The Thomas Rowe Price investment firm was founded by Mr. Thomas Rowe Price in 1937. He is widely considered to be the father of growth investing. Over its lifetime, the T Rowe Price investment firm has become the home to a number of spectacular funds which are focused on fast growing stocks. A lot of the Best T Rowe Price Retirement Funds are considered to be among the best funds for retirement, especially for the 401(k). In this post, we will take a look at some of the best ones. Let’s get started.
Here are the Best T. Rowe Price Retirement Funds
T. Rowe Price Growth Stock
Kicking off our list of the Best T Rowe Price Retirement Funds, is the T. Rowe Price Growth Stock. It is one of three T. Rowe Price funds on the roster of popular 401(k) funds that focus on large, growing companies (Blue Chip Growth and Large Cap Growth are the others).
What sets this fund apart from its siblings is its higher stake in tech stocks. The fund chiefly invests in tech stocks. You may not have access to Blue Chip Growth in your 401(k) plan, and in that case, Growth Stock is a solid choice.
Between 2014 and 2019, Growth Stock’s 17.1% annualized return beats 64% of its peers, as well as the S&P 500. The portfolio consists of 85 stocks, with Amazon.com, Microsoft, Apple (AAPL) and Facebookmaking up the fund’s top holdings.
T. Rowe Price Blue Chip Growth
Next on the list of the best T. Rowe Price Retirement Funds, is the T. Rowe Price Blue Chip Growth. This fund has been a member of the Kiplinger 25 since 2016. This great fund has had an 11.8% annualized return over the past 27 years, which outpaces the 9.7% gain in the S&P 500 index.
The retirement fund invests heavily on big tech and consumer stocks, such as Facebook (FB), Amazon.com (AMZN), Alphabet (GOOGL) and Microsoft (MSFT) – all of which are top holdings in Blue Chip Growth. This fund has over 100 stocks, mainly consisting of well run companies helmed by smart executives.
T. Rowe Price Large-Cap Growth Class I
Next on the list of the best T. Rowe Price Retirement Funds, is You might be less familiar with Large-Cap Growth Class I than other T. Rowe Price funds, but that’s only because this institutional fund’s $1 million minimum puts it beyond the reach of most individual investors.
Since 2017, the Large Cap Growth Class I, formerly known as Institutional Large-Cap Growth, has returned 26.2% annualized, well ahead of the S&P 500, which gained 14.6% over the same period.
The portfolio of this fund consists of somewhere between 60 to 70 stocks. Over half of the fund’s holdings are represented by the top 10% of the holdings. Some of the prominent stocks in this fund are Amazon.com, Microsoft, Alphabet, Facebook and Apple.
T. Rowe Price Mid-Cap Growth
Next on the list of the best T. Rowe Price Retirement Funds, is the T. Rowe Price Mid-Cap Growth. It has been closed to new investors for more than a decade. But if you have access to it in your workplace retirement savings plan, and you’re new to the fund, those rules don’t apply.
Since July 1992, this fund has returned 13.9% annualized, which outpaces the S&P 500 by an average of 3.8 percentage points per year.
As its name suggests, Mid-Cap Growth invests in midsize companies. The fund mainly consists of firms with market values of roughly $4 billion to $30 billion. Top holding Hologic (HOLX), a health care company focused on women, has a market value of just under $20 billion. And holdings in the fund have an average market value of $16 billion. An exception to that is Microchip Technology, which has been on the portfolio since 2002 and has a value of $32 billion.
T. Rowe Price New Horizons
Next on the list of the best T. Rowe Price Retirement Funds, is T. Rowe Price New Horizons.
Between 2010-2019, the fund’s 18.7% annualized return during that time easily bested the average annual gains in the Russell 2000, a small-company stock index; the Russell Mid Cap, an index of midsize company stocks; and the S&P 500. Today, the average market value of holdings is over $13 billion. The portfolio has been trimmed over time. And the number of stocks is down to 200, compared to the 250 from before. However, it is one of the funds with the highest asset value at $36 billion.
T. Rowe Price Retirement Target-Date Series
Rounding off our list of the best T. Rowe Price Retirement Funds, is the T. Rowe Price Retirement Target-Date Series. T. Rowe Price’s target date funds are formidable performers. Seven of them rank among the largest 401(k) funds in america. This group of target date funds ranges from 2020 to 2050. The 2030 fund is the most popular among investors. This has been a solid and consistent performing series. No other target date series of funds has performed better as a group.
The biggest secret of the success of T. Rowe Price’s Retirement target-date funds is the fantastic team behind it. Earlier, a lot of people speculated that the large amount of stocks was the reason. However, that has been proven to be incorrect over time.
While the bigger stock stake may lead to higher risks, the high returns offset them quite well.
So those were the best T. Rowe Price Retirement Funds for you to buy today. They are some of America’s most popular retirement products and they will most likely form a great part of your retirement plan. They are among the most popular 401(k) funds in America and there are many great reasons for that. Hopefully, you have seen and understood quite a few of those with the help of this article. Now you can use these funds to bolster your retirement funds and have a wonderful final phase of your life.