Share Class Information
The American Funds are distributed through financial professionals because we believe that all investors benefit from ongoing professional advice. We recognize, though, that investors have different preferences for paying for that advice. No matter which share class you choose, American Funds’ annual expenses are among the lowest for comparable funds, as measured by Lipper℠ Inc.
When you work with your financial professional to determine which share class to own, consider how long you expect to own the shares, your investment objective, how much you plan to invest and the expenses associated with each share class.
We offer two types of share classes, one for our regular mutual funds and another for CollegeAmerica®, our 529 college savings plan:
Class A and 529-A shares are sold with an up-front sales charge, which declines as the investment amount increases. For many shareholders — especially those with significant account balances — these shares are the most cost-effective way to own American Funds.
Class B and 529-B shares are no longer offered by American Funds. Shareholders currently invested in Class B or 529-B shares will be able to hold those shares until the shares convert to Class A or 529-A shares. In addition, shareholders invested in Class B or 529-B shares may exchange those shares for Class B or 529-B shares of other American Funds offering such shares until they convert. However, no additional investments into Class B or 529-B shares will be accepted. If you sell (redeem) shares before you have owned them for six years you will pay a sales charge (maximum 5%) on the shares that you sell. This charge is called a contingent deferred sales charge, or CDSC. Class B and 529-B shares convert to Class A and 529-A shares, respectively, after eight years. This conversion will lower your ongoing annual expenses.
Class C and 529-C shares do not have an up-front sales charge. However, if you sell (redeem) these shares before you hold them for 12 months, you will pay a 1% sales charge on the shares that you sell. This is called a contingent deferred sales charge, or CDSC. In addition, investors pay higher expenses than on Class A and 529-A shares. Class C shares convert to Class F-1 shares after 10 years. Class 529-C shares do not convert.
Class F-1, F-2 and 529-F-1 shares are available only through participating financial professionals. Class F-1, F-2 and 529-F-1 share purchasers pay an annual asset-based fee charged by their financial professional. Class F-2 shares do not carry a 12b-1 fee.
Investments are not FDIC-insured, nor are they deposits of or guaranteed by a bank or any other entity, so they may lose value.
Investors should carefully consider investment objectives, risks, charges and expenses. This and other important information is contained in the fund prospectuses, summary prospectuses and CollegeAmerica Program Description, which can be obtained from a financial professional and should be read carefully before investing. CollegeAmerica is distributed by American Funds Distributors® and sold through unaffiliated intermediaries.
Depending on your state of residence, there may be an in-state plan that offers tax and other benefits not available through CollegeAmerica. Before investing in any state's 529 plan, investors should consult a tax advisor.