Schwab Expands Line-up of Target Date Funds for Retail and Retirement Plan
Charles Schwab Bank also marks 10-year and four-year track records for two
target date fund families
SAN FRANCISCO -- January 23, 2013
Charles Schwab Investment Management, Inc. announced today three new additions
to the Schwab Target Funds for the years 2045, 2050, and 2055. Additionally,
Charles Schwab Bank has added two new funds to its line-up of collective trust
funds for eligible retirement plans – the Schwab Managed Retirement Trust Fund
2055 (SMRT 2055) and the Schwab Indexed Retirement Trust Fund 2055 (SIRT
With these additions, Schwab now offers a full suite of retail and
institutional target-date funds designed to meet the needs of investors and
retirement plan sponsors. The funds provide investors -- from those just
entering the workforce to retirees -- with broadly diversified retirement
solutions designed to become more conservative over time.
“These new funds are designed for young people who want an affordable,
accessible solution for a more distant retirement,” said Omar Aguilar, senior
vice president and chief investment officer, equities, for Charles Schwab
Investment Management. “Whether you’re investing in the funds directly or
through an employer’s retirement plan, they deliver broad asset allocation and
ongoing professional investment management.”
Schwab Target Funds for Individual Investors
The Schwab Target Funds are mutual funds designed primarily for retail
investors, and offer shareholders a diversified portfolio of both active and
passive management, as well as a combination of proprietary and externally
The Schwab Target Funds have net operating expense ratios ranging from 0.55%
to 0.84%, and a low $100 account minimum.
For more information about Schwab Target Funds, visit www.schwab.com/target or
SMRT and SIRT Collective Trust Funds for Retirement Plans
For sponsors of employer based retirement plans, Charles Schwab Bank offers
both active (SMRT) and passive (SIRT) products to provide flexibility and
The Schwab Managed Retirement Trust (SMRT) Funds and Schwab Indexed Retirement
Trust (SIRT) Funds, maintained by Charles Schwab Bank as trustee, offer target
date portfolios in a collective trust vehicle which are diversified across
traditional and non-traditional asset classes. The SMRT Funds use a
combination of active and passive investments while the SIRT Funds use
primarily passive investment strategies.
The Funds use an open-architecture approach, investing in strategies using
investment advice from many industry-recognized investment firms to complement
Schwab’s internal capabilities. This approach enables Charles Schwab Bank to
offer investors greater investment management expertise in each asset class,
and additional diversification. And, Charles Schwab Bank has increased
flexibility to replace underlying strategies, a focal point for retirement
plan fiduciaries when evaluating target fund construction.
This approach is unlike most other target date retirement funds which rely on
a single investment firm’s strategies for an entire target date portfolio. In
addition, the collective trust funds’ structure helps keep costs low, another
key benefit for plan sponsors and participants.
The Schwab Managed Retirement Trust Funds are available in four unit classes
with all-in operating expense ratios starting at 0.45 percent.
The Schwab Indexed Retirement Trust Funds are available in a single unit class
with no investment minimums and an all-in operating expense ratio of 0.18
The funds are available to eligible, qualified retirement plan clients of
Charles Schwab Bank, and to such entities through other retirement providers
via the National Securities Clearing Corporation (NSCC).
Plan sponsors and their advisors may learn more about the funds
Funds Reach Significant Milestones
Last quarter, the Schwab Managed Retirement Trust Funds reached their 10-year
anniversary, and the Schwab Indexed Retirement Trust Funds reached their
four-year anniversary this month.
The ten-year milestone for the original SMRT funds stands as one of the longer
track records for target date funds of any type. Additionally, the Class IV
unit classes of the original 2010, 2020, 2030 and 2040 funds have achieved
top-decile rankings over the ten-year period versus their respective
Morningstar categories as of 12/31/12.
“These milestones are significant. Offering funds with an established track
record and well-tested investment process in a retirement plan is important
both to plan sponsors and to the investment consultants who often evaluate and
recommend which funds are included in a plan,” said Mark Coffrini, senior vice
president of Retirement Business Services for Charles Schwab.
About Charles Schwab Investment Management
Founded in 1989, Charles Schwab Investment Management, Inc. (CSIM), a
subsidiary of The Charles Schwab Corporation, is one of the nation's largest
asset management companies with $219.3 billion in assets under management as
of December 31, 2012. It is among the country's largest money market fund
managers and is the third-largest provider of retail index funds.^1 In
addition to managing Schwab’s proprietary funds, CSIM provides oversight for
the institutional-style, sub-advised Laudus Fund family. CSIM currently
manages 76 mutual funds in addition to two separate account model portfolios,
and 15 ETFs.
About SMRT and SIRT
The Schwab Managed Retirement Trust Funds™ and the Schwab Institutional Trust
Funds® are collective trust funds maintained by Charles Schwab Bank, trustee
of the Funds. The Charles Schwab Bank collective trust funds are not insured
by FDIC or any other type of deposit insurance; are not deposits or other
obligations of, and are not guaranteed by Charles Schwab Bank or any of its
affiliates; and involve investment risks, including possible loss of principal
invested. The Funds are not mutual funds, and their units are not registered
under the Securities Act of 1933, as amended, or applicable securities laws of
any state or other jurisdiction. The Funds are exempt from registration under
the Investment Company Act of 1940, as amended, or other applicable law, and
unit holders are not entitled to the protections of the 1940 Act. As more
specifically defined in the Funds’ Declaration of Trust and Participation
Agreement documents, the Funds are available for investment by (i) retirement
plan trusts that qualify for exemption from federal income tax pursuant to
Section 501(a) of the Internal Revenue Code (“Code”) because they are
qualified under Section 401(a) of the Code, (ii) eligible governmental plans
under Section 457(b) of the Code which are exempt from tax under Section
457(g) of the Code, or (iii) group trusts which consist solely of the assets
of these types of plans. The decision to invest in the Funds should be
carefully considered. The unit values for the Funds will fluctuate, and
investors may lose money.
About Charles Schwab
The Charles Schwab Corporation (NYSE:SCHW) is a leading provider of financial
services, with more than 300 offices and 8.8 million active brokerage
accounts, 1.6 million corporate retirement plan participants, 865,000 banking
accounts, and $1.95 trillion in shareholders assets. The company was ranked
‘Highest in Investor Satisfaction with Self-Directed Services’ in the 2012 US
Self-Directed Investor Satisfaction Study^SM from J.D Power and Associates.
Through its operating subsidiaries, the company provides a full range of
securities brokerage, banking, money management and financial advisory
services to individual investors and independent investment advisors. Its
broker-dealer subsidiary, Charles Schwab & Co., Inc. (member SIPC,
www.sipc.org), and affiliates offer a complete range of investment services
and products including an extensive selection of mutual funds; financial
planning and investment advice; retirement plan and equity compensation plan
services; compliance and trade monitoring solutions; referrals to independent
fee-based investment advisors; and custodial, operational and trading support
for independent, fee-based investment advisors through its Advisor Services
division. Its banking subsidiary, Charles Schwab Bank (member FDIC and an
Equal Housing Lender), provides trust and custody services, banking and
lending services and products. Investment products offered by Charles Schwab &
Co., Inc. are not insured by the FDIC, are not deposits or obligations of
Charles Schwab Bank, and are subject to investment risk, including the
possible loss of principal invested. More information is available at
www.schwab.com and www.aboutschwab.com.
Follow us on Twitter: @charlesschwab
Brokerage Products: Not FDIC Insured | No Bank Guarantee | May Lose Value
Investors should carefully consider information contained in the prospectus,
including investment objectives, risks, charges, and expenses. You can view,
download, and print a prospectus by clicking Investor Information, or call
800-435-4000 to request a prospectus. Please read the prospectus carefully
Investment value and return will fluctuate, such that shares when redeemed may
be worth more or less than original cost. The values of the funds will
fluctuate up to and after the target dates. There is no guarantee the funds
will provide adequate income at or through retirement.
Past performance is no guarantee of future results.
The Funds are subject to market volatility and risks associated with the
underlying investments. Risks include exposure to international and emerging
markets, small company and sector equity securities, and fixed income
securities subject to changes in inflation, market valuations, liquidity,
prepayments, and early redemption.
The funds are built for investors who expect to start gradual withdrawals of
fund assets on the target date, to begin covering expenses in retirement.
The information presented is for general informational purposes only and
should not be considered an individualized recommendation or personalized
investment advice. The investment strategies mentioned here may not be
suitable for everyone. Each plan sponsor or consultant should carefully review
an investment strategy before making any investment decision.
The Laudus Group® of Funds includes the Laudus Mondrian and Laudus Growth
Investors Funds, which are part of the Laudus Trust and Laudus Institutional
Trust and distributed by ALPS Distributors, Inc.; and the Laudus MarketMasters
Funds®, which are part of the Schwab Capital Trust and distributed by Charles
Schwab & Co., Inc. Charles Schwab & Co., Inc. and ALPS Distributors, Inc. are
Schwab Affiliated Funds include Schwab Funds and Laudus Funds. Schwab Funds
and Laudus Funds are advised by Charles Schwab Investment Management, Inc., an
affiliate of Charles Schwab & Co., Inc.
Charles Schwab Investment Management, Inc. ("CSIM"), the investment advisor
for Schwab's proprietary funds, Charles Schwab & Co., Inc. ("Schwab"), the
distributor for Schwab Funds, and Charles Schwab Bank are separate but
affiliated companies and subsidiaries of The Charles Schwab Corporation.
© 2013 Charles Schwab & Co., Inc. All rights reserved. Unauthorized access is
prohibited. Usage will be monitored.
^1 Strategic Insight, November 2012
Alison Wertheim, 415-667-0475
The Neibart Group
David Neibart, 718-875-4198
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