In addition to similar portfolio construction, the Retirement Funds and Target Funds also share common attributes with respect to philosophy, process, and people—all of which are supported by a proprietary global research platform.
At the highest level, we believe that retirement accounts are designed to achieve two primary goals: accumulation of wealth prior to retirement and conversion of wealth to income during retirement.
The investment process for our target date solutions reflects the firm’s broader investment culture—a commitment to fundamental research and close collaboration among seasoned professionals that allows us to deliver investment management excellence. This process begins with the firm’s Asset Allocation Committee—a team of senior investment professionals that helps to guide and manage all of the firm’s asset allocation portfolios. The committee also approves all strategic and tactical asset allocation changes for our suite of target date solutions.
With over 20 years of experience in building asset allocation portfolios, T. Rowe Price offers a consistent investment process with a long-tenured, dedicated target date portfolio management team.
Jerome Clark, CFA
Portfolio Manager of Retirement Funds
Co-portfolio Manager of Target Funds
Wyatt Lee, CFA
Co-portfolio Manager of Target Funds
The principal value of the Retirement Funds and Target Funds (collectively, the "target date funds”) is not guaranteed at any time, including at or after the target date, which is the approximate year an investor plans to retire (assumed to be age 65) and likely stop making new investments in the fund. If an investor plans to retire significantly earlier or later than age 65, the funds may not be an appropriate investment even if the investor is retiring on or near the target date. The target date funds’ allocations among a broad range of underlying T. Rowe Price stock and bond funds will change over time. The Retirement Funds emphasize potential capital appreciation during the early phases of retirement asset accumulation, balance the need for appreciation with the need for income as retirement approaches, and focus on supporting an income stream over a long-term retirement withdrawal horizon. The Target Funds emphasize asset accumulation prior to retirement, balance the need for reduced market risk and income as retirement approaches, and focus on supporting an income stream over a moderate postretirement withdrawal horizon. The target date funds are not designed for a lump-sum redemption at the target date and do not guarantee a particular level of income. The key difference between the Retirement Funds and the Target Funds is the overall allocation to equity; although they each maintain significant allocations to equities both prior to and after the target date, the Retirement Funds maintain a higher equity allocation, which can result in greater volatility over shorter time horizons.
For over two decades, we have managed asset allocation portfolios, adding value through portfolio construction, risk management, and glide path design. A long-term approach underlies this philosophy.
The T. Rowe Price Retirement Active Trusts and Retirement Date Trusts (the “Trusts”) are not mutual funds. They are common trust funds established by T. Rowe Price Trust Company under Maryland banking law, and their units are exempt from registration under the Securities Act of 1933. Investments in the Trusts are not deposits or obligations of, or guaranteed by, the U.S. government or its agencies or T. Rowe Price Trust Company and are subject to investment risks, including possible loss of principal.