Consider These Three Steps to Select a LifePath® Fund

Selecting a LifePath Fund requires a few decisions. You need to know your investment time horizon and risk tolerance.

1. Decide when you need the money
Your target year is when you plan to start withdrawing money from your account. To find your target year, simply add the number of years until you need the money to the current year. For example, if the current year is 2005 and you plan to retire in 25 years, your target year is 2030.

2. Decide how you feel about risk
The following investor profiles can help you determine which kind of investor you are.

Conservative: You're willing to accept potentially lower returns on your investments to avoid potential losses. You become uncomfortable when your account jumps up and down and feel that slow and steady is more appropriate strategy for you.

Moderate: You like the potential for higher returns but you may not stick with your investments when they start to tumble. You look for a balance between higher potential returns and relatively stable investment alternatives.

Aggressive: You're willing to have your account balance shift up and down in exchange for potentially higher returns. You are able to withstand the highs and lows in the market without too much concern and are willing to accept an increased potential for loss.

3. Now, select your LifePath
Use the chart below to help determine which LifePath Fund may be best suited for your needs.

This is a hypothetical example for illustrative purposes only. The chart represents potential risk and return and does not reflect actual LifePath Portfolio allocations.

LifePath®, LifePath 2010®, LifePath 2020®, LifePath 2030®, LifePath 2040®, LifePath 2050® are all registered trademarks of Barclays Global Investors, N.A.

It is important to note that there is market risk involved when investing in mutual funds, including possible loss of principal.

State Farm VP Management Corp Risk/Important Disclosures. State Farm Mutual Funds Prospectus. The State Farm College Savings Plan Enrollment Handbook (PDF 390 KB) .

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AP2008/10/1415