About the KP Retirement Path Funds
The Glidepath — Asset Allocation Over Time
Your KP Retirement Path Fund helps you maintain a sensible investment strategy all the way through retirement by changing its asset allocation over time. The way that the fund changes its asset allocation is commonly referred to as the "glidepath." In short, the glidepath is the specific way the fund will shift its asset allocation over time.
The chart below is designed to illustrate the glidepath for the KP Retirement Path Funds. The horizontal axis shows the assumed number of years until retirement, and the vertical axis shows the percentage allocated to each asset class within the fund.
When you are 20 years old (and still have 45 years until you are assumed to retire) the fund is primarily made up of large cap, small cap, and international stocks, with a modest allocation to bonds. At this stage of your savings career, capital growth (return) is the primary objective, and considerations of short-term fluctuations in price (risk) are not as great a concern because you still have a very long time-horizon before you will be accessing your retirement savings.
When you are 60 years old (with only 5 years left until assumed retirement) the fund has a smaller allocation to stocks and a correspondingly greater percentage allocated to bonds and real assets. At this stage the fund's primary objective has switched away from long-term growth, and towards a balance of income generation and inflation protection. Capital growth is still important at this stage of your savings career (since you are expected to live many years after retirement), but it must be balanced against the shorter-term goals of income and price stability.
By automatically adjusting the asset allocation over time consistent with the fund's glidepath, the KP Retirement Funds provide an all-in-one investment strategy designed to provide the optimal balance between growth, income, and inflation protection throughout your entire savings career.
To determine if one of these funds is an appropriate investment for you, carefully consider the fund's investment objectives, risk factors, charges, and expenses before investing. This and other information may be found in the fund's summary and full prospectuses, which may be obtained by calling (855)4-KPFNDS or on this website. Please read the prospectus carefully before investing.
The KP Retirement Path Funds are mutual funds. They are part of The KP Funds Series Trust, an open-end management investment company that offers shares of diversified portfolios. The funds are advised by Callan LLC, a registered investment advisor. They are administered by SEI Investments Global Funds Services and distributed by SEI Investments Distribution Co., which are not affiliated with Callan.
Only participants in the Kaiser Permanente defined contribution plans can invest in the funds.
There can be no assurance that a Fund will achieve its stated objectives. An investor may experience losses, at any time, including near, at or after the Fund's target year. In addition, there is no guarantee that an investor's investment in the fund will provide any income at or through the years following the Fund's target year in amounts adequate to meet the investor's goals or retirement needs.
Investing involves risk including loss of principal. Bond and bond funds are subject to interest rate risk and will decline in value as interest rates rise. Mortgage-backed securities are subject to pre-payment and extension risk and therefore react differently to changes in interest rates than other bonds. Small movements in interest rates may quickly and significantly reduce the value of certain mortgage-backed securities. Non-investment grade bonds involve greater risks of default and are more volatile than investment grade securities, due to the speculative nature of the investment. International investments involve risk of capital loss from unfavorable fluctuation in currency values, from differences in generally accepted accounting principles or from social, economic or political instability in other nations. These risks are heightened when investing in emerging markets or in a single state.
Currency risk is the risk that foreign currencies will decline in value relative to the U.S. dollar or, in the case of hedging positions, that the U.S. dollar will decline in value relative to the currency hedged. In either event, the dollar value of an investment in the Underlying Fund would be adversely affected. The use of leverage by the fund managers may accelerate the velocity of potential losses. Furthermore, the use of derivatives are often more volatile than other investments and magnify the Fund's gains or losses. Diversification does not protect against market loss.