How do I invest in the American Funds?
If the American Funds approach to investing appeals to you, you may be interested in putting some of your nonretirement plan savings in the funds. The American Funds are sold through financial professionals, like the one who is associated with your company’s retirement plan.
The minimum initial investment is $250 for all funds except the money market funds and the state tax-exempt funds, for which the minimum is $1,000. The minimum investment for any additional investments you make is $50.
Talk with your financial professional before you make the first investment. He or she will help you figure out which fund or funds might be right for your particular needs. Then you’ll read the fund prospectus, work with your financial professional to fill out a simple application and send it to American Funds along with a check for the amount you’d like to invest.
You can make additional investments in a number of ways. Choose what’s most convenient for you:
- Contact your financial professional. If you do not have a professional and would like the name of one in your area, call us for a referral at 800/421-4120 between 8 a.m. and 8 p.m. Eastern time, Monday through Friday.
- Set up a direct transfer from your bank account using American FundsLink®.
- Set up a bank wire.
- Send regular monthly or quarterly investments. You may want to use American FundsLine® at 800/325-3590.
- Send a check with the investment coupon at the bottom of your statements.
- Use payroll deduction. Check with your employer on how to set this up.
Three ways to buy shares
There are three methods of buying fund shares outside of your retirement plan. These methods allow American Funds to compensate your financial professional for helping you decide which funds are right for your particular needs:
- Class A shares are sold with an up-front sales charge, which declines as the investment amount increases. For many American Funds shareholders — especially those with significant account balances — this remains the most cost-effective way to own American Funds shares.
- Class C shares do not have an up-front sales charge, but investors are subject to a 1% contingent deferred sales charge on shares sold within 12 months of purchase. In addition, investors pay higher expenses than on Class A shares. These shares convert to Class F-1 shares after 10 years.
- Class F shares are sold without a sales charge. Shareholders can purchase them through participating financial professionals, who receive an annual asset-based fee from their clients.
No class of shares is better than the others. You decide how you want to pay for your investment and the advice of your financial professional. When deciding which share class is best for you, be sure to consider how much you have to invest and how long you plan to stay invested. Your financial professional can help you decide which share class is appropriate for you. For more information about share classes, including specific sales charges and expenses, please see the fund prospectuses.
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 or downloaded and should be read carefully before investing.