PGIM Launches 3 Retirement Spending Funds
The funds' varied risk levels give investors options that take into account both essential and flexible spending goals.
PGIM, the global investment management business of Prudential Financial, has launched three retirement-focused investment funds that aim to strike a balance between growth and conservation of capital with added consideration of the specific risks faced by retirees
The three new funds are: the PGIM Conservative Retirement Spending Fund (ticker PGFCX), PGIM Moderate Retirement Spending Fund (PGFMX) and PGIM Enhanced Retirement Spending Fund (PGFEX). All three options come with total annual fund operating expenses of 0.35%, after fee waivers or expense reimbursements.
As noted in the firm’s announcement, these funds are designed for investors near or in retirement and aim to help U.S. workers better manage their long-term investments. David Blanchett, the retirement expert and one of the three portfolio managers on the funds, tells ThinkAdvisor they are intended to be paired with some new “guided spending rates” that are detailed in a new research paper.
The different risk levels associated with the funds allow investors to select the option that best fits their preferences and spending goals — taking both essential and flexible spending into account.
As the names suggest, the more conservative fund seeks to help investors meet their essential spending goals with a lower level of risk; the moderate fund takes a blended approach that balances essential and flexible spending goals; and the enhanced version incorporates more risk in the pursuit of goals that are less essential.
The funds are subadvised by PGIM DC Solutions, the retirement plan-focused wing of Prudential. They are each organized as a “fund of funds,” investing primarily in a range of fixed income, equity, real asset and alternative mutual funds and exchange-traded funds.
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