Jul
21
2026
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What Is a Target Date Fund (TDF): Pros, Cons, and How to Choose

By | invest, Investing, Preparing for Retirement | No Comments

Target date funds are all-in-one mutual funds that automatically adjust their asset allocations over time based on a specific target year. Typically used for retirement savings, they can also be used for other goals with a set time frame, such as saving for college. The target date of these funds is typically years in the future and indicates the approximate point at which the investor would begin withdrawing funds for their retirement (or education) needs.

Unlike standard mutual funds, a target date fund shifts its allocation over time, gradually becoming more conservative as the target date approaches to help protect an investor’s money from potential volatility and losses.

Here’s what to know about how target funds work, plus benefits and drawbacks to consider.

Key Points

•   Target date funds (TDFs) are all-in-one mutual funds or ETFs that hold a diversified mix of stocks, bonds, and other assets, automatically adjusting their allocation based on a selected target year.

•   TDFs use a “glide path” formula that starts with a higher allocation of growth-oriented assets like stocks, gradually shifting to a more conservative mix as the target retirement date approaches.

•   Two glide path types exist: a “to” glide path stops adjusting asset allocation at the target date, while a “through” glide path continues adjusting beyond it into retirement.

•   Simplicity is one advantage — TDFs automatically select and rebalance assets based on an investor’s time horizon, however, these funds lack flexibility for investors’ changing needs or retirement dates.

•   Fees can add up and vary significantly between TDFs; investors should be aware of potential layered costs since TDFs often hold other mutual funds or ETFs, and each may carry their own expense ratios.

TDF Meaning: What Is a Target Date Fund?

A target date fund (TDF) is a type of mutual fund or exchange-traded fund (ETF) that holds a diversified mix of assets, such as stocks, bonds, and other investments. Investors select a TDF based on their target retirement date. For example, a 31-year-old today might plan to retire in 34 years at age 65, or in 2060. In that case, they might select a 2060 target date fund.

Target date funds are common investment choices in retirement accounts such as 401(k)s and traditional and Roth IRAs.

TDFs are designed to invest across different asset classes and then adjust the mix over time as an investor gets closer to retirement using a formula known as a “glide path.” At the beginning, the TDF typically has more assets with long-term growth potential, such as stocks, and as the years go by, the asset allocation gradually becomes more conservative until the fund reaches the target date. The idea is that by starting out with a more aggressive allocation and slowly dialing back as years pass, the TDF may be able to deliver growth and protect savings.

Although they both allow for a more hands-off investment approach, TDFs are different from robo advisors.

How Do Target Date Funds Work?

As mentioned, unlike a standard mutual fund, target date funds use a formula known as a glide path to determine the asset allocation of the fund over time.

Understanding the Glide Path

The glide path is a formula the managers of the target date fund choose when they put together a TDF. The glide path determines how and when the asset allocation of the TDF will adjust. The idea is to create a set-it-and-forget-it structure for individuals saving for retirement by providing a mix of assets based on their time horizon.

Younger investors with decades until they retire, might have a higher allocation of riskier assets like stocks in a TDF. As they near retirement, however, they would generally want a lower allocation of riskier assets. A glide path would automatically adjust the asset allocation in the portfolio to assets such as bonds that are typically lower-risk.

However, it’s important to be aware that like any other investment, target date funds involve risk and they can gain or lose money.

Example of a Target Date Fund Glide Path

Hypothetically speaking, the portfolio allocation of a 2060 target date fund today, which is 34 years from the target date, might be 80% to 90% equities and 10% to 20% fixed income or cash or cash equivalents. This asset allocation is designed to give investors potential for growth. And while there is risk exposure with an 80% to 90% investment in stocks, there is still time (more than three decades) for the portfolio to potentially recover from any losses before money is needed for retirement.

After five or 10 years, the fund’s allocation might adjust to 70% equities and 30% fixed income securities.

After another 10 years or so, the allocation may include more conservative investments for an allocation that’s closer to 50-50. The allocation at the target date might then be 30% equities, and 70% fixed income. (These percentages are all hypothetical.)

Pros and Cons of Target Date Funds

Like any type of investment, target date funds have their advantages and disadvantages. Here are some pros and cons for investors to consider.

Benefits of Target Date Funds

Potential advantages of target date funds include:

•   Simplicity. Target funds can potentially make investing for retirement easier because assets are selected and adjusted based on an investor’s time horizon.

•   Provide a mix of assets. Many target funds offer a diversified mix of securities.

•   Low maintenance. Since the glide path adjusts the investment mix in these funds automatically, investors can take a more “hands-off” approach.

Drawbacks of Target Date Funds

TDFs also have disadvantages to be aware of. One of the biggest: Like all investments, there is risk involved, and TDFs offer no guarantee of returns. Other drawbacks of TDFs include:

•   Lack of control. Investors cannot choose different securities than the ones available in the fund, and they can’t adjust the mix of securities in a TDF or the asset allocation.

•   Investment strategies can vary by fund. Target date funds that have the same target year can be very different when it comes to such factors as asset allocation and how the allocation changes over time. Also, TDFs may be actively managed, passively managed, or a mixture of the two.

•   No flexibility. An investor may not end up retiring as early as planned, or they might retire even sooner, for instance. A TDF doesn’t offer flexibility for changes in retirement dates.

•   Costs can add up. Some target date funds are invested in index funds, which are passively managed and typically lower cost. Others may be invested in actively managed funds, which generally charge higher expense ratios. Be sure to check, as investment costs can significantly impact returns.

How to Choose a Target Date Fund

For an investor looking for an uncomplicated long-term investment, a low-cost target date fund is one option to explore. But TDFs may not be right for every individual. Here are some of the factors for an investor to consider.

Assessing Your Risk Tolerance

Like every investment, TDFs involve risk, and it’s critical for an investor to know how much risk they can tolerate. Typically, when an individual is younger and has a longer time horizon, target date funds hold a higher allocation of riskier assets like stocks. As they get older and closer to retirement, investors’ risk tolerance often changes as they seek to protect their money from losses.

When exploring target date funds, it’s a good idea for an investor to look at the investments in the fund and how they will change over time to make sure they’re comfortable with the risk-reward ratio.

“To” vs “Through” Glide Paths

There are generally two types of TDF glide paths: the “to” glide path and the “through” glide path. With a “to” glide path, funds typically shift their asset allocation mix until the target date and not after that point. They tend to reach the most conservative allocation at that time, reducing exposure to riskier assets (like stocks) and increasing exposure to lower-risk assets (like bonds).

TDFs with a “through” glide path continue to adjust allocations after the target date — for as long as 30 more years. They tend to have a slightly higher allocation of riskier assets at and right after retirement.

When considering TDFs, an investor should find out whether the glide path is “to” or “through” to help evaluate whether it makes sense for their retirement strategy, financial situation, and risk tolerance.

Evaluating Fees and Expense Ratios

Fees and costs can vary significantly between TDFs, depending on how they’re managed, as noted earlier. Another consideration is potential layers of fees. Because a TDF is a fund that often has other mutual funds or ETFs in it, an investor may have to pay fees and expense ratios for both the TDF and the funds within it. The layered costs of some TDFs may make them more expensive than a standard mutual fund, which may potentially erode returns over time.

An investor can review a TDF’s prospectus to find out fees and what the total cost to them would be.

The Takeaway

Target date funds may be an option to explore for investors who aren’t geared toward doing portfolio management on their own, but who are looking for a solid long-term investment portfolio for retirement — or another long-term goal like saving for college. TDFs offer a predetermined mix of investments, and asset allocation and rebalancing is done automatically by the glide path function of the fund.

Target funds are offered by most major financial institutions and brokerages. Although they go by different names, you can generally tell a target date fund because it includes the target date, such as 2040, 2050, 2065, and so on.

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FAQ

Are target date funds good for beginners?

Generally speaking, target date funds can be a good option for beginners who have a target date for retirement (or another long-term goal like college), but don’t have the time or expertise to put together and manage a diversified portfolio on their own. TDFs include a mix of asset allocations that are automatically adjusted over the years to go from riskier at the beginning to more conservative as an individual gets closer to retirement. However, TDFs do involve risk, like any other investment, and returns are not guaranteed.

Can you lose money in a target date fund?

Yes, it is possible to lose money in a target date fund at any time. These funds hold investments like stocks and bonds that can fluctuate with market conditions. It’s possible to experience losses in a TDF even near or at the target date because these funds typically still contain some exposure to stocks at that time.

What happens when a target date fund reaches its target year?

There are two types of target date funds — “to” funds and “through” funds — that operate differently when a fund reaches its target date. “To” funds typically shift their asset allocation mix only up until the target date, and they tend to reach their most conservative allocation at that time. “Through” funds typically continue adjusting allocations after the target date and they tend to have a slightly higher allocation of riskier assets at that time.

Are target date funds actively or passively managed?

Target date funds may be actively or passively managed, and some may be a combination of actively and passively managed funds, typically called a hybrid. In general, active funds tend to have a higher fee because of their management structure than passive funds, which simply track a benchmark index.

Can I sell a target date fund before the target date?

Yes. You can sell a target date fund at any time. There generally are no penalties charged by the fund itself for doing so. However, there may be tax implications involved. For example, if your TDF is in a taxable brokerage account, selling it may trigger a taxable event. But if your TDF is in a tax-advantaged plan, you can generally sell the TDF within the account without being taxed. You may want to consult a tax professional about your specific situation.

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Jul
21
2026

How Timeshare Financing Works for Vacation Property

By | Budgeting & Goals, Family Finances, Home Ownership, invest, personal_loan | No Comments

Many of us would love to own a vacation home, but the added expense isn’t always doable. Because we can’t all own multiple properties, vacation timeshares continue to be a popular choice for solo travelers, couples, and families who want more space, amenities, and “a place to call home” at their locale of choice.

Here, you’ll get an honest rundown of how timeshares work, their pros and cons, and a few financing options.

Key Points

•   Timeshares offer a shared vacation property, providing a cost-effective alternative to owning a vacation home.

•   Various types of timeshare ownership exist, including deeded and nondeeded, with different use periods.

•   High interest rates often accompany timeshare financing, but alternatives such as home equity and personal loans may offer better terms.

•   Timeshares can be transferred to heirs or gifted, but selling them may result in financial loss.

•   Renting out a timeshare depends on the agreement, requiring a check of specific terms.

What Is a Timeshare?

A timeshare is a way for multiple unrelated purchasers to acquire a fractional share of a vacation property, which they take turns using. They share costs, which can make timeshares far cheaper than buying a vacation home of their own.

Timeshares are a popular way to vacation. In fact, nearly 10 million U.S. households own one or more timeshare products, according to the American Resort Development Association (ARDA). The average price of a timeshare transaction is $23,160. This figure can vary widely depending on the location, size, and quality of the property, the length of stay,

How Do Timeshares Work?

If you’ve ever been lured to a sales presentation by the promise of a free hotel stay, spa treatment, or gift card, it was probably for a vacation timeshare. As long as you sit through the sales pitch, you get your freebie. Some invitees go on to make a purchase. You can also buy a timeshare on the secondary market, taking over from a previous owner.

What you’re getting is access to a property for a set amount of time per year (usually one to two weeks) in a desirable resort location. Timeshares may be located near the beach, ski resorts, or amusement parks. You can trade weeks with other owners and sometimes even try out other properties around the country — or around the world — in a trade.

In addition to the upfront cost of the timeshare, owners pay annual maintenance fees based on the size of the property — about $1,480 on average — whether or not they use their timeshare that year. These fees, which cover the cost of upkeep and cleaning, often increase over time with the cost of living. Timeshare owners may also have to pay service charges, such as fees due at booking.

Recommended: Loans With No Credit Check

Types of Timeshares

There are two broad categories of timeshare ownership: deeded and nondeeded. In addition, you’ll find four types of timeshare use periods: fixed week, floating week, fractional ownership, and a points-based system.

It’s important to understand all of these terms before you commit.

Deeded Timeshare

With a deeded structure, each party owns a piece of the property, which is tied to the amount of time they can spend there. The partial owner receives a deed for the property that tells them when they’re allowed to use it. For example, a property that sells timeshares in one-week increments will have 52 deeds: one for each week of the year.

Nondeeded Timeshare

Nondeeded timeshares work on a leasing system, where the developer remains the owner of the property. You can lease a property for a set period during the year or a floating period that allows you greater flexibility. Your lease expires after a predetermined period.

Fixed-Week Timeshare

Timeshares offer a limited number of options for when they can be used. Fixed-week means you can use the property during the same set week each year.

Floating-Week Timeshare

Floating-week agreements allow you to choose when you use the property depending on availability.

Fractional Ownership

Most timeshare owners have access to the property for one or two weeks a year. Fractional timeshares are available for five weeks per year or more. In this ownership structure, there are fewer buyers involved, usually 2-12. Each party holds an equal share of the title, and the cost of maintenance and taxes is split.

Points System

Finally, you may be able to purchase “points” that you can use in different timeshare locations at various times of the year.

Is a Timeshare a Good Investment?

Getting out of a timeshare can be difficult. Selling sometimes involves a financial loss, which means they’re not necessarily a good investment. However, if you purchase a timeshare in a place that your family will want to return to for a long time — and can easily get to — you may end up spending less than you would if you were to purchase a vacation home.

Benefits of Timeshare Loans

The timeshare developer will likely offer you financing as part of their sales pitch. The main benefit of a timeshare loan is convenience. And if you’re happy to return to the same vacation spot year after year, you may save money compared to staying in hotels. Plus, for many people, it may be the only way they can afford getting a vacation home.

Drawbacks of Timeshare Loans

Timeshare loans from developers often come with steep interest rates, especially for buyers with lower credit scores, who may be offered rates that exceed 20.00%. And if you eventually decide to sell, you’ll probably lose money. That’s because timeshares tend not to gain value over time. Finally, if you’re not careful about running the numbers before you commit, you can end up paying more in annual fees than you expect.

Recommended: What Is Revolving Credit?

Financing a Timeshare

Developer financing is often proposed as the only timeshare financing option, especially if you buy while you’re on vacation. However, with a little advance planning, there are alternative options for financing timeshares. If developer financing is taken as an initial timeshare financing option, some timeshare owners may want to consider timeshare refinance in the future.

Home Equity Loan

If you have equity built up in your primary home, it may be possible for you to obtain a type of home equity loan from a private lender to purchase a timeshare. Home equity loans are typically used for expenses or investments that will improve the resale value of your primary residence, but they can be used for timeshare financing as well.

Home equity loans are “secured” loans, meaning they use your house as collateral. As a result, lenders will give you a lower interest rate compared to the rate on an unsecured timeshare loan offered at a developer pitch. You can learn more about the differences in SoFi’s guide to secured vs. unsecured loans.

Additionally, the interest you pay on a home equity loan for a timeshare purchase may be tax-deductible as long as the timeshare meets Internal Revenue Service (IRS) requirements, in addition to other factors. Before using a home equity loan as timeshare financing, or even to refinance timeshares, be aware of the risk you’re taking on. If you fail to pay back your loan, your lender may seize your house to recoup their losses.

Personal Loan

Another option to consider for timeshare financing is obtaining a personal loan from a bank or an online lender. While interest rates for personal loans can be higher than rates for home equity loans, you’ll likely find a loan with a lower rate than those offered by the timeshare sales agent.

Additionally, with an unsecured personal loan as an option for timeshare financing, your primary residence isn’t at risk in the event of default.

Getting approved for a personal loan is generally a simpler process than qualifying for a home equity loan. Online lenders, in particular, offer competitive rates for personal loans and are streamlining the process as much as possible.

Awarded Best Online Personal Loan by NerdWallet.
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The Takeaway

Timeshares offer one way to secure a place to stay in your favorite vacation destination each year without having to buy a second home. And timeshares may save you money over time compared to the cost of a high-end hotel. However, beware of timeshare financing offered by developers. Interest rates can be as high as 20.00%. There are other ways to finance a timeshare that can be more affordable, including home equity loans and personal loans.

Think twice before turning to high-interest credit cards. Consider a SoFi personal loan instead. SoFi offers competitive fixed rates and same-day funding. See your rate in minutes.

SoFi’s Personal Loan was named a NerdWallet 2026 winner for Best Personal Loan for Large Loan Amounts.

FAQ

Can I rent my timeshare to someone else?

Whether or not you can rent your timeshare out to others will depend on your timeshare agreement. But in many cases, your timeshare resort will allow you to rent out your allotted time at the property.

Can I sell my timeshare?

Your timeshare agreement will give you details about when and how you can sell your timeshare. In most cases, you should be able to sell, but it may be hard to do so, and you may take a financial loss.

Can I transfer ownership of my timeshare or leave it to my heirs?

You can leave ownership of a timeshare to your heirs when you die and even transfer ownership as a gift while you’re living. Once again, refer to your timeshare agreement for rules about what is possible and how to carry out a transfer.

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Jul
21
2026
What Is a Growth Savings Account?

Growth Savings Accounts: What They Are and How They Work

By | Financial Independence, invest, Life & Career | Comments Off on Growth Savings Accounts: What They Are and How They Work

The term growth savings account or grow savings account generally refers to a savings account that earns more than the average interest rate for a savings account. This allows your money to grow faster, just for sitting in the bank.

But are these accounts always a good bet? Important points to consider are:

• What is a growth savings account?

• How do growth savings accounts work?

• The pros and cons of a growth savings account

• How to open a growth savings account

Key Points

• Growth savings accounts, also known as high-yield savings accounts, function the same way as a traditional savings account but pay a notably higher interest rate.

• When choosing a growth savings account, compare the interest rate, minimum balance requirements, fees, account features, and other products and services offered by the financial institution.

• Advantages of growth savings accounts include liquidity and higher interest rates.

• Disadvantages of growth savings accounts include tax implications, possible withdrawal limits, and lower long-term growth than with investments such as stocks.

• Growth savings accounts are suitable for emergency funds and short-term financial goals.

What Is a Growth Savings Account?

Growth savings accounts are similar to regular savings accounts, except that they tend to pay a higher annual percentage yield (APY), which represents how much an account holder will earn in interest over the course of a year.

More commonly referred to as a high-yield savings account, these accounts can pay up to 15 times more than the average APY for a savings account, while helping keep those funds safe and accessible.

You may get a better interest rate on a growth savings account at an online bank or credit union versus a traditional brick-and-mortar bank. However, even at their best, the APYs on these savings accounts generally lag behind what you could earn by investing in the market over time. That makes growth savings accounts best-suited for your emergency fund and money that you’re saving for a short-term goal, such as a vacation or a large purchase.

How Do Growth Savings Accounts Work?

Growth savings accounts work in the same way as regular savings accounts. You open the account at a bank or credit union, deposit money into the account, and begin to earn interest on your balance. You can continue adding money to the account, either by making a deposit at a branch or ATM, transferring money from a linked account, or via mobile check deposit or direct deposit.

Savings accounts are typically insured up to $250,000 per depositor, per account ownership category, per insured bank by the Federal Deposit Insurance Corporation (FDIC) at banks and by the National Credit Union Administration (NCUA) at credit unions. So you can’t lose your money (up to certain limits) even if the bank were to go out of business.

Savings accounts allow easy access to your money when you need it, though some institutions may limit the number of withdrawals or transfers you can make to six or nine per month.

Recommended: How High-Yield Savings Accounts Work

Pros of a Growth Savings Account

Here’s a look at some of the advantages that come with opening a growth or high-yield savings account.

Higher Interest Rates

Because these savings accounts can offer higher interest rates, the money held in the account tends to grow faster than money held in traditional savings accounts. When determining what is a good interest rate, it’s a good idea to also look into minimum balance requirements. You may see that you need to keep your balance above a certain threshold to earn the highest available rate.

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*Earn up to 3.80% Annual Percentage Yield (APY) on one SoFi Savings account with a 0.70% APY Boost (added to the 3.10% APY as of 5/28/26) for up to 6 months. Open your first SoFi Checking and Savings account and receive eligible direct deposits OR qualifying deposits of $5,000 every 31 days by 12/31/26. Rates are variable, subject to change. Terms apply at https://www.sofi.com/banking/#2. SoFi Bank, N.A. Member FDIC.

Accessible Form of Growth

Putting money in a savings account can be a great way to earn interest while keeping that money liquid, meaning you can access it as soon as you need it. You don’t need to sell off investments or wait until a particular maturity date to withdraw the money.

Recommended: CDs vs Savings Accounts Compared

Good Way to Build an Emergency Fund

Because these funds are fairly accessible, a growth savings account can be a great place to build an emergency fund. That way, the emergency fund can continue to grow until it might be needed.

Cons of a Growth Savings Account

There are also some downsides to growth savings accounts worth keeping in mind before opening one.

Limited Growth Opportunity

Yes, growth savings accounts typically earn more interest than traditional savings accounts. However, when considering your long-term savings options, there may be more strategic investments that can enhance growth over time. If, for instance, you’re saving for retirement, which is a few decades away, you might take a look at the stock market for growth.

Withdrawal Limits

Growth savings accounts generally provide easier access to funds than keeping money in investments. That said, you may only be able to make a certain number of withdrawals or transfers per month (such as six or nine) or risk running into fees. While the Federal Reserve withdrew this rule in 2020, banks are allowed to continue imposing those limits, so it’s a good idea to check.

Earnings Are Taxable Income

The interest earned in a growth savings account can count as taxable income. By contrast, the money you put into a Roth Individual Retirement Account (IRA) grows tax-free.

Pros of Growth Savings Accounts Cons of Growth Savings Accounts
Higher interest rates Possible withdrawal limits
Good way to build an emergency fund Limited growth opportunity
Accessible form of growth Earnings are taxable income

Recommended: What Is a Roth IRA and How Does It Work?

Choosing a Growth Savings Account

When you’re looking for ways to earn more interest on your money, a growth or high-yield savings account might be a good option. It’s a good idea to shop around to find the best fit for your needs. Here are a few factors to keep in mind when looking for a new savings account:

• APYs

• Minimum balance requirements

• Fees

• Account features

• Mobile app

• Other product and service offerings

How to Open a Growth Savings Account

While each banking institution will have its own process, opening a growth savings account typically includes the following steps:

• Fill out the application. When filling out a savings account application, you’ll usually provide details such as your name, Social Security number, proof of address (say, from a utility bill), and government-issued photo ID.

• Choose the account type. There may be different savings account types, such as an individual account or a joint account (to share with a spouse or family member). Select the kind that’s right for your needs.

• Designate beneficiaries. It’s important to choose a beneficiary for your growth savings account, just as you might select a beneficiary for a 401(k) plan. This is the person who would receive the account’s funds if you were to become incapacitated or pass away.

• Deposit funds. Some banks require a minimum initial deposit, so you may need to make that deposit to open the account.

• Create login information. To set up your online account, you’ll need to create login information such as a username and password. Be sure to create a unique and complex password with at least one capital letter, number, and symbol.

While there may be another step or two in some situations, that’s how to open a bank account.

The Takeaway

Growth savings accounts generally offer higher interest rates than traditional savings accounts, which can help your money grow faster. In some cases, however, these accounts may come with monthly fees and/or require you to maintain a certain minimum balance to earn the higher rate, so it pays to shop around.

Interested in opening an online bank account? When you sign up for a SoFi Checking and Savings account with eligible direct deposit, you’ll get a competitive annual percentage yield (APY), pay zero account fees, and enjoy an array of rewards, such as access to the Allpoint Network of 55,000+ fee-free ATMs globally. Qualifying accounts can even access their paycheck up to two days early.

Better banking is here with SoFi, named the #1 Bank in the U.S. for the fourth year in a row by Forbes (2026).* Enjoy up to 3.10% APY on SoFi Checking and Savings.

FAQ

How do growth savings accounts work?

Growth savings accounts function similarly to traditional savings accounts. The only difference between these account types is that growth savings accounts tend to have higher interest rates.

What does “growth account” mean?

A growth account, also known as a high-yield account, typically offers a higher interest rate than a traditional savings account. This higher interest rate leads to more growth on deposited funds.

How much interest does a growth savings account earn?

These days, a growth or high-yield savings account can earn as much as 4.10% APY. Be sure to compare rates at different banks before opening your account.

About the author

Jacqueline DeMarco

Jacqueline DeMarco

Jacqueline DeMarco is a freelance writer who specializes in financial topics. Her first job out of college was in the financial industry, and it was there she gained a passion for helping others understand tricky financial topics. Read full bio.

Photo credit: iStock/Eoneren

SoFi® Checking and Savings is offered through SoFi Bank, N.A. ©2026 SoFi Bank, N.A. All rights reserved. Member FDIC. Equal Housing Lender.

Annual percentage yield (APY) is variable and subject to change at any time. Rates are current as of 5/28/26. There is no minimum balance requirement. Fees may reduce earnings. Additional rates and information can be found at https://www.sofi.com/legal/banking-rate-sheet

Eligible Direct Deposit means a recurring deposit of regular income to an account holder’s SoFi Checking or Savings account, including payroll, pension, or government benefit payments (e.g., Social Security), made by the account holder’s employer, payroll or benefits provider or government agency (“Eligible Direct Deposit”) via the Automated Clearing House (“ACH”) Network every 31 calendar days.

Although we do our best to recognize all Eligible Direct Deposits, a small number of employers, payroll providers, benefits providers, or government agencies do not designate payments as direct deposit. To ensure you're earning the APY for account holders with Eligible Direct Deposit, we encourage you to check your APY Details page the day after your Eligible Direct Deposit posts to your SoFi account. If your APY is not showing as the APY for account holders with Eligible Direct Deposit, contact us at 855-456-7634 with the details of your Eligible Direct Deposit. As long as SoFi Bank can validate those details, you will start earning the APY for account holders with Eligible Direct Deposit from the date you contact SoFi for the next 31 calendar days. You will also be eligible for the APY for account holders with Eligible Direct Deposit on future Eligible Direct Deposits, as long as SoFi Bank can validate them.

Deposits that are not from an employer, payroll, or benefits provider or government agency, including but not limited to check deposits, peer-to-peer transfers (e.g., transfers from PayPal, Venmo, Wise, etc.), merchant transactions (e.g., transactions from PayPal, Stripe, Square, etc.), and bank ACH funds transfers and wire transfers from external accounts, or are non-recurring in nature (e.g., IRS tax refunds), do not constitute Eligible Direct Deposit activity. There is no minimum Eligible Direct Deposit amount required to qualify for the stated interest rate. SoFi Bank shall, in its sole discretion, assess each account holder's Eligible Direct Deposit activity to determine the applicability of rates and may request additional documentation for verification of eligibility.

See additional details at https://www.sofi.com/legal/banking-rate-sheet.
We do not charge any account, service, or maintenance fees for SoFi Checking and Savings. We do charge transaction fees for outgoing wire transfers, Instant Transfers, and global remittance transfers. Our fee policy is subject to change at any time. See the SoFi Bank Fee Sheet for details at sofi.com/legal/banking-fees/.
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*Awards or rankings from Forbes are not indicative of future success or results. This award and its ratings are independently determined and awarded by their respective publications.


1SoFi Bank is a member FDIC and does not provide more than $250,000 of FDIC insurance per depositor per legal category of account ownership, as described in the FDIC’s regulations. Any additional FDIC insurance is provided by the SoFi Insured Deposit Program. Deposits may be insured up to $3M through participation in the program. See full terms at SoFi.com/banking/fdic/sidpterms. See list of participating banks at SoFi.com/banking/fdic/participatingbanks.

Tax Information: This article provides general background information only and is not intended to serve as legal or tax advice or as a substitute for legal counsel. You should consult your own attorney and/or tax advisor if you have a question requiring legal or tax advice.

Financial Tips & Strategies: The tips provided on this website are of a general nature and do not take into account your specific objectives, financial situation, and needs. You should always consider their appropriateness given your own circumstances.

Third-Party Brand Mentions: No brands, products, or companies mentioned are affiliated with SoFi, nor do they endorse or sponsor this article. Third-party trademarks referenced herein are property of their respective owners.

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Jul
21
2026
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What Is the SWIFT Banking System?

By | Growing Wealth, invest, Investing | Comments Off on What Is the SWIFT Banking System?

The Society for Worldwide Interbank Financial Telecommunication (SWIFT) provides a secure communication network for financial institutions to communicate and facilitate cross-border transactions and payments.

The SWIFT system is a critical piece of infrastructure for the international banking system because it allows financial institutions to talk to one another securely. Without access to the SWIFT messaging network, banks are essentially shut out of the global financial system because they cannot speak to banks in other countries to agree on transaction and payment terms.

🛈 Currently, SoFi does not support SWIFT, BIC, or IBAN codes.

Key Points

•   SWIFT is a messaging network that allows banks and other financial institutions to communicate securely when making cross-border payments and transfers between international bank accounts.

•   The system uses a standardized system of codes to transmit information between banks during transactions.

•   Each 8- or 11-character code is unique and identifies the bank, country, city, and branch.

•   SWIFT was developed in 1973 to replace the human error-prone Telex system.

•   Based in Belgium, SWIFT is governed by a board of directors and overseen by the G10 countries’ central banks.

What Is SWIFT?

SWIFT doesn’t hold assets or move money around. Instead, it is a messaging system for banks and other financial institutions. When banks need to conduct business across borders with other financial companies, the SWIFT system allows them to communicate with one another in a secure and standardized manner to ensure reliable transaction terms.

The SWIFT messaging system relies on a standardized system of codes to transmit information and payment instructions. These codes are interchangeably called Bank Identifier Codes (BIC), SWIFT codes, SWIFT IDs, or ISO 9362 codes. Each member of the SWIFT network is assigned a BIC/SWIFT code, providing an efficient transfer of information during transactions.

SWIFT codes are used so banks and financial institutions can communicate reliably. For example, a bank in the United States wants to make sure it is messaging the right bank in France to set up payment instructions before transferring money.

Since SWIFT doesn’t send money, it requires banks to take additional steps to transfer funds globally after communicating with their counterparty. This makes the whole process relatively slow and adds costs to the transfers. The advent of blockchain technology may alleviate these time lags and additional costs as the technology is adopted more broadly.

Format of BIC/SWIFT Code

These codes are unique and have 8 or 11 characters, identifying the bank, country, city, and branch:

•   Bank code (0-9 or A-Z): 4 characters representing the bank

•   Country code (A-Z): 2 letters representing the country of the bank

•   Location code (0-9 or A-Z): 2 characters of letters or numbers for the location of the bank

•   Branch code (0-9 or A-Z): 3 digits specifying a particular branch (optional)

For example, Wells Fargo, with a branch in Philadelphia, has the 11-character SWIFT code PNBPUS33PHL. The first four characters reflect the institute code (PNBP for Wells Fargo), the next two are the country code (US), the following two characters specify the location/city code (33), and the last three characters indicate the individual branch (PHL). The last three characters are optional — if the bank is the head office, the code ends with XXX.

More SWIFT Code Examples
Bank Name Barclays Bank Plc Toronto-Dominion Bank MUFG Bank, Ltd.
SWIFT Code BARCGB22 TDOMCATTTOR BOTKJPJT
Bank Code BARC TDOM BOTK
Country Code GB (United Kingdom) CA (Canada) JP (Japan)
Location Code 22 (London) TT (Toronto) JT (Tokyo)
Branch Code XXX or not assigned (indicates head office) TOR XXX or not assigned (indicates head office)

History of SWIFT

Telex was an early electronic communications system used in the post-World War II period, allowing businesses to send written messages across the globe. Before SWIFT, financial institutions used Telex to communicate with one another to ensure the successful transfer of international payments. However, Telex was slow, lacked security, and was prone to human error because it didn’t run on a standardized system.

To alleviate the problems of Telex, 239 banks from 15 countries joined forces in 1973 to develop a communications network that would provide safe, secure, and standardized messaging for cross-border payments. These banks formed the Society for Worldwide Interbank Financial Telecommunication and went live with the SWIFT messaging service in 1977. Soon, SWIFT was widely adopted and became the gold standard for cross-border messaging in the global financial system.

More than 11,000 financial institutions in over 200 countries use the SWIFT system to communicate, allowing millions of people worldwide to safely make international payments without worry. It processes tens of millions of messages per day, too.

Who Controls SWIFT?

Based in Belgium, SWIFT is a member-owned cooperative, meaning that member institutions have stakes in SWIFT and the right to nominate directors to its governing board. This governing board is made up of 25 people from across the globe and overseen by the G10 countries’ central banks (Bank of Canada, Deutsche Bundesbank, Banque de France, Banca d’Italia, Bank of Japan, National Bank of Belgium, De Nederlandsche Bank, Sveriges Riksbank, Swiss National Bank, Bank of England, US Federal Reserve System).

Traditionally, SWIFT acts as a neutral party, so it doesn’t make any decisions on sanctions. However, because it operates under Belgian law and European Union regulations, SWIFT will adhere to sanctions imposed by the EU if necessary. This resulted in banks from Iran being kicked off the SWIFT system in 2012 because of the country’s nuclear weapons program. Additionally, in early 2022, several Russian institutions were kicked off SWIFT after the country invaded Ukraine.

The Future of SWIFT

Because of SWIFT’s significant role in the global financial system, some believe that blockchain technology could circumvent the need to use the network. Proponents of decentralized finance believe that these new technologies could increase global payments’ speed, security, and transparency. Just as SWIFT replaced Telex as the standard for messaging in the global financial system, some think that blockchain technology could do the same.

The Takeaway

SWIFT is a critical part of the global financial system. Without the secure messaging services of SWIFT, banks and other financial institutions would struggle to complete transactions and make payments in overseas business. However, the SWIFT system is relatively slow and costly for financial institutions. Even with the safe and secure messaging of SWIFT, cross-border payments and transfers between financial institutions can still take several days to complete.

In a world that desires high-speed money transfers, this lag in transaction time can be burdensome to banks and other financial institutions. As new challengers in the global financial system, such as blockchain technology, break through and become a more mainstream part of the financial payments system, they could put pressure on the ubiquity of the SWIFT system and the overall global payments system.

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Better banking is here with SoFi, named the #1 Bank in the U.S. for the fourth year in a row by Forbes (2026).* Enjoy up to 3.10% APY on SoFi Checking and Savings.

FAQ

Which US banks use SWIFT?

Most major U.S. banks use the SWIFT network to facilitate international payments. While some smaller local credit unions or banks may not be part of the SWIFT system, they usually route international payments through larger intermediary banks.

How does SWIFT banking work?

SWIFT is a secure, global messaging network used by over 11,000 financial institutions across 200 countries. It does not physically move money but rather acts as a standardized communications system that instructs banks on how and where to transfer funds internationally.

Is SWIFT the same as a routing number?

No, a routing number and a SWIFT code are not the same thing. A routing number is a 9-digit numerical code used exclusively for domestic transfers. A SWIFT code is an 8- to 11-character alphanumeric code used for international payments and transfers to identify a specific bank anywhere in the world.

Are SWIFT payments safe?

Yes, SWIFT employs strict security measures, including rigorous encryption, institutional vetting, and message verification, making payments highly secure. However, due to the system’s reliance on human interaction, the primary risks usually involve data-entry errors or scams rather than system failures.

How long does a SWIFT payment take?

Typically, a SWIFT payment takes one to five business days to arrive. The exact time it takes will depend on the currencies, time zones, and how many intermediary banks are required to make the transfer.

Photo credit: iStock/Evgeniy Skripnichenko

SoFi® Checking and Savings is offered through SoFi Bank, N.A. ©2026 SoFi Bank, N.A. All rights reserved. Member FDIC. Equal Housing Lender.
Annual percentage yield (APY) is variable and subject to change at any time. Rates are current as of 5/28/26. There is no minimum balance requirement. Fees may reduce earnings. Additional rates and information can be found at https://www.sofi.com/legal/banking-rate-sheet

Eligible Direct Deposit means a recurring deposit of regular income to an account holder’s SoFi Checking or Savings account, including payroll, pension, or government benefit payments (e.g., Social Security), made by the account holder’s employer, payroll or benefits provider or government agency (“Eligible Direct Deposit”) via the Automated Clearing House (“ACH”) Network every 31 calendar days.

Although we do our best to recognize all Eligible Direct Deposits, a small number of employers, payroll providers, benefits providers, or government agencies do not designate payments as direct deposit. To ensure you're earning the APY for account holders with Eligible Direct Deposit, we encourage you to check your APY Details page the day after your Eligible Direct Deposit posts to your SoFi account. If your APY is not showing as the APY for account holders with Eligible Direct Deposit, contact us at 855-456-7634 with the details of your Eligible Direct Deposit. As long as SoFi Bank can validate those details, you will start earning the APY for account holders with Eligible Direct Deposit from the date you contact SoFi for the next 31 calendar days. You will also be eligible for the APY for account holders with Eligible Direct Deposit on future Eligible Direct Deposits, as long as SoFi Bank can validate them.

Deposits that are not from an employer, payroll, or benefits provider or government agency, including but not limited to check deposits, peer-to-peer transfers (e.g., transfers from PayPal, Venmo, Wise, etc.), merchant transactions (e.g., transactions from PayPal, Stripe, Square, etc.), and bank ACH funds transfers and wire transfers from external accounts, or are non-recurring in nature (e.g., IRS tax refunds), do not constitute Eligible Direct Deposit activity. There is no minimum Eligible Direct Deposit amount required to qualify for the stated interest rate. SoFi Bank shall, in its sole discretion, assess each account holder's Eligible Direct Deposit activity to determine the applicability of rates and may request additional documentation for verification of eligibility.

See additional details at https://www.sofi.com/legal/banking-rate-sheet. We do not charge any account, service, or maintenance fees for SoFi Checking and Savings. We do charge transaction fees for outgoing wire transfers, Instant Transfers, and global remittance transfers. Our fee policy is subject to change at any time. See the SoFi Bank Fee Sheet for details at sofi.com/legal/banking-fees/. ^Early access to direct deposit funds is based on the timing in which we receive notice of impending payment from the Federal Reserve, which is typically up to two days before the scheduled payment date, but may vary.
*Awards or rankings from Forbes are not indicative of future success or results. This award and its ratings are independently determined and awarded by their respective publications.

1SoFi Bank is a member FDIC and does not provide more than $250,000 of FDIC insurance per depositor per legal category of account ownership, as described in the FDIC’s regulations. Any additional FDIC insurance is provided by the SoFi Insured Deposit Program. Deposits may be insured up to $3M through participation in the program. See full terms at SoFi.com/banking/fdic/sidpterms. See list of participating banks at SoFi.com/banking/fdic/participatingbanks.
Tax Information: This article provides general background information only and is not intended to serve as legal or tax advice or as a substitute for legal counsel. You should consult your own attorney and/or tax advisor if you have a question requiring legal or tax advice.
Financial Tips & Strategies: The tips provided on this website are of a general nature and do not take into account your specific objectives, financial situation, and needs. You should always consider their appropriateness given your own circumstances.
Third-Party Brand Mentions: No brands, products, or companies mentioned are affiliated with SoFi, nor do they endorse or sponsor this article. Third-party trademarks referenced herein are property of their respective owners.

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Jul
20
2026
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ETFs vs Index Fund: Key Differences & Which Is Better?

By | invest, Investing, Terminology | No Comments

The main difference between exchange-traded funds (ETFs) vs. index funds concerns how each type of fund is structured. Index funds, like many mutual funds, are open-end funds with a portfolio based on a basket of securities (e.g. stocks and bonds). Fund shares are priced once at the end of the trading day, based on the fund’s net asset value (NAV).

An ETF, on the other hand, is a type of investment fund that also includes a basket of securities, but shares of the fund are designed to be traded throughout the day on an exchange, similar to stocks. For clarity, index funds are designed to try and track a specific market index, whereas ETFs are a type of fund structure, and they can be passively or actively managed. Index mutual funds (which can be referred to as index mutual funds), then, can also be funds that are designed to track an index.

Key Points

• ETFs and index funds both offer investors exposure to a basket of securities, which may provide portfolio diversification.

• ETFs can be traded throughout the day, while index mutual funds are traded at the end of the day.

• ETFs typically disclose their holdings daily, whereas index funds disclose quarterly.

• ETFs tend to have higher expense ratios than index funds, but can offer more trading flexibility.

• ETFs are generally more tax efficient than index funds.

What Are Index Funds?

Index funds (or index mutual funds) are a type of mutual fund or ETF. Like other mutual funds, an index fund portfolio generally comprises a collection of stocks, bonds, or other securities that are bundled together into a pooled investment fund.

Passive Management in Index Funds

Unlike most other types of mutual funds, which are actively managed by a portfolio manager, index funds are designed to mirror the holdings and the performance of an index like the S&P 500 index of U.S. large-cap stocks, or the Russell 2000 index of small-cap stocks.

Index funds are generally passively managed, and as a result, they tend to have lower costs than other types of mutual funds.

Index Fund Liquidity Constraints

Liquidity constraints may be of concern to some investors when it comes to index funds. Investors buy shares of the fund, which gives them exposure to the basket of securities within the fund. As noted above, index mutual fund trades can only be executed once per day, which makes them less liquid than ETFs.

In addition, index funds (and mutual funds in general) reveal their holdings every quarter, so they tend to be less transparent than ETFs, which typically reveal their holdings once a day.

As a plus, though, there are thousands of indexes to choose from, and it’s possible to create an investing portfolio from index funds alone.

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What Are ETFs?

Unlike index mutual funds, ETF shares can be traded on exchanges throughout the day, just like stocks. ETFs can also be designed to track an index. Accordingly, ETFs require a different structure than traditional index mutual funds.

ETF Costs

When trading ETFs, bear in mind that the average expense ratio of ETFs is around 0.15%, which is historically low – but still higher than most index mutual funds, which have an average expense ratio of 0.05%.

Depending on the brokerage involved, investors may also pay commissions and a bid-ask spread, which is the difference between the ask price and the bid price of an ETF share, although this has less of an impact for buy-and-hold investors.

ETFs and Tax Efficiency

Due to the way ETF shares are created and redeemed, ETFs may be more tax efficient than index funds. When investors sell shares of an index fund, the underlying securities in the fund must be sold, and if there is a capital gain it’s passed onto all the fund shareholders.

When an investor sells shares of an ETF, the fund doesn’t incur capital gains, owing to the mechanism for redeeming shares. But if the investor sees a profit from the sale, this would result in capital gains (which is also true when selling index fund shares), which has specific tax implications.

Of course, investors who hold ETFs or index funds within an IRA or other retirement account would not be subject to capital gains tax events. It may be a good idea to speak with a financial professional for guidance to get a sense of exactly what type of tax liabilities you may be looking at.

When picking ETFs, however, bear in mind that the majority of ETFs are passively managed: i.e. they are index ETFs. Only about 9% of ETFs were actively managed at the end of 2024, a big increase from previous years, owing to the complexity of their structure and industry rules about transparency for these funds.

Key Differences: ETF vs. Index Fund

When comparing ETFs vs. index funds, there are a few similarities:

• Both types of funds include a basket of securities that can include stocks, bonds, and other securities.

• ETFs and index funds may provide some degree of portfolio diversification.

• Index funds and most ETFs are usually considered passive investments because they often mirror the constituents of a benchmark index. (By comparison, actively managed mutual funds and active ETFs have a live portfolio manager who oversees the fund, and makes trades with the goal of outperformance.)

Minimum Investments

Further, there may be minimum investments in the mix that investors should know about. ETFs don’t generally have minimum investments, but some index mutual funds do set minimums. That’s not to say that all do, and some may have very small minimums, such as $1. But it’s something to be aware of.

Trading Flexibility

As noted, ETFs may be a bit more easier to trade compared to index mutual funds, since they can be bought or sold at any time during the day. That may not be the same case for mutual funds. In other words, the two asset types have different levels of liquidity.

This chart helps to summarize the similarities and differences between ETFs vs index funds.

ETFs

 Index Funds
Similarities:
Portfolio consists of many securities Portfolio consists of many securities
Portfolio consists of many securities Portfolio consists of many securities
Provides diversification via exposure to different asset classes Provides diversification via exposure to different asset classes
ETF expense ratios are generally low Index fund expense ratios are generally low
Most ETFs are passively managed Index funds are passively managed
Differences:
A special creation-redemption mechanism enables intraday share trading Shares bought and sold/redeemed via the fund itself
Shares trade during market hours on an exchange Trades executed at end of day
Fund holdings disclosed daily Fund holdings disclosed quarterly
Shares are more liquid Shares are less liquid
Investors may also pay a commission on trades or other fees Investors may pay a sales load or other fees
ETFs tend to be more tax efficient Index funds may be less tax efficient

ETF vs. Index Fund: Which Is Right for You?

There’s no cut-and-dried answer to whether ETFs are better than index funds, but there are a number of pros and cons to consider for each type of fund.

When to Choose an ETF

ETF shares, which trade throughout the day like stocks, are priced by the share like stocks as well. Knowing stock market basics can help you invest in ETFs, as well. If you have $100 and the ETF is $50 per share when you place the trade, you can buy two shares.

This ETF pricing structure also allows investors to use stop orders or limit orders to set the price at which they’re willing to buy or sell. These types of orders, which are different from standard market orders, can also be executed through an online investing platform or by calling a broker.

ETFs are generally considered more tax efficient than mutual funds, including index funds.

The way mutual funds are structured, there can be more tax implications as investors buy in and out of an index fund, and the cost of taxes is shared among different investors. ETF shares are redeemed differently, so if there are capital gains, you would only owe them based on your ETF shares.

So, if liquidity and tax efficiency is important to you, ETFs may be a good option.

When to Choose an Index Fund

By law, mutual funds are required to disclose their holdings every quarter. This is a stark contrast with ETFs, which typically disclose their holdings each day.

Transparency may matter less when it comes to index funds, however, because index funds track an index, so the holdings are not in dispute. That said, many investors prefer the transparency of ETFs, whose holdings can be verified day to day.

Because a mutual fund’s net asset value (NAV) isn’t determined until markets close, it can be hard to know exactly how much shares of an index fund cost until the end of the trading day. That’s partly why mutual funds, including index funds, allow straight dollar amounts to be invested. If you buy an index fund at noon, you can buy $100 worth, for example, regardless of the price per share.

Given all that, mutual funds can also be a wise investment depending on your preferences and strategy.

The Takeaway

Choosing between ETFs vs. index funds typically comes down to cost and flexibility, as well as understanding the tax implications of the two fund types. While both ETFs and index funds are low-cost, passively managed funds – two factors which can provide an upside when it comes to long-term performance – ETFs can have the upper hand when it comes to taxes.

As always, you should consider your strategy and goals when deciding how to invest. It may be a good idea to speak with a financial professional for guidance as well.

Invest in what matters most to you with SoFi Active Invest. In a self-directed account provided by SoFi Securities, you can trade stocks, exchange-traded funds (ETFs), mutual funds, alternative funds, options, and more — all while paying $0 commission on every trade. Other fees may apply. Whether you want to trade after-hours or manage your portfolio using real-time stock insights and analyst ratings, you can invest your way in SoFi's easy-to-use mobile app.

FAQ

Is it better to hold an ETF or index fund long-term?

It is not necessarily better to invest in an index fund or an ETF over the long term, but rather, to invest in the vehicle that best aligns with your goals and strategy. Each type of investment has its pros and cons, so it’s a good idea to research each before making a decision.

Can an ETF also be an index fund?

It’s theoretically possible that an index fund could be an ETF. That would take the form of an ETF that tracks a specific index, like an index fund, and functionally bundle the same investments within it.

Are ETFs or index funds better for beginners?

Neither is particularly better for beginners, but both may be an option for beginners as they are are typically passively managed.

Do index funds pay dividends like ETFs?

Some index funds pay dividends, and some ETFs do as well. It depends on the specific fund in both cases, however.

Which has lower fees: ETFs or index funds?

Index funds, as mutual funds, tend to have higher fees or associated costs compared to ETFs.

INVESTMENTS ARE NOT FDIC INSURED • ARE NOT BANK GUARANTEED • MAY LOSE VALUE

SoFi Invest is a trade name used by SoFi Wealth LLC and SoFi Securities LLC offering investment products and services. Robo investing and advisory services are provided by SoFi Wealth LLC, an SEC-registered investment adviser. Brokerage and self-directed investing products offered through SoFi Securities LLC, Member FINRA/SIPC.

For disclosures on SoFi Invest platforms visit SoFi.com/legal. For a full listing of the fees associated with Sofi Invest please view our fee schedule.

Financial Tips & Strategies: The tips provided on this website are of a general nature and do not take into account your specific objectives, financial situation, and needs. You should always consider their appropriateness given your own circumstances.

Tax Information: This article provides general background information only and is not intended to serve as legal or tax advice or as a substitute for legal counsel. You should consult your own attorney and/or tax advisor if you have a question requiring legal or tax advice.

Options involve substantial risk of loss and the possibility an investor may lose the entire amount invested. Before starting options trading, investors should be familiar with the Characteristics and Risks of Standardized Options . TTax implications with options should be considered. Consult your tax advisor to understand any impacts to your taxes.

Disclaimer: The projections or other information regarding the likelihood of various investment outcomes are hypothetical in nature, do not reflect actual investment results, and are not guarantees of future results.

S&P 500 Index: The S&P 500 Index is a market-capitalization-weighted index of 500 leading publicly traded companies in the U.S. It is not an investment product, but a measure of U.S. equity performance. Historical performance of the S&P 500 Index does not guarantee similar results in the future. The historical return of the S&P 500 Index shown does not include the reinvestment of dividends or account for investment fees, expenses, or taxes, which would reduce actual returns.
Mutual Funds (MFs): Investors should read and carefully consider the information contained in the prospectus, which contains the Mutual Fund’s investment objectives, risks, charges, expenses, and other relevant information. You may obtain a prospectus from the Fund company’s website or SoFi's customer service at: 1.855.456.7634. Mutual Funds must be bought and sold at NAV (Net Asset Value); unless otherwise noted in the prospectus, trades are only done once per day after the markets close. Investment returns are subject to risks. Shares may be worth more or less their original value when redeemed. The diversification of a mutual fund will not protect against loss. A mutual fund may not achieve its stated investment objective. Rebalancing and other activities within the fund may have tax implications.

Exchange Traded Funds (ETFs): Before investing in Exchange Traded Funds (ETF), always read the fund's prospectus. It contains important information about the fund’s objectives, risks, and fees. You can get a prospectus from the fund company’s website or by emailing our customer service at [email protected].

Investment Risk: Diversification can help reduce some investment risk, but cannot guarantee profit nor fully protect in a down market.

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