SOURCE: Putnam Investments

Putnam Investments

March 22, 2011 09:59 ET

Putnam Develops Fund Suite to Address Retirement Income Needs of Baby Boomers and Longer-Term Retirees

New Investment Solutions and Planning Tool to Address Boomers' Need for Management of Retirement Savings Withdrawal Phase; Retirement Income Products to Integrate Absolute Return Strategies to Address Volatility

BOSTON, MA--(Marketwire - March 22, 2011) - As 75 million baby boomers* begin to turn age 65 this year -- at a pace of roughly 7,000 a day -- Putnam Investments plans to offer a unique suite of income-oriented funds that aim to help advisors work with retirees in developing strategies for monthly income flows, at varying levels of risk tolerance, to flexibly address their changing lifestyle financial needs throughout retirement. 

The product suite, composed of Putnam Retirement Income Fund Lifestyle 1, Putnam Retirement Income Fund Lifestyle 2, and Putnam Retirement Income Fund Lifestyle 3, is expected to have broad applicability for defined contribution, IRA, and other retirement assets. The funds will be accompanied by a new, prescriptive planning tool to help guide advisors and clients in creating a range of personalized income strategies drawing from their retirement savings. These Putnam Funds, combined with the planning tool, allow risk levels and withdrawal rates to be customized and regularly updated to meet individuals' needs and evolving circumstances. Subject to regulatory review, the funds are expected to be available in their entirety by midyear. The tool will be available at or near the funds' launch.

Putnam's retirement income solutions are designed to focus on the "drawdown" phase, in which investors withdraw assets to provide retirement income, and to complement Putnam RetirementReady® Funds, the firm's 10-fund suite of target-date/lifecycle funds, which seek to help investors in their savings phase. The new offerings will integrate absolute return funds, which seek positive returns over a period of three years with less volatility than has been associated with traditional asset classes that have earned similar rates of return. 

"Turning life savings into lifetime income is the toughest challenge millions of Americans face as they move into retirement. The stakes are very high," said Robert L. Reynolds, Putnam's President and Chief Executive Officer.

Reynolds added, "We are seeking to address the breadth of retirees' ever-changing lifestyle income needs and full range of risk tolerance by offering clear guidance on withdrawal rates that can be adjusted regularly, as markets and their own life circumstances change." He indicated that the Putnam Lifestyle solutions "are designed to enable advisors, working with their clients, to choose strategies that reflect individually appropriate risk levels and then to set personalized withdrawal rates from their various retirement savings vehicles." 

The suite, which is designed for investors who are already in retirement, who plan to retire in the near future or who expect to begin withdrawing their invested funds soon. The products can be used as a stand-alone solution or to work in tandem with other retirement income vehicles, and will offer funds with differing levels of return potential and risk, seeking to meet retirees' diverse needs, timelines and investment goals. The inclusion of absolute return strategies across the suite demonstrates the importance of volatility management throughout the asset "drawdown" phase.

The new suite of retirement income funds will consist of the following:

  • Putnam Retirement Income Fund Lifestyle 1, the suite's retirement income conservative option, will be the new name of Putnam RetirementReady Maturity Fund, which includes a combination of Putnam Absolute Return 100, 300 and 500 Funds, Putnam Asset Allocation: Conservative Portfolio and Putnam Money Market Fund.
  • Putnam Retirement Income Fund Lifestyle 2, a moderate retirement income portfolio, will be a new fund and strategy based on a combination of Putnam Absolute Return 100, 300, 500 and 700 Funds, domestic and international equity securities, convertible securities and fixed income securities.
  • Putnam Retirement Income Fund Lifestyle 3, the most aggressive option in the suite, will be the new name of Putnam Income Strategies Fund, which will be modified to include a combination of Putnam Absolute Return 700 Fund, domestic and international equity securities, convertibles and fixed income securities. It seeks current income consistent with what Putnam believes to be prudent risk, with a secondary objective of capital appreciation.

The funds will be managed by Jeffrey L. Knight, CFA, Putnam's Head of Global Asset Allocation; Robert J. Kea, CFA, a 23-year industry veteran who joined Putnam in 1988; and Robert J. Schoen, a 22-year industry veteran who joined Putnam in 1997.

The three funds are expected to be placed in Lipper's new Retirement Income Category and in Morningstar's Retirement Income Category.

Putnam Investments and Retirement
Since Reynolds, a 30-year veteran of the retirement savings industry, became Putnam's President and CEO in 2008, the company has deepened its commitment to the retirement market and launched a series of innovations and initiatives to meet emerging customer needs. These retirement initiatives include a Lifetime Income(SM) Analysis Tool for plan participants and new levels of fee transparency disclosures designed to provide the clearest, most complete overview of fees and expenses in the workplace savings industry.

Putnam also has expanded the services it offers to 401(k) retirement plans and has developed products to meet the needs of those planning for or already in retirement. The firm has created a platform that provides flexible and scalable services and solutions for advisors, consultants and their plan sponsor clients in every segment of the retirement market.

Putnam RetirementReady® Funds, the firm's suite of 10 target-date/lifecycle retirement funds, were the first suite of lifecycle funds to integrate Absolute Return Funds, which seek positive returns over a period of three years with less volatility than has been associated with traditional asset classes that have earned similar rates of return. Employed in retirement portfolios, Putnam Absolute Return Funds are intended to pursue positive returns in up and down markets, to help protect against the harmful effects of adverse investment returns and to seek to reduce volatility.

About Putnam Investments
Founded in 1937, Putnam Investments is a leading global money management firm with over 70 years of investment experience. The firm was recently named one of the top 15 mutual fund families by Barron's/Lipper for the second consecutive year. At the end of February 2011, Putnam had $125 billion in assets under management, including mutual fund assets of $69 billion and institutional assets of $56 billion. Putnam has offices in Boston, London, Frankfurt, Amsterdam, Tokyo, Singapore and Sydney. For more information, visit putnam.com.

* U.S. Census Bureau
Putnam mutual funds are distributed by Putnam Retail Management.

Contact Information