FUND PROFILE
Target 2000
Target 2005
Target 2010
Target 2015
Target 2020
Target 2025
INVESTOR CLASS
January 31, 1999
[american century logo(reg.sm)]
American
Century
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This profile summarizes key information about the funds that is included in the
funds' Prospectus. The funds' Prospectus has additional information about the
funds, including a more detailed description of the risks associated with
investing in the funds, that you may want to consider before you invest. You
may obtain the Prospectus and other information about the funds at no cost by
calling us at 1-800-345-2021, accessing our Web site or visiting one of our
Investor Centers. See the back cover for additional telephone numbers and our
address.
BENHAM GROUP
AMERICAN CENTURY INVESTMENTS
TARGET 2000 TARGET 2005 TARGET 2010
TARGET 2015 TARGET 2020 TARGET 2025
1. WHAT ARE THE FUNDS' INVESTMENT OBJECTIVES?
These funds seek the highest return consistent with investment in U.S.
Treasury securities.
2. WHAT ARE THE FUNDS' INVESTMENT STRATEGIES?
The funds invest primarily in zero-coupon U.S. Treasury securities. Each
fund is designed to provide an investment experience that is similar to a
direct investment in a zero-coupon investment.
Each fund is managed to mature in the year identified in its name;
therefore, the funds' weighted average maturities are different. Funds with
longer weighted average maturities have the most volatile share prices. For
example, Target 2025 has the longest weighted average maturity, and its
share price will fluctuate the most.
U.S. Treasury bonds have a traditional design: interest is paid
periodically until maturity, when the principal is repaid. Zero-coupon
Treasury securities, however, do not make any periodic interest payments.
Instead, all of the interest and principal is paid when the securities
mature.
Zero-coupon Treasury securities are created by separating a traditional
Treasury bond's interest and principal parts. Each part can be used to
create zero-coupon Treasury securities. These securities are created by
financial institutions (like a dealer), the U.S. Treasury and other
agencies of the federal government. The important characteristic is that
the final maturity value of a zero-coupon Treasury security is supported by
Treasury securities.
Zero-coupon Treasury securities are beneficial for investors who wish to
invest for a fixed period of time at a selected rate. When an investor
purchases a traditional bond, it is paid periodic interest at a
predetermined rate. This interest payment must be reinvested elsewhere.
However, the investor may not be able to reinvest this interest payment in
an investment that has a return similar to the bond. This is called
reinvestment risk. Since zero-coupon securities do not pay interest
periodically, there is no reinvestment risk.
If you invest in a fund, reinvest all distributions and hold your shares
until the fund is liquidated, your investment experience will be similar to
that of an investment in a zero-coupon U.S. Treasury security that matures
at the end of the fund's maturity year. Each fund is managed to provide an
investment return that does not differ substantially from the anticipated
growth rate (AGR) and anticipated value at maturity (AVM) calculated on the
day the shares were purchased.
A fund's AGR is a calculation of the annualized rate of growth that an
investor may expect from the purchase date to the fund's target maturity
date.
The AVM is the calculated value of a fund's investment portfolio. It is
based on the maturity values of the fund's zero-coupon Treasury securities
The advisor calculates each fund's AGR and AVM on each business day.
While many factors can influence each fund's daily AGR and AVM, they tend
to fluctuate within narrow ranges.
When a fund reaches its maturity year
* The fund managers may begin to buy traditional Treasury securities
consistent with the fund's investment objective and pending
maturity.
* As the fund's zero-coupon Treasury securities mature, the proceeds
will be invested in Treasury bills.
* In January of the year following maturity, the fund will be
liquidated.
Additional information about the funds' investments is available in
their annual and semiannual reports. In these reports you will find a
discussion of the market conditions and investment strategies that
significantly affected the funds' performance during the most recent fiscal
period. You may get these reports at no cost by calling us.
TARGET MATURITIES AMERICAN CENTURY INVESTMENTS
3. WHAT ARE THE SIGNIFICANT RISKS OF INVESTING IN THE FUNDS?
*The funds have different weighted average maturities. Because of this, the
funds will respond differently to changes in interest rates. Funds with
longer weighted average maturities are more sensitive to interest rate
changes. When interest rates rise, the values of the funds usually fall,
but the values of the funds with longer weighted average maturities
generally will fall further. This interest rate sensitivity is greater in
the funds than for traditional Treasury funds. If you sell your shares when
their value is less than the price you paid, you will lose money.
*While we recommend that shareholders hold their investment in the funds,
we do not restrict your (or any other shareholders') ability to redeem
shares. When a fund's shareholders redeem their shares before the target
maturity year, unanticipated capital gains or losses may result. The fund
will distribute these capital gains and losses to all shareholders.
*The funds are designed to provide an investment that is similar to
investing in a zero-coupon U.S. Treasury security that matures in the year
identified in its name. The fund managers adhere to investment policies
that are designed to ensure that this happens. However, a precise forecast
of a fund's final maturity value and yield to maturity are not possible.
*An investment in the funds is not a bank deposit, and it is not insured or
guaranteed by the Federal Deposit Insurance Corporation (FDIC) or any other
government agency.
In summary, the funds are intended for investors who seek the highest
return consistent with U.S. Treasury securities and who are willing to
accept the risks associated with the funds' investment strategy.
FUND PERFORMANCE
The following bar chart shows the performance of the funds' Investor
Class shares for each of the last 10 calendar years or for each full
calendar year in the life of the fund if less than 10 years. The bar chart
indicates the volatility of the funds' historical returns from year to
year. Neither the bar chart nor the performance information below it is
intended to indicate how the fund will perform in the future.
[bar chart]
Target Target Target Target Target Target
2000 2005 2010 2015 2020 2025
1998 7.36% 12.87% 15.07% 14.60% 16.49% 21.81%
1997 7.05% 11.63% 16.75% 22.92% 28.62% 30.11%
1996 1.99% -1.24% -3.54% -6.03% -8.42%
1995 20.74% 32.65% 42.09% 52.72% 61.34%
1994 -6.89% -8.90% -11.56% -14.08% -17.66%
1993 15.46% 21.56% 26.28% 30.51% 35.62%
1992 8.47% 9.56% 9.78% 7.77% 8.33%
1991 20.66% 21.47% 21.06% 22.47% 17.36%
1990 6.31% 3.58% 0.27% -3.38% -4.50%
1989 19.81% 23.89% 28.02% 33.49%
FUND PROFILE TARGET MATURITIES
The highest and lowest returns of the funds' Investor Class shares for a
calendar quarter during the period reflected by the preceding bar chart are
provided in the following chart to indicate the funds' historical
short-term volatility. Shareholders should be aware, however, that the
funds are intended for investors whose investment horizon permits them to
hold a fund until it is liquidated. The funds are not managed for results
before maturity.
[bar chart]
Lowest Highest
Target 2000 -4.93% 1Q 1994 14.65% 2Q 1989
Target 2005 -7.65% 1Q 1990 18.27% 2Q 1989
Target 2010 -10.88% 1Q 1990 23.61% 2Q 1989
Target 2015 -13.82% 1Q 1996 27.42% 2Q 1989
Target 2020 -16.61% 1Q 1996 21.44% 2Q 1995
Target 2025 -10.19% 1Q 1997 14.68% 4Q 1997
The following table shows the average annual returns of the funds'
Investor Class shares for the periods indicated. The benchmarks are
unmanaged indices that have no operating costs and are included in the
table for performance comparison.
LIFE
1 YEAR 5 YEARS 10 YEARS OF FUND(1)
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AVERAGE ANNUAL TOTAL RETURNS (PERIOD ENDED DECEMBER 31, 1998)
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Target 2000 7.36% 5.67% 9.75% 12.12%
Merrill Lynch Long-Term
Treasury Index 13.55% 9.34% 11.48% 12.53%
11/15/00 Maturity
STRIPS Issue(2) 7.91% 6.15% 10.33% 13.43%
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Target 2005 12.87% 8.50% 12.05% 14.43%
Merrill Lynch Long-Term
Treasury Index 13.55% 9.34% 11.48% 12.53%
11/15/05 Maturity
STRIPS Issue(2) 13.45% 8.73% 12.39% 16.03%
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Target 2010 15.07% 10.24% 13.37% 16.03%
Merrill Lynch Long-Term
Treasury Index 13.55% 9.34% 11.48% 12.53%
11/15/10 Maturity
STRIPS Issue(2) 16.09% 10.94% 14.09% 17.51%
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Target 2015 14.60% 11.68% 14.45% 11.62%
Merrill Lynch Long-Term
Treasury Index 13.55% 9.34% 11.48% 9.72%
11/15/15 Maturity
STRIPS Issue(2) 15.13% 12.19% 15.11% 11.62%
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Target 2020 16.49% 12.76% N/A 12.98%
Merrill Lynch Long-Term
Treasury Index 13.55% 9.34% N/A 10.69
11/15/20 STRIPS Issue(2) 17.59% 13.25% N/A 12.61%
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Target 2025 21.81% N/A N/A 16.92%
Merrill Lynch Long-Term
Treasury Index 13.55% N/A N/A 11.44
11/15/25 STRIPS Issue(2) 22.67% N/A N/A 18.31%
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For performance information, including yields, please call us or access our Web
site.
(1) The inception dates are: Target 2000, Target 2005 and Target 2010: March
25, 1985; Target 2015: September 1, 1986; Target 2020: December 29, 1989;
and Target 2025: February 15, 1996.
(2) The Target funds are designed to have a performance behavior that is like a
zero-coupon security of the maturity suggested by each fund's name. The
STRIPS issues listed in this table are examples of these zero-coupon
securities. The STRIPS issues are not indices, but are important benchmarks
of the Target funds' performance.
TARGET MATURITIES AMERICAN CENTURY INVESTMENTS
4. WHAT ARE THE FUND'S FEES AND EXPENSES?
There are no sales loads, fees or other charges to buy fund shares
directly from American Century, to reinvest dividends in additional shares,
to exchange into the Investor Class shares of other American Century funds
or to redeem your shares. The following table describes the fees and
expenses that you will pay if you buy and hold shares of the fund.
ANNUAL FUND OPERATING EXPENSES
(EXPENSES THAT ARE DEDUCTED FROM FUND ASSETS)
Management Fee 0.59%(1)
Distribution and Service (12b-1) Fees None
Other Expenses(2 ) 0.00%
Total Annual Fund Operating Expenses 0.59%
(1) Based on expenses incurred during the funds' most recent fiscal
year. The funds have a stepped fee schedule. As a result, the
funds' management fees generally decrease as fund assets
increase.
(2) Other expenses, which include the fees and expenses of the funds'
independent trustees, their legal counsel, interest and
extraordinary expenses, were less than 0.005% for the most recent
fiscal year.
EXAMPLE
Assuming you . . .
* invest $10,000 in the fund
* redeem all of your shares at the end of the periods shown
below
* earn 5% return each year
* incur the same operating expenses shown above
. . . your cost of investing in a fund would be:
1 year 3 years 5 years 10 years
$60 $189 $329 $736
Of course, actual costs may be higher or lower. Use this example
to compare costs of investing in other funds.
FUND PROFILE
5. WHO ARE THE FUNDS' INVESTMENT ADVISOR AND PORTFOLIO MANAGERS?
American Century Investment Management, Inc. provides investment
advisory and management services for the funds. American Century uses teams
of portfolio managers, assistant portfolio managers and analysts working
together to manage its mutual funds. The portfolio managers on the team are
identified below:
DAVID SCHROEDER, Vice President and Senior Portfolio Manager, has been a
member of the team that manages the Target funds since joining American
Century in July 1990. He has a bachelor of arts from Pomona College.
JEREMY FLETCHER, Associate Portfolio Manager, has been a member of the
team that manages the Target funds since August 1997. He joined American
Century in 1991 as an Investor Services Representative. He has bachelor's
degrees in economics and mathematics from Claremont McKenna College.
6. HOW DO I BUY FUND SHARES?
* Complete and return the enclosed application
* Call us and exchange shares from another American Century fund
* Call us and send your investment by bank wire transfer
Your initial investment must be at least $2,500 ($1,000 for traditional
IRAs, Roth IRAs and UGMA/UTMA accounts) unless you establish an automatic
investment plan of at least $50 per month. If the value of your account
falls below this account minimum, your shares may be redeemed
involuntarily.
7. HOW DO I SELL FUND SHARES?
You may sell all or part of your fund shares on any business day by
writing or calling us. You also may exchange your shares in a fund for
shares in nearly 70 other mutual funds offered by American Century.
Depending on the options you select when you open your account, some
restrictions may apply. For your protection, some redemption requests
require a signature guarantee.
TARGET MATURITIES
8. HOW ARE FUND DISTRIBUTIONS MADE AND TAXED?
The funds each pay distributions of substantially all of their income
(and capital gains, if necessary) in December of each year. Distributions
are reinvested automatically in additional shares unless you choose another
option.
At the same time that a fund's annual distributions are made, the Board
of Trustees declares a reverse share split for each fund that exactly
offsets the distributions. This allows the fund's share price to behave
like the price of an equivalent zero-coupon Treasury security. Those
shareholders who reinvest all distributions will own exactly the same
number of shares of the fund as they did before the distributions.
9. WHAT SERVICES ARE AVAILABLE?
American Century offers several ways to make it easier for you to manage
your account, such as:
* telephone transactions
* wire and electronic funds transfers
* 24-hour Automated Information Line transactions
* 24-hour online Internet account access and transactions
You will find more information about these choices in our Investor
Services Guide, which you may request by calling us, accessing our Web site
or visiting one of our Investor Centers.
Information contained in our Investor Services Guide pertains to
shareholders who invest directly with American Century rather than through
an employer-sponsored retirement plan or through a financial intermediary
If you own or are considering purchasing fund shares through an
employer-sponsored retirement plan or financial intermediary, your ability
to purchase shares of the fund, exchange them for shares of other American
Century funds, and redeem them will depend on the terms of your plan or
financial intermediary. If you have questions about investing in an
employer-sponsored retirement plan or through a financial intermediary,
call an Institutional Services Representative at 1-800-345-3533.
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[american century logo(reg.sm)]
American
Century
AMERICAN CENTURY INVESTMENTS
P.O. BOX 419200
KANSAS CITY, MISSOURI 64141-6200
WWW.AMERICANCENTURY.COM
INVESTOR SERVICES
1-800-345-2021 or 816-531-5575
AUTOMATED INFORMATION LINE
1-800-345-8765
CORPORATE; NOT-FOR-PROFIT; FOUNDATIONS; ENDOWMENTS; KEOGH; SEP-, SARSEP-, AND
SIMPLE-IRA; AND 403(B) SERVICES
1-800-345-3533
TELECOMMUNICATIONS DEVICE FOR THE DEAF
1-800-634-4113 or 816-444-3485
FAX 816-340-7962
SH-PRF-14137 9901 Funds Distributor, Inc.
