Retirement Income Fund Lifestyle 1  (PRMAX)

Helping investors pursue monthly income in retirement

Objective

Seeks as high a rate of current income as Putnam believes is consistent with capital preservation.

Fund price

Yesterday’s close 52-week high 52-week low
Net asset value $17.88
0.06% | $0.01
$17.88
10/16/17
$16.93
11/14/16
Historical fund price

Fund facts as of 09/30/17

Total net assets
$93.65M
Turnover (fiscal year end)
39%
Dividend frequency (view rate)
Monthly
Number of holdings
5
Fiscal year end
July
CUSIP / Fund code
746859537 / 0151
Inception Date
11/01/04
Category
Asset Allocation
Open to new investors
Ticker
PRMAX

Management team


Co-Head of Global Asset Allocation

Co-Head of Global Asset Allocation

Chief Investment Officer, Global Asset Allocation

Co-Head of Global Asset Allocation

Strategy and process

  • Retirement income: Designed for investors who are in or near the "drawdown" phase of retirement, in which they seek to withdraw assets for income
  • Conservative approach: Seeks income with careful consideration of capital preservation
  • Absolute return strategies: Invests in a combination of funds and securities, including absolute return funds that seek reduced volatility: Putnam Absolute Return 100, 300, and 500 Funds; Putnam Asset Allocation: Conservative Portfolio; Putnam Money Market Fund

Literature


Why a meaningful near-term market correction is unlikely
2017 is a rare year without a stock market correction of at least 5%, but that doesn't make a correction more likely in the fourth quarter.
How the Japan election may influence global interest rates
The Japan election could have consequences for the future leadership of the Bank of Japan and the country's impact on global interest rate trends.
Using and enhancing ESG investment data
ESG data is having investment impact but is still evolving, and stands to benefit from feedback offered by fundamental analysts.

Performance

Consistency of positive performance over five years

Performance represents 5-year returns in rolling quarter-end periods since inception.

Performance shown above does not reflect the effects of any sales charges. Note that returns of 0.00% are counted as positive periods. For complete fund performance, please see below.

9.44%

Best 5-year annualized return

(for period ending 03/31/14)


0.94%

Worst 5-year annualized return

(for period ending 12/31/11)


3.32%

Average 5-year annualized return


  • Total return (%) as of 09/30/17

  • Annual performance as of 09/30/17

Annualized performance 1 yr. 3 yrs. 5 yrs. 10 yrs.
Before sales charge 5.45% 2.76% 3.48% 2.49%
After sales charge 1.23% 1.37% 2.64% 2.08%
Bloomberg Barclays U.S. Aggregate Bond Index 0.07% 2.71% 2.06% 4.27%
S&P 500 Index 18.61% 10.81% 14.22% 7.44%

Current performance may be lower or higher than the quoted past performance, which cannot guarantee future results. Share price, principal value, and return will vary, and you may have a gain or loss when you sell your shares. To obtain the most recent month-end performance, visit putnam.com. Performance assumes reinvestment of distributions and does not account for taxes. Returns before sales charge do not reflect the current maximum sales charges as indicated below. Had the sales charge been reflected, returns would be lower. Returns at public offering price (after sales charge) for class A and class M shares reflect the current maximum initial sales charges of 5.75% and 3.50% for equity funds and Putnam Absolute Return 500 Fund and 700 Fund, and 4.00% and 3.25% for income funds (1.00% and 0.75% for Putnam Floating Rate Income Fund, Putnam Absolute Return 100 Fund and 300 Fund, and Putnam Short-Term Municipal Income Fund), respectively. Class B share returns reflect the applicable contingent deferred sales charge (CDSC), which is 5% in the first year, declining to 1% in the sixth year, and is eliminated thereafter (except for Putnam Floating Rate Income Fund, Putnam Absolute Return 100 Fund and 300 Fund, and Putnam Short-Term Municipal Income Fund, which is 1% in the first year, declining to 0.5% in the second year, and is eliminated thereafter). Class C shares reflect a 1% CDSC the first year that is eliminated thereafter. Performance for class B, C, M, R, T1, and Y shares prior to their inception is derived from the historical performance of class A shares, adjusted for the applicable sales charge (or CDSC) and, except for class Y shares, the higher operating expenses for such shares (with the exception of Putnam Tax-Free High Yield Fund and Putnam AMT-Free Municipal Fund, which are based on the historical performance of class B shares). Class R5/R6 shares, available to qualified employee-benefit plans only, are sold without an initial sales charge and have no CDSC. Class Y shares are generally only available for corporate and institutional clients and have no initial sales charge. Performance for Class R5/R6 shares before their inception are derived from the historical performance of class Y shares, which have not been adjusted for the lower expenses; had they, returns would have been higher. Class A, M, and T1 shares of Putnam money market funds have no initial sales charge. For a portion of the period, some funds had expenses limitations or had been sold on a limited basis with limited assets and expenses, without which returns would be lower.

Performance snapshot

  Before sales charge After sales charge
1 mt. as of 09/30/17 0.37 % -3.65 %
YTD as of 10/16/17 5.60 % 1.37 %

Yield

Distribution rate before sales charge
as of 10/16/17
0.34%
Distribution rate after sales charge
as of 10/16/17
0.32%
30-day SEC yield with subsidy
as of 09/29/17 (after sales charge)
1.06%
30-day SEC yield without subsidy
as of 09/29/17 (after sales charge)
0.91%

Risk-adjusted performance as of 09/30/17

Alpha (3 yrs.) 2.08
Sharpe ratio (3 yrs.) 0.96
Treynor ratio (3 yrs.) 14.62
Information ratio (3 yrs.) 0.01

Volatility as of 09/30/17

Standard deviation (3 yrs.) 2.61%
Beta 0.17
R-squared 0.03

Capture ratio as of 09/30/17

Up-market (3 yrs.) 65.71
Down-market (3 yrs.) 26.92

Lipper rankings as of 09/30/17

Retirement Income Funds Percentile ranking Rank/Funds in category
1 yr. 84% 95/113
3 yrs. 89% 67/75
5 yrs. 92% 69/74
10 yrs. 91% 46/50

Morningstar ratings as of 09/30/17

Target-Date Retirement Rating Funds in category
Overall (144)
3 yrs. (144)
5 yrs. (125)
10 yrs. (70)

Distributions

Record/Ex dividend date 09/27/17
Payable date 09/29/17
Income $0.005
Extra income $0.0
Short-term cap. gain --
Long-term cap. gain --

Lipper rankings are based on total return without sales charge relative to all share classes of funds with similar objectives as determined by Lipper. Past performance is not indicative of future results.

The Morningstar RatingTM for funds, or "star rating", is calculated for managed products (including mutual funds, variable annuity and variable life subaccounts, exchange-traded funds, closed-end funds, and separate accounts) with at least a three-year history. Exchange-traded funds and open-ended mutual funds are considered a single population for comparative purposes. It is calculated based on a Morningstar Risk-Adjusted Return measure that accounts for variation in a managed product's monthly excess performance, placing more emphasis on downward variations and rewarding consistent performance. The top 10% of products in each product category receive 5 stars, the next 22.5% receive 4 stars, the next 35% receive 3 stars, the next 22.5% receive 2 stars, and the bottom 10% receive 1 star. The Overall Morningstar Rating for a managed product is derived from a weighted average of the performance figures associated with its three-, five-, and 10-year (if applicable) Morningstar Rating metrics. The weights are: 100% three-year rating for 36-59 months of total returns, 60% five-year rating/40% three-year rating for 60-119 months of total returns, and 50% 10-year rating/30% five-year rating/20% three-year rating for 120 or more months of total returns. While the 10-year overall star rating formula seems to give the most weight to the 10-year period, the most recent three-year period actually has the greatest impact because it is included in all three rating periods.

The up-market capture ratio is used to evaluate how well an investment manager performed relative to an index during periods when that index has risen. The ratio is calculated by dividing the manager’s returns by the returns of the index during the up-market, and multiplying that factor by 100. The down-market capture ratio is used to evaluate how well an investment manager performed relative to an index during periods when that index has dropped. The ratio is calculated by dividing the manager’s returns by the returns of the index during the down-market and multiplying that factor by 100.


Holdings

Top holdings as of 09/30/17

Putnam Dynamic Asset Allocation Conservative Fund 34.31%
Putnam Absolute Return 500 Fund 30.14%
Putnam Absolute Return 300 Fund 20.84%
Putnam Absolute Return 100 Fund 8.95%
Putnam Government Money Market Fund 5.84%

Full portfolio holdings as of 06/30/17

PUTNAM DYNAMIC ASSET ALLOCATION CONSERVATIVE FUND 34.02%
PUTNAM ABSOLUTE RETURN 500 FUND 30.02%
PUTNAM ABSOLUTE RETURN 300 FUND 21.01%
PUTNAM ABSOLUTE RETURN 100 FUND 9.01%
PUTNAM GOVERNMENT MONEY MARKET FUND 6.01%

Prior top holdings

Top holdings as of 09/30/17
Putnam Dynamic Asset Allocation Conservative Fund 34.31%
Putnam Absolute Return 500 Fund 30.14%
Putnam Absolute Return 300 Fund 20.84%
Putnam Absolute Return 100 Fund 8.95%
Putnam Government Money Market Fund 5.84%
Top holdings as of 08/31/17
Putnam Dynamic Asset Allocation Conservative Fund 34.25%
Putnam Absolute Return 500 30.27%
Putnam Absolute Return 300 Fund 20.75%
Putnam Absolute Return 100 Fund 8.93%
Putnam Government Money Market Fund 5.87%
Top holdings as of 07/31/17
Putnam Dynamic Asset Allocation Conservative Fund 34.16%
Putnam Absolute Return 500 Fund 30.12%
Putnam Absolute Return 300 Fund 20.88%
Putnam Absolute Return 100 Fund 8.97%
Putnam Government Money Market Fund 5.90%
Top holdings as of 06/30/17
Putnam Dynamic Asset Allocation Conservative Fund 34.33%
Putnam Absolute Return 500 Fund 29.90%
Putnam Absolute Return 300 Fund 21.05%
Putnam Absolute Return 100 Fund 8.93%
Putnam Government Money Market Fund 5.85%

Percentages based on market value. Portfolio composition will vary over time. Due to rounding, percentages may not equal 100%.

Money market funds are not insured or guaranteed by the Federal Deposit Insurance Corporation (FDIC) or any other governmental agency. Although the fund seeks to maintain a constant share price of $1.00, it is possible to lose money by investing in this fund.

Portfolio composition as of 09/30/17

Global investment-grade bonds 49.95%
Net cash 23.64%
U.S. large-cap equity 12.70%
Commodities 4.20%
International equity 3.43%
Mortgage credit 2.38%
U.S. small- and mid-cap equity 2.23%
Emerging-markets debt 1.88%
Emerging-markets equity -0.08%
Global high-yield bonds -0.33%

Fund characteristics will vary over time.

Due to rounding, percentages may not equal 100%.

Consider these risks before investing: International investing involves certain risks, such as currency fluctuations, economic instability, and political developments. Additional risks may be associated with emerging-market securities, including illiquidity and volatility. The fund may invest a portion of its assets in small and/or midsize companies. Such investments increase the risk of greater price fluctuations. Lower-rated bonds may offer higher yields in return for more risk. Funds that invest in government securities are not guaranteed. Mortgage-backed securities are subject to prepayment risk and the risk that they may increase in value less when interest rates decline and decline in value more when interest rates rise. Our allocation of assets among permitted asset categories may hurt performance. Derivatives also involve the risk, in the case of many over-the-counter instruments, of the potential inability to terminate or sell derivatives positions and the potential failure of the other party to the instrument to meet its obligations. Growth stocks may be more susceptible to earnings disappointments, and value stocks may fail to rebound. Bond investments are subject to interest-rate risk, which means the prices of the fund's bond investments are likely to fall if interest rates rise. Bond investments also are subject to credit risk, which is the risk that the issuer of the bond may default on payment of interest or principal. Interest-rate risk is generally greater for longer-term bonds, and credit risk is generally greater for below-investment-grade bonds, which may be considered speculative. Unlike bonds, funds that invest in bonds have ongoing fees and expenses. There is no guarantee that the fund will provide adequate income at and through an investor's retirement. Bond prices may fall or fail to rise over time for several reasons, including both general financial market conditions and factors related to a specific issuer or industry. You can lose money by investing in the fund.


Expenses

Expense ratio

Class A Class B Class C Class M Class R Class R6 Class Y
Total expense ratio 1.25% 2.00% 2.00% 1.50% 1.50% 0.85% 1.00%
What you pay† 1.03% 1.78% 1.78% 1.28% 1.28% 0.63% 0.78%

† The fund's expense ratio is taken from the most recent prospectus and is subject to change. What you pay reflects Putnam Management's decision to contractually limit expenses through 11/30/17

Sales charge

Investment Breakpoint Class A Class B Class C Class M Class R Class R6 Class Y
$0-$49,999 4.00% 0.00% 0.00% 3.25% -- -- --
$50,000-$99,999 4.00% 0.00% 0.00% 2.25% -- -- --
$100,000-$249,999 3.25% -- 0.00% 1.25% -- -- --
$250,000-$499,999 2.50% -- 0.00% 1.00% -- -- --
$500,000-$999,999 0.00% -- -- -- -- -- --
$1M-$4M 0.00% -- -- -- -- -- --
$4M-$50M 0.00% -- -- -- -- -- --
$50M+ 0.00% -- -- -- -- -- --

CDSC

  Class A (sales for $500,000+) Class B Class C Class M Class R Class R6 Class Y
0 to 9 mts. 1.00% 5.00% 1.00% -- -- -- --
9 to 12 mts. 0.00% 5.00% 1.00% -- -- -- --
2 yrs. -- 4.00% 0.00% -- -- -- --
3 yrs. -- 3.00% 0.00% -- -- -- --
4 yrs. -- 3.00% 0.00% -- -- -- --
5 yrs. -- 2.00% 0.00% -- -- -- --
6 yrs. -- 1.00% 0.00% -- -- -- --
7+ yrs. -- 0.00% 0.00% -- -- -- --

The Bloomberg Barclays U.S. Aggregate Bond Index is an unmanaged index of U.S. investment-grade fixed-income securities. The S&P 500 Index is an unmanaged index of common stock performance. You cannot invest directly in an index.

Consider these risks before investing: International investing involves certain risks, such as currency fluctuations, economic instability, and political developments. Additional risks may be associated with emerging-market securities, including illiquidity and volatility. The fund may invest a portion of its assets in small and/or midsize companies. Such investments increase the risk of greater price fluctuations. Lower-rated bonds may offer higher yields in return for more risk. Funds that invest in government securities are not guaranteed. Mortgage-backed securities are subject to prepayment risk and the risk that they may increase in value less when interest rates decline and decline in value more when interest rates rise. Our allocation of assets among permitted asset categories may hurt performance. Derivatives also involve the risk, in the case of many over-the-counter instruments, of the potential inability to terminate or sell derivatives positions and the potential failure of the other party to the instrument to meet its obligations. Growth stocks may be more susceptible to earnings disappointments, and value stocks may fail to rebound. Bond investments are subject to interest-rate risk, which means the prices of the fund's bond investments are likely to fall if interest rates rise. Bond investments also are subject to credit risk, which is the risk that the issuer of the bond may default on payment of interest or principal. Interest-rate risk is generally greater for longer-term bonds, and credit risk is generally greater for below-investment-grade bonds, which may be considered speculative. Unlike bonds, funds that invest in bonds have ongoing fees and expenses. There is no guarantee that the fund will provide adequate income at and through an investor's retirement. Bond prices may fall or fail to rise over time for several reasons, including both general financial market conditions and factors related to a specific issuer or industry. You can lose money by investing in the fund.

Robert Kea will retire from Putnam effective 12/31/17.