Age-Based Funds and Target Retirement Funds

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Age-based funds are marketed by big companies such as T. Rowe Price, Vanguard, and Fidelity as a fund that you can invest in and forget about until you need it. However there are some things you absolutely need to know before getting involved in one.

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Age-Based Funds and Target Retirement Funds

  1. 1. Mullooly Asset Management Podcast February 6, 2013Mullooly Asset Management February 2013
  2. 2. When You Retire…Do you want to get swung around by the stock market?Where will interest rates be? Mullooly Asset Management February 2013
  3. 3. When Your Child is Ready for College…Should that 529 account be…All in stocks?All in short-term bonds? Mullooly Asset Management February 2013
  4. 4. From T Rowe Price website:Investment objective – provide highest total return with emphasis on capital growth/incomeStrategy – To invest in a diversified portfolio …that represent various asset classes and sectors. As the fund nears its target retirement date, its allocation … will become more conservative over time based on a pre- determined “glide path”. Mullooly Asset Management February 2013
  5. 5. TRRDX T Rowe Price 2040 FundCurrently: -90% in stocks -7% in bonds -3% cashOf 90% in stocks: -74% large caps -21% mid caps -5% small caps Mullooly Asset Management February 2013
  6. 6. With all Target Date(or Age-Based) Funds:What stocks do they own?A “basket” of other mutual funds (a “fund of funds”) Mullooly Asset Management February 2013
  7. 7. TRRAX: T Rowe Price 2010 FundIn the 2010 Fund: -51% in stocks -42% in bonds -5% in cashFrom the T Rowe Price website:“You should choose the Retirement Fund with the target date closest to the year you reach age 65.” Mullooly Asset Management February 2013
  8. 8. None of the securities mentioned in this (or any)podcast or video represent past specificrecommendations of Mullooly Asset Management.This video is NOT a recommendation to buy or sell anyof the securities mentioned here.If you’re relying on a podcast for investment advice, youare likely making a huge mistake.We strongly urge our listeners to consult with theirinvestment advisor before they make a decision to buyor sell any investment. Mullooly Asset Management February 2013
  9. 9. Mullooly Asset Management, LLC support (at) mullooly (dot) net 732-223-9000 www.mullooly.net Mullooly Asset Management February 2013
  10. 10. Mullooly Asset Management, LLC support (at) mullooly (dot) net 732-223-9000 www.mullooly.net Mullooly Asset Management February 2013

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