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Best American Funds for Your 401(k) Retirement Savings


We don’t often write about the American Funds at Kiplinger, but that’s not because they’re poor performers. Actually, the family has several good funds. The problem: Its funds typically charge a commission when sold to individual investors, and as a rule, we don’t recommend load funds because of the added cost. As Burton Malkiel, author of A Random Walk Down Wall Street, once said, “The lower the fee, the more there is left for me.”

Many of American Funds’ portfolios are solid choices, and if they are offered in your 401(k) plan, you won’t have to pay the load to buy shares. So, in the fourth in a series looking at the most popular funds in the 401(k) market, we examine seven American Funds offerings that rank among the 101 largest mutual funds in employer-sponsored retirement plans. We've also written about the most popular funds at Fidelity, T. Rowe Price and Vanguard.

But first, Capital Group, the firm that manages the American Funds, needs some introduction...

Funds are listed in order of their retirement-plan assets, starting with the fund with the most assets, based on data from BrightScope, a consulting firm that rates and ranks retirement plans. Although your plan may offer these funds’ institutional share class, all data, including symbols, listed below refer to the share class that’s most accessible to the average investor, which in this case is the Class A shares. All returns are as of September 30.

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