The Best American Funds for 401(k) Retirement Savers

American Funds is the third-largest fund family in the country, with $1.6 trillion in mutual fund assets. Many of its mutual funds are among the biggest in the land, too. So it should come as no surprise that fund company's portfolios are popular in 401(k) plans.

In fact, eight actively managed American Funds portfolios and five of the firm's target-date funds rank among the top 100 funds with the most 401(k) assets - a list prepared by financial data company BrightScope.

You don't read much about American Funds on Kiplinger.com or in Kiplinger's Personal Finance magazine because until recently the firm's funds were sold only through advisers, and with a hefty sales charge, too. At Kiplinger, we favor funds you can buy for no transaction fee. But American Funds recently launched a no-load F1-share class that do-it-yourself investors can buy through a handful of online brokers, including Fidelity and Schwab. (In your 401(k) plan, of course, you don't pay a sales charge to buy shares in any American Funds portfolio.)

American Funds runs its portfolios in a unique way called the Capital System. Managers are encouraged to invest their own money in the funds they run, and most do. Every fund is run by multiple managers - each gets a slice of the fund's assets and applies his or her own style and investment philosophy to