The American Funds plans to invest $1.5 trillion to create a new 401(ks) that will generate a 20% return and be the most successful retirement plan in history, according to a plan released Wednesday by the fund’s CEO.
The plan calls for a plan that will be more profitable than any other 401(p) in the world and a “unique retirement account experience,” according to the plan.
“The American Funds, the most valuable employer-sponsored retirement account in the United States, is the ultimate corporate tool for increasing employee productivity and productivity growth,” the plan says.
The American Fund is also the only one of the three largest publicly traded 401(q)s in the country to be part of the S&P 500 index.
The fund is the beneficiary of the $5.5 billion in government assistance the Treasury Department provided in July for the creation of a 401(r) called the American Account.
“A successful American 401(kr) will be a unique opportunity to create new shareholder value and new opportunities for growth,” American Funds CEO William J. McDonough said in the plan’s release.
“While the American Fund’s retirement plan is not expected to be the largest in the history of the company, it is well positioned to compete on a scale that makes it a world leader in its industry.”
The American funds’ plan will provide employees a “high quality retirement package” that includes an “all-in-one” package that includes a $50,000 employer match, a $25,000 contribution to a Roth IRA, and a contribution to an index fund.
Employees can also take advantage of 401(a) and 457 plans, which provide a tax-deferred investment plan.
In addition, American Funds will invest in a “highly leveraged” mutual fund, which has a return of 30% per annum.
American Funds’ plans are a direct response to the financial crisis and are part of a wider “rebalancing” effort by the firm, which had been operating under the assumption that the recession had ended.
The firm’s chief executive, William J and Mary C. McNamee, have said they believe that the firm’s stock is undervalued because the firm has not been able to sell any of its bonds or mortgage-backed securities.
American Fund shares were down nearly 10% in after-hours trading Wednesday.
The stock is up about 2.6% in the past week.
“American Funds’ new 401k will be unique because it will offer a broad range of benefits and features that are unique to our business,” McDonought said in a statement.
“It will also offer a compelling investment opportunity for our clients, which includes an increased number of options and a diversified portfolio of investment products that are aligned to their personal investment goals.”
The plan also says that the plan will have a “strong corporate presence” at the company.
McDonaldough said the plan was a “rebalance” to the firm.
“We will now have an opportunity to take a strong, global business and work to reshape it in a way that benefits both our investors and our employees,” McNamees said in July.
American funds has been a pioneer in creating a retirement plan that has generated returns of 30%, according to research by Vanguard, a mutual fund firm.
The funds’ plans were the subject of a $500 million SEC lawsuit in the summer of 2016.
The lawsuit alleged that American Funds had failed to disclose that the company’s plans were not subject to SEC regulation.