American Century Investments has been around since 1958. With over $200 billion in assets under management and a wide range of mutual funds, it’s a well-known name in the world of long-term investing. But with so many fund providers out there—Vanguard, Fidelity, Schwab—how does American Century compare?
In this post, we’ll give you an honest American Century review. We’ll dig into performance, fees, fund types, and who this provider is really best for. Whether you’re planning for retirement or building a diversified portfolio, this mutual fund comparison will help you make the right call.
1. What Is American Century Investments?
American Century is a privately owned asset management firm based in Kansas City. One of its standout features is that over 40% of the company’s profits go to funding medical research through the Stowers Institute for Medical Research.
That’s a nice social impact angle—but we’re here to talk about your money.
American Century offers:
- Mutual funds
- ETFs
- Retirement accounts (IRAs, 401(k) rollovers)
- College savings plans (529s)
- Managed portfolios
Their core offering is actively managed mutual funds, but they’ve expanded into ETFs and index-based strategies in recent years.
2. Types of Mutual Funds Offered
American Century offers more than 80 mutual funds. These span across all the major categories:
- Equity Funds – Large-cap, mid-cap, small-cap, global, emerging markets
- Fixed Income Funds – Government, corporate, high-yield, tax-free municipal bonds
- Asset Allocation Funds – Target-date and balanced funds
- Sustainable / ESG Funds – Focused on socially responsible investing
- Alternative Funds – Low-volatility or hedged strategies
You can choose based on your risk level, time horizon, and investment goal—whether that’s growth, income, or preservation.
3. Performance Overview: Are the Returns Worth It?
So, how do their funds actually perform?
The Good:
Some of American Century’s equity and growth-oriented funds have outperformed their category peers, especially in the large-cap space.
Examples of solid performers (as of latest data):
- American Century Focused Dynamic Growth Fund (ACFOX) – A high-conviction growth fund with strong long-term returns.
- American Century Ultra Fund (TWCUX) – Well-known large-cap growth fund that consistently beats the benchmark over the long term.
- American Century Inflation-Adjusted Bond Fund (ACITX) – Popular among conservative investors during inflationary periods.
These funds have earned strong Morningstar ratings (mostly 4-star and some 5-star).
The Not-So-Great:
Not all funds are winners. Some fixed income and international equity funds have lagged behind peers—especially when you consider fees vs performance.
So, while some American Century funds are solid, others are mediocre or inconsistent.
4. Fees: What Will You Pay?
Now let’s get into the cost—and this matters a lot.
American Century mutual funds typically fall in the actively managed category, meaning fees are higher than index funds. Their expense ratios range from:
- 0.35% – 1.25% (depending on the fund and share class)
- No-load funds available, but some carry transaction fees if bought through a brokerage
Example:
- ACFOX has an expense ratio of 1.00%
- TWCUX charges around 0.93%
- Index-based ETFs, like ESGA, offer lower expense ratios (around 0.30%)
While these fees are lower than some boutique fund managers, they’re still higher than low-cost providers like Vanguard or Fidelity. That can eat into your returns over time, especially in a passive portfolio.
Tip: If you’re going the active route, make sure the fund’s performance justifies the extra cost.
5. Fund Accessibility and Minimum Investment
You can invest in American Century funds directly through their website or via most major brokerages like Fidelity, Schwab, or TD Ameritrade.
- Minimum investment:
- $2,500 for most funds
- $1,000 for IRAs
- $50 per month for automatic investing plans
So, accessibility is pretty friendly for beginners.
6. Pros and Cons
Let’s break this American Century review down into clear pros and cons.
✅ Pros:
- Strong track record on some growth funds
- Wide variety of funds across asset classes
- Good tools and resources for retirement planning
- Social impact focus (Stowers Institute)
- Automatic investing options with low minimums
❌ Cons:
- Higher expense ratios on many mutual funds
- Mixed performance across certain categories
- Not ideal for passive investors who want ultra-low fees
- Some funds lack transparency in strategy or holdings
7. How Does It Compare to Other Investment Providers?
Here’s a quick mutual fund comparison between American Century and other top players:
| Provider | Best For | Average Fund Fees | Investment Style |
|---|---|---|---|
| American Century | Long-term investors, growth focus | 0.70% – 1.20% | Actively managed |
| Vanguard | Cost-conscious index investors | 0.05% – 0.25% | Index + some active |
| Fidelity | Variety + tech tools | 0.00% – 0.75% | Index + active |
| T. Rowe Price | Active retirement investors | 0.60% – 0.95% | Actively managed |
If you prefer active management with a trusted brand, American Century is solid. But if you’re focused on low fees and passive investing, Vanguard or Fidelity might offer better value.
8. Who Should Invest with American Century?
You might consider American Century if:
- You believe in active management and are willing to pay for it
- You want to support a socially responsible company
- You’re looking for solid growth funds for long-term goals
- You want an easy platform with low minimums and good customer service
On the other hand, if you’re looking for low-cost index investing, or want full control through ETFs, there are cheaper and more flexible options elsewhere.
Final Thoughts
American Century Investments is a reputable firm with a strong legacy, good customer service, and several standout funds. But not all their offerings are top-tier, and fees can be a concern for long-term investors focused on cost.
If you’re willing to do your homework and pick the right fund (especially in growth categories), American Century can be a worthwhile piece of your portfolio. Just be sure to compare fund returns, check the expense ratio, and think about your investment goals.
For those just starting out, American Century also offers simple tools and retirement-focused options that make it beginner-friendly.
Want to compare mutual funds side by side?
Check out our upcoming post: “Vanguard vs American Century: Which One’s Right for You?” — or sign up for our newsletter on oklee.online for weekly insights on finance and investing.
