Types of investments

One important factor in retirement preparation is choosing options in which to invest. Because each investor has different goals and different circumstances, there is no set strategy that works for everyone. However, having a better understanding of the basic types of investments can help you determine a strategy that may be suitable for you.

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Asset classes

Most investment options will fall into one of three broad groupings of investment types, called asset classes. Options within an asset class tend to exhibit similar characteristics and behave in a similar way in the markets.

	Overview	Risk & Return	Other info
Stocks	Signify ownership in a corporation May invest in many different companies at varying levels	Highest potential investment returns over time Highest amount of risk to principal	If the company does well and its stock price increases, investment could increase in value. If the stock goes down in price, it may lose money.
Bonds	An investor loans money to an entity Loan is for a defined period of time	Typically moderate risk level Dependant on the financial strength of the issuer	Used by companies, municipalities, state/U.S. and foreign governments Finance a variety of projects and activities
Cash Equivalents	Investment securities that are short-term Have high credit quality Are highly liquid	Low-risk Low-return	May include U.S. government Treasury bills May also include bank certificates of deposit and other money market instruments

Asset allocation funds

Asset allocation funds are investment options that provide investors with a portfolio of a fixed or variable mix of the three main asset classes.

Asset allocation fund types:

Balanced funds: Generally, a “balanced fund” implies a fixed mix of stocks and bonds (such as 60% stocks and 40% bonds.)
“Life-cycle” or “target-date” funds: These usually have a mix of stocks, bonds and cash equivalent securities that start out with a higher risk-return position and gradually become less risky as the investor ages.
“Life-style” or “target-risk” funds: The fund manager of one of these options actively manages the underlying asset classes in response to market conditions to maintain a risk level that is consistent with that of the original objective (typically either conservative, moderate or aggressive).

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What type of investor are you?

As an investor, you want to find a balance between financial stability and potential asset growth — a balance that makes you comfortable with how you allocate your assets. Most investors fall into one of five types, depending on how much they value stability over growth. Get a feel for your financial risk tolerance when you answer these questions.

Determine your investor profile

I expect to begin withdrawing money from my retirement account in:

Once I begin withdrawing money from my retirement account, I expect the withdrawals to last:

I would take money out of my retirement account to pay for a large, unexpected expense.

To meet my financial goals, my investments must grow at a high rate of return.

I prefer investments that are a low risk, even if the returns are lower than the rate of inflation (the rise in prices over time).

I prefer an investment strategy designed to grow steadily and avoid sharp ups and downs.

When it comes to investing, protecting the money I have is my highest priority.

I am unwilling to wait several years to recover from losses I could incur in an extended down market.

I always choose investments with the highest possible return, even if the investments may frequently experience large declines in value because of higher risk.

10.

If I had $1,000 invested in an account, and its value dropped to $850 after six months, I would move all my money to a more conservative account.

Note: Investment information is provided for educational purposes only.

Group variable annuity products are issued by American United Life Insurance Company^® (AUL) and registered group variable annuity products are distributed by OneAmerica Securities, Inc., Member FINRA, SIPC, a Registered Investment Advisor, One American Square, Indianapolis, IN 46282, which is a wholly owned subsidiary of AUL. McCready and Keene provides administrative and record keeping services and is not a broker/dealer or an investment advisor. Neither AUL, OneAmerica Securities, McCready and Keene nor their representatives provide tax, legal or investment advice.

Investing always involves risk, including the potential loss of principal. Participants should carefully consider their risk tolerance, investing time horizon, needs and objectives as well as the specific risks and limitations associated with each of the investment options before investing.

What type of investor are you?

Your answers indicate that a retirement portfolio similar to this may suit your investment type.

This risk profile is a sample only. The proper asset allocation for your situation may differ. In applying any one of the profiles to your individual situation, you also should consider your other assets, income, and investments (including home equity, savings accounts, and other retirement plans), as well as your needs, goals and aversion to risk. If any of these factors change, you should review your investment allocation.