AAK732...

I would go with the 2.5% option for the reasons that Helmut has pointed out. There is also a good chance that the E.R of the fund may further drop by a few basis points down the road.

I believe the divvys and cap gains are reinvested into the same share class as far as I know.

For the C shares, they convert into F shares after about 10 years from what I understand.

Use the following URL and click on the link how the share classes differ below the fund selection.

 http://www.americanfunds.com/funds/details.htm?fundNumber=7

Hope this helps.

 Wayne.

Ok, for a 2.5% percent load --> go with "A" shares.

Now, what if I fall under the 250K limit, and now qualify for the 3.5% Class "A" Load ?

 Which Class of shares is better  (A, or B) ?

Hi,

Some of the bond funds ASBAX for example carries a 2.5% load. You could simply buy that and wait a couple of months before converting to CAIBX.

It is perfectly legal.

Using this scenario, my earlier view still stands. You do have to weigh market risks though. ASBAX is the newest bond fund offering with very short term duration.

W~.

because the American Funds allows no "B" share contributions when the account is above $100,000.00 in total value so why that is an issue is strange to me.  Almost all, if not all, load funds cut you off at $100,000.00. 

 

"C" shares are only appropriate for those with a short term horizon.  "A"shares are definitely the way to go with a 20-year horizon. 

 

With my clients I frequently use Short Term bond fund and then move the money to equity or bond funds.  No  time frame for a waiting period as one can do it the next day, next week, or next month.    Saves client money--less for me--within IRA great way to dollar-cost average on a weekly basis.

AL Lindquist:

With my clients I frequently use Short Term bond fund and then move the money to equity or bond funds.  No  time frame for a waiting period as one can do it the next day, next week, or next month.    Saves client money--less for me--within IRA great way to dollar-cost average on a weekly basis.

Al,

Thanks for the information.  Coming from you, it makes it "official."

But you said, "within IRA great way to dollar-cost ....," will it also work in a taxable account as well?  I don't see why not.

Thanks again.  Sorry about "saves client money--less for me." :-)

Justin

sorry as 2.00% for me works nicely and seems fair.  Works just as well in non-IRA accounts except you get the "loss" or "gain" which means some work at tax time.  I believe the American Funds tells the shareholder whether each transaction is a gain or loss so it could be very easy at tax time.  Have clients doing the taxable weekly exchange which works well in such volatile times.

Al,

Thank you.

Justin