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Lifecycle Funds

Welcome to Your Money.  The topic of today’s podcast is lifecycle funds. 

To accommodate investors who prefer to use one investment to save for a particular investment goal, such as retirement, some mutual fund companies have begun offering a product known as a "lifecycle fund."  A lifecycle fund is a diversified mutual fund – one that automatically shifts towards a more conservative mix of investments as it approaches a particular year in the future, known as its "target date."  

As an investor, you have one responsibility if you invest in a lifecycle – picking a fund with the right target date based on your particular investment goal.  The managers of the fund then do the rest.  They make all the decisions about asset allocation, diversification, and rebalancing, for example.  Some people think of it as investing on “cruise control.”  It's easy to identify a lifecycle fund because its name likely will refer to its target date. For example, you might see lifecycle funds with names like "Portfolio 2015," "Retirement Fund 2030," or "Target 2045."

For more information, here are the names of a couple of brochures you should check out: 

Both brochures are available online in the Investor Information section of the SEC’s website (www.sec.gov).  You also can get SEC publications by calling 1-800-SEC-0330.  Tell them the folks at “Your Money” told you to call.

Thanks for joining us. Your Money is brought to you by the U.S. Securities and Exchange Commission. Write us at podcast@sec.gov  


http://www.sec.gov/rss/your_money/lifecycle.htm

We have provided this information as a service to investors.  It is neither 
a legal interpretation nor a statement of SEC policy.  If you have questions concerning the meaning or application of a particular 
law or rule, please consult with an attorney who specializes in securities law.


Modified: 08/01/2006