Russell Changes Asset Allocation of LifePoints® (Russell.com)

Russell Changes Asset Allocation of LifePoints® Target Date Funds
New Russell Research Supports More Aggressive Glide Path in Earlier Years

Tacoma, WA — November 6, 2006 — Original research by Russell Investment Group has determined that typical defined contribution participants can benefit from more aggressive asset allocation in the early years of saving and investing for retirement. As a result, the firm has adopted a refined methodology for constructing target date funds and has announced changes to its LifePoints® Funds, Target Date Series, comprised of four target date portfolios available to defined contribution plan participants.

Russell's Approach to Target Date Funds: Building a Simple and Powerful Solution to Retirement Savings by Grant W. Gardner, Ph.D., senior balanced fund strategist, and Yuan-An Fan, Ph.D., senior research analyst, presents a method for constructing what Russell believes is the optimal "glide path" for a target date fund. The glide path is the evolution of the mix of equities and fixed income over the life of the fund. Russell's glide path is designed to meet the needs of a typical defined contribution participant, taking into account current income levels, projected future income growth, retirement contribution rates and retirement income needs. The typical participant has the goal of building enough wealth at retirement to maintain his or her pre-retirement standard of living.

Russell's glide path is specifically designed to manage the risk of failure in achieving the goal of replacing 42% of pre-retirement income of $80,000, an amount determined necessary for maintaining a pre-retirement standard of living for typical income levels in a 2004 study by Aon Consulting and Georgia State University. Based on Russell's assumptions and this research, this glide path is optimal in the sense that it meets the needs of the typical participant better than other glide paths compared in the analysis.

The research finds that typical participants can tolerate the risk of an all-equity portfolio in earlier years when they have many years of future savings available to offset investment losses. In contrast, a more conservative portfolio with the majority of assets held in fixed income is called for in the final few years before retirement as well as after retirement.

"The changes made in the funds' glide paths were in response both to Russell's ongoing research into investor behavior as well as plan sponsors' needs. We believe the new glide path provides shareholders of our LifePoints Target Date funds with an improved opportunity to meet the goal of building an adequate retirement portfolio" said Matt Smith, managing director, Russell Retirement Services.

Russell modified the glide path of its 2010 Strategy Fund, 2020 Strategy Fund, 2030 Strategy Fund and 2040 Strategy Fund. Each fund is designed for investors who plan to retire close to the target year indicated in the fund name. The changes to the allocation to equity and fixed income underlying funds for each Target Date fund are as follows:

Fund	Effective October 2006	Prior to October 2006
2010 Strategy Fund	40% stock funds / 60% fixed income funds	45% stock funds / 55% fixed income funds
2020 Strategy Fund	64% stock funds / 36% fixed income funds	55% stock funds / 45% fixed income funds
2030 Strategy Fund	95% stock funds / 5% fixed income funds	64% stock funds / 36% fixed income funds
2040 Strategy Fund	100% stock funds / 0% fixed income funds	72% stock funds / 28% fixed income funds

In addition, at target date, each fund will keep an allocation of 32% stock funds and 68% fixed income funds, rather than continuing to become more conservative following the target year.

"Russell's target date funds are designed to help overcome the uncertainty that many find on the way to retirement financial independence," said Dr. Gardner. "Starting early and keeping invested is a critical factor when it comes to achieving retirement goals. But defined contribution plan sponsors should also know the assumptions standing behind a fund's glide path. Otherwise, they may be buying a retirement savings black box that may be inappropriate for them."

The LifePoints Funds, Target Date Series were launched in March 2005 and are currently available through selected independent financial intermediaries and on several defined contribution platforms.

About Russell
Russell Investment Group, a global leader in multi-manager investing, provides investment products and services in more than 44 countries. Russell manages more than $181 billion in assets for advisory clients as of September 30, 2006. In 2006, and for the fifth time since 1999, Russell is ranked among the Fortune Magazine's 100 Best Companies to Work For in America.

Contact:
Jennifer Tice, 253-439-2921
Matt Burkhard, 718-875-2122

Russell Investment Group is a Washington, USA corporation, which operates through subsidiaries worldwide and is a subsidiary of The Northwestern Mutual Life Insurance Company.

Fund objectives, risks, charges and expenses should be carefully considered before investing. A prospectus containing this and other important information can be obtained by calling (866) 676-7680 or visiting www.russell.com. Please read the prospectus carefully before investing.

Effective July 1, 2006 Frank Russell Investment Company changed its name to Russell Investment Company ("RIC"). RIC Funds are distributed by Russell Fund Distributors, Inc., and advised by Russell Investment Management Company ("RIMCo"). Effective July 1, 2006 RIMCo changed its name from Frank Russell Investment Management Company.

The LifePoints® Funds are exposed to the risks of the underlying fund proportionately to their underlying fund allocation. Investment in LifePoints® Funds involves direct and indirect expenses which together can be higher than those incurred when investing directly in an underlying fund. Currently, direct operating expenses, other than distribution fees, shareholder servicing fees and non-recurring and extraordinary expenses, are waived or reimbursed by Russell Investment Management Company.

Each of the LifePoints® Funds, Target Date Series, invests its assets in shares of a number of underlying Russell Investment Company Funds. The allocation of each fund's assets is based solely on time horizon and will become more conservative over time until approximately the year indicated in the Fund's name, at which time the allocation will remain fixed. From time to time, Russell Investment Management Company expects to modify the target asset allocation for any fund and/or the underlying funds in which a fund invests. In addition, the funds may in the future invest in other funds which are not currently underlying funds.

Securities distributed through Russell Fund Distributors, Inc. member NASD, part of Russell Investment Group.

RFD 06-6308
First used: November 2006