THE POWER OF INCOME

Everyone would like to enter retirement in a position of financial strength. For many, this starts with figuring out how to generate income once they stop working. Here’s an idea to consider. Use any income distributions to help with monthly living expenses while reinvesting all capital gains.

For more than 70 years, spanning multiple market cycles, Franklin Income Fund--Advisor Class (FRIAX) has paid uninterrupted dividends, while also paying annual capital gains nearly 80% of the time.1 Here's how it would've worked for someone retiring about 20 years ago on December 31, 1998:2

For a retire
making

initial investment
in September 30, 2002

Generated an
average income

of
$3,306

After 15 years
Ending September 30, 2017

a total of
$595,151
from monthly income

+

a capital of
$664,397
from reinvestments


Click the envelopes below to see the income generated each month by this scenario.

THE ENVELOPE, PLEASE...

Income Distributions of a $500,000 Investment in Franklin Income Fund─Advisor Class
20-Year Period Ended December 31, 2018

Reveal all

 JanFebMarAprMayJunJulAugSeptOctNovDec
1999
2000
2001
2002
2003
2004
2005
2006
2007
2008
2009
2010
2011
2012
2013
2014
2015
2016
2017
2018

Dividends will vary depending on the fund's income, and past distributions are not indicative of future trends.

Performance data represents past performance, which does not guarantee future results. Current performance may differ from the figures shown. A fund’s investment return and principal value will change with market conditions, and investors may have a gain or a loss when they sell their shares. Please view Franklin Income Fund’s most recent month-end performance.

The hypothetical scenario does not take into account federal, state or municipal taxes. If taxes were taken into account, the hypothetical values shown would have been lower.

Franklin Income Fund

Franklin Income Fund seeks to maximize income, while maintaining prospects for capital appreciation over the long term by:

Seeking undervalued securities unconstrained by asset classes or market cycles

Pursuing income across the capital structure of a company using stocks, convertible securities and bonds

Adjusting fund allocations without set proportions based on current market opportunities

With over 70 years of uninterrupted dividends, Franklin Income Fund provides investors seeking income a time-tested strategy that has delivered strong results over multiple market cycles.”

Edward D. Perks
Portfolio Manager, Franklin Income Fund

Average Annual Total Returns (For Periods Ended September 30, 2019)

1-year3-year5-year10-yearSince Inception
(8/31/48)
Advisor Class (FRIAX)1 4.65% 6.28% 3.98% 7.59% 10.10%
Class A (FKIQX)3          
Without Sales Charge 4.40% 6.06% 3.79% 7.41% 10.01%
With 4.25% Initial Sales Charge 0.49% 4.72% 3.00% 7.00% 9.95%
Total Annual Operating Expenses
Advisor Class 0.47%
Class A 0.72%
30-Day Standardized Yield As of September 30, 20194
Advisor Class 3.95%
Class A 3.55%

Performance data represents past performance, which does not guarantee future results. Current performance may differ from the figures shown. A fund’s investment return and principal value will change with market conditions, and investors may have a gain or a loss when they sell their shares. Please view Franklin Income Fund’s most recent month-end performance.

Advisor Class shares do not have sales charges or Rule 12b‐1 fees and are offered only to certain eligible investors as stated in the prospectus. The fund offers other share classes, subject to different fees and expenses that will affect their performance. Please see the fund’s prospectus for more information about fees and expenses.

  1. Effective 12/31/96, the fund began offering Advisor Class shares. For periods prior to the fund's Advisor Class inception date, a restated figure is used based on the fund's oldest share class, Class A1 performance, excluding the effect of Class A1's maximum initial sales charge but reflecting the effect of the Class A1 Rule 12b-1 fees; and for periods after the fund's Advisor Class inception date, actual Advisor Class performance is used, reflecting all charges and fees applicable to that class.
  2. Source: Morningstar via Advanced HypotheticalTM Tool. Assumes initial $500,000 investment without sales charges, all income distributions paid out, and reinvestment of all capital gains. If sales charges had been included, the results would have been lower.
  3. Effective 9/10/18 Class A shares closed to new investors, were renamed Class A1 shares, and a new Class A share with a different expense structure became available. Class A performance shown has been calculated as follows: (a) for periods prior to 9/10/18, a restated figure is used based on the fund's Class A1 performance and including any Rule 12b-1 rate differential as exists between Class A1 and Class A; and (b) for periods after 9/10/18, actual Class A performance is used, reflecting all charges and fees applicable to that class. On 5/1/94, the fund implemented a Rule 12b-1 plan, which affects subsequent performance.
  4. The fund’s 30-day standardized yield is calculated over a trailing 30-day period using the yield to maturity on bonds and/or the dividends accrued on stocks. It may not equal the fund’s actual income distribution rate, which reflects the fund’s past dividends paid to shareholders.

What Are the Risks?

All investments involve risks, including possible loss of principal. The fund's share price and yield will be affected by interest rate movements. Bond prices generally move in the opposite direction of interest rates. Thus, as the prices of bonds in the fund adjust to a rise in interest rates, the fund's share price may decline. Changes in the financial strength of a bond issuer or in a bond's credit rating may affect its value. The fund's portfolio includes a substantial portion of higher-yielding, lower-rated corporate bonds because of the relatively higher yields they offer. Floating-rate loans are lower-rated, higher-yielding instruments, which are subject to increased risk of default and can potentially result in loss of principal. These securities carry a greater degree of credit risk relative to investment-grade securities. Stock prices fluctuate, sometimes rapidly and dramatically, due to factors affecting individual companies, particular industries or sectors, or general market conditions. These and other risk considerations are discussed in the fund's prospectus.

Important Legal Information

For Financial Professional Use Only

This communication is general in nature and provided for educational and informational purposes only. It should not be considered or relied upon as legal, tax or investment advice or an investment recommendation, or as a substitute for legal or tax counsel. Any investment products or services named herein are for illustrative purposes only, and should not be considered an offer to buy or sell, or an investment recommendation for, any specific security, strategy or investment product or service. As a financial professional, only you can provide your customers with personalized advice and investment recommendations tailored to their specific goals, individual situation, and risk tolerance.

Franklin Templeton Investments (FTI) does not provide legal or tax advice. Federal and state laws and regulations are complex and subject to change, which can materially impact results. FTI cannot guarantee that such information is accurate, complete or timely; and disclaims any liability arising out of your use of, or any tax position taken in reliance on, such information.

All financial decisions and investments involve risk, including possible loss of principal.

Your clients should carefully consider a fund's investment goals, risks, charges and expenses before investing. Download a prospectus, which contains this and other information. Your clients should read the prospectus carefully, before they invest or send money.

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Franklin Templeton Distributors, Inc.