Some investors looking for steady income in retirement are turning to managed payout funds. There are just a handful of these niche mutual funds, which pay monthly income to investors, Morningstar portfolio strategist Amy Arnott said. Schwab offers three such funds: Schwab Monthly Income Fund - Income Payout (SWLRX), Schwab Monthly Income Fund - Flexible Payout (SWKRX) and Schwab Monthly Income Fund - Target Payout (SWJRX). The Schwab Monthly Income Fund - Target Payout (SWJRX), on the other hand, aims to offer a 5% annual payout. Managed payout funds are not offered in many defined contribution plans, such as 401(k)s. In fact, a 2022 Cerulli survey of defined contribution plan consultants showed just 17% of the plans offered any managed payout funds.

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Persons: Morningstar, Amy Arnott, Schwab, Inga Rachwald, Schwab's, Morningstar's Arnott, Rachwald, Arnott, Brett Lozowski, doesn't Organizations: Schwab, Income, Schwab Asset Management, Planning Partners