
(NR)
include
income
net
of
tax
withholding
when
dividends
are
paid.
See
www.franklintempletondatasources.com
for
additional
data
provider
information.
The
dollar
value,
number
of
shares
or
principal
amount,
and
names
of
all
portfolio
holdings
are
listed
in
the
Fund’s
Statement
of
Investments
(SOI).
The
SOI
begins
on
page
70
.
Franklin
LifeSmart™
Retirement
Income
Fund
5
franklintempleton.com
Annual
Report
Select
Dividend
ETF,
underperformed
the
Fund’s
equity
benchmark,
the
MSCI
ACWI-NR.
The
index-linked
note
increased
the
level
of
income
the
Fund
was
able
to
generate.
Thank
you
for
your
continued
participation
in
Franklin
LifeSmart™
Retirement
Income
Fund.
We
look
forward
to
serving
your
future
investment
needs.
Thomas
A.
Nelson,
CFA
Wylie
Tollette,
CFA
Berkeley
Revenaugh
Portfolio
Management
Team
The
foregoing
information
reflects
our
analysis,
opinions
and
portfolio
holdings
as
of
December
31,
2021,
the
end
of
the
reporting
period.
The
way
we
implement
our
main
investment
strategies
and
the
resulting
portfolio
holdings
may
change
depending
on
factors
such
as
market
and
economic
conditions.
These
opinions
may
not
be
relied
upon
as
investment
advice
or
an
offer
for
a
particular
security.
The
information
is
not
a
complete
analysis
of
every
aspect
of
any
market,
country,
industry,
security
or
the
Fund.
Statements
of
fact
are
from
sources
considered
reliable,
but
the
investment
manager
makes
no
representation
or
warranty
as
to
their
completeness
or
accuracy.
Although
historical
performance
is
no
guarantee
of
future
results,
these
insights
may
help
you
understand
our
investment
management
philosophy.
Top
10
Holdings
12/31/21
%
of
Total
Net
Assets
a
a
Global
X
U.S.
Preferred
ETF
11.6%
Franklin
U.S.
Government
Securities
Fund,
Class
R6
10.0%
Western
Asset
Income
Fund,
Class
IS
9.9%
Western
Asset
Short
Duration
High
Income
Fund,
Class
I
9.0%
Franklin
Liberty
U.S.
Core
Bond
ETF
9.0%
ClearBridge
Tactical
Dividend
Income
Fund,
Class
IS
8.0%
Franklin
Liberty
Investment
Grade
Corporate
ETF
5.9%
Credit
Suisse
AG,
Senior
Note
5.7%
UBS
AG,
Senior
Note
5.6%
Franklin
Liberty
High
Yield
Corporate
ETF
5.0%
CFA
®
is
a
trademark
owned
by
CFA
Institute.
Performance
Summary
as
of
December
31,
2021
Franklin
LifeSmart™
Retirement
Income
Fund
6
franklintempleton.com
Annual
Report
The
performance
tables
and
graphs
do
not
reflect
any
taxes
that
a
shareholder
would
pay
on
Fund
dividends,
capital
gain
distributions,
if
any,
or
any
realized
gains
on
the
sale
of
Fund
shares.
Total
return
reflects
reinvestment
of
the
Fund’s
dividends
and
capital
gain
distributions,
if
any,
and
any
unrealized
gains
or
losses.
Your
dividend
income
will
vary
depending
on
dividends
or
interest
paid
by
securities
in
the
Fund’s
portfolio,
adjusted
for
operating
expenses
of
each
class.
Capital
gain
distributions
are
net
profits
realized
from
the
sale
of
portfolio
securities.
Performance
as
of
12/31/21
1
Cumulative
total
return
excludes
sales
charges.
Average
annual
total
return
includes
maximum
sales
charges.
Sales
charges
will
vary
depending
on
the
size
of
the
investment
and
the
class
of
share
purchased.
The
maximum
is
5.50%
and
the
minimum
is
0%.
Class
A
:
5.50%
maximum
initial
sales
charge;
Advisor
Class
:
no
sales
charges.
For
other
share
classes,
visit
franklintempleton.com.
Performance
data
represent
past
performance,
which
does
not
guarantee
future
results.
Investment
return
and
principal
value
will
fluctuate,
and
you
may
have
a
gain
or
loss
when
you
sell
your
shares.
Current
performance
may
differ
from
figures
shown.
For
most
recent
month-end
performance,
go
to
franklintempleton.com
or
call
(800)
342-5236
.
Share
Class
Cumulative
Total
Return
2
Average
Annual
Total
Return
3
A
4
1-Year
+5.41%
-0.42%
5-Year
+30.74%
+4.32%
10-Year
+69.37%
+4.81%
Advisor
1-Year
+5.58%
+5.58%
5-Year
+32.34%
+5.76%
10-Year
+73.96%
+5.69%
30-Day
Standardized
Yield
6
Share
Class
Distribution
Rate
5
(with
fee
waiver)
(without
fee
waiver)
A
3.53%
3.26%
2.70%
Advisor
3.99%
3.74%
3.14%
See
page
8
for
Performance
Summary
footnotes.
Franklin
LifeSmart™
Retirement
Income
Fund
Performance
Summary
7
franklintempleton.com
Annual
Report
See
page
8
for
Performance
Summary
footnotes.
Total
Return
Index
Comparison
for
a
Hypothetical
$10,000
Investment
1
Total
return
represents
the
change
in
value
of
an
investment
over
the
periods
shown.
It
includes
any
applicable
maximum
sales
charge,
Fund
expenses,
account
fees
and
reinvested
distributions.
The
unmanaged
indexes
include
reinvestment
of
any
income
or
distributions.
They
differ
from
the
Fund
in
composition
and
do
not
pay
management
fees
or
expenses.
One
cannot
invest
directly
in
an
index.
Class
A
(1/1/12–12/31/21)
Advisor
Class
(1/1/12–12/31/21)
Franklin
LifeSmart™
Retirement
Income
Fund
Performance
Summary
8
franklintempleton.com
Annual
Report
Each
class
of
shares
is
available
to
certain
eligible
investors
and
has
different
annual
fees
and
expenses,
as
described
in
the
prospectus.
All
investments
involve
risks,
including
possible
loss
of
principal.
Since
the
Fund
invests
in
underlying
funds,
including
exchange-traded
funds
(ETFs),
which
may
engage
in
a
variety
of
investment
strategies
involving
certain
risks,
the
Fund
is
subject
to
those
same
risks.
Stock
prices
fluctuate,
sometimes
rapidly
and
dramatically,
due
to
factors
affecting
individual
companies,
particular
industries
or
sectors,
or
general
market
conditions.
Bond
prices
generally
move
in
the
opposite
direction
of
interest
rates.
Thus,
as
the
prices
of
bonds
in
the
Fund
adjust
to
a
rise
in
interest
rates,
the
Fund’s
share
price
may
decline.
Foreign
investing
carries
additional
risks
such
as
currency
and
market
volatility
and
political
or
social
instability,
risks
which
are
heightened
in
developing
countries.
Investments
in
equity-linked
notes
(ELNs)
often
have
risks
similar
to
their
underlying
securities,
which
could
include
management,
market,
and,
as
applicable,
foreign
securities
and
currency
risks.
In
addition,
ELNs
are
subject
to
certain
debt
securities
risks,
such
as
interest
rate
and
credit
risks,
as
well
as
counterparty
and
liquidity
risk.
Investments
in
equity
index-linked
notes
(ILNs)
often
have
risks
similar
to
securities
in
the
underlying
index,
which
could
include
management
risk,
market
risk
and,
as
applicable,
foreign
securities
and
currency
risks.
Investments
in
derivatives
involve
costs
and
can
create
economic
leverage,
which
may
result
in
significant
volatility
and
cause
the
fund
to
participate
in
losses
(as
well
as
gains)
that
exceed
the
fund’s
initial
investment.
The
Fund
is
not
guaranteed
to
achieve
its
investment
goal
of
preserving
capital
while
making
monthly
distributions
nor
is
there
any
guarantee
that
the
Fund
will
provide
sufficient
income
at
or
through
the
investor’s
retirement.
In
addition,
some
of
its
distributions
may
be
treated
in
part
as
a
return
of
capital
which
will
de-
crease
shareholders’
cost
basis
in
the
Fund
and
affect
the
amount
of
any
capital
gain
or
loss
that
shareholders
realize
when
selling
or
exchanging
Fund
shares.
The
annual
payout
rate
may
be
adjusted
higher
or
lower
from
year
to
year,
and
could
vary
substantially
over
time.
It
is
possible
for
the
Fund
to
suffer
substantial
investment
losses
and
simultaneously
experience
additional
asset
reductions
as
a
result
of
its
distributions
to
shareholders
under
the
managed
distribution
policy.
Investors
who
hold
the
Fund
within
a
tax-advantaged
retirement
account
should
consult
their
tax
advisors
to
discuss
tax
consequences
of
receiving
cash
distributions.
In
addition,
use
of
the
Fund
or
election
of
the
option
to
receive
distribution
payments
in
cash
may
be
restricted
in
certain
retirement
plans
by
the
terms
of
the
governing
plan
documents
and/or
the
discretion
of
the
plan
administrator.
Investors
are
strongly
advised
to
consult
with
their
financial
advisor
for
assistance
before
selecting
the
appropriate
fund,
based
on
their
goals
and
personal
situations,
including
time
horizon,
retirement
income
needs,
risk
tolerance
and
tax
bracket.
Events
such
as
the
spread
of
deadly
diseases,
disasters,
and
financial,
political
or
social
disruptions,
may
heighten
risks
and
adversely
affect
performance.
These
and
other
risks
are
described
more
fully
in
the
Fund’s
prospectus.
1.
The
Fund
has
an
expense
reduction
contractually
guaranteed
through
4/30/22.
Fund
investment
results
reflect
the
expense
reduction;
without
this
reduction,
the
results
would
have
been
lower.
Effective
1/29/21,
the
Fund
change
its
strategic
asset
allocation
40%
to
equity
funds
and
60%
to
fixed
income
funds
aligning
it
to
the
landing
point
of
the
glide
path
(the
strategic
asset
allocation
of
a
target
date
fund
over
time)
of
other
Franklin
LifeSmart
retirement
funds.
Previously,
as
of
5/1/16,
the
Fund
changed
its
name
from
Franklin
LifeSmart
2015
Retirement
Target
Date
Fund
in
connection
with
changes
to
its
strategies
including,
among
other
things,
the
addition
of
an
income
generation
strategy
to
support
the
Fund’s
managed
distribution
policy.
Prior
to
that,
as
of
October
2013,
the
Fund’s
glide
path
was
modified,
and
among
other
changes,
reflects
a
lower
starting
allocation
to
equity
funds.
Such
changes
can
impact
performance.
2.
Cumulative
total
return
represents
the
change
in
value
of
an
investment
over
the
periods
indicated.
3.
Average
annual
total
return
represents
the
average
annual
change
in
value
of
an
investment
over
the
period
indicated.
Return
for
less
than
one
year,
if
any,
has
not
been
annualized.
4.
Prior
to
9/10/18,
these
shares
were
offered
at
a
higher
initial
sales
charge
of
5.75%,
thus
actual
returns
(with
sales
charges)
would
have
differed.
Average
annual
total
returns
(with
sales
charges)
have
been
restated
to
reflect
the
current
maximum
initial
sales
charge
of
5.50%.
Net
Asset
Value
Share
Class
12/31/21
12/31/20
Change
A
(FTRAX)
$11.50
$11.62
-$0.12
C
(FRTCX)
$11.36
$11.48
-$0.12
R
(FBRLX)
$11.47
$11.59
-$0.12
R6
(FLMTX)
$11.55
$11.67
-$0.12
Advisor
(FLRDX)
$11.55
$11.66
-$0.11
Distributions
(1/1/21–12/31/21)
Share
Class
Net
Investment
Income
Short-Term