Mutual Fund Summary Prospectus (497k)
August 07 2013 - 5:26PM
Edgar (US Regulatory)
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SUMMARY
PROSPECTUS
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TRFOX
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August
20, 2013
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T. Rowe Price
Target
Retirement 2050 Fund
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A fund managed based
on a specific retirement year that seeks capital growth and income through investments in a combination
of T. Rowe Price stock and bond funds.
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Before you invest, you
may want to review the funds prospectus, which contains more information about the fund and its
risks. You can find the funds prospectus and other information about the fund online at
troweprice.com/prospectus.
You can
also get this information at no cost by calling
1-800-225-5132
or by sending an e-mail request to
info@troweprice.com.
This Summary
Prospectus incorporates by reference the funds prospectus, dated August 20, 2013, and Statement
of Additional Information, dated August 20, 2013.
The
Securities and Exchange Commission has not approved or disapproved these securities or passed upon the
adequacy of this prospectus. Any representation to the contrary is a criminal offense.
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Investment Objective
The fund seeks the highest total return over time consistent with
an emphasis on both capital growth and income.
Fees and Expenses
This table describes the fees
and expenses that you may pay if you buy and hold shares of the fund.
Fees and Expenses of the Fund*
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Shareholder fees (fees paid
directly from your investment)
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Maximum sales charge (load) imposed on
purchases
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NONE
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Maximum deferred sales charge (load)
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NONE
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Redemption fee
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NONE
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Maximum account fee
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$20
a
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Annual fund operating expenses
(expenses that you pay each year
as a
percentage of the value of your investment)
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Management fees
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0.00%
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Distribution and service (12b-1) fees
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0.00%
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Other expenses
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0.00%
b
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Acquired fund fees and expenses
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0.77%
b
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Total annual fund operating expenses
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0.77%
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*
While the fund itself charges no management fee, it will indirectly
bear its pro-rata share of the expenses of the underlying T. Rowe Price funds in which it invests (acquired
funds). The acquired funds are expected to bear the operating expenses of the fund.
a
Subject
to certain exceptions, accounts with a balance of less than $10,000 are charged an annual $20 fee.
b
Expenses are estimated for
the current fiscal year.
Example
This example is intended to help you compare the cost of investing in the fund with the cost of investing
in other mutual funds. The example assumes that you invest $10,000 in the fund for the time periods indicated
and then redeem all of your shares at the end of those periods. The example also assumes that your investment
has a 5% return each year and that the funds operating expenses remain the same. Although your
actual costs may be higher or lower, based on these assumptions your costs would be:
Portfolio
Turnover
The fund pays transaction costs, such as commissions, when it buys and sells securities
(or turns over its portfolio). A higher portfolio turnover rate may indicate higher transaction
costs and may result in higher taxes when fund shares are held in a taxable account. These costs, which
are not reflected in annual fund operating expenses or in the example, affect the funds performance.
Investments,
Risks, and Performance
Principal Investment
Strategies
The fund pursues its objective by investing in a diversified portfolio of other T.
Rowe Price stock and bond funds that represent various asset classes and sectors. The funds allocation
between T. Rowe Price stock and bond funds will change over time in relation to its target retirement
date.
The
fund is managed based on the specific retirement year (target date 2050) included in its name and assumes
a retirement age of 65. The target date refers to the approximate year an investor in the fund would
plan to retire and likely stop making new investments in the fund. The fund is primarily designed for
an investor who anticipates retiring at or about the target date and who plans to withdraw the value
of the account in the fund over a moderate time horizon in retirement. This fund may not be appropriate
for an investor who plans to retire on or near the target date, but at an age well before or after age
65.
Over
time, the allocation to asset classes and funds will change according to a predetermined glide
path shown in the following chart. The glide path represents the shifting of asset classes over
time and shows how the funds asset mix becomes more conservativeboth prior to and after retirementas
time elapses. This reflects the need for reduced market risks as retirement approaches and the need for
lower portfolio volatility after retiring. Although the glide path is meant to dampen the funds
potential volatility as retirement approaches, the fund is not designed for a lump sum redemption at
the retirement date. The fund pursues an asset allocation strategy that promotes asset accumulation prior
to retirement, but it is intended to also serve as a post-retirement investment vehicle with allocations
designed to support an income stream over a moderate post-retirement withdrawal horizon. After
the target date, the fund is designed to balance the need for reduced market risk and income, although
it does not guarantee a particular level of income.
At the target date, the funds allocation to stocks is anticipated to be approximately
42.5% of its assets. The funds exposure to stocks will continue to decline until approximately
30 years after its target date, when its allocation to stocks will remain fixed at approximately 20%
of its assets and the remainder will be invested in bonds. There are no maturity restrictions within
the funds overall allocation to bonds, although the bond funds in which the fund invests may impose
specific limits on maturity or credit quality. The allocations shown in the glide path are referred to
as neutral allocations because they do not reflect any tactical decisions made by T. Rowe
Price to overweight or underweight a particular asset class or sector based on its market outlook. The
target allocations assigned to the broad asset classes (Stocks and Bonds), which reflect these tactical
decisions resulting from market outlook, are not expected to vary from the neutral allocations set forth
in the glide path by more than plus (+) or minus (-) five percentage (5%) points.
The following table details
the way the portfolio is generally expected to be allocated between the asset classes. The table also
shows the sectors within those broad asset classes to which the portfolio will have exposure, and the
expected allocations to the T. Rowe Price funds that will be used to represent those sectors. The information
in the table represents the neutral allocations for the fund at inception. The target allocations and
actual allocations may differ. The funds shareholder reports will set forth its actual allocations
between stock funds and bond funds and to the individual T. Rowe Price funds.
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Target
2050 Fund
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Asset Class
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Sector
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Fund
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Neutral Allocation
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Stocks
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88.00%
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Domestic Large-Cap Stocks
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Equity Index 500
Growth Stock
Value
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7.24%
18.91
18.91
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Domestic Mid-Cap Stocks
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Mid-Cap Growth
Mid-Cap Value
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3.51
3.51
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Domestic Small-Cap Stocks
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New Horizons
Small-Cap Stock
Small-Cap
Value
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2.15
2.14
2.15
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International Developed Market
Stocks
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International Growth & Income
International Stock
Overseas
Stock
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7.11
7.11
7.10
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International Emerging Market
Stocks
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Emerging Markets Stock
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3.76
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Inflation Focused Stocks
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Real Assets
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4.40
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Bonds
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12.00
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Domestic Investment-Grade Bonds
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New Income
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8.40
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Domestic High Yield Bonds
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High Yield
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1.20
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International Bonds
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Emerging Markets Bond
International Bond
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1.20
1.20
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Inflation
Focused Bonds
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Inflation Focused Bond
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0.00
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Principal Risks
As with any
mutual fund, there is no guarantee that the fund will achieve its objective. The funds share price
fluctuates, which means you could lose money by investing in the fund. You may experience losses, including
losses near, at, or after the target retirement date. There is no guarantee that the fund will provide
adequate income at and through your retirement. The principal risks of investing in this fund are summarized
as follows:
Asset allocation
risk
The funds risks will directly correspond to the risks of the underlying funds in which
it invests. By investing in many underlying funds, the fund has partial exposure to the risks of many
different areas of the market, and the funds overall level of risk should decline over time. However,
the selection of the underlying funds and the allocation of the funds assets among the various
asset classes and market sectors could cause the fund to underperform other funds with a similar investment
objective.
General equity risk
Stocks generally
fluctuate in value more than bonds and may decline significantly over short periods. As with any fund
having equity exposure, the funds share price can fall because of overall weakness in the stock
market. The value of a stock fund in which the fund invests may decline due to general market conditions
or because of factors that affect a particular industry or market sector.
Small- and mid-cap stock risk
Investing in small- and mid-cap
funds entails greater risk than investing in funds that focus on larger companies. Stocks of smaller
companies
are usually more volatile than stocks of larger companies because smaller companies usually have more
limited financial resources, less experienced management, and less publicly available information, and
seldom pay significant dividends that could help to cushion returns in a falling market.
Investment style risk
Because the fund invests in stock funds
with both growth and value characteristics, its share price may be negatively affected if either investing
approach falls out of favor. Growth stocks tend to be more volatile than certain other types of stocks
and are more sensitive to changes in current or expected earnings. Value stocks carry the risk that investors
will not recognize their intrinsic value for a long time or that they are actually appropriately priced
at a low level.
Interest rate risk
This is the risk that a rise in interest rates could cause the price of a bond fund in which the fund
invests to fall. Generally, the longer the weighted average maturity of an underlying fund, the greater
its interest rate risk.
Credit risk
This is the risk that an issuer of a debt security held by an underlying bond fund could suffer an adverse
change in financial condition that results in a payment default, security downgrade, or inability to
meet a financial obligation, thereby negatively affecting the funds price or yield. The funds
exposure to credit risk is increased to the extent it invests in bond funds that hold securities rated
as below investment-grade, also known as junk bonds. Junk bonds carry a higher risk of default
and should be considered speculative.
Liquidity
risk
This is the risk that a fund may not be able to sell a holding in a timely manner at a desired
price. This risk could affect both stock and bond funds in which the fund invests.
Foreign investing risk
This is the risk that the funds
investments in international funds may be adversely affected by economic conditions or developments overseas,
or decreases in foreign currency values relative to the U.S. dollar. The risks are heightened for underlying
funds that focus on emerging markets.
Performance
Because the fund commenced operations in 2013, there is no historical performance information shown
here. Performance history will be presented after the fund has been in operation for one full calendar
year.
Current
performance information may be obtained through troweprice.com or by calling 1-800-225-5132.
Management
Investment Adviser
T. Rowe
Price Associates, Inc. (T. Rowe Price)
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Portfolio
Manager
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Title
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Managed Fund Since
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Joined Investment
Adviser
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Jerome A. Clark
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Co-Chairman of
Investment Advisory Committee
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2013
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1992
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Wyatt A. Lee
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Co-Chairman of
Investment Advisory Committee
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2013
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1999
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Purchase
and Sale of Fund Shares
The funds investment minimums generally are as follows (if you hold shares through
a financial intermediary, the intermediary may impose different investment minimums):
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Type of Account
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Minimum
initial purchase
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Minimum subsequent
purchase
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Individual
retirement accounts, small business retirement plan accounts, and Uniform Gifts to Minors Act or Uniform
Transfers to Minors Act accounts
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$1,000
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$100
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All other accounts
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2,500
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100
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You
may purchase, redeem, or exchange shares of the fund on any day the New York Stock Exchange is open for
business by accessing your account online at troweprice.com, by calling 1-800-225-5132, or by written
request. If you hold shares through a financial intermediary, you must purchase, redeem, and exchange
shares through your intermediary.
Tax Information
Any dividends or capital gains
are declared and paid annually, usually in December. Distributions by the fund, whether or not you reinvest
these amounts in additional fund shares, may be taxed as ordinary income or capital gains unless you
invest through a tax-deferred account. A redemption or exchange of fund shares may be taxable.
Payments
to Broker-Dealers and Other Financial Intermediaries
If you purchase shares of the fund through a
broker-dealer or other financial intermediary (such as a bank), the fund and its related companies may
pay the intermediary for the sale of fund shares and related services. These payments may create a conflict
of interest by influencing the broker-dealer or other intermediary and your salesperson to recommend
the fund over another investment. Ask your salesperson or visit your financial intermediarys website
for more information.
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T. Rowe Price
Associates, Inc.
100 East Pratt Street
Baltimore, MD 21202
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F198-045
8/20/13
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