Fund Evaluator:

Fidelity Advisor Freedom 2040 Z Overview

Fidelity Advisor Freedom 2040 Z (FIJPX) is an actively managed Allocation Target-Date 2040 fund. Fidelity Investments launched the fund in 2018.

The investment seeks high total return with a secondary objective of principal preservation as the fund approaches its target date and beyond. The fund invests primarily in a combination of Fidelity® U.S. equity funds, international equity funds, bond funds, and short-term funds (underlying Fidelity ® funds). The adviser allocates assets according to a neutral asset allocation strategy that adjusts over time until it reaches an allocation similar to that of the Fidelity Advisor Freedom® Income Fund.

About Fidelity Advisor Freedom 2040 Z (FIJPX)

There are 4 members of the management team with an average tenure of 7.41 years: Andrew Dierdorf (2011), Brett Sumsion (2014), Finola McGuire Foley (2025), Cait Dourney Earle (2025). Management tenure is more important for actively managed funds than passive index funds.

The fund has 1 primary benchmark: S&P 500 (TR) (1970) index with a weighting of 100%. Fidelity Advisor Freedom 2040 Z has 47 securities in its portfolio. The top 10 holdings constitute 70.8% of the fund’s assets. The fund meets the SEC requirement of being classified as a diversified fund. The fund is not considered to have an ESG focus with its investment selection and management.

Fidelity Advisor Freedom 2040 Z is part of the Allocation global asset class and is within the Allocation fund group. Fidelity Advisor Freedom 2040 Z has 43.4% of its portfolio invested in foreign issues. The overall assets allocated to domestic stock is 43.9%. There is 39.9% allocated to foreign stock, and 0.1% is allocated to preferred stocks. The bond allocation as a percentage of total assets is 16.9% (13.4% domestic bond, 3.6% foreign bond and 0.0% convertible bond). Fidelity Advisor Freedom 2040 Z has -1.6% of the portfolio in cash.

Assets Under Management

The fund has $710 million in total assets, which is below the $1 billion average for the Target-Date 2040 category. Normally, lower assets under management translates to higher average expense ratios, and greater total assets are desired. However, for some investment categories, such as small-cap investing, it may be difficult for the manager to fully employ the desired active strategy if assets grow too large or too quickly.

FIJPX Performance and Fees

The expense ratio measures how much of a fund’s assets are used for administrative expenses and operating expenses, including adviser fees and fees for the transfer agent and custodial services. The Fidelity Advisor Freedom 2040 Z expense ratio is above average compared to funds in the Target-Date 2040 category. Fidelity Advisor Freedom 2040 Z has an expense ratio of 0.62%, which is 8% lower than its category average, making the fund expense ratio grade a C. While it is difficult to predict returns, it is known that high annual expense ratios reduce your rate of return, and excessive fees are difficult to overcome. Active management normally comes with higher expense ratios than passive index management. Certain investment categories such as small company and foreign also normally have higher expense ratios. It is best to compare fund expense ratios against the category averages for meaningful assessments.

High portfolio turnover can translate to higher expenses and lower aftertax returns. Fidelity Advisor Freedom 2040 Z has a portfolio turnover rate of 18%, indicating that holds its assets around 0.1 years. By way of comparison, the average portfolio turnover is 22% for the Target-Date 2040 category.

Recently, in the month of June 2026, Fidelity Advisor Freedom 2040 Z returned 1.1%, which earned it a grade of A, as the Target-Date 2040 category had an average return of 0.3%. The letter grades of A, B, C, D and F are based upon relative rankings within the investment category. A grade of A, for example, would indicate that the return is in the highest 20% for that time period compared to all funds in that category.

Fidelity Advisor Freedom 2040 Z has a trailing yield of 1.39%, which is below the 1.91% category average. The fund normally distributes its income semi-annually and its capital gains semi-annually.

It’s natural to seek the best-performing investments, but you must consider the relationship between risk and return and the impact of costs and taxes on your realized returns.

Fidelity Advisor Freedom 2040 Z Grades

Year to date, the fund has returned 11.6%, 2.0 percentage points better than the category, which translates into a grade of A. The fund has returned 21.7% over the past year (grade of A), 17.9% over the past three years (grade of A) and 9.0% per year over the past five years (grade of A) and 11.9% per year over the past 10 years (grade of A).

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