Target Date Blend

Our Target Date Retirement Blend Series seeks to preserve the design principles of our all-active approach while thoughtfully integrating passive vehicles to obtain market exposures with the potential to lower tracking error and overall costs. It is designed to build and preserve wealth, using our established glide path for strategic asset allocation direction, as well as dynamic bottom-up flexibility and security selection via active underlying strategies.

Design principles

A focus on participant objectives
Our Series focuses on the complex and evolving mix of objectives (such as growth and capital preservation) that participants want.

Combination of active and passive
Passive strategies are integrated with actively managed Capital Group strategies across major asset classes including U.S. and non-U.S. equities and fixed income.

Research-driven allocations
Capital Group’s multidimensional portfolio construction methodologies seek to deliver better outcomes through strategic asset allocation research and by harnessing underlying portfolio flexibility, where applicable, among other techniques.

Our glide path within a glide path

Our target date blend Series adjusts both the proportion and types of fixed income and equities over time as it seeks to generate returns and manage risk

Allocation by objective and asset type

This stacked area chart illustrates how the composition of the strategy’s holdings broken down by roles and objectives evolves over time. The y-axis is scaled from 0% to 100%. The x-axis begins 45 years to retirement and continues for 30 years following retirement. At 45, 40 and 30 years to retirement, the target allocation is 37% to growth, 26% to growth and income, 9% to balanced, 3% to diversification from equity, 21% to passive equity and 4% to passive fixed income. At 25 years to retirement, the target allocation is 34% to growth, 25% to growth and income, 2% to equity income, 9% to balanced, 3% to diversification from equity, 23% to passive equity and 4% to passive fixed income. At 20 years to retirement, the target allocation is 32% to growth, 23% to growth and income, 4% to equity income, 9% to balanced, 3% to diversification from equity, 24% to passive equity and 5% to passive fixed income. At 15 years to retirement, the target allocation is 26% to growth, 23% to growth and income, 5% to equity income, 9% to balanced, 2% to income, 1% to inflation protection, 3% to diversification from equity, 23% to passive equity and 8% to passive fixed income At 10 years to retirement, the target allocation is 16% to growth, 22% to growth and income, 7% to equity income, 9% to balanced, 5% to income, 2% to inflation protection, 7% to diversification from equity, 18% to passive equity and 14% to passive fixed income. At five years to retirement, the target allocation is 11% to growth, 18% to growth and income, 8% to equity income, 9% to balanced, 10% to income, 3% to inflation protection, 6% to diversification from equity, 17% to passive equity and 18% to passive fixed income. At retirement, the target allocation is 3% to growth, 16% to growth and income, 11% to equity income, 9% to balanced, 14% to income, 3% to inflation protection, 7% to diversification from equity, 14% to passive equity and 23% to passive fixed income. At five years post-retirement, the target allocation is 2% to growth, 14% to growth and income, 14% to equity income, 8% to balanced, 14% to income, 3% to inflation protection, 7% to diversification from equity, 14% to passive equity and 24% to passive fixed income. At 10 years post-retirement, the target allocation is 13% to growth and income, 14% to equity income, 7% to balanced, 15% to income, 3% to inflation protection, 6% to diversification from equity, 2% to capital preservation, 13% to passive equity and 27% to passive fixed income. At 15 years post-retirement, the target allocation is 11% to growth and income, 18% to equity income, 4% to balanced, 11% to income, 3% to inflation protection, 7% to diversification from equity, 6% to capital preservation, 13% to passive equity and 27% to passive fixed income. At 20 years post-retirement, the target allocation is 8% to growth and income, 19% to equity income, 3% to balanced, 9% to income, 3% to inflation protection, 11% to diversification from equity, 7% to capital preservation, 12% to passive equity and 28% to passive fixed income. At 25 years post-retirement, the target allocation is 5% to growth and income, 19% to equity income, 3% to balanced, 9% to income, 3% to inflation protection, 12% to diversification from equity, 9% to capital preservation, 10% to passive equity and 30% to passive fixed income. At 30 years post-retirement, the target allocation is 4% to growth and income, 20% to equity income, 3% to balanced, 7% to income, 3% to inflation protection, 10% to diversification from equity, 13% to capital preservation, 9% to passive equity and 31% to passive fixed income.

Source: Capital Group. The target allocations shown are as of January 31, 2024, and are subject to the oversight committee’s discretion. The investment adviser anticipates assets will be invested within a range that deviates no more than 10% above or below the allocations shown in the characteristics statement. Underlying strategies may be added or removed during the year. Passive strategies are managed to deliver a pattern of results consistent with an index, unlike Capital Group strategies, which are managed to specific objectives, as illustrated. For that reason, within our investment process we do not categorize passive strategies to Capital Group’s investment framework.

Our Blend approach

A target date blend solution that gives participants access to an objective-based glide path that aligns with their goals and has the potential to outpace markets with a focus on lower costs

Active oversight and strategies

Capital Group’s active portfolio construction and underlying strategies seek to deliver superior outcomes relative to benchmarks with lower risk

Security selection
The ability to pursue excess return from active investment decisions

Glide path
A strategic asset allocation that evolves over time

Flexibility
The ability to tactically deviate from strategic asset allocations

Passive complement

Passive strategies seek to efficiently increase investors’ breadth of holdings at a low cost

Reduce tracking error
The ability to minimize differences in returns versus the benchmark

Lower overall costs
Seeks to lower total expense ratios while providing broad market exposure

Broad exposure
Exposure across market caps, geography, ratings and subsectors complement active holdings

A focus on maximizing active exposure for higher return potential

Active allocation as a % of vintage: Capital Group Target Date Retirement Blend Series and four significant peers

This chart illustrates the percentage allocated to active underlying strategies of the Capital Group Target Date Retirement Blend Strategy compared to four significant peers. For the vintages compared (2065 through 2010) the Capital Group Target Date Retirement Blend Series has the highest percentage allocated to active (ranging from 75% for the 2065 through 2055 vintages to 60% for the 2015 and 2010 vintages). The overall range of the analysis is at its maximum for the 2065 vintage, with the active allocation percentage ranging from 75% to 10% before narrowing to 60% to 45% for the 2010 vintage. An average line is plotted on the chart and remains near the 50% threshold across the vintages in the analysis.

Source: Capital Group using Morningstar data as of June 30, 2024. Peers included in the analysis are the CIT vehicles of the Fidelity Freedom Blend, JPMorgan SmartRetirementBlend, T.Rowe Price Retirement Blend and Principal LifeTime Hybrid strategies. These peers were selected because they are the blend/hybrid strategies of the 10 largest target date managers by assets under management as of December 31, 2023, according to Morningstar, excluding series that are not proactively distributed or have limited platform availability. To calculate the range and average data points, the allocation data for Capital Group Target Date Retirement Blend Series plus the four peers was combined and the minimum, maximum and average values were plotted. The area between the minimum and maximum values is shaded. Data shown reflects all existing vintages for the five series presented, with notable exceptions being a lack of 2015 and 2010 vintages for JPMorgan SmartRetirement Blend, the lack of a 2010 vintage for Principal LifeTime Hybrid, and no retirement income vintage for the Capital Group Target Date Retirement Blend Series.

Our Series emphasizes active exposure along the glide path relative to peers and the difference is especially noticeable in further-dated vintages with a growth orientation. We believe that a higher allocation to actively managed, equity-focused strategies can seek to maximize the capital appreciation potential that is so critical to younger participants.

Rigorous passive selection process

Qualitative metrics

Established providers track desired exposures with strong operational resources, research capabilities and deep expertise.

Qualitative screening

Metrics include fees, returns, tracking error and relative drawdown.

Target Date Solutions Committee

Our Target Date Solutions Committee, which oversees the Strategy, brings a diversity of experience and draws on the fundamental research and quantitative resources of the global Capital Group team.

Michelle Black Portfolio Manager
David Hoag Portfolio Manager
Samir Mathur Portfolio Manager
Raj Paramaguru Solutions Portfolio Manager
Wesley Phoa Portfolio Manager
Will Robbins Portfolio Manager
Jessica Spaly Portfolio Manager
Shannon Ward Portfolio Manager

Learn more about how our Blend approach is differentiated in the industry

Learn more

Investments are not FDIC-insured, nor are they deposits of or guaranteed by a bank or any other entity, so they may lose value.

Investors should carefully consider investment objectives, risks, charges and expenses. This and other important information is contained in the fund prospectuses and summary prospectuses, which can be obtained from a financial professional and should be read carefully before investing.

Important information about objectives, risks, charges and expenses for collective investment trusts is contained in the Characteristics Statement, which can be obtained from Capital Group or participants' plan provider or employer.

Although the target date portfolios are managed for investors on a projected retirement date time frame, the allocation strategy does not guarantee that investors' retirement goals will be met. Investment professionals manage the portfolio, moving it from a more growth-oriented strategy to a more income-oriented focus as the target date gets closer. The target date is the year that corresponds roughly to the year in which an investor is assumed to retire and begin taking withdrawals. Investment professionals continue to manage each portfolio for approximately 30 years after it reaches its target date.

All Capital Group trademarks mentioned are owned by The Capital Group Companies, Inc., an affiliated company or fund. All other company and product names mentioned are the property of their respective companies.

Use of this website is intended for U.S. residents only.

Collective Investment Trusts (CITs) are available for investment only to certain qualified retirement plans. Capital Group CITs are maintained by Capital Bank and Trust Company (“trustee”), which has retained an affiliate to serve as investment adviser to the trustee.

Capital Client Group, Inc.

This content, developed by Capital Group, home of American Funds, should not be used as a primary basis for investment decisions and is not intended to serve as impartial investment or fiduciary advice.

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Capital Group Target Date Retirement Blend Series

A thoughtful combination of active and passive management