T. Rowe Price Retirement 2040 Fund (TRRDX)
Ticker Symbol:
TRRDX
Fund Status:
Open to new Retail investors  /  Open to subsequent Retail investments
Fund Objective
Quick Stats
Fiscal Year End  May
Morningstar Category  Target-Date 2040
Inception Date 09/30/2002
Tax ID 20-0001638
Investment Objective
The objective is to provide the highest total return over time consistent with an emphasis on both capital growth and income.
Strategy
To invest in a diversified portfolio of other T. Rowe Price stock and bond funds that represent various asset classes and sectors. As the fund nears its target retirement date, its allocation between T. Rowe Price stock and bond funds will become more conservative over time based on a pre-determined “glide path”.

The allocations shown in the glide path are referred to as “neutral” allocations because they do not reflect the 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 (stock and bonds), which reflect these strategic 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 (5) percentage points.

While the fund does not guarantee a level of income, it continues to serve as a post-retirement investment vehicle with allocations designed to provide an income stream through retirement.
Risk Potential**
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This fund provides an option for retirement investing including professional management, broad-based diversification, and low-cost management fees. The principal value of the Retirement Funds is not guaranteed at any time, including at or after the target date, which is the approximate year an investor plans to retire (assumed to be age 65) and likely stop making new investments in the fund. If an investor plans to retire significantly earlier or later than age 65, the funds may not be an appropriate investment even if the investor is retiring on or near the target date. The funds' allocations among a broad range of underlying T. Rowe Price stock and bond funds will change over time. The funds emphasize potential capital appreciation during the early phases of retirement asset accumulation, balance the need for appreciation with the need for income as retirement approaches, and focus on supporting an income stream over a long-term postretirement withdrawal horizon. The funds are not designed for a lump-sum redemption at the target date and do not guarantee a particular level of income. The funds maintain a substantial allocation to equities both prior to and after the target date, which can result in greater volatility over shorter time horizons.
**This chart displays relative risk of each U.S. mutual fund listed using standard deviation of returns. Those values are provided in the bars at the top of the chart.

Methodology: We evaluate the standard deviation and its resulting placement within a specific risk/return category on an annual basis. A fund is generally placed in a risk/return category based on the 10-year standard deviation of its performance. If a fund is less than 10 years old, the actual fund performance history is supplemented with the primary prospectus benchmark history to obtain a full 10-year history, or longest time period available up to 10 years. For an Asset Allocation fund with less than 10 years of performance history, sub-strategy returns are used. When a sub-strategy is less than 10 years old, the actual sub-strategy performance history is supplemented with benchmark history to obtain a full 10-year history, or longest time period available up to 10 years.

Risk return categories overlap; a fund with a standard deviation in the overlap between two categories, denoted by a plus (+), is placed so that its risk categorization is better aligned with anticipated return characteristics an investor may experience going forward at the discretion of T Rowe Price.

When a fund has a cash-like benchmark, denoted by a double plus (++), its standard deviation is estimated using only available fund returns. If the fund is less than 10 years old, benchmark returns are not used to obtain a full 10-year history because they would artificially suppress the volatility estimate.

All investments are subject to market risk, including the possible loss of principal. Standard deviation of returns, a measure of price volatility, is one measure of risk. Please consult the funds' prospectuses for a more complete discussion of the funds' risks.
See Glossary for additional details on all data elements.