UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM N-CSR
CERTIFIED SHAREHOLDER REPORT OF REGISTERED
MANAGEMENT INVESTMENT COMPANIES
Investment Company Act file number 811-4085
Fidelity Income Fund
(Exact name of registrant as specified in charter)
245 Summer St., Boston, MA 02210
(Address of principal executive offices) (Zip code)
Marc Bryant, Secretary
245 Summer St.
Boston, Massachusetts 02210
(Name and address of agent for service)
Registrant's telephone number, including area code:
617-563-7000
| |
Date of fiscal year end: | July 31 |
|
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Date of reporting period: | January 31, 2017 |
Item 1.
Reports to Stockholders
Fidelity® GNMA Fund
Semi-Annual Report January 31, 2017 |
 |
Contents
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Other third-party marks appearing herein are the property of their respective owners.
All other marks appearing herein are registered or unregistered trademarks or service marks of FMR LLC or an affiliated company. © 2017 FMR LLC. All rights reserved.
This report and the financial statements contained herein are submitted for the general information of the shareholders of the Fund. This report is not authorized for distribution to prospective investors in the Fund unless preceded or accompanied by an effective prospectus.
A fund files its complete schedule of portfolio holdings with the SEC for the first and third quarters of each fiscal year on Form N-Q. Forms N-Q are available on the SEC’s web site at http://www.sec.gov. A fund's Forms N-Q may be reviewed and copied at the SEC’s Public Reference Room in Washington, DC. Information regarding the operation of the SEC's Public Reference Room may be obtained by calling 1-800-SEC-0330.
For a complete list of a fund's portfolio holdings, view the most recent holdings listing, semiannual report, or annual report on Fidelity's web site at http://www.fidelity.com, http://www.institutional.fidelity.com, or http://www.401k.com, as applicable.
NOT FDIC INSURED •MAY LOSE VALUE •NO BANK GUARANTEE
Neither the Fund nor Fidelity Distributors Corporation is a bank.
Investment Summary (Unaudited)
Coupon Distribution as of January 31, 2017
| | % of fund's investments | % of fund's investments 6 months ago |
| 0.01 - 0.99% | 1.2 | 3.5 |
| 1 - 1.99% | 4.3 | 0.9 |
| 2 - 2.99% | 3.2 | 3.6 |
| 3 - 3.99% | 58.4 | 42.4 |
| 4 - 4.99% | 19.8 | 20.0 |
| 5 - 5.99% | 5.8 | 6.1 |
| 6 - 6.99% | 1.3 | 1.1 |
| 7 - 7.99% | 2.3 | 0.6 |
| 8% and above | 0.3 | 1.7 |
Coupon distribution shows the range of stated interest rates on the fund's investments, excluding short-term investments.
Asset Allocation (% of fund's net assets)
| As of January 31, 2017*,** |
| | Mortgage Securities | 89.8% |
| | CMOs and Other Mortgage Related Securities | 16.0% |
| | Short-Term Investments and Net Other Assets (Liabilities)*** | (5.8)% |
* GNMA Securities - 104.3%
** Futures and Swaps - 3.5%
*** Short-Term Investments and Net Other Assets (Liabilities) are not included in the pie chart
| As of July 31, 2016*,** |
| | Mortgage Securities | 85.7% |
| | CMOs and Other Mortgage Related Securities | 16.5% |
| | Short-Term Investments and Net Other Assets (Liabilities)*** | (2.2)% |
* GNMA Securities - 100.1%
** Futures and Swaps - (0.8)%
*** Short-Term Investments and Net Other Assets (Liabilities) are not included in the pie chart
Percentages in the above tables are adjusted for the effect of TBA Sale Commitments.
Investments January 31, 2017
Showing Percentage of Net Assets
| U.S. Government and Government Agency Obligations - 0.0% | | | |
| | | Principal Amount (000s) | Value (000s) |
| U.S. Treasury Obligations - 0.0% | | | |
| U.S. Treasury Notes: | | | |
| 0.75% 7/15/19 (a)(b) | | $2,564 | $2,527 |
| 1.375% 12/15/19 | | 534 | 533 |
| | | | 3,060 |
| TOTAL U.S. GOVERNMENT AND GOVERNMENT AGENCY OBLIGATIONS | | | |
| (Cost $3,090) | | | 3,060 |
|
| U.S. Government Agency - Mortgage Securities - 92.0% | | | |
| Fannie Mae - 1.3% | | | |
| 2.416% 2/1/33 (c) | | 26 | 27 |
| 2.459% 12/1/34 (c) | | 84 | 86 |
| 2.5% 8/1/31 | | 40,607 | 40,663 |
| 2.532% 7/1/35 (c) | | 32 | 33 |
| 2.546% 3/1/35 (c) | | 43 | 45 |
| 2.552% 9/1/33 (c) | | 614 | 635 |
| 2.563% 3/1/36 (c) | | 166 | 174 |
| 2.574% 1/1/35 (c) | | 266 | 276 |
| 2.666% 10/1/33 (c) | | 26 | 27 |
| 2.67% 7/1/36 (c) | | 151 | 158 |
| 2.73% 7/1/34 (c) | | 53 | 56 |
| 2.798% 10/1/33 (c) | | 62 | 66 |
| 2.876% 3/1/33 (c) | | 125 | 130 |
| 2.921% 11/1/36 (c) | | 271 | 284 |
| 2.929% 8/1/35 (c) | | 408 | 429 |
| 2.947% 6/1/47 (c) | | 121 | 126 |
| 2.965% 5/1/35 (c) | | 379 | 397 |
| 2.975% 9/1/34 (c) | | 446 | 476 |
| 2.989% 7/1/34 (c) | | 739 | 787 |
| 3.259% 8/1/35 (c) | | 563 | 596 |
| 4% 9/1/45 | | 1,873 | 1,967 |
| 4% 2/1/47 (d) | | 17,800 | 18,671 |
| 4% 2/1/47 (d) | | 8,000 | 8,391 |
| 5.5% 12/1/17 to 3/1/20 | | 203 | 212 |
| 6.5% 10/1/17 | | 5 | 5 |
| 7% 3/1/17 | | 0 | 0 |
| 7.5% 4/1/17 | | 0 | 0 |
| 8.5% 12/1/27 | | 62 | 73 |
| 9.5% 9/1/30 | | 13 | 16 |
| 10.25% 10/1/18 | | 1 | 1 |
| | | | 74,807 |
| Freddie Mac - 0.2% | | | |
| 2.2% 3/1/37 (c) | | 32 | 33 |
| 2.602% 6/1/33 (c) | | 368 | 385 |
| 2.726% 12/1/35 (c) | | 2,411 | 2,554 |
| 2.85% 7/1/35 (c) | | 272 | 284 |
| 2.851% 12/1/35 (c) | | 268 | 278 |
| 2.875% 5/1/37 (c) | | 66 | 70 |
| 2.888% 6/1/33 (c) | | 926 | 977 |
| 2.914% 3/1/35 (c) | | 1,593 | 1,689 |
| 2.968% 11/1/35 (c) | | 345 | 359 |
| 2.989% 4/1/36 (c) | | 328 | 345 |
| 3.035% 10/1/36 (c) | | 521 | 547 |
| 3.065% 10/1/35 (c) | | 234 | 246 |
| 3.11% 8/1/34 (c) | | 146 | 154 |
| 3.139% 3/1/33 (c) | | 3 | 4 |
| 3.193% 6/1/33 (c) | | 952 | 1,001 |
| 5.5% 7/1/24 to 1/1/25 | | 907 | 1,004 |
| 8.5% 10/1/18 to 6/1/25 | | 15 | 17 |
| 9.5% 7/1/30 | | 27 | 29 |
| | | | 9,976 |
| Ginnie Mae - 90.5% | | | |
| 2.5% 2/20/41 to 3/20/43 | | 57,380 | 55,547 |
| 3% 5/15/27 to 1/20/47 | | 1,188,230 | 1,201,120 |
| 3% 2/1/47 (d) | | 126,180 | 127,177 |
| 3% 2/1/47 (d) | | 148,820 | 149,996 |
| 3% 2/1/47 (d) | | 169,000 | 170,335 |
| 3% 2/1/47 (d) | | 19,600 | 19,755 |
| 3.25% 2/20/41 to 7/20/46 | | 2,797 | 2,862 |
| 3.5% 9/15/26 to 11/20/46 (a)(b)(e) | | 1,683,295 | 1,752,488 |
| 3.5% 2/1/47 (d) | | 34,540 | 35,771 |
| 3.5% 2/1/47 (d) | | 2,000 | 2,071 |
| 3.5% 2/1/47 (d) | | 5,300 | 5,489 |
| 3.5% 2/1/47 (d) | | 70,000 | 72,495 |
| 3.5% 2/1/47 (d) | | 62,300 | 64,521 |
| 3.5% 2/1/47 (d) | | 62,300 | 64,521 |
| 3.7% 10/15/42 | | 13,458 | 14,125 |
| 3.74% 7/20/42 to 8/20/42 | | 1,615 | 1,692 |
| 3.75% 10/20/41 to 11/20/46 | | 32,623 | 34,092 |
| 4% 2/20/33 to 2/20/46 (a) | | 603,651 | 642,891 |
| 4% 5/15/44 | | 3,473 | 3,714 |
| 4% 2/1/47 (d) | | 4,080 | 4,313 |
| 4% 2/1/47 (d) | | 28,300 | 29,918 |
| 4% 2/1/47 (d) | | 40,000 | 42,288 |
| 4% 2/1/47 (d) | | 4,000 | 4,229 |
| 4% 2/1/47 (d) | | 98,250 | 103,869 |
| 4.25% 1/20/46 | | 963 | 1,025 |
| 4.3% 8/20/61 (f) | | 7,303 | 7,497 |
| 4.5% 7/15/33 to 3/20/45 | | 340,777 | 370,014 |
| 4.5% 2/1/47 (d) | | 31,500 | 33,788 |
| 4.5% 2/1/47 (d) | | 31,500 | 33,788 |
| 4.649% 2/20/62 (f) | | 5,866 | 6,103 |
| 4.682% 2/20/62 (f) | | 7,463 | 7,761 |
| 4.75% 7/15/40 | | 1,673 | 1,826 |
| 4.875% 9/15/39 to 12/15/39 | | 9,160 | 10,035 |
| 5% 8/15/18 to 4/15/41 | | 143,644 | 159,104 |
| 5.09% 4/15/36 to 11/15/36 | | 7,180 | 7,988 |
| 5.35% 4/20/29 to 12/20/30 | | 12,971 | 14,259 |
| 5.391% 11/20/59 (f) | | 16,123 | 16,399 |
| 5.5% 12/20/18 to 2/20/42 | | 14,600 | 16,456 |
| 6% 8/15/17 to 3/15/39 | | 18,601 | 21,248 |
| 6.45% 1/15/32 to 8/15/32 | | 389 | 457 |
| 6.5% 5/15/23 to 1/15/39 | | 11,643 | 13,311 |
| 7% 4/15/22 to 9/20/34 | | 21,422 | 24,942 |
| 7.25% 9/15/27 | | 44 | 51 |
| 7.395% 6/20/25 to 2/20/27 | | 587 | 664 |
| 7.5% 9/15/21 to 9/20/32 | | 8,853 | 10,293 |
| 8% 1/15/20 to 9/15/31 | | 2,456 | 2,891 |
| 8.5% 2/15/17 to 2/15/31 | | 187 | 225 |
| 9% 9/15/19 to 5/15/30 | | 177 | 196 |
| 10.5% 1/15/18 to 10/15/18 | | 0 | 0 |
| | | | 5,365,600 |
| TOTAL U.S. GOVERNMENT AGENCY - MORTGAGE SECURITIES | | | |
| (Cost $5,450,220) | | | 5,450,383 |
|
| Collateralized Mortgage Obligations - 16.0% | | | |
| U.S. Government Agency - 16.0% | | | |
| Fannie Mae planned amortization class Series G93-32 Class PJ, 6.75% 9/25/23 | | 2,176 | 2,388 |
| Fannie Mae Stripped Mortgage-Backed Securities: | | | |
| Series 331 Class 12, 6.5% 2/25/33 (c)(g) | | 345 | 72 |
| Series 339 Class 5, 5.5% 7/25/33 (g) | | 431 | 101 |
| Series 343 Class 16, 5.5% 5/25/34 (g) | | 366 | 66 |
| Freddie Mac: | | | |
| planned amortization class: | | | |
| Series 2220 Class PD, 8% 3/15/30 | | 749 | 896 |
| Series 40 Class K, 6.5% 8/17/24 | | 234 | 259 |
| sequential payer Series 2204 Class N, 7.5% 12/20/29 | | 1,673 | 1,977 |
| Ginnie Mae 1.93% 2/1/57 (d)(f) | | 33,917 | 33,954 |
| Ginnie Mae guaranteed Multi-family REMIC pass-thru securities sequential payer Series 2002-71 Class Z, 5.5% 10/20/32 | | 6,925 | 7,731 |
| Ginnie Mae guaranteed REMIC pass-thru certificates: | | | |
| floater: | | | |
| Series 2001-22 Class FM, 1.1267% 5/20/31 (c) | | 149 | 150 |
| Series 2002-41 Class HF, 1.1672% 6/16/32 (c) | | 180 | 181 |
| Series 2007-37 Class TS, 5.9228% 6/16/37 (c)(g)(h) | | 2,063 | 417 |
| Series 2008-51 Class FE, 1.5172% 6/16/38 (c) | | 451 | 456 |
| Series 2008-57 Class AF, 1.3567% 7/20/38 (c) | | 1,449 | 1,460 |
| Series 2010-130 Class KF, 1.4172% 10/16/40 (c) | | 3,121 | 3,158 |
| Series 2010-H03 Class FA, 1.3111% 3/20/60 (c)(f) | | 25,590 | 25,542 |
| Series 2010-H17 Class FA, 1.0911% 7/20/60 (c)(f) | | 14,109 | 13,969 |
| Series 2010-H18 Class AF, 0.9467% 9/20/60 (c)(f) | | 17,360 | 17,173 |
| Series 2010-H19 Class FG, 0.9467% 8/20/60 (c)(f) | | 19,011 | 18,809 |
| Series 2010-H27 Series FA, 1.0267% 12/20/60 (c)(f) | | 5,846 | 5,798 |
| Series 2011-H05 Class FA, 1.1467% 12/20/60 (c)(f) | | 9,993 | 9,958 |
| Series 2011-H07 Class FA, 1.1467% 2/20/61 (c)(f) | | 4,356 | 4,341 |
| Series 2011-H12 Class FA, 1.1367% 2/20/61 (c)(f) | | 23,650 | 23,563 |
| Series 2011-H13 Class FA, 1.1467% 4/20/61 (c)(f) | | 8,661 | 8,631 |
| Series 2011-H14: | | | |
| Class FB, 1.1467% 5/20/61 (c)(f) | | 10,032 | 9,993 |
| Class FC, 1.1467% 5/20/61 (c)(f) | | 9,064 | 9,030 |
| Series 2011-H17 Class FA, 1.1767% 6/20/61 (c)(f) | | 12,549 | 12,517 |
| Series 2011-H21 Class FA, 1.2467% 10/20/61 (c)(f) | | 13,964 | 13,958 |
| Series 2012-48 Class FA, 1.1172% 4/16/42 (c) | | 948 | 946 |
| Series 2012-76 Class GF 1.0672% 6/16/42 (c) | | 1,035 | 1,034 |
| Series 2012-H01 Class FA, 1.3467% 11/20/61 (c)(f) | | 12,303 | 12,337 |
| Series 2012-H03 Class FA, 1.3467% 1/20/62 (c)(f) | | 7,977 | 7,999 |
| Series 2012-H06 Class FA, 1.2767% 1/20/62 (c)(f) | | 12,200 | 12,206 |
| Series 2012-H07 Class FA, 1.2767% 3/20/62 (c)(f) | | 7,491 | 7,499 |
| Series 2012-H21 Class DF, 1.2967% 5/20/61 (c)(f) | | 6,975 | 6,986 |
| Series 2012-H26, Class CA, 1.1767% 7/20/60 (c)(f) | | 31,592 | 31,515 |
| Series 2015-H13 Class FL, 0.9267% 5/20/63 (c)(f) | | 18,638 | 18,614 |
| Series 2015-H19 Class FA, 0.8467% 4/20/63 (c)(f) | | 22,071 | 22,022 |
| Series 2016-12 Class FA, 1.1267% 1/20/46 (c) | | 4,719 | 4,689 |
| planned amortization class: | | | |
| Series 1993-13 Class PD, 6% 5/20/29 | | 2,617 | 2,945 |
| Series 2002-50 Class PE, 6% 7/20/32 | | 3,184 | 3,613 |
| Series 2003-74 Class PZ, 5.5% 8/20/33 | | 3,654 | 4,290 |
| Series 2004-19 Class DP, 5.5% 3/20/34 | | 152 | 159 |
| Series 2005-24 Class TC, 5.5% 3/20/35 | | 5,403 | 5,990 |
| Series 2005-57 Class PB, 5.5% 7/20/35 | | 5,673 | 6,420 |
| Series 2006-50 Class JC, 5% 6/20/36 | | 3,892 | 4,167 |
| Series 2010-117 Class E, 3% 10/20/39 | | 10,076 | 10,158 |
| Series 2010-134 Class ES, 5.2233% 11/20/39 (c)(g)(h) | | 24,444 | 2,628 |
| Series 2010-160 Class MX, 4.5% 8/20/39 | | 5,414 | 5,796 |
| Series 2011-136 Class WI, 4.5% 5/20/40 (g) | | 3,697 | 482 |
| sequential payer: | | | |
| Series 2001-40 Class Z, 6% 8/20/31 | | 1,244 | 1,377 |
| Series 2001-49 Class Z, 7% 10/16/31 | | 674 | 788 |
| Series 2002-18 Class ZB, 6% 3/20/32 | | 1,208 | 1,363 |
| Series 2002-24 Class SK, 7.1828% 4/16/32 (c)(g)(h) | | 839 | 169 |
| Series 2002-29: | | | |
| Class SK, 8.25% 5/20/32 (c)(h) | | 97 | 120 |
| Class Z, 6.5% 5/16/32 | | 1,718 | 1,983 |
| Series 2002-33 Class ZJ, 6.5% 5/20/32 | | 1,219 | 1,432 |
| Series 2002-42 Class ZA, 6% 6/20/32 | | 817 | 922 |
| Series 2002-45 Class Z, 6% 6/20/32 | | 497 | 564 |
| Series 2003-75 Class ZA, 5.5% 9/20/33 | | 2,960 | 3,317 |
| Series 2004-24 Class ZM, 5% 4/20/34 | | 6,537 | 7,185 |
| Series 2004-46 Class BZ, 6% 6/20/34 | | 3,630 | 4,122 |
| Series 2004-61 Class Z, 5% 8/16/34 | | 20,343 | 22,243 |
| Series 2004-86 Class G, 6% 10/20/34 | | 6,273 | 7,675 |
| Series 2005-26 Class ZA, 5.5% 1/20/35 | | 18,588 | 20,771 |
| Series 2005-28 Class AJ, 5.5% 4/20/35 | | 6,675 | 6,978 |
| Series 2005-47 Class ZY, 6% 6/20/35 | | 8,001 | 9,284 |
| Series 2005-6 Class EX, 5.5% 11/20/34 | | 1,001 | 1,164 |
| Series 2005-82 Class JV, 5% 6/20/35 | | 3,500 | 3,919 |
| Series 2006-2 Class Z, 5.5% 1/20/36 | | 11,887 | 13,037 |
| Series 2008-17 Class BN, 5% 2/20/38 | | 5,280 | 5,681 |
| Series 2010-168 Class BG, 4% 4/20/40 | | 9,204 | 9,779 |
| Series 2011-21 Class SB, 7.9656% 2/16/41 (c)(h) | | 15,000 | 16,178 |
| Series 2011-29 Class BV, 5% 5/20/40 | | 10,483 | 11,576 |
| Series 2016-H04 Class FE, 1.2967% 11/20/65 (c)(f) | | 9,707 | 9,717 |
| Series 1999-45 Class SC, 7.8328% 12/16/29 (c)(g) | | 16 | 0 |
| Series 2000-35 Class SA, 7.1828% 12/16/26 (c)(g)(h) | | 1,870 | 365 |
| Series 2000-36 Class S, 7.1828% 11/16/30 (c)(g) | | 1,314 | 238 |
| Series 2001-3 Class S, 7.3328% 2/16/31 (c)(g) | | 251 | 45 |
| Series 2001-36: | | | |
| Class SB, 7.3328% 12/16/23 (c)(g)(h) | | 663 | 100 |
| Class SP, 7.9828% 9/16/26 (c)(g) | | 401 | 54 |
| Series 2001-38 Class SB, 6.8128% 8/16/31 (c)(g)(h) | | 414 | 73 |
| Series 2001-49: | | | |
| Class SC, 6.8328% 12/16/25 (c)(g)(h) | | 854 | 123 |
| Class SL, 6.8328% 5/16/30 (c)(g)(h) | | 1,227 | 214 |
| Class SV, 7.4828% 12/16/28 (c)(g)(h) | | 111 | 12 |
| Series 2001-50: | | | |
| Class SD, 7.4233% 11/20/31 (c)(g)(h) | | 692 | 156 |
| Class ST, 6.9328% 8/16/27 (c)(g)(h) | | 296 | 54 |
| Class SV, 8.5328% 9/16/27 (c)(g) | | 821 | 107 |
| Series 2001-65 Class SV, 7.3233% 2/20/29 (c)(g)(h) | | 1,624 | 379 |
| Series 2002-21 Class SV, 7.3328% 3/16/32 (c)(g)(h) | | 2,136 | 445 |
| Series 2002-5 Class SP, 6.6828% 1/16/32 (c)(g)(h) | | 432 | 67 |
| Series 2003-23 Class S, 5.7828% 12/16/29 (c)(g)(h) | | 2,104 | 353 |
| Series 2003-42 Class SH, 5.7733% 5/20/33 (c)(g)(h) | | 850 | 172 |
| Series 2004-32: | | | |
| Class GS, 5.7328% 5/16/34 (c)(g)(h) | | 585 | 108 |
| Class SG, 5.7233% 3/20/33 (c)(g)(h) | | 9,430 | 1,647 |
| Series 2004-59 Class SC, 6.4328% 8/16/34 (c)(g) | | 3,621 | 792 |
| Series 2004-73 Class AL, 6.4927% 8/17/34 (c)(g)(h) | | 1,303 | 301 |
| Series 2005-13 Class SA, 6.0233% 2/20/35 (c)(g)(h) | | 7,227 | 1,393 |
| Series 2005-6 Class EY, 5.5% 11/20/33 | | 1,016 | 1,158 |
| Series 2005-82 Class NS, 5.5233% 7/20/34 (c)(g) | | 7,372 | 1,295 |
| Series 2006-13 Class DS, 9.935% 3/20/36 (c)(h) | | 7,032 | 8,974 |
| Series 2007-35 Class SC, 35.5967% 6/16/37 (c)(h) | | 2,242 | 4,065 |
| Series 2008-15 Class CI, 5.7133% 2/20/38 (c)(g) | | 3,229 | 598 |
| Series 2009-13 Class E, 4.5% 3/16/39 | | 6,054 | 6,342 |
| Series 2009-42 Class AY, 5% 6/16/37 | | 4,016 | 4,327 |
| Series 2010-14 Class SN, 5.1828% 2/16/40 (c)(g)(h) | | 5,030 | 833 |
| Series 2010-35 Class QI, 4.5% 3/20/40 (g) | | 4,861 | 953 |
| Series 2010-H10 Class FA, 1.0911% 5/20/60 (c)(f) | | 9,864 | 9,768 |
| Series 2010-H12 Class PT, 5.47% 11/20/59 (f) | | 3,171 | 3,213 |
| Series 2011-52 Class HI, 7% 4/16/41 (g) | | 892 | 216 |
| Series 2012-103 Class IL, 3% 8/20/27 (g) | | 52,439 | 4,884 |
| Series 2012-64 Class KI, 3.5% 11/20/36(g) | | 2,810 | 266 |
| Series 2012-76 Class GS, 5.9328% 6/16/42 (c)(g)(h) | | 3,141 | 588 |
| Series 2013-124: | | | |
| Class ES, 7.6311% 4/20/39 (c)(h) | | 9,736 | 10,332 |
| Class ST, 7.7644% 8/20/39 (c)(h) | | 19,167 | 20,874 |
| Series 2013-182 Class IQ, 4.5% 12/16/43 (g) | | 12,976 | 2,601 |
| Series 2013-39 Class GS, 7.9467% 3/20/41 (c) | | 58,981 | 63,080 |
| Series 2014-183 Class BI, 4.5% 12/20/44 (g) | | 23,964 | 4,837 |
| Series 2014-44: | | | |
| Class 1A, 3.5% 5/20/28 (g) | | 37,116 | 4,111 |
| Class IC, 3% 4/20/28 (g) | | 60,139 | 5,687 |
| Series 2014-5 Class LS, 6.0328% 6/16/43 (c)(g)(h) | | 32,486 | 5,993 |
| Series 2015-117 Class IE, 4.5% 8/20/45 (g) | | 16,068 | 3,333 |
| Series 2015-H13 Class HA, 2.5% 8/20/64 (f) | | 71,786 | 72,637 |
| Series 2015-H17 Class HA, 2.5% 5/20/65 (f) | | 27,553 | 27,829 |
| Series 2015-H21: | | | |
| Class HZ, 4.57% 6/20/63 (c)(f) | | 5,314 | 5,726 |
| Class JZ, 4.6914% 6/20/65 (c)(f) | | 1,065 | 1,161 |
| Series 2016-17: | | | |
| Class A, 3% 2/16/46 | | 46,097 | 46,951 |
| Class D, 3% 2/16/46 | | 38,561 | 39,446 |
| Class S, 5.3828% 2/16/46 (c)(g) | | 28,921 | 4,860 |
| Class SA, 5.3828% 2/16/46 (c)(g) | | 61,463 | 12,242 |
| | | | 946,765 |
| TOTAL COLLATERALIZED MORTGAGE OBLIGATIONS | | | |
| (Cost $940,662) | | | 946,765 |
|
| Commercial Mortgage Securities - 0.0% | | | |
| Ginnie Mae guaranteed Multi-family REMIC pass-thru securities: | | | |
| sequential payer Series 2001-58 Class X, 0.4902% 9/16/41 (c)(g) | | 4,572 | 27 |
| Series 2001-12 Class X, 0.643% 7/16/40 (c)(g) | | 1,280 | 2 |
| Ginnie Mae guaranteed REMIC pass-thru certificates: | | | |
| sequential payer Series 2002-81 Class IO, 0.6186% 9/16/42 (c)(g) | | 6,613 | 125 |
| Series 2002-62 Class IO, 1.1232% 8/16/42 (c)(g) | | 2,623 | 51 |
| Series 2002-85 Class X, 0.365% 3/16/42 (c)(g) | | 2,742 | 23 |
| TOTAL COMMERCIAL MORTGAGE SECURITIES | | | |
| (Cost $11,421) | | | 228 |
| | | Shares | Value (000s) |
|
| Money Market Funds - 1.7% | | | |
| Fidelity Cash Central Fund, 0.62% (i) | | | |
| (Cost $98,337) | | 98,324,898 | 98,345 |
| TOTAL INVESTMENT PORTFOLIO - 109.7% | | | |
| (Cost $6,503,730) | | | 6,498,781 |
| NET OTHER ASSETS (LIABILITIES) - (9.7)% | | | (573,558) |
| NET ASSETS - 100% | | | $5,925,223 |
| TBA Sale Commitments | | |
| | Principal Amount (000s) | Value (000s) |
| Fannie Mae | | |
| 4% 2/1/47 | $(1,900) | $(1,993) |
| Ginnie Mae | | |
| 3% 2/1/47 | (3,000) | (3,024) |
| 3% 2/1/47 | (7,000) | (7,055) |
| 3.5% 2/1/47 | (2,000) | (2,071) |
| 3.5% 2/1/47 | (5,300) | (5,489) |
| 3.5% 2/1/47 | (6,000) | (6,214) |
| 3.5% 2/1/47 | (2,000) | (2,071) |
| 3.5% 2/1/47 | (5,300) | (5,489) |
| 3.5% 2/1/47 | (6,000) | (6,214) |
| 4% 2/1/47 | (4,000) | (4,229) |
| 4% 2/1/47 | (600) | (634) |
| 4% 2/1/47 | (3,300) | (3,489) |
| 4% 2/1/47 | (4,000) | (4,229) |
| 4% 2/1/47 | (4,000) | (4,229) |
| 4.5% 2/1/47 | (31,500) | (33,788) |
| 4.5% 2/1/47 | (31,500) | (33,787) |
|
| TOTAL GINNIE MAE | | (122,012) |
|
| TOTAL TBA SALE COMMITMENTS | | |
| (Proceeds $123,495) | | $(124,005) |
| Futures Contracts | | | |
| | Expiration Date | Underlying Face Amount at Value (000s) | Unrealized Appreciation/(Depreciation) (000s) |
| Sold | | | |
| Treasury Contracts | | | |
| 459 CBOT 10-Year U.S. Treasury Note Contracts (United States) | March 2017 | 57,131 | $193 |
| 558 CBOT 2-Year U.S. Treasury Note Contracts (United States) | March 2017 | 120,973 | (324) |
| 913 CBOT 5-Year U.S. Treasury Note Contracts (United States) | March 2017 | 107,613 | (275) |
| 3 CBOT Long Term U.S. Treasury Bond Contracts (United States) | March 2017 | 453 | 3 |
| TOTAL FUTURES CONTRACTS | | | $(403) |
The face value of futures sold as a percentage of Net Assets is 4.8%
For the period, the average monthly underlying face amount at value for futures contracts in the aggregate was $231,187,000.
Swaps
| Clearinghouse/Counterparty(1) | Expiration Date | Notional Amount (000s) | Payment Received | Payment Paid | Value (000s) | Upfront Premium Received/(Paid) (000s)(2) | Unrealized Appreciation/(Depreciation) (000s) |
| Interest Rate Swaps | | | | | | | |
| LCH | Mar. 2027 | $77,313 | 3-month LIBOR | 1.75% | $(42) | $0 | $(42) |
| LCH | Mar. 2047 | 2,100 | 3-month LIBOR | 2.25% | (13) | 0 | (13) |
|
| TOTAL INTEREST RATE SWAPS | | | | | $(55) | $0 | $(55) |
|
(1) Swaps with LCH Clearnet Group (LCH) are centrally cleared over-the-counter (OTC) swaps.
(2) Any premiums for centrally cleared over-the-counter (OTC) swaps are recorded periodically throughout the term of the swap to variation margin and included in unrealized appreciation (depreciation).
For the period, the average monthly notional amount for swaps in the aggregate was $123,914,000.
Values shown as $0 may reflect amounts less than $500.
Legend
(a) Security or a portion of the security was pledged to cover margin requirements for futures contracts. At period end, the value of securities pledged amounted to $2,068,000.
(b) Security or a portion of the security has been segregated as collateral for mortgage-backed or asset-backed securities purchased on a delayed delivery or when-issued basis. At period end, the value of securities pledged amounted to $1,459,000.
(c) Coupon rates for floating and adjustable rate securities reflect the rates in effect at period end.
(d) Security or a portion of the security purchased on a delayed delivery or when-issued basis.
(e) Security or a portion of the security was pledged to cover margin requirements for centrally cleared OTC swaps. At period end, the value of securities pledged amounted to $5,234,000.
(f) Represents an investment in an underlying pool of reverse mortgages which typically do not require regular principal and interest payments as repayment is deferred until a maturity event.
(g) Security represents right to receive monthly interest payments on an underlying pool of mortgages or assets. Principal shown is the outstanding par amount of the pool as of the end of the period.
(h) Coupon is inversely indexed to a floating interest rate multiplied by a specified factor. The price may be considerably more volatile than the price of a comparable fixed rate security.
(i) Affiliated fund that is generally available only to investment companies and other accounts managed by Fidelity Investments. The rate quoted is the annualized seven-day yield of the fund at period end. A complete unaudited listing of the fund's holdings as of its most recent quarter end is available upon request. In addition, each Fidelity Central Fund's financial statements, which are not covered by the Fund's Report of Independent Registered Public Accounting Firm, are available on the SEC's website or upon request.
Affiliated Central Funds
Information regarding fiscal year to date income earned by the Fund from investments in Fidelity Central Funds is as follows:
| Fund | Income earned |
| | (Amounts in thousands) |
| Fidelity Cash Central Fund | $728 |
| Total | $728 |
Investment Valuation
The following is a summary of the inputs used, as of January 31, 2017, involving the Fund's assets and liabilities carried at fair value. The inputs or methodology used for valuing securities may not be an indication of the risk associated with investing in those securities. For more information on valuation inputs, and their aggregation into the levels used below, please refer to the Investment Valuation section in the accompanying Notes to Financial Statements.
| | Valuation Inputs at Reporting Date: |
| Description | Total | Level 1 | Level 2 | Level 3 |
| (Amounts in thousands) | | | | |
| Investments in Securities: | | | | |
| U.S. Government and Government Agency Obligations | $3,060 | $-- | $3,060 | $-- |
| U.S. Government Agency - Mortgage Securities | 5,450,383 | -- | 5,450,383 | -- |
| Collateralized Mortgage Obligations | 946,765 | -- | 946,765 | -- |
| Commercial Mortgage Securities | 228 | -- | 228 | -- |
| Money Market Funds | 98,345 | 98,345 | -- | -- |
| Total Investments in Securities: | $6,498,781 | $98,345 | $6,400,436 | $-- |
| Derivative Instruments: | | | | |
| Assets | | | | |
| Futures Contracts | $196 | $196 | $-- | $-- |
| Total Assets | $196 | $196 | $-- | $-- |
| Liabilities | | | | |
| Futures Contracts | $(599) | $(599) | $-- | $-- |
| Swaps | (55) | -- | (55) | -- |
| Total Liabilities | $(654) | $(599) | $(55) | $-- |
| Total Derivative Instruments: | $(458) | $(403) | $(55) | $-- |
| Other Financial Instruments: | | | | |
| TBA Sale Commitments | $(124,005) | $-- | $(124,005) | $-- |
| Total Other Financial Instruments: | $(124,005) | $-- | $(124,005) | $-- |
Value of Derivative Instruments
The following table is a summary of the Fund's value of derivative instruments by primary risk exposure as of January 31, 2017. For additional information on derivative instruments, please refer to the Derivative Instruments section in the accompanying Notes to Financial Statements.
| Primary Risk Exposure / Derivative Type | Value |
| | Asset | Liability |
| (Amounts in thousands) | | |
| Interest Rate Risk | | |
| Futures Contracts(a) | $196 | $(599) |
| Swaps(b) | 0 | (55) |
| Total Interest Rate Risk | 196 | (654) |
| Total Value of Derivatives | $196 | $(654) |
(a) Reflects gross cumulative appreciation (depreciation) on futures contracts as presented in the Schedule of Investments. In the Statement of Assets and Liabilities, the period end daily variation margin is included in receivable or payable for daily variation margin for derivative instruments, and the net cumulative appreciation (depreciation) is included in net unrealized appreciation (depreciation).
(b) For centrally cleared over-the-counter (OTC) swaps, reflects gross cumulative appreciation (depreciation) as presented in the Schedule of Investments. In the Statement of Assets and Liabilities, the period end daily variation margin for centrally cleared OTC swaps is included in receivable or payable for daily variation margin for derivative instruments, and the net cumulative appreciation (depreciation) for centrally cleared OTC swaps is included in net unrealized appreciation (depreciation).
See accompanying notes which are an integral part of the financial statements.
Financial Statements
Statement of Assets and Liabilities
| Amounts in thousands (except per-share amount) | | January 31, 2017 |
| Assets | | |
Investment in securities, at value — See accompanying schedule:
Unaffiliated issuers (cost $6,405,393) | $6,400,436 | |
| Fidelity Central Funds (cost $98,337) | 98,345 | |
| Total Investments (cost $6,503,730) | | $6,498,781 |
| Receivable for investments sold | | 445,321 |
| Receivable for TBA sale commitments | | 123,495 |
| Receivable for fund shares sold | | 4,098 |
| Interest receivable | | 17,027 |
| Distributions receivable from Fidelity Central Funds | | 46 |
| Other receivables | | 44 |
| Total assets | | 7,088,812 |
| Liabilities | | |
| Payable for investments purchased | | |
| Regular delivery | $1,961 | |
| Delayed delivery | 1,025,420 | |
| TBA sale commitments, at value | 124,005 | |
| Payable for fund shares redeemed | 8,482 | |
| Distributions payable | 937 | |
| Accrued management fee | 1,542 | |
| Payable for daily variation margin for derivative instruments | 495 | |
| Other affiliated payables | 702 | |
| Other payables and accrued expenses | 45 | |
| Total liabilities | | 1,163,589 |
| Net Assets | | $5,925,223 |
| Net Assets consist of: | | |
| Paid in capital | | $5,958,468 |
| Distributions in excess of net investment income | | (16,879) |
| Accumulated undistributed net realized gain (loss) on investments | | (10,449) |
| Net unrealized appreciation (depreciation) on investments | | (5,917) |
| Net Assets, for 519,318 shares outstanding | | $5,925,223 |
| Net Asset Value, offering price and redemption price per share ($5,925,223 ÷ 519,318 shares) | | $11.41 |
See accompanying notes which are an integral part of the financial statements.
Statement of Operations
| Amounts in thousands | | Six months ended January 31, 2017 |
| Investment Income | | |
| Interest | | $72,628 |
| Income from Fidelity Central Funds | | 728 |
| Total income | | 73,356 |
| Expenses | | |
| Management fee | $9,679 | |
| Transfer agent fees | 3,127 | |
| Fund wide operations fee | 1,251 | |
| Independent trustees' fees and expenses | 13 | |
| Miscellaneous | 9 | |
| Total expenses before reductions | 14,079 | |
| Expense reductions | (14) | 14,065 |
| Net investment income (loss) | | 59,291 |
| Realized and Unrealized Gain (Loss) | | |
| Net realized gain (loss) on: | | |
| Investment securities: | | |
| Unaffiliated issuers | (20,659) | |
| Fidelity Central Funds | 59 | |
| Futures contracts | 7,723 | |
| Swaps | 7,769 | |
| Total net realized gain (loss) | | (5,108) |
Change in net unrealized appreciation (depreciation) on:
Investment securities | (143,135) | |
| Futures contracts | 2,633 | |
| Swaps | 4,223 | |
| Delayed delivery commitments | 2,745 | |
| Total change in net unrealized appreciation (depreciation) | | (133,534) |
| Net gain (loss) | | (138,642) |
| Net increase (decrease) in net assets resulting from operations | | $(79,351) |
See accompanying notes which are an integral part of the financial statements.
Statement of Changes in Net Assets
| Amounts in thousands | Six months ended January 31, 2017 | Year ended July 31, 2016 |
| Increase (Decrease) in Net Assets | | |
| Operations | | |
| Net investment income (loss) | $59,291 | $128,674 |
| Net realized gain (loss) | (5,108) | 20,094 |
| Change in net unrealized appreciation (depreciation) | (133,534) | 50,414 |
| Net increase (decrease) in net assets resulting from operations | (79,351) | 199,182 |
| Distributions to shareholders from net investment income | (58,158) | (127,994) |
| Distributions to shareholders from net realized gain | (22,284) | (30,293) |
| Total distributions | (80,442) | (158,287) |
| Share transactions | | |
| Proceeds from sales of shares | 591,805 | 1,564,276 |
| Reinvestment of distributions | 72,680 | 142,930 |
| Cost of shares redeemed | (954,555) | (1,317,669) |
| Net increase (decrease) in net assets resulting from share transactions | (290,070) | 389,537 |
| Total increase (decrease) in net assets | (449,863) | 430,432 |
| Net Assets | | |
| Beginning of period | 6,375,086 | 5,944,654 |
| End of period | $5,925,223 | $6,375,086 |
| Other Information | | |
| Distributions in excess of net investment income end of period | $(16,879) | $(18,012) |
| Shares | | |
| Sold | 51,182 | 134,721 |
| Issued in reinvestment of distributions | 6,283 | 12,316 |
| Redeemed | (82,878) | (113,562) |
| Net increase (decrease) | (25,413) | 33,475 |
See accompanying notes which are an integral part of the financial statements.
Financial Highlights — Fidelity GNMA Fund
| | Six months endedJanuary 31, | Years ended July 31, | | | | |
| | 2017 | 2016 | 2015 | 2014 | 2013 | 2012 |
| Selected Per–Share Data | | | | | | |
| Net asset value, beginning of period | $11.70 | $11.63 | $11.49 | $11.30 | $11.98 | $11.78 |
| Income from Investment Operations | | | | | | |
| Net investment income (loss)A | .110 | .245 | .228 | .257 | .222 | .326 |
| Net realized and unrealized gain (loss) | (.251) | .128 | .130 | .252 | (.520) | .348 |
| Total from investment operations | (.141) | .373 | .358 | .509 | (.298) | .674 |
| Distributions from net investment income | (.108) | (.244) | (.218) | (.252)B | (.216) | (.330) |
| Distributions from net realized gain | (.041) | (.059) | – | (.067)B | (.166) | (.144) |
| Total distributions | (.149) | (.303) | (.218) | (.319) | (.382) | (.474) |
| Net asset value, end of period | $11.41 | $11.70 | $11.63 | $11.49 | $11.30 | $11.98 |
| Total ReturnC,D | (1.22)% | 3.26% | 3.13% | 4.58% | (2.57)% | 5.83% |
| Ratios to Average Net AssetsE,F | | | | | | |
| Expenses before reductions | .45%G | .45% | .45% | .45% | .45% | .45% |
| Expenses net of fee waivers, if any | .45%G | .45% | .45% | .45% | .45% | .45% |
| Expenses net of all reductions | .45%G | .45% | .45% | .45% | .45% | .45% |
| Net investment income (loss) | 1.88 %G | 2.11% | 1.96% | 2.26% | 1.90% | 2.75% |
| Supplemental Data | | | | | | |
| Net assets, end of period (in millions) | $5,925 | $6,375 | $5,945 | $6,683 | $8,154 | $10,749 |
| Portfolio turnover rateH | 312%G | 304% | 450% | 409% | 363% | 263% |
A Calculated based on average shares outstanding during the period.
B The amounts shown reflect certain reclassifications related to book to tax difference that were made in the year shown.
C Total returns for periods of less than one year are not annualized.
D Total returns would have been lower if certain expenses had not been reduced during the applicable periods shown.
E Fees and expenses of any underlying Fidelity Central Funds are not included in the Fund's expense ratio. The Fund indirectly bears its proportionate share of the expenses of any underlying Fidelity Central Funds.
F Expense ratios reflect operating expenses of the Fund. Expenses before reductions do not reflect amounts reimbursed by the investment adviser or reductions from expense offset arrangements and do not represent the amount paid by the Fund during periods when reimbursements or reductions occur. Expenses net of fee waivers reflect expenses after reimbursement by the investment adviser but prior to reductions from expense offset arrangements. Expenses net of all reductions represent the net expenses paid by the Fund.
G Annualized
H Amount does not include the portfolio activity of any underlying Fidelity Central Funds.
See accompanying notes which are an integral part of the financial statements.
Notes to Financial Statements
For the period ended January 31, 2017
(Amounts in thousands except percentages)
1. Organization.
Fidelity GNMA Fund (the Fund) is a fund of Fidelity Income Fund (the Trust) and is authorized to issue an unlimited number of shares. Share transactions on the Statement of Changes in Net Assets may contain exchanges between affiliated funds. The Trust is registered under the Investment Company Act of 1940, as amended (the 1940 Act), as an open-end management investment company organized as a Massachusetts business trust.
2. Investments in Fidelity Central Funds.
The Fund invests in Fidelity Central Funds, which are open-end investment companies generally available only to other investment companies and accounts managed by the investment adviser and its affiliates. The Fund's Schedule of Investments lists each of the Fidelity Central Funds held as of period end, if any, as an investment of the Fund, but does not include the underlying holdings of each Fidelity Central Fund. As an Investing Fund, the Fund indirectly bears its proportionate share of the expenses of the underlying Fidelity Central Funds.
The Money Market Central Funds seek preservation of capital and current income and are managed by Fidelity Investments Money Management, Inc. (FIMM), an affiliate of the investment adviser. Annualized expenses of the Money Market Central Funds as of their most recent shareholder report date are less than .005%.
A complete unaudited list of holdings for each Fidelity Central Fund is available upon request or at the Securities and Exchange Commission (the SEC) website at www.sec.gov. In addition, the financial statements of the Fidelity Central Funds, which are not covered by the Fund's Report of Independent Registered Public Accounting Firm, are available on the SEC website or upon request.
3. Significant Accounting Policies.
The financial statements have been prepared in conformity with accounting principles generally accepted in the United States of America (GAAP), which require management to make certain estimates and assumptions at the date of the financial statements. Actual results could differ from those estimates. Subsequent events, if any, through the date that the financial statements were issued have been evaluated in the preparation of the financial statements. The following summarizes the significant accounting policies of the Fund:
Investment Valuation. Investments are valued as of 4:00 p.m. Eastern time on the last calendar day of the period. The Board of Trustees (the Board) has delegated the day to day responsibility for the valuation of the Fund's investments to the Fair Value Committee (the Committee) established by the Fund's investment adviser. In accordance with valuation policies and procedures approved by the Board, the Fund attempts to obtain prices from one or more third party pricing vendors or brokers to value its investments. When current market prices, quotations or currency exchange rates are not readily available or reliable, investments will be fair valued in good faith by the Committee, in accordance with procedures adopted by the Board. Factors used in determining fair value vary by investment type and may include market or investment specific events, changes in interest rates and credit quality. The frequency with which these procedures are used cannot be predicted and they may be utilized to a significant extent. The Committee oversees the Fund's valuation policies and procedures and reports to the Board on the Committee's activities and fair value determinations. The Board monitors the appropriateness of the procedures used in valuing the Fund's investments and ratifies the fair value determinations of the Committee.
The Fund categorizes the inputs to valuation techniques used to value its investments into a disclosure hierarchy consisting of three levels as shown below:
- Level 1 – quoted prices in active markets for identical investments
- Level 2 – other significant observable inputs (including quoted prices for similar investments, interest rates, prepayment speeds, etc.)
- Level 3 – unobservable inputs (including the Fund's own assumptions based on the best information available)
Valuation techniques used to value the Fund's investments by major category are as follows:
Debt securities, including restricted securities, are valued based on evaluated prices received from third party pricing vendors or from brokers who make markets in such securities. U.S. government and government agency obligations are valued by pricing vendors who utilize matrix pricing which considers yield or price of bonds of comparable quality, coupon, maturity and type or by broker-supplied prices. Collateralized mortgage obligations, commercial mortgage securities and U.S. government agency mortgage securities are valued by pricing vendors who utilize matrix pricing which considers prepayment speed assumptions, attributes of the collateral, yield or price of bonds of comparable quality, coupon, maturity and type or by broker-supplied prices. Swaps are marked-to-market daily based on valuations from third party pricing vendors, registered derivatives clearing organizations (clearinghouses) or broker-supplied valuations. These pricing sources may utilize inputs such as interest rate curves, credit spread curves, default possibilities and recovery rates. When independent prices are unavailable or unreliable, debt securities and swaps may be valued utilizing pricing methodologies which consider similar factors that would be used by third party pricing vendors. Debt securities and swaps are generally categorized as Level 2 in the hierarchy but may be Level 3 depending on the circumstances.
Futures contracts are valued at the settlement price established each day by the board of trade or exchange on which they are traded and are categorized as Level 1 in the hierarchy. Investments in open-end mutual funds, including the Fidelity Central Funds, are valued at their closing net asset value (NAV) each business day and are categorized as Level 1 in the hierarchy.
Changes in valuation techniques may result in transfers in or out of an assigned level within the disclosure hierarchy.
Investment Transactions and Income. For financial reporting purposes, the Fund's investment holdings and NAV include trades executed through the end of the last business day of the period. The NAV per share for processing shareholder transactions is calculated as of the close of business of the New York Stock Exchange (NYSE), normally 4:00 p.m. Eastern time and includes trades executed through the end of the prior business day. Gains and losses on securities sold are determined on the basis of identified cost. Income and capital gain distributions from Fidelity Central Funds, if any, are recorded on the ex-dividend date. Interest income is accrued as earned and includes coupon interest and amortization of premium and accretion of discount on debt securities as applicable.
Expenses. Expenses directly attributable to a fund are charged to that fund. Expenses attributable to more than one fund are allocated among the respective funds on the basis of relative net assets or other appropriate methods. Expense estimates are accrued in the period to which they relate and adjustments are made when actual amounts are known.
Deferred Trustee Compensation. Under a Deferred Compensation Plan (the Plan), independent Trustees may elect to defer receipt of a portion of their annual compensation. Deferred amounts are invested in a cross-section of Fidelity funds, are marked-to-market and remain in the Fund until distributed in accordance with the Plan. The investment of deferred amounts and the offsetting payable to the Trustees are included in the accompanying Statement of Assets and Liabilities.
Income Tax Information and Distributions to Shareholders. Each year, the Fund intends to qualify as a regulated investment company under Subchapter M of the Internal Revenue Code, including distributing substantially all of its taxable income and realized gains. As a result, no provision for U.S. Federal income taxes is required. The Fund files a U.S. federal tax return, in addition to state and local tax returns as required. The Fund's federal income tax returns are subject to examination by the Internal Revenue Service (IRS) for a period of three fiscal years after they are filed. State and local tax returns may be subject to examination for an additional fiscal year depending on the jurisdiction.
Dividends are declared and recorded daily and paid monthly from net investment income. Distributions from realized gains, if any, are declared and recorded on the ex-dividend date. Income and capital gain distributions are determined in accordance with income tax regulations, which may differ from GAAP.
Capital accounts within the financial statements are adjusted for permanent book-tax differences. These adjustments have no impact on net assets or the results of operations. Capital accounts are not adjusted for temporary book-tax differences which will reverse in a subsequent period.
Book-tax differences are primarily due to futures contracts, swaps, market discount, deferred trustees compensation, financing transactions and losses deferred due to wash sales.
The federal tax cost of investment securities and unrealized appreciation (depreciation) as of period end were as follows:
| Gross unrealized appreciation | $64,398 |
| Gross unrealized depreciation | (69,455) |
| Net unrealized appreciation (depreciation) on securities | $(5,057) |
| Tax cost | $6,503,838 |
Delayed Delivery Transactions and When-Issued Securities. During the period, the Fund transacted in securities on a delayed delivery or when-issued basis. Payment and delivery may take place after the customary settlement period for that security. The price of the underlying securities and the date when the securities will be delivered and paid for are fixed at the time the transaction is negotiated. The securities purchased on a delayed delivery or when-issued basis are identified as such in the Fund's Schedule of Investments. The Fund may receive compensation for interest forgone in the purchase of a delayed delivery or when-issued security. With respect to purchase commitments, the Fund identifies securities as segregated in its records with a value at least equal to the amount of the commitment. Losses may arise due to changes in the value of the underlying securities or if the counterparty does not perform under the contract's terms, or if the issuer does not issue the securities due to political, economic, or other factors.
To-Be-Announced (TBA) Securities and Mortgage Dollar Rolls. During the period, the Fund transacted in TBA securities that involved buying or selling mortgage-backed securities (MBS) on a forward commitment basis. A TBA transaction typically does not designate the actual security to be delivered and only includes an approximate principal amount; however delivered securities must meet specified terms defined by industry guidelines, including issuer, rate and current principal amount outstanding on underlying mortgage pools. The Fund may enter into a TBA transaction with the intent to take possession of or deliver the underlying MBS, or the Fund may elect to extend the settlement by entering into either a mortgage or reverse mortgage dollar roll. Mortgage dollar rolls are transactions where a fund sells TBA securities and simultaneously agrees to repurchase MBS on a later date at a lower price and with the same counterparty. Reverse mortgage dollar rolls involve the purchase and simultaneous agreement to sell TBA securities on a later date at a lower price. Transactions in mortgage dollar rolls and reverse mortgage dollar rolls are accounted for as purchases and sales and may result in an increase to the Fund's portfolio turnover rate.
Purchases and sales of TBA securities involve risks similar to those discussed above for delayed delivery and when-issued securities. Also, if the counterparty in a mortgage dollar roll or a reverse mortgage dollar roll transaction files for bankruptcy or becomes insolvent, the Fund's right to repurchase or sell securities may be limited. Additionally, when a fund sells TBA securities without already owning or having the right to obtain the deliverable securities (an uncovered forward commitment to sell), it incurs a risk of loss because it could have to purchase the securities at a price that is higher than the price at which it sold them. A fund may be unable to purchase the deliverable securities if the corresponding market is illiquid.
TBA securities subject to a forward commitment to sell at period end are included at the end of the Fund's Schedule of Investments under the caption "TBA Sale Commitments." The proceeds and value of these commitments are reflected in the Fund's Statement of Assets and Liabilities as Receivable for TBA sale commitments and TBA sale commitments, at value, respectively.
4. Derivative Instruments.
Risk Exposures and the Use of Derivative Instruments. The Fund's investment objective allows the Fund to enter into various types of derivative contracts, including futures contracts and swaps. Derivatives are investments whose value is primarily derived from underlying assets, indices or reference rates and may be transacted on an exchange or over-the-counter (OTC). Derivatives may involve a future commitment to buy or sell a specified asset based on specified terms, to exchange future cash flows at periodic intervals based on a notional principal amount, or for one party to make one or more payments upon the occurrence of specified events in exchange for periodic payments from the other party.
The Fund used derivatives to increase returns, to gain exposure to certain types of assets and to manage exposure to certain risks as defined below. The success of any strategy involving derivatives depends on analysis of numerous economic factors, and if the strategies for investment do not work as intended, the Fund may not achieve its objectives.
The Fund's use of derivatives increased or decreased its exposure to the following risk:
| Interest Rate Risk | Interest rate risk relates to the fluctuations in the value of interest-bearing securities due to changes in the prevailing levels of market interest rates. |
The Fund is also exposed to additional risks from investing in derivatives, such as liquidity risk and counterparty credit risk. Liquidity risk is the risk that the Fund will be unable to close out the derivative in the open market in a timely manner. Counterparty credit risk is the risk that the counterparty will not be able to fulfill its obligation to the Fund. Counterparty credit risk related to exchange-traded futures contracts may be mitigated by the protection provided by the exchange on which they trade. Counterparty credit risk related to centrally cleared OTC swaps may be mitigated by the protection provided by the clearinghouse.
Investing in derivatives may involve greater risks than investing in the underlying assets directly and, to varying degrees, may involve risk of loss in excess of any initial investment and collateral received and amounts recognized in the Statement of Assets and Liabilities. In addition, there may be the risk that the change in value of the derivative contract does not correspond to the change in value of the underlying instrument.
Net Realized Gain (Loss) and Change in Net Unrealized Appreciation (Depreciation) on Derivatives. The table below, which reflects the impacts of derivatives on the financial performance of the Fund, summarizes the net realized gain (loss) and change in net unrealized appreciation (depreciation) for derivatives during the period as presented in the Statement of Operations.
| Primary Risk Exposure / Derivative Type | Net Realized Gain (Loss) | Change in Net Unrealized Appreciation (Depreciation) |
| Interest Rate Risk | | |
| Futures Contracts | $7,723 | $2,633 |
| Swaps | 7,769 | 4,223 |
| Totals | $15,492 | $6,856 |
A summary of the value of derivatives by primary risk exposure as of period end is included at the end of the Schedule of Investments.
Futures Contracts. A futures contract is an agreement between two parties to buy or sell a specified underlying instrument for a fixed price at a specified future date. The Fund used futures contracts to manage its exposure to the bond market and fluctuations in interest rates.
Upon entering into a futures contract, a fund is required to deposit either cash or securities (initial margin) with a clearing broker in an amount equal to a certain percentage of the face value of the contract. Futures contracts are marked-to-market daily and subsequent daily payments (variation margin) are made or received by a fund depending on the daily fluctuations in the value of the futures contracts and are recorded as unrealized appreciation or (depreciation). This receivable and/or payable, if any, is included in daily variation margin for derivative instruments in the Statement of Assets and Liabilities. Realized gain or (loss) is recorded upon the expiration or closing of a futures contract.
Any open futures contracts at period end are presented in the Schedule of Investments under the caption "Futures Contracts". The underlying face amount at value reflects each contract's exposure to the underlying instrument or index at period end. Securities deposited to meet initial margin requirements are identified in the Schedule of Investments.
Swaps. A swap is a contract between two parties to exchange future cash flows at periodic intervals based on a notional principal amount. A centrally cleared OTC swap is a transaction executed between a fund and a dealer counterparty, then cleared by a futures commission merchant (FCM) through a clearinghouse. Once cleared, the clearinghouse serves as a central counterparty, with whom a fund exchanges cash flows for the life of the transaction, similar to transactions in futures contracts.
Centrally cleared OTC swaps require a fund to deposit either cash or securities (initial margin) with the FCM, at the instruction of and for the benefit of the clearinghouse. Securities deposited to meet initial margin requirements are identified in the Schedule of Investments. Centrally cleared OTC swaps are marked-to-market daily and subsequent payments (variation margin) are made or received depending on the daily fluctuations in the value of the swaps and are recorded as unrealized appreciation or (depreciation). These daily payments, if any, are included in receivable or payable for daily variation margin for derivative instruments in the Statement of Assets and Liabilities. Any premiums for centrally cleared OTC swaps are recorded periodically throughout the term of the swap to variation margin and included in unrealized appreciation (depreciation) in the Statement of Assets and Liabilities. Any premiums are recognized as realized gain (loss) upon termination or maturity of the swap.
Payments are exchanged at specified intervals, accrued daily commencing with the effective date of the contract and recorded as realized gain or (loss). Some swaps may be terminated prior to the effective date and realize a gain or loss upon termination. The net realized gain (loss) and change in net unrealized appreciation (depreciation) on swaps during the period is included in the Statement of Operations.
Any open swaps at period end are included in the Schedule of Investments under the caption "Swaps."
Interest Rate Swaps. Interest rate swaps are agreements between counterparties to exchange cash flows, one based on a fixed rate, and the other on a floating rate. The Fund entered into interest rate swaps to manage its exposure to interest rate changes. Changes in interest rates can have an effect on both the value of bond holdings as well as the amount of interest income earned. In general, the value of bonds can fall when interest rates rise and can rise when interest rates fall.
5. Fees and Other Transactions with Affiliates.
Management Fee. Fidelity Management & Research Company (the investment adviser) and its affiliates provide the Fund with investment management related services for which the Fund pays a monthly management fee. The management fee is the sum of an individual fund fee rate that is based on an annual rate of .20% of the Fund's average net assets and an annualized group fee rate that averaged .11% during the period. The group fee rate is based upon the average net assets of all the mutual funds advised by the investment adviser, including any mutual funds previously advised by the investment adviser that are currently advised by Fidelity SelectCo, LLC, an affiliate of the investment adviser. The group fee rate decreases as assets under management increase and increases as assets under management decrease. For the reporting period, the total annualized management fee rate was .31% of the Fund's average net assets.
Transfer Agent Fees. Fidelity Investments Institutional Operations Company, Inc. (FIIOC), an affiliate of the investment adviser, is the Fund's transfer, dividend disbursing and shareholder servicing agent. FIIOC receives an asset-based fee of .10% of the Fund's average net assets. FIIOC pays for typesetting, printing and mailing of shareholder reports, except proxy statements.
Fund Wide Operations Fee. Pursuant to the Fund Wide Operations and Expense Agreement (FWOE), the investment adviser has agreed to provide for fund level expenses (which do not include transfer agent, compensation of the independent Trustees, interest (including commitment fees), taxes or extraordinary expenses, if any) in return for a FWOE fee equal to .35% of the Fund's average net assets less the total amount of the management fee. The FWOE paid by the Fund is reduced by an amount equal to the fees and expenses paid to the independent Trustees. For the period, the FWOE fee was equivalent to an annualized rate of .04% of average net assets.
Interfund Trades. The Fund may purchase from or sell securities to other Fidelity Funds under procedures adopted by the Board. The procedures have been designed to ensure these interfund trades are executed in accordance with Rule 17a-7 of the 1940 Act. Interfund trades are included within the respective purchases and sales amounts shown in the Purchases and Sales of Investments note.
6. Committed Line of Credit.
The Fund participates with other funds managed by the investment adviser or an affiliate in a $4.25 billion credit facility (the "line of credit") to be utilized for temporary or emergency purposes to fund shareholder redemptions or for other short-term liquidity purposes. The Fund has agreed to pay commitment fees on its pro-rata portion of the line of credit, which amounted to $10 and is reflected in Miscellaneous expenses on the Statement of Operations. During the period, the Fund did not borrow on this line of credit.
7. Expense Reductions.
Through arrangements with the Fund's custodian, credits realized as a result of certain uninvested cash balances were used to reduce the Fund's management fee. During the period, these credits reduced the Fund's management fee by $14.
8. Other.
The Fund's organizational documents provide former and current trustees and officers with a limited indemnification against liabilities arising in connection with the performance of their duties to the Fund. In the normal course of business, the Fund may also enter into contracts that provide general indemnifications. The Fund's maximum exposure under these arrangements is unknown as this would be dependent on future claims that may be made against the Fund. The risk of material loss from such claims is considered remote.
Report of Independent Registered Public Accounting Firm
To the Trustees of Fidelity Income Fund and Shareholders of Fidelity GNMA Fund:
In our opinion, the accompanying statement of assets and liabilities, including the schedule of investments, and the related statements of operations and of changes in net assets and the financial highlights present fairly, in all material respects, the financial position of Fidelity GNMA Fund (a fund of Fidelity Income Fund) as of January 31, 2017, the results of its operations for the for the periods indicated, the changes in its net assets for each of the periods indicated and the financial highlights for each of the periods indicated, in conformity with accounting principles generally accepted in the United States of America. These financial statements and financial highlights (hereafter referred to as “financial statements”) are the responsibility of the Fidelity GNMA Fund’s management. Our responsibility is to express an opinion on these financial statements based on our audits. We conducted our audits of these financial statements in accordance with the standards of the Public Company Accounting Oversight Board (United States). Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements, assessing the accounting principles used and significant estimates made by management, and evaluating the overall financial statement presentation. We believe that our audits, which included confirmation of securities as of January 31, 2017 by correspondence with the custodian and brokers, provide a reasonable basis for our opinion.
PricewaterhouseCoopers LLP
Boston, Massachusetts
March 16, 2017
Shareholder Expense Example
As a shareholder of the Fund, you incur two types of costs: (1) transaction costs and (2) ongoing costs, including management fees and other Fund expenses. This Example is intended to help you understand your ongoing costs (in dollars) of investing in the Fund and to compare these costs with the ongoing costs of investing in other mutual funds.
The Example is based on an investment of $1,000 invested at the beginning of the period and held for the entire period (August 1, 2016 to January 31, 2017).
Actual Expenses
The first line of the accompanying table provides information about actual account values and actual expenses. You may use the information in this line, together with the amount you invested, to estimate the expenses that you paid over the period. Simply divide your account value by $1,000.00 (for example, an $8,600 account value divided by $1,000.00 = 8.6), then multiply the result by the number in the first line under the heading entitled "Expenses Paid During Period" to estimate the expenses you paid on your account during this period. A small balance maintenance fee of $12.00 that is charged once a year may apply for certain accounts with a value of less than $2,000. This fee is not included in the table below. If it was, the estimate of expenses you paid during the period would be higher, and your ending account value lower, by this amount. In addition, the Fund, as a shareholder in the underlying Fidelity Central Funds, will indirectly bear its pro-rata share of the fees and expenses incurred by the underlying Fidelity Central Funds. These fees and expenses are not included in the Fund's annualized expense ratio used to calculate the expense estimate in the table below.
Hypothetical Example for Comparison Purposes
The second line of the accompanying table provides information about hypothetical account values and hypothetical expenses based on the Fund's actual expense ratio and an assumed rate of return of 5% per year before expenses, which is not the Fund's actual return. The hypothetical account values and expenses may not be used to estimate the actual ending account balance or expenses you paid for the period. You may use this information to compare the ongoing costs of investing in the Fund and other funds. To do so, compare this 5% hypothetical example with the 5% hypothetical examples that appear in the shareholder reports of the other funds. A small balance maintenance fee of $12.00 that is charged once a year may apply for certain accounts with a value of less than $2,000. This fee is not included in the table below. If it was, the estimate of expenses you paid during the period would be higher, and your ending account value lower, by this amount. In addition, the Fund, as a shareholder in the underlying Fidelity Central Funds, will indirectly bear its pro-rata share of the fees and expenses incurred by the underlying Fidelity Central Funds. These fees and expenses are not included in the Fund's annualized expense ratio used to calculate the expense estimate in the table below.
Please note that the expenses shown in the table are meant to highlight your ongoing costs only and do not reflect any transaction costs. Therefore, the second line of the table is useful in comparing ongoing costs only, and will not help you determine the relative total costs of owning different funds.
| | Annualized Expense Ratio-A | Beginning
Account Value
August 1, 2016 | Ending
Account Value
January 31, 2017 | Expenses Paid
During Period-B
August 1, 2016
to January 31, 2017 |
| Actual | .45% | $1,000.00 | $987.80 | $2.25 |
| Hypothetical-C | | $1,000.00 | $1,022.94 | $2.29 |
A Annualized expense ratio reflects expenses net of applicable fee waivers.
B Expenses are equal to the Fund's annualized expense ratio, multiplied by the average account value over the period, multiplied by 184/365 (to reflect the one-half year period).
C 5% return per year before expenses
Board Approval of Investment Advisory Contracts and Management Fees
Fidelity GNMA Fund
Each year, the Board of Trustees, including the Independent Trustees (together, the Board), votes on the renewal of the management contract with Fidelity Management & Research Company (FMR) and the sub-advisory agreements (together, the Advisory Contracts) for the fund. The Board, assisted by the advice of fund counsel and Independent Trustees' counsel, requests and considers a broad range of information relevant to the renewal of the Advisory Contracts throughout the year.
The Board meets regularly and, at each of its meetings, covers an extensive agenda of topics and materials and considers factors that are relevant to its annual consideration of the renewal of the fund's Advisory Contracts, including the services and support provided to the fund and its shareholders. The Board has established four standing committees (Committees) — Operations, Audit, Fair Valuation, and Governance and Nominating — each composed of and chaired by Independent Trustees with varying backgrounds, to which the Board has assigned specific subject matter responsibilities in order to enhance effective decision-making by the Board. The Operations Committee, of which all of the Independent Trustees are members, meets regularly throughout the year and considers, among other matters, information specifically related to the annual consideration of the renewal of the fund's Advisory Contracts. The Board, acting directly and through its Committees, requests and receives information concerning the annual consideration of the renewal of the fund's Advisory Contracts. The Board also meets as needed to consider matters specifically related to the Board's annual consideration of the renewal of the Advisory Contracts. Members of the Board may also meet with trustees of other Fidelity funds through ad hoc joint committees to discuss certain matters relevant to all of the Fidelity funds.
At its September 2016 meeting, the Board unanimously determined to renew the fund's Advisory Contracts. In reaching its determination, the Board considered all factors it believed relevant, including (i) the nature, extent, and quality of the services to be provided to the fund and its shareholders (including the investment performance of the fund); (ii) the competitiveness of the fund's management fee and total expense ratio relative to peer funds; (iii) the total costs of the services to be provided by and the profits to be realized by Fidelity from its relationships with the fund; and (iv) the extent to which, if any, economies of scale exist and would be realized as the fund grows, and whether any economies of scale are appropriately shared with fund shareholders.
In considering whether to renew the Advisory Contracts for the fund, the Board reached a determination, with the assistance of fund counsel and Independent Trustees' counsel and through the exercise of its business judgment, that the renewal of the Advisory Contracts was in the best interests of the fund and its shareholders and that the compensation payable under the Advisory Contracts was fair and reasonable. The Board's decision to renew the Advisory Contracts was not based on any single factor, but rather was based on a comprehensive consideration of all the information provided to the Board at its meetings throughout the year. The Board, in reaching its determination to renew the Advisory Contracts, was aware that shareholders of the fund have a broad range of investment choices available to them, including a wide choice among funds offered by Fidelity's competitors, and that the fund's shareholders, who have the opportunity to review and weigh the disclosure provided by the fund in its prospectus and other public disclosures, have chosen to invest in this fund, which is part of the Fidelity family of funds.
Nature, Extent, and Quality of Services Provided. The Board considered Fidelity's staffing as it relates to the fund, including the backgrounds of investment personnel of Fidelity, and also considered the fund's investment objective, strategies, and related investment philosophy. The Independent Trustees also had discussions with senior management of Fidelity's investment operations and investment groups. The Board considered the structure of the investment personnel compensation program and whether this structure provides appropriate incentives to act in the best interests of the fund. Additionally, the Board considered the portfolio managers' investments, if any, in the funds that they manage.
Resources Dedicated to Investment Management and Support Services. The Board reviewed the general qualifications and capabilities of Fidelity's investment staff, including its size, education, experience, and resources, as well as Fidelity's approach to recruiting, managing, and compensating investment personnel. The Board noted that Fidelity has continued to increase the resources devoted to non-U.S. offices, including expansion of Fidelity's global investment organization. The Board also noted that Fidelity's analysts have extensive resources, tools and capabilities that allow them to conduct sophisticated quantitative and fundamental analysis, as well as credit analysis of issuers, counterparties and guarantors. Further, the Board considered that Fidelity's investment professionals have sufficient access to global information and data so as to provide competitive investment results over time, and that those professionals also have access to sophisticated tools that permit them to assess portfolio construction and risk and performance attribution characteristics continuously, as well as to transmit new information and research conclusions rapidly around the world. Additionally, in its deliberations, the Board considered Fidelity's trading, risk management, compliance, and technology and operations capabilities and resources, which are integral parts of the investment management process.
Shareholder and Administrative Services. The Board considered (i) the nature, extent, quality, and cost of advisory, administrative, and shareholder services performed by FMR, the sub-advisers (together with FMR, the Investment Advisers), and their affiliates under the Advisory Contracts and under separate agreements covering transfer agency, pricing and bookkeeping, and securities lending services for the fund; (ii) the nature and extent of the supervision of third party service providers, principally custodians, subcustodians, and pricing vendors; and (iii) the resources devoted to, and the record of compliance with, the fund's compliance policies and procedures.
The Board noted that the growth of fund assets over time across the complex allows Fidelity to reinvest in the development of services designed to enhance the value or convenience of the Fidelity funds as investment vehicles. These services include 24-hour access to account information and market information through telephone representatives and over the Internet, investor education materials and asset allocation tools, and the expanded availability of Fidelity Investor Centers.
Investment in a Large Fund Family. The Board considered the benefits to shareholders of investing in a Fidelity fund, including the benefits of investing in a fund that is part of a large family of funds offering a variety of investment disciplines and providing a large variety of mutual fund investor services. The Board noted that Fidelity had taken, or had made recommendations that resulted in the Fidelity funds taking, a number of actions over the previous year that benefited particular funds, including: (i) continuing to dedicate additional resources to investment research and to the support of the senior management team that oversees asset management; (ii) continuing efforts to enhance Fidelity's global research capabilities; (iii) launching new funds and making other enhancements to meet client needs; (iv) broadening eligibility requirements for certain lower-priced share classes of, and streamlining the fee structure for, certain existing equity index funds; (v) lowering expense caps for certain existing funds and classes to reduce expenses paid by shareholders; (vi) eliminating redemption fees for certain variable insurance product funds and classes; (vii) continuing to launch dedicated lower cost underlying funds to meet portfolio construction needs related to expanding underlying fund options for Fidelity funds of funds, specifically for the Freedom Fund product lines; (viii) launching a lower cost share class for use by the Freedom Index Fund product line; (ix) rationalizing product lines and gaining increased efficiencies through fund mergers and share class consolidations; (x) continuing to develop, acquire and implement systems and technology to improve services to the funds and shareholders, strengthen information security, and increase efficiency; (xi) implementing investment enhancements to further strengthen Fidelity's target date product line to increase investors' probability of success in achieving their goals; (xii) accelerating the conversion of all remaining Class B shares to Class A shares, which have a lower expense structure; and (xiii) implementing changes to Fidelity's money market fund product line in response to recent regulatory reforms.
Investment Performance. The Board considered whether the fund has operated in accordance with its investment objective, as well as its record of compliance with its investment restrictions and its performance history.
The Board took into account discussions with representatives of the Investment Advisers about fund investment performance that occur at Board meetings throughout the year. In this regard the Board noted that as part of regularly scheduled fund reviews and other reports to the Board on fund performance, the Board considers annualized return information for the fund for different time periods, measured against a securities market index ("benchmark index") and a peer group of funds with similar objectives ("peer group"), if any. In its evaluation of fund investment performance at meetings throughout the year, the Board gave particular attention to information indicating underperformance of certain Fidelity funds for specific time periods and discussed with the Investment Advisers the reasons for such underperformance.
In addition to reviewing absolute and relative fund performance, the Independent Trustees periodically consider the appropriateness of fund performance metrics in evaluating the results achieved. In general, the Independent Trustees believe that fund performance should be evaluated based on gross performance (before fees and expenses but after transaction costs) compared to appropriate benchmark indices, over appropriate time periods that may include full market cycles, and on net performance (after fees and expenses) compared to peer groups, as applicable, over the same periods, taking into account relevant factors including the following: general market conditions; expectations for interest rate levels and credit conditions; issuer-specific information including credit quality; the potential for incremental return versus the fund's benchmark index weighed against the risks involved in obtaining that incremental return, including the risk of diminished or negative total returns; and fund cash flows and other factors. Depending on the circumstances, the Independent Trustees may be satisfied with a fund's performance notwithstanding that it lags its benchmark index or peer group for certain periods.
The Independent Trustees recognize that shareholders evaluate performance on a net basis over their own holding periods, for which one-, three-, and five-year periods are often used as a proxy. For this reason, the performance information reviewed by the Board also included net cumulative calendar year total return information for the fund and an appropriate benchmark index and peer group for the most recent one-, three-, and five-year periods.
Based on its review, the Board concluded that the nature, extent, and quality of services provided to the fund under the Advisory Contracts should continue to benefit the shareholders of the fund.
Competitiveness of Management Fee and Total Expense Ratio. The Board considered the fund's management fee and total expense ratio compared to "mapped groups" of competitive funds and classes created for the purpose of facilitating the Trustees' competitive analysis of management fees and total expenses. Fidelity creates "mapped groups" by combining similar Lipper investment objective categories that have comparable investment mandates. Combining Lipper investment objective categories aids the Board's management fee and total expense ratio comparisons by broadening the competitive group used for comparison.
Management Fee. The Board considered two proprietary management fee comparisons for the 12-month periods shown in basis points (BP) in the chart below. The group of Lipper funds used by the Board for management fee comparisons is referred to below as the "Total Mapped Group" and, for the reasons explained above, is broader than the Lipper peer group used by the Board for performance comparisons. The Total Mapped Group comparison focuses on a fund's standing in terms of gross management fees before expense reimbursements or caps relative to the total universe of funds with comparable investment mandates, regardless of whether their management fee structures also are comparable. Funds with comparable investment mandates offer exposure to similar types of securities. Funds with comparable management fee structures have similar management fee contractual arrangements (
e.g., flat rate charged for advisory services, all-inclusive fee rate,
etc.). "TMG %" represents the percentage of funds in the Total Mapped Group that had management fees that were lower than the fund's. For example, a hypothetical TMG % of 20% would mean that 80% of the funds in the Total Mapped Group had higher, and 20% had lower, management fees than the fund. The fund's actual TMG %s and the number of funds in the Total Mapped Group are in the chart below. The "Asset-Size Peer Group" (ASPG) comparison focuses on a fund's standing relative to a subset of non-Fidelity funds within the Total Mapped Group that are similar in size and management fee structure. For example, if a fund is in the first quartile of the ASPG, the fund's management fee ranks in the least expensive or lowest 25% of funds in the ASPG. The ASPG represents at least 15% of the funds in the Total Mapped Group with comparable asset size and management fee structures, subject to a minimum of 50 funds (or all funds in the Total Mapped Group if fewer than 50). Additional information, such as the ASPG quartile in which the fund's management fee rate ranked, is also included in the chart and considered by the Board.
Fidelity GNMA Fund
The Board noted that the fund's management fee rate ranked below the median of its Total Mapped Group and below the median of its ASPG for 2015.
The Board noted that, in 2014, the ad hoc Committee on Group Fee was formed by it and the boards of other Fidelity funds to conduct an in-depth review of the "group fee" component of the management fee of funds with such management fee structures. The Committee's focus included the mechanics of the group fee, the competitive landscape of group fee structures, Fidelity funds with no group fee component and investment products not included in group fee assets. The Board also considered that, for funds subject to the group fee, FMR agreed to voluntarily waive fees over a specified period of time in amounts designed to account for assets converted from certain funds to certain collective investment trusts.
Based on its review, the Board concluded that the fund's management fee is fair and reasonable in light of the services that the fund receives and the other factors considered.
Total Expense Ratio. In its review of the fund's total expense ratio, the Board considered the fund's management fee rate as well as other fund expenses, such as transfer agent fees, pricing and bookkeeping fees, and custodial, legal, and audit fees. The Board also noted that Fidelity may agree to waive fees and expenses from time to time, and the extent to which, if any, it has done so for the fund. As part of its review, the Board also considered the current and historical total expense ratios of the fund compared to competitive fund median expenses. The fund is compared to those funds and classes in the Total Mapped Group (used by the Board for management fee comparisons) that have a similar sales load structure.
The Board noted that the fund's total expense ratio ranked below the competitive median for 2015.
The Board considered that the current contractual arrangements for the fund have the effect of setting the total "fund-level" expenses (including, among certain other "fund-level" expenses, the management fee) at 0.35%. These contractual arrangements may not be amended to increase the fees or expenses payable except by a vote of a majority of the Board.
The Board recognized that the fund's management contract incorporates a "group fee" structure, which provides for lower group fee rates as total group assets increase, and for higher group fee rates as total group assets decrease (with "group assets" defined to include fund assets under FMR's management plus the assets of sector funds previously under FMR's management). FMR calculates the group fee rates based on a tiered asset "breakpoint" schedule that varies based on asset class. The Board noted, however, that because the current contractual arrangements set the total "fund-level" expenses at 0.35%, increases or decreases in the management fee due to changes in the group fee rate will not impact the total expense ratio.
Fees Charged to Other Fidelity Clients. The Board also considered Fidelity fee structures and other information with respect to clients of Fidelity, such as other funds advised or subadvised by Fidelity, pension plan clients, and other institutional clients with similar mandates. The Board noted that an ad hoc joint committee created by it and the boards of other Fidelity funds periodically (most recently in 2013) reviews and compares Fidelity's institutional investment advisory business with its business of providing services to the Fidelity funds, including the differences in services provided, fees charged, and costs incurred, as well as competition in their respective marketplaces.
Based on its review of total expense ratios and fees charged to other Fidelity clients, the Board concluded that the fund's total expense ratio was reasonable in light of the services that the fund and its shareholders receive and the other factors considered.
Costs of the Services and Profitability. The Board considered the revenues earned and the expenses incurred by Fidelity in conducting the business of developing, marketing, distributing, managing, administering and servicing the fund and servicing the fund's shareholders. The Board also considered the level of Fidelity's profits in respect of all the Fidelity funds.
On an annual basis, Fidelity presents to the Board information about the profitability of its relationships with the fund. Fidelity calculates profitability information for each fund, as well as aggregate profitability information for groups of Fidelity funds and all Fidelity funds, using a series of detailed revenue and cost allocation methodologies which originate with the books and records of Fidelity on which Fidelity's audited financial statements are based. The Audit Committee of the Board reviews any significant changes from the prior year's methodologies.
PricewaterhouseCoopers LLP (PwC), independent registered public accounting firm and auditor to Fidelity and certain Fidelity funds, has been engaged annually by the Board as part of the Board's assessment of Fidelity's profitability analysis. PwC's engagement includes the review and assessment of the methodologies used by Fidelity in determining the revenues and expenses attributable to Fidelity's mutual fund business, and completion of agreed-upon procedures in respect of the mathematical accuracy of the fund profitability information and its conformity to established allocation methodologies. After considering PwC's reports issued under the engagement and information provided by Fidelity, the Board concluded that while other allocation methods may also be reasonable, Fidelity's profitability methodologies are reasonable in all material respects.
The Board also reviewed Fidelity's non-fund businesses and fall-out benefits related to the mutual fund business as well as cases where Fidelity's affiliates may benefit from or be related to the fund's business.
The Board considered the costs of the services provided by and the profits realized by Fidelity in connection with the operation of the fund and was satisfied that the profitability was not excessive.
Economies of Scale. The Board considered whether there have been economies of scale in respect of the management of the Fidelity funds, whether the Fidelity funds (including the fund) have appropriately benefited from any such economies of scale, and whether there is potential for realization of any further economies of scale. The Board considered the extent to which the fund will benefit from economies of scale as assets grow through increased services to the fund, through waivers or reimbursements, or through fee or expense ratio reductions. The Board also noted that a committee (the Economies of Scale Committee) created by it and the boards of other Fidelity funds periodically (most recently in 2013) analyzes whether Fidelity attains economies of scale in respect of the management and servicing of the Fidelity funds, whether the Fidelity funds have appropriately benefited from such economies of scale, and whether there is potential for realization of any further economies of scale.
The Board concluded, taking into account the analysis of the Economies of Scale Committee, that economies of scale, if any, are being appropriately shared between fund shareholders and Fidelity.
Additional Information Requested by the Board. In order to develop fully the factual basis for consideration of the Fidelity funds' advisory contracts, the Board requested and received additional information on certain topics, including: (i) Fidelity's fund profitability methodology, profitability trends for certain funds, and the impact of certain factors on fund profitability results; (ii) portfolio manager changes that have occurred during the past year and the amount of the investment that each portfolio manager has made in the Fidelity fund(s) that he or she manages; (iii) Fidelity's compensation structure for portfolio managers, research analysts, and other key personnel, including its effects on fund profitability, the rationale for the compensation structure, and the extent to which current market conditions have affected retention and recruitment; (iv) the arrangements with and compensation paid to certain fund sub-advisers on behalf of the Fidelity funds; (v) Fidelity's voluntary waiver of its fees to maintain minimum yields for certain money market funds and classes as well as contractual waivers in place for certain funds; (vi) the methodology with respect to competitive fund data and peer group classifications; (vii) Fidelity's transfer agent fee, expense, and service structures for different funds and classes relative to competitive trends, and the impact of the increased use of omnibus accounts; (viii) Fidelity's long-term expectations for its offerings in the workplace investing channel; (ix) new developments in the retail and institutional marketplaces; (x) the approach to considering "fall-out" benefits; and (xi) the impact of money market reform on Fidelity's money market funds, including with respect to costs and profitability. In addition, the Board considered its discussions with Fidelity throughout the year regarding enhanced information security initiatives and the funds' fair valuation policies.
Based on its evaluation of all of the conclusions noted above, and after considering all factors it believed relevant, the Board concluded that the advisory fee structures are fair and reasonable, and that the fund's Advisory Contracts should be renewed.
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Class A, Class T, Class C and Class I
Semi-Annual Report January 31, 2017 |
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Contents
To view a fund's proxy voting guidelines and proxy voting record for the 12-month period ended June 30, visit http://www.fidelity.com/proxyvotingresults or visit the Securities and Exchange Commission's (SEC) web site at http://www.sec.gov.
You may also call 1-877-208-0098 to request a free copy of the proxy voting guidelines.
Standard & Poor's, S&P and S&P 500 are registered service marks of The McGraw-Hill Companies, Inc. and have been licensed for use by Fidelity Distributors Corporation.
Other third-party marks appearing herein are the property of their respective owners.
All other marks appearing herein are registered or unregistered trademarks or service marks of FMR LLC or an affiliated company. © 2017 FMR LLC. All rights reserved.
This report and the financial statements contained herein are submitted for the general information of the shareholders of the Funds. This report is not authorized for distribution to prospective investors in the Funds unless preceded or accompanied by an effective prospectus.
A fund files its complete schedule of portfolio holdings with the SEC for the first and third quarters of each fiscal year on Form N-Q. Forms N-Q are available on the SEC’s web site at http://www.sec.gov. A fund's Forms N-Q may be reviewed and copied at the SEC’s Public Reference Room in Washington, DC. Information regarding the operation of the SEC's Public Reference Room may be obtained by calling 1-800-SEC-0330.
For a complete list of a fund's portfolio holdings, view the most recent holdings listing, semiannual report, or annual report on Fidelity's web site at http://www.fidelity.com, http://www.institutional.fidelity.com, or http://www.401k.com, as applicable.
NOT FDIC INSURED •MAY LOSE VALUE •NO BANK GUARANTEE
Neither the Funds nor Fidelity Distributors Corporation is a bank.
Fidelity Income Replacement 2018 Fund℠
Investment Summary (Unaudited)
The information in the following tables is based on the direct investments of the Fund.
Top Holdings as of January 31, 2017
| | % of fund's net assets | % of fund's net assets 6 months ago |
| Fidelity Investments Money Market Government Portfolio Institutional Class 0.47% | 62.1 | 53.8 |
| Fidelity Short-Term Bond Fund | 27.5 | 28.1 |
| Fidelity Total Bond Fund | 2.8 | 6.3 |
| Fidelity Series Broad Market Opportunities Fund | 1.3 | 1.8 |
| Fidelity Equity-Income Fund | 1.2 | 1.5 |
| Fidelity Strategic Real Return Fund | 0.9 | 2.1 |
| Fidelity Government Income Fund | 0.9 | 2.1 |
| Fidelity Large Cap Stock Fund | 0.9 | 1.1 |
| Fidelity Advisor Mid Cap II Fund Class I | 0.8 | 1.1 |
| Fidelity Series 100 Index Fund | 0.8 | 1.0 |
| | 99.2 | 98.9 |
Asset Allocation (% of fund's net assets)
| Period end |
| | Domestic Equity Funds | 5.8% |
| | Investment Grade Fixed-Income Funds | 4.6% |
| | Short-Term Funds | 89.6% |
| Six months ago |
| | Domestic Equity Funds | 7.6% |
| | Investment Grade Fixed-Income Funds | 10.5% |
| | Short-Term Funds | 81.9% |
Fidelity Income Replacement 2018 Fund℠
Investments January 31, 2017 (Unaudited)
Showing Percentage of Net Assets
| Equity Funds - 5.8% | | | |
| | | Shares | Value |
| Domestic Equity Funds - 5.8% | | | |
| Fidelity Advisor Mid Cap II Fund Class I (a) | | 2,186 | $43,353 |
| Fidelity Blue Chip Growth Fund (a) | | 568 | 40,141 |
| Fidelity Equity-Income Fund (a) | | 1,075 | 62,085 |
| Fidelity Large Cap Stock Fund (a) | | 1,564 | 46,564 |
| Fidelity Series 100 Index Fund (a) | | 2,723 | 40,141 |
| Fidelity Series Broad Market Opportunities Fund (a) | | 4,394 | 71,184 |
| Fidelity Series Small Cap Opportunities Fund (a) | | 456 | 6,423 |
| TOTAL DOMESTIC EQUITY FUNDS | | | |
| (Cost $218,089) | | | 309,891 |
|
| Fixed-Income Funds - 4.6% | | | |
| Investment Grade Fixed-Income Funds - 4.6% | | | |
| Fidelity Government Income Fund (a) | | 4,837 | 49,240 |
| Fidelity Strategic Real Return Fund (a) | | 5,583 | 49,240 |
| Fidelity Total Bond Fund (a) | | 13,951 | 147,185 |
| TOTAL INVESTMENT GRADE FIXED-INCOME FUNDS | | | |
| (Cost $242,620) | | | 245,665 |
|
| Short-Term Funds - 89.6% | | | |
| Fidelity Investments Money Market Government Portfolio Institutional Class 0.47% (a)(b) | | 3,324,249 | 3,324,249 |
| Fidelity Short-Term Bond Fund (a) | | 171,407 | 1,472,391 |
| TOTAL SHORT-TERM FUNDS | | | |
| (Cost $4,788,570) | | | 4,796,640 |
| TOTAL INVESTMENT PORTFOLIO - 100.0% | | | |
| (Cost $5,249,279) | | | 5,352,196 |
| NET OTHER ASSETS (LIABILITIES) - 0.0% | | | (422) |
| NET ASSETS - 100% | | | $5,351,774 |
Legend
(a) Affiliated Fund
(b) The rate quoted is the annualized seven-day yield of the fund at period end.
Affiliated Underlying Funds
Information regarding the Fund's fiscal year to date purchases and sales of the affiliated Underlying Funds and income earned by the Fund from investments in affiliated Underlying Funds is as follows:
| Affiliate | Value, beginning of period | Purchases | Sales Proceeds | Dividend Income | Value, end of period |
| Fidelity Advisor Mid Cap II Fund Class I | $52,411 | $13,979 | $24,888 | $185 | $43,353 |
| Fidelity Blue Chip Growth Fund | 48,982 | 13,092 | 22,726 | 91 | 40,141 |
| Fidelity Equity-Income Fund | 74,943 | 19,114 | 35,661 | 869 | 62,085 |
| Fidelity Government Income Fund | 102,373 | 17,159 | 66,834 | 571 | 49,240 |
| Fidelity Investments Money Market Government Portfolio Institutional Class 0.47% | 2,633,775 | 1,258,222 | 567,748 | 4,812 | 3,324,249 |
| Fidelity Large Cap Stock Fund | 56,330 | 14,175 | 27,894 | 385 | 46,564 |
| Fidelity Series 100 Index Fund | 48,982 | 12,370 | 22,427 | 849 | 40,141 |
| Fidelity Series Broad Market Opportunities Fund | 86,209 | 20,884 | 40,356 | 319 | 71,184 |
| Fidelity Series Small Cap Opportunities Fund | 7,347 | 1,835 | 3,281 | 32 | 6,423 |
| Fidelity Short-Term Bond Fund | 1,376,889 | 492,627 | 386,455 | 8,073 | 1,472,391 |
| Fidelity Strategic Real Return Fund | 102,373 | 16,904 | 69,834 | 834 | 49,240 |
| Fidelity Total Bond Fund | 307,608 | 51,566 | 206,305 | 3,082 | 147,185 |
| Total | $4,898,222 | $1,931,927 | $1,474,409 | $20,102 | $5,352,196 |
Investment Valuation
All investments are categorized as Level 1 under the Fair Value Hierarchy. The inputs or methodology used for valuing securities may not be an indication of the risk associated with investing in those securities. For more information on valuation inputs please refer to the Investment Valuation section in the accompanying Notes to Financial Statements.
See accompanying notes which are an integral part of the financial statements.
Fidelity Income Replacement 2018 Fund℠
Financial Statements
Statement of Assets and Liabilities
| | | January 31, 2017 (Unaudited) |
| Assets | | |
| Investment in securities, at value (cost $5,249,279) — See accompanying schedule | | $5,352,196 |
| Cash | | 1 |
| Receivable for investments sold | | 143,055 |
| Total assets | | 5,495,252 |
| Liabilities | | |
| Payable for investments purchased | $143,045 | |
| Distribution and service plan fees payable | 433 | |
| Total liabilities | | 143,478 |
| Net Assets | | $5,351,774 |
| Net Assets consist of: | | |
| Paid in capital | | $5,286,350 |
| Undistributed net investment income | | 887 |
| Accumulated undistributed net realized gain (loss) on investments | | (38,380) |
| Net unrealized appreciation (depreciation) on investments | | 102,917 |
| Net Assets | | $5,351,774 |
| Calculation of Maximum Offering Price | | |
| Class A: | | |
| Net Asset Value and redemption price per share ($444,981 ÷ 8,077.88 shares) | | $55.09 |
| Maximum offering price per share (100/94.25 of $55.09) | | $58.45 |
| Class T: | | |
| Net Asset Value and redemption price per share ($212,667 ÷ 3,859.65 shares) | | $55.10 |
| Maximum offering price per share (100/96.50 of $55.10) | | $57.10 |
| Class C: | | |
| Net Asset Value and offering price per share ($293,819 ÷ 5,369.37 shares)(a) | | $54.72 |
| Income Replacement 2018: | | |
| Net Asset Value, offering price and redemption price per share ($4,207,243 ÷ 76,357.25 shares) | | $55.10 |
| Class I: | | |
| Net Asset Value, offering price and redemption price per share ($193,064 ÷ 3,503.56 shares) | | $55.11 |
(a) Redemption price per share is equal to net asset value less any applicable contingent deferred sales charge.
See accompanying notes which are an integral part of the financial statements.
Statement of Operations
| | | Six months ended January 31, 2017 (Unaudited) |
| Investment Income | | |
| Income distributions from underlying funds | | $20,102 |
| Expenses | | |
| Distribution and service plan fees | $2,712 | |
| Independent trustees' fees and expenses | 12 | |
| Total expenses before reductions | 2,724 | |
| Expense reductions | (12) | 2,712 |
| Net investment income (loss) | | 17,390 |
| Realized and Unrealized Gain (Loss) | | |
| Realized gain (loss) on sale of underlying fund shares | 37,439 | |
| Capital gain distributions from underlying funds | 5,077 | |
| Total net realized gain (loss) | | 42,516 |
| Change in net unrealized appreciation (depreciation) on underlying funds | | (40,985) |
| Net gain (loss) | | 1,531 |
| Net increase (decrease) in net assets resulting from operations | | $18,921 |
See accompanying notes which are an integral part of the financial statements.
Statement of Changes in Net Assets
| | Six months ended January 31, 2017 (Unaudited) | Year ended July 31, 2016 |
| Increase (Decrease) in Net Assets | | |
| Operations | | |
| Net investment income (loss) | $17,390 | $45,857 |
| Net realized gain (loss) | 42,516 | 117,792 |
| Change in net unrealized appreciation (depreciation) | (40,985) | (103,534) |
| Net increase (decrease) in net assets resulting from operations | 18,921 | 60,115 |
| Distributions to shareholders from net investment income | (17,293) | (46,006) |
| Distributions to shareholders from net realized gain | – | (2,469) |
| Total distributions | (17,293) | (48,475) |
| Share transactions - net increase (decrease) | 452,418 | (1,174,262) |
| Total increase (decrease) in net assets | 454,046 | (1,162,622) |
| Net Assets | | |
| Beginning of period | 4,897,728 | 6,060,350 |
| End of period | $5,351,774 | $4,897,728 |
| Other Information | | |
| Undistributed net investment income end of period | $887 | $790 |
See accompanying notes which are an integral part of the financial statements.
Financial Highlights — Fidelity Income Replacement 2018 Fund Class A
| | Six months ended (Unaudited) January 31, | Years ended July 31, | | | | |
| | 2017 | 2016 | 2015 | 2014 | 2013 | 2012 |
| Selected Per–Share Data | | | | | | |
| Net asset value, beginning of period | $55.07 | $54.99 | $54.46 | $52.45 | $50.59 | $49.87 |
| Income from Investment Operations | | | | | | |
| Net investment income (loss)A | .162 | .374 | .437 | .588 | .719 | .774 |
| Net realized and unrealized gain (loss) | .008 | .101 | .583 | 2.080 | 2.135 | .909 |
| Total from investment operations | .170 | .475 | 1.020 | 2.668 | 2.854 | 1.683 |
| Distributions from net investment income | (.150) | (.371) | (.432) | (.579) | (.705) | (.765) |
| Distributions from net realized gain | – | (.024) | (.058) | (.079) | (.289) | (.198) |
| Total distributions | (.150) | (.395) | (.490) | (.658) | (.994) | (.963) |
| Net asset value, end of period | $55.09 | $55.07 | $54.99 | $54.46 | $52.45 | $50.59 |
| Total ReturnB,C,D | .31% | .87% | 1.88% | 5.11% | 5.70% | 3.45% |
| Ratios to Average Net AssetsE,F | | | | | | |
| Expenses before reductions | .25%G | .25% | .25% | .25% | .25% | .25% |
| Expenses net of fee waivers, if any | .25%G | .25% | .25% | .25% | .25% | .25% |
| Expenses net of all reductions | .25%G | .25% | .25% | .25% | .25% | .25% |
| Net investment income (loss) | .59%G | .69% | .79% | 1.10% | 1.39% | 1.57% |
| Supplemental Data | | | | | | |
| Net assets, end of period (000 omitted) | $445 | $483 | $567 | $868 | $774 | $762 |
| Portfolio turnover rate E | 61%G | 105% | 56% | 56% | 41% | 44% |
A Calculated based on average shares outstanding during the period.
B Total returns for periods of less than one year are not annualized.
C Total returns would have been lower if certain expenses had not been reduced during the applicable periods shown.
D Total returns do not include the effect of the sales charges.
E Amounts do not include the activity of the Underlying Funds.
F Expense ratios reflect operating expenses of the class. Expenses before reductions do not reflect amounts reimbursed by the investment adviser or reductions from expense offset arrangements and do not represent the amount paid by the class during periods when reimbursements or reductions occur. Expenses net of fee waivers reflect expenses after reimbursement by the investment adviser but prior to reductions from expense offset arrangements. Expenses net of all reductions represent the net expenses paid by the class but do not include expenses of the underlying funds in which the Fund invests.
G Annualized
See accompanying notes which are an integral part of the financial statements.
Financial Highlights — Fidelity Income Replacement 2018 Fund Class T
| | Six months ended (Unaudited) January 31, | Years ended July 31, | | | | |
| | 2017 | 2016 | 2015 | 2014 | 2013 | 2012 |
| Selected Per–Share Data | | | | | | |
| Net asset value, beginning of period | $55.08 | $55.00 | $54.48 | $52.48 | $50.62 | $49.90 |
| Income from Investment Operations | | | | | | |
| Net investment income (loss)A | .093 | .238 | .299 | .454 | .589 | .651 |
| Net realized and unrealized gain (loss) | .008 | .101 | .573 | 2.085 | 2.133 | .909 |
| Total from investment operations | .101 | .339 | .872 | 2.539 | 2.722 | 1.560 |
| Distributions from net investment income | (.081) | (.235) | (.294) | (.460) | (.573) | (.642) |
| Distributions from net realized gain | – | (.024) | (.058) | (.079) | (.289) | (.198) |
| Total distributions | (.081) | (.259) | (.352) | (.539) | (.862) | (.840) |
| Net asset value, end of period | $55.10 | $55.08 | $55.00 | $54.48 | $52.48 | $50.62 |
| Total ReturnB,C,D | .17% | .64% | 1.60% | 4.86% | 5.43% | 3.19% |
| Ratios to Average Net AssetsE,F | | | | | | |
| Expenses before reductions | .50%G | .50% | .50% | .50% | .50% | .50% |
| Expenses net of fee waivers, if any | .50%G | .50% | .50% | .50% | .50% | .50% |
| Expenses net of all reductions | .50%G | .50% | .50% | .50% | .50% | .50% |
| Net investment income (loss) | .34%G | .44% | .54% | .85% | 1.14% | 1.32% |
| Supplemental Data | | | | | | |
| Net assets, end of period (000 omitted) | $213 | $257 | $357 | $444 | $101 | $128 |
| Portfolio turnover rate E | 61%G | 105% | 56% | 56% | 41% | 44% |
A Calculated based on average shares outstanding during the period.
B Total returns for periods of less than one year are not annualized.
C Total returns would have been lower if certain expenses had not been reduced during the applicable periods shown.
D Total returns do not include the effect of the sales charges.
E Amounts do not include the activity of the Underlying Funds.
F Expense ratios reflect operating expenses of the class. Expenses before reductions do not reflect amounts reimbursed by the investment adviser or reductions from expense offset arrangements and do not represent the amount paid by the class during periods when reimbursements or reductions occur. Expenses net of fee waivers reflect expenses after reimbursement by the investment adviser but prior to reductions from expense offset arrangements. Expenses net of all reductions represent the net expenses paid by the class but do not include expenses of the underlying funds in which the Fund invests.
G Annualized
See accompanying notes which are an integral part of the financial statements.
Financial Highlights — Fidelity Income Replacement 2018 Fund Class C
| | Six months ended (Unaudited) January 31, | Years ended July 31, | | | | |
| | 2017 | 2016 | 2015 | 2014 | 2013 | 2012 |
| Selected Per–Share Data | | | | | | |
| Net asset value, beginning of period | $54.78 | $54.80 | $54.36 | $52.38 | $50.56 | $49.85 |
| Income from Investment Operations | | | | | | |
| Net investment income (loss)A | (.044) | (.035) | .024 | .187 | .330 | .403 |
| Net realized and unrealized gain (loss) | (.002)B | .111 | .574 | 2.073 | 2.129 | .912 |
| Total from investment operations | (.046) | .076 | .598 | 2.260 | 2.459 | 1.315 |
| Distributions from net investment income | (.014) | (.072) | (.100) | (.201) | (.350) | (.407) |
| Distributions from net realized gain | – | (.024) | (.058) | (.079) | (.289) | (.198) |
| Total distributions | (.014) | (.096) | (.158) | (.280) | (.639) | (.605) |
| Net asset value, end of period | $54.72 | $54.78 | $54.80 | $54.36 | $52.38 | $50.56 |
| Total ReturnC,D,E | (.08)% | .14% | 1.10% | 4.32% | 4.90% | 2.68% |
| Ratios to Average Net AssetsF,G | | | | | | |
| Expenses before reductions | 1.00%H | 1.00% | 1.00% | 1.00% | 1.00% | 1.00% |
| Expenses net of fee waivers, if any | 1.00%H | 1.00% | 1.00% | 1.00% | 1.00% | 1.00% |
| Expenses net of all reductions | 1.00%H | 1.00% | 1.00% | 1.00% | 1.00% | 1.00% |
| Net investment income (loss) | (.16)%H | (.06)% | .04% | .35% | .64% | .82% |
| Supplemental Data | | | | | | |
| Net assets, end of period (000 omitted) | $294 | $321 | $579 | $787 | $498 | $439 |
| Portfolio turnover rate F | 61%H | 105% | 56% | 56% | 41% | 44% |
A Calculated based on average shares outstanding during the period.
B The amount shown for a share outstanding does not correspond with the aggregate net gain (loss) on investments for the period due to the timing of sales and repurchases of shares in relation to fluctuating marker values of the investments of the Fund.
C Total returns for periods of less than one year are not annualized.
D Total returns would have been lower if certain expenses had not been reduced during the applicable periods shown.
E Total returns do not include the effect of the contingent deferred sales charge.
F Amounts do not include the activity of the Underlying Funds.
G Expense ratios reflect operating expenses of the class. Expenses before reductions do not reflect amounts reimbursed by the investment adviser or reductions from expense offset arrangements and do not represent the amount paid by the class during periods when reimbursements or reductions occur. Expenses net of fee waivers reflect expenses after reimbursement by the investment adviser but prior to reductions from expense offset arrangements. Expenses net of all reductions represent the net expenses paid by the class but do not include expenses of the underlying funds in which the Fund invests.
H Annualized
See accompanying notes which are an integral part of the financial statements.
Financial Highlights — Fidelity Income Replacement 2018 Fund
| | Six months ended (Unaudited) January 31, | Years ended July 31, | | | | |
| | 2017 | 2016 | 2015 | 2014 | 2013 | 2012 |
| Selected Per–Share Data | | | | | | |
| Net asset value, beginning of period | $55.08 | $55.00 | $54.47 | $52.46 | $50.60 | $49.88 |
| Income from Investment Operations | | | | | | |
| Net investment income (loss)A | .230 | .510 | .574 | .722 | .848 | .898 |
| Net realized and unrealized gain (loss) | .008 | .101 | .582 | 2.081 | 2.135 | .908 |
| Total from investment operations | .238 | .611 | 1.156 | 2.803 | 2.983 | 1.806 |
| Distributions from net investment income | (.218) | (.507) | (.568) | (.714) | (.834) | (.888) |
| Distributions from net realized gain | – | (.024) | (.058) | (.079) | (.289) | (.198) |
| Total distributions | (.218) | (.531) | (.626) | (.793) | (1.123) | (1.086) |
| Net asset value, end of period | $55.10 | $55.08 | $55.00 | $54.47 | $52.46 | $50.60 |
| Total ReturnB,C | .43% | 1.13% | 2.13% | 5.38% | 5.96% | 3.71% |
| Ratios to Average Net AssetsD,E | | | | | | |
| Expenses before reductions F | - %G | -% | -% | -% | -% | -% |
| Expenses net of fee waivers, if any | - %G | -% | -% | -% | -% | -% |
| Expenses net of all reductions | - %G | -% | -% | -% | -% | -% |
| Net investment income (loss) | .84%G | .94% | 1.04% | 1.35% | 1.64% | 1.82% |
| Supplemental Data | | | | | | |
| Net assets, end of period (000 omitted) | $4,207 | $3,609 | $4,263 | $4,665 | $3,875 | $3,904 |
| Portfolio turnover rate D | 61%G | 105% | 56% | 56% | 41% | 44% |
A Calculated based on average shares outstanding during the period.
B Total returns for periods of less than one year are not annualized.
C Total returns would have been lower if certain expenses had not been reduced during the applicable periods shown.
D Amounts do not include the activity of the Underlying Funds.
E Expense ratios reflect operating expenses of the class. Expenses before reductions do not reflect amounts reimbursed by the investment adviser or reductions from expense offset arrangements and do not represent the amount paid by the class during periods when reimbursements or reductions occur. Expenses net of fee waivers reflect expenses after reimbursement by the investment adviser but prior to reductions from expense offset arrangements. Expenses net of all reductions represent the net expenses paid by the class but do not include expenses of the underlying funds in which the Fund invests.
F Amount represents less than .005%.
G Annualized
See accompanying notes which are an integral part of the financial statements.
Financial Highlights — Fidelity Income Replacement 2018 Fund Class I
| | Six months ended (Unaudited) January 31, | Years ended July 31, | | | | |
| | 2017 | 2016 | 2015 | 2014 | 2013 | 2012 |
| Selected Per–Share Data | | | | | | |
| Net asset value, beginning of period | $55.09 | $55.00 | $54.48 | $52.46 | $50.61 | $49.89 |
| Income from Investment Operations | | | | | | |
| Net investment income (loss)A | .231 | .510 | .575 | .722 | .849 | .891 |
| Net realized and unrealized gain (loss) | .007 | .111 | .571 | 2.091 | 2.124 | .915 |
| Total from investment operations | .238 | .621 | 1.146 | 2.813 | 2.973 | 1.806 |
| Distributions from net investment income | (.218) | (.507) | (.568) | (.714) | (.834) | (.888) |
| Distributions from net realized gain | – | (.024) | (.058) | (.079) | (.289) | (.198) |
| Total distributions | (.218) | (.531) | (.626) | (.793) | (1.123) | (1.086) |
| Net asset value, end of period | $55.11 | $55.09 | $55.00 | $54.48 | $52.46 | $50.61 |
| Total ReturnB,C | .43% | 1.14% | 2.11% | 5.40% | 5.94% | 3.71% |
| Ratios to Average Net AssetsD,E | | | | | | |
| Expenses before reductions F | - %G | -% | -% | -% | -% | -% |
| Expenses net of fee waivers, if any | - %G | -% | -% | -% | -% | -% |
| Expenses net of all reductions | - %G | -% | -% | -% | -% | -% |
| Net investment income (loss) | .84%G | .94% | 1.04% | 1.35% | 1.64% | 1.82% |
| Supplemental Data | | | | | | |
| Net assets, end of period (000 omitted) | $193 | $227 | $295 | $434 | $491 | $470 |
| Portfolio turnover rate D | 61%G | 105% | 56% | 56% | 41% | 44% |
A Calculated based on average shares outstanding during the period.
B Total returns for periods of less than one year are not annualized.
C Total returns would have been lower if certain expenses had not been reduced during the applicable periods shown.
D Amounts do not include the activity of the Underlying Funds.
E Expense ratios reflect operating expenses of the class. Expenses before reductions do not reflect amounts reimbursed by the investment adviser or reductions from expense offset arrangements and do not represent the amount paid by the class during periods when reimbursements or reductions occur. Expenses net of fee waivers reflect expenses after reimbursement by the investment adviser but prior to reductions from expense offset arrangements. Expenses net of all reductions represent the net expenses paid by the class but do not include expenses of the underlying funds in which the Fund invests.
F Amount represents less than .005%.
G Annualized
See accompanying notes which are an integral part of the financial statements.
Fidelity Income Replacement 2020 Fund℠
Investment Summary (Unaudited)
The information in the following tables is based on the direct investments of the Fund.
Top Holdings as of January 31, 2017
| | % of fund's net assets | % of fund's net assets 6 months ago |
| Fidelity Investments Money Market Government Portfolio Institutional Class 0.47% | 34.0 | 28.1 |
| Fidelity Short-Term Bond Fund | 22.7 | 20.8 |
| Fidelity Total Bond Fund | 17.3 | 20.5 |
| Fidelity Strategic Real Return Fund | 5.8 | 6.8 |
| Fidelity Government Income Fund | 5.8 | 6.8 |
| Fidelity Series Broad Market Opportunities Fund | 3.3 | 3.9 |
| Fidelity Equity-Income Fund | 2.9 | 3.4 |
| Fidelity Large Cap Stock Fund | 2.1 | 2.6 |
| Fidelity Advisor Mid Cap II Fund Class I | 2.0 | 2.4 |
| Fidelity Series 100 Index Fund | 1.9 | 2.2 |
| | 97.8 | 97.5 |
Asset Allocation (% of fund's net assets)
| Period end |
| | Domestic Equity Funds | 14.4% |
| | Investment Grade Fixed-Income Funds | 28.9% |
| | Short-Term Funds | 56.7% |
| Six months ago |
| | Domestic Equity Funds | 17.0% |
| | Investment Grade Fixed-Income Funds | 34.1% |
| | Short-Term Funds | 48.9% |
Fidelity Income Replacement 2020 Fund℠
Investments January 31, 2017 (Unaudited)
Showing Percentage of Net Assets
| Equity Funds - 14.4% | | | |
| | | Shares | Value |
| Domestic Equity Funds - 14.4% | | | |
| Fidelity Advisor Mid Cap II Fund Class I (a) | | 10,280 | $203,853 |
| Fidelity Blue Chip Growth Fund (a) | | 2,672 | 188,715 |
| Fidelity Equity-Income Fund (a) | | 5,032 | 290,641 |
| Fidelity Large Cap Stock Fund (a) | | 7,320 | 217,981 |
| Fidelity Series 100 Index Fund (a) | | 12,803 | 188,715 |
| Fidelity Series Broad Market Opportunities Fund (a) | | 20,619 | 334,036 |
| Fidelity Series Small Cap Opportunities Fund (a) | | 2,077 | 29,266 |
| TOTAL DOMESTIC EQUITY FUNDS | | | |
| (Cost $891,710) | | | 1,453,207 |
|
| Fixed-Income Funds - 28.9% | | | |
| Investment Grade Fixed-Income Funds - 28.9% | | | |
| Fidelity Government Income Fund (a) | | 57,299 | 583,300 |
| Fidelity Strategic Real Return Fund (a) | | 66,134 | 583,301 |
| Fidelity Total Bond Fund (a) | | 165,867 | 1,749,901 |
| TOTAL INVESTMENT GRADE FIXED-INCOME FUNDS | | | |
| (Cost $2,915,610) | | | 2,916,502 |
|
| Short-Term Funds - 56.7% | | | |
| Fidelity Investments Money Market Government Portfolio Institutional Class 0.47% (a)(b) | | 3,434,209 | 3,434,209 |
| Fidelity Short-Term Bond Fund (a) | | 266,332 | 2,287,788 |
| TOTAL SHORT-TERM FUNDS | | | |
| (Cost $5,709,164) | | | 5,721,997 |
| TOTAL INVESTMENT PORTFOLIO - 100.0% | | | |
| (Cost $9,516,484) | | | 10,091,706 |
| NET OTHER ASSETS (LIABILITIES) - 0.0% | | | (925) |
| NET ASSETS - 100% | | | $10,090,781 |
Legend
(a) Affiliated Fund
(b) The rate quoted is the annualized seven-day yield of the fund at period end.
Affiliated Underlying Funds
Information regarding the Fund's fiscal year to date purchases and sales of the affiliated Underlying Funds and income earned by the Fund from investments in affiliated Underlying Funds is as follows:
| Affiliate | Value, beginning of period | Purchases | Sales Proceeds | Dividend Income | Value, end of period |
| Fidelity Advisor Mid Cap II Fund Class I | $233,659 | $33,235 | $72,447 | $951 | $203,853 |
| Fidelity Blue Chip Growth Fund | 216,969 | 31,053 | 62,913 | 435 | 188,715 |
| Fidelity Equity-Income Fund | 332,817 | 42,529 | 103,488 | 4,349 | 290,641 |
| Fidelity Government Income Fund | 670,542 | 85,110 | 141,362 | 5,068 | 583,300 |
| Fidelity Investments Money Market Government Portfolio Institutional Class 0.47% | 2,759,731 | 966,551 | 292,072 | 5,346 | 3,434,209 |
| Fidelity Large Cap Stock Fund | 250,349 | 31,474 | 83,660 | 1,974 | 217,981 |
| Fidelity Series 100 Index Fund | 216,969 | 27,737 | 62,288 | 4,426 | 188,715 |
| Fidelity Series Broad Market Opportunities Fund | 382,887 | 43,566 | 114,304 | 1,634 | 334,036 |
| Fidelity Series Small Cap Opportunities Fund | 33,380 | 3,924 | 10,771 | 153 | 29,266 |
| Fidelity Short-Term Bond Fund | 2,039,119 | 472,607 | 206,734 | 12,468 | 2,287,788 |
| Fidelity Strategic Real Return Fund | 670,543 | 81,666 | 168,879 | 8,344 | 583,301 |
| Fidelity Total Bond Fund | 2,010,644 | 248,957 | 457,709 | 27,646 | 1,749,901 |
| Total | $9,817,609 | $2,068,409 | $1,776,627 | $72,794 | $10,091,706 |
Investment Valuation
All investments are categorized as Level 1 under the Fair Value Hierarchy. The inputs or methodology used for valuing securities may not be an indication of the risk associated with investing in those securities. For more information on valuation inputs please refer to the Investment Valuation section in the accompanying Notes to Financial Statements.
See accompanying notes which are an integral part of the financial statements.
Fidelity Income Replacement 2020 Fund℠
Financial Statements
Statement of Assets and Liabilities
| | | January 31, 2017 (Unaudited) |
| Assets | | |
| Investment in securities, at value (cost $9,516,484) — See accompanying schedule | | $10,091,706 |
| Cash | | 6 |
| Receivable for investments sold | | 169,059 |
| Total assets | | 10,260,771 |
| Liabilities | | |
| Payable for investments purchased | $169,056 | |
| Distribution and service plan fees payable | 934 | |
| Total liabilities | | 169,990 |
| Net Assets | | $10,090,781 |
| Net Assets consist of: | | |
| Paid in capital | | $9,499,991 |
| Undistributed net investment income | | 2,198 |
| Accumulated undistributed net realized gain (loss) on investments | | 13,370 |
| Net unrealized appreciation (depreciation) on investments | | 575,222 |
| Net Assets | | $10,090,781 |
| Calculation of Maximum Offering Price | | |
| Class A: | | |
| Net Asset Value and redemption price per share ($1,088,885 ÷ 19,824.30 shares) | | $54.93 |
| Maximum offering price per share (100/94.25 of $54.93) | | $58.28 |
| Class T: | | |
| Net Asset Value and redemption price per share ($187,499 ÷ 3,412.90 shares) | | $54.94 |
| Maximum offering price per share (100/96.50 of $54.94) | | $56.93 |
| Class C: | | |
| Net Asset Value and offering price per share ($752,023 ÷ 13,728.20 shares)(a) | | $54.78 |
| Income Replacement 2020: | | |
| Net Asset Value, offering price and redemption price per share ($7,997,220 ÷ 145,592.80 shares) | | $54.93 |
| Class I: | | |
| Net Asset Value, offering price and redemption price per share ($65,154 ÷ 1,186.10 shares) | | $54.93 |
(a) Redemption price per share is equal to net asset value less any applicable contingent deferred sales charge.
See accompanying notes which are an integral part of the financial statements.
Statement of Operations
| | | Six months ended January 31, 2017 (Unaudited) |
| Investment Income | | |
| Income distributions from underlying funds | | $72,794 |
| Expenses | | |
| Distribution and service plan fees | $5,783 | |
| Independent trustees' fees and expenses | 22 | |
| Total expenses before reductions | 5,805 | |
| Expense reductions | (22) | 5,783 |
| Net investment income (loss) | | 67,011 |
| Realized and Unrealized Gain (Loss) | | |
| Realized gain (loss) on sale of underlying fund shares | 64,598 | |
| Capital gain distributions from underlying funds | 30,830 | |
| Total net realized gain (loss) | | 95,428 |
| Change in net unrealized appreciation (depreciation) on underlying funds | | (82,288) |
| Net gain (loss) | | 13,140 |
| Net increase (decrease) in net assets resulting from operations | | $80,151 |
See accompanying notes which are an integral part of the financial statements.
Statement of Changes in Net Assets
| | Six months ended January 31, 2017 (Unaudited) | Year ended July 31, 2016 |
| Increase (Decrease) in Net Assets | | |
| Operations | | |
| Net investment income (loss) | $67,011 | $117,846 |
| Net realized gain (loss) | 95,428 | 123,507 |
| Change in net unrealized appreciation (depreciation) | (82,288) | (47,102) |
| Net increase (decrease) in net assets resulting from operations | 80,151 | 194,251 |
| Distributions to shareholders from net investment income | (66,946) | (117,535) |
| Distributions to shareholders from net realized gain | (84,587) | (191,220) |
| Total distributions | (151,533) | (308,755) |
| Share transactions - net increase (decrease) | 345,567 | 1,124,392 |
| Total increase (decrease) in net assets | 274,185 | 1,009,888 |
| Net Assets | | |
| Beginning of period | 9,816,596 | 8,806,708 |
| End of period | $10,090,781 | $9,816,596 |
| Other Information | | |
| Undistributed net investment income end of period | $2,198 | $2,133 |
See accompanying notes which are an integral part of the financial statements.
Financial Highlights — Fidelity Income Replacement 2020 Fund Class A
| | Six months ended (Unaudited) January 31, | Years ended July 31, | | | | |
| | 2017 | 2016 | 2015 | 2014 | 2013 | 2012 |
| Selected Per–Share Data | | | | | | |
| Net asset value, beginning of period | $55.33 | $56.15 | $55.94 | $53.59 | $50.69 | $49.99 |
| Income from Investment Operations | | | | | | |
| Net investment income (loss)A | .336 | .662 | .653 | .674 | .770 | .793 |
| Net realized and unrealized gain (loss) | .063 | .370 | .871 | 2.766 | 3.157 | .884 |
| Total from investment operations | .399 | 1.032 | 1.524 | 3.440 | 3.927 | 1.677 |
| Distributions from net investment income | (.328) | (.654) | (.650) | (.670) | (.774) | (.794) |
| Distributions from net realized gain | (.471) | (1.198) | (.664) | (.420) | (.253) | (.183) |
| Total distributions | (.799) | (1.852) | (1.314) | (1.090) | (1.027) | (.977) |
| Net asset value, end of period | $54.93 | $55.33 | $56.15 | $55.94 | $53.59 | $50.69 |
| Total ReturnB,C,D | .73% | 1.96% | 2.76% | 6.48% | 7.84% | 3.44% |
| Ratios to Average Net AssetsE,F | | | | | | |
| Expenses before reductions | .25%G�� | .25% | .25% | .25% | .25% | .25% |
| Expenses net of fee waivers, if any | .25%G | .25% | .25% | .25% | .25% | .25% |
| Expenses net of all reductions | .25%G | .25% | .25% | .25% | .25% | .25% |
| Net investment income (loss) | 1.22%G | 1.22% | 1.17% | 1.23% | 1.47% | 1.61% |
| Supplemental Data | | | | | | |
| Net assets, end of period (000 omitted) | $1,089 | $1,187 | $1,099 | $813 | $411 | $408 |
| Portfolio turnover rateE | 36%G | 66% | 41% | 25% | 44% | 35% |
A Calculated based on average shares outstanding during the period.
B Total returns for periods of less than one year are not annualized.
C Total returns would have been lower if certain expenses had not been reduced during the applicable periods shown.
D Total returns do not include the effect of the sales charges.
E Amounts do not include the activity of the Underlying Funds.
F Expense ratios reflect operating expenses of the class. Expenses before reductions do not reflect amounts reimbursed by the investment adviser or reductions from expense offset arrangements and do not represent the amount paid by the class during periods when reimbursements or reductions occur. Expenses net of fee waivers reflect expenses after reimbursement by the investment adviser but prior to reductions from expense offset arrangements. Expenses net of all reductions represent the net expenses paid by the class but do not include expenses of the underlying funds in which the Fund invests.
G Annualized
See accompanying notes which are an integral part of the financial statements.
Financial Highlights — Fidelity Income Replacement 2020 Fund Class T
| | Six months ended (Unaudited) January 31, | Years ended July 31, | | | | |
| | 2017 | 2016 | 2015 | 2014 | 2013 | 2012 |
| Selected Per–Share Data | | | | | | |
| Net asset value, beginning of period | $55.34 | $56.16 | $55.95 | $53.59 | $50.69 | $49.99 |
| Income from Investment Operations | | | | | | |
| Net investment income (loss)A | .267 | .527 | .512 | .537 | .639 | .670 |
| Net realized and unrealized gain (loss) | .062 | .370 | .871 | 2.770 | 3.145 | .885 |
| Total from investment operations | .329 | .897 | 1.383 | 3.307 | 3.784 | 1.555 |
| Distributions from net investment income | (.258) | (.519) | (.509) | (.527) | (.631) | (.672) |
| Distributions from net realized gain | (.471) | (1.198) | (.664) | (.420) | (.253) | (.183) |
| Total distributions | (.729) | (1.717) | (1.173) | (.947) | (.884) | (.855) |
| Net asset value, end of period | $54.94 | $55.34 | $56.16 | $55.95 | $53.59 | $50.69 |
| Total ReturnB,C,D | .60% | 1.71% | 2.50% | 6.22% | 7.54% | 3.18% |
| Ratios to Average Net AssetsE,F | | | | | | |
| Expenses before reductions | .50%G | .50% | .50% | .50% | .50% | .50% |
| Expenses net of fee waivers, if any | .50%G | .50% | .50% | .50% | .50% | .50% |
| Expenses net of all reductions | .50%G | .50% | .50% | .50% | .50% | .50% |
| Net investment income (loss) | .97%G | .97% | .92% | .98% | 1.22% | 1.36% |
| Supplemental Data | | | | | | |
| Net assets, end of period (000 omitted) | $187 | $192 | $204 | $94 | $101 | $189 |
| Portfolio turnover rateE | 36%G | 66% | 41% | 25% | 44% | 35% |
A Calculated based on average shares outstanding during the period.
B Total returns for periods of less than one year are not annualized.
C Total returns would have been lower if certain expenses had not been reduced during the applicable periods shown.
D Total returns do not include the effect of the sales charges.
E Amounts do not include the activity of the Underlying Funds.
F Expense ratios reflect operating expenses of the class. Expenses before reductions do not reflect amounts reimbursed by the investment adviser or reductions from expense offset arrangements and do not represent the amount paid by the class during periods when reimbursements or reductions occur. Expenses net of fee waivers reflect expenses after reimbursement by the investment adviser but prior to reductions from expense offset arrangements. Expenses net of all reductions represent the net expenses paid by the class but do not include expenses of the underlying funds in which the Fund invests.
G Annualized
See accompanying notes which are an integral part of the financial statements.
Financial Highlights — Fidelity Income Replacement 2020 Fund Class C
| | Six months ended (Unaudited) January 31, | Years ended July 31, | | | | |
| | 2017 | 2016 | 2015 | 2014 | 2013 | 2012 |
| Selected Per–Share Data | | | | | | |
| Net asset value, beginning of period | $55.20 | $56.02 | $55.84 | $53.51 | $50.65 | $49.97 |
| Income from Investment Operations | | | | | | |
| Net investment income (loss)A | .129 | .255 | .233 | .262 | .377 | .422 |
| Net realized and unrealized gain (loss) | .055 | .378 | .862 | 2.759 | 3.151 | .876 |
| Total from investment operations | .184 | .633 | 1.095 | 3.021 | 3.528 | 1.298 |
| Distributions from net investment income | (.133) | (.255) | (.251) | (.271) | (.415) | (.435) |
| Distributions from net realized gain | (.471) | (1.198) | (.664) | (.420) | (.253) | (.183) |
| Total distributions | (.604) | (1.453) | (.915) | (.691) | (.668) | (.618) |
| Net asset value, end of period | $54.78 | $55.20 | $56.02 | $55.84 | $53.51 | $50.65 |
| Total ReturnB,C,D | .34% | 1.21% | 1.98% | 5.68% | 7.02% | 2.65% |
| Ratios to Average Net AssetsE,F | | | | | | |
| Expenses before reductions | 1.00%G | 1.00% | 1.00% | 1.00% | 1.00% | 1.00% |
| Expenses net of fee waivers, if any | 1.00%G | 1.00% | 1.00% | 1.00% | 1.00% | 1.00% |
| Expenses net of all reductions | 1.00%G | 1.00% | 1.00% | 1.00% | 1.00% | 1.00% |
| Net investment income (loss) | .47%G | .47% | .42% | .48% | .72% | .86% |
| Supplemental Data | | | | | | |
| Net assets, end of period (000 omitted) | $752 | $832 | $810 | $563 | $322 | $306 |
| Portfolio turnover rateE | 36%G | 66% | 41% | 25% | 44% | 35% |
A Calculated based on average shares outstanding during the period.
B Total returns for periods of less than one year are not annualized.
C Total returns would have been lower if certain expenses had not been reduced during the applicable periods shown.
D Total returns do not include the effect of the contingent deferred sales charge.
E Amounts do not include the activity of the Underlying Funds.
F Expense ratios reflect operating expenses of the class. Expenses before reductions do not reflect amounts reimbursed by the investment adviser or reductions from expense offset arrangements and do not represent the amount paid by the class during periods when reimbursements or reductions occur. Expenses net of fee waivers reflect expenses after reimbursement by the investment adviser but prior to reductions from expense offset arrangements. Expenses net of all reductions represent the net expenses paid by the class but do not include expenses of the underlying funds in which the Fund invests.
G Annualized
See accompanying notes which are an integral part of the financial statements.
Financial Highlights — Fidelity Income Replacement 2020 Fund
| | Six months ended (Unaudited) January 31, | Years ended July 31, | | | | |
| | 2017 | 2016 | 2015 | 2014 | 2013 | 2012 |
| Selected Per–Share Data | | | | | | |
| Net asset value, beginning of period | $55.34 | $56.15 | $55.94 | $53.59 | $50.69 | $50.00 |
| Income from Investment Operations | | | | | | |
| Net investment income (loss)A | .404 | .798 | .795 | .813 | .901 | .917 |
| Net realized and unrealized gain (loss) | .054 | .382 | .866 | 2.762 | 3.160 | .874 |
| Total from investment operations | .458 | 1.180 | 1.661 | 3.575 | 4.061 | 1.791 |
| Distributions from net investment income | (.397) | (.792) | (.787) | (.805) | (.908) | (.918) |
| Distributions from net realized gain | (.471) | (1.198) | (.664) | (.420) | (.253) | (.183) |
| Total distributions | (.868) | (1.990) | (1.451) | (1.225) | (1.161) | (1.101) |
| Net asset value, end of period | $54.93 | $55.34 | $56.15 | $55.94 | $53.59 | $50.69 |
| Total ReturnB,C | .84% | 2.24% | 3.01% | 6.74% | 8.11% | 3.68% |
| Ratios to Average Net AssetsD,E | | | | | | |
| Expenses before reductionsF | - %G | -% | -% | -% | -% | -% |
| Expenses net of fee waivers, if any | - %G | -% | -% | -% | -% | -% |
| Expenses net of all reductions | - %G | -% | -% | -% | -% | -% |
| Net investment income (loss) | 1.47%G | 1.47% | 1.42% | 1.48% | 1.72% | 1.86% |
| Supplemental Data | | | | | | |
| Net assets, end of period (000 omitted) | $7,997 | $7,536 | $6,502 | $7,053 | $5,196 | $3,945 |
| Portfolio turnover rateD | 36%G | 66% | 41% | 25% | 44% | 35% |
A Calculated based on average shares outstanding during the period.
B Total returns for periods of less than one year are not annualized.
C Total returns would have been lower if certain expenses had not been reduced during the applicable periods shown.
D Amounts do not include the activity of the Underlying Funds.
E Expense ratios reflect operating expenses of the class. Expenses before reductions do not reflect amounts reimbursed by the investment adviser or reductions from expense offset arrangements and do not represent the amount paid by the class during periods when reimbursements or reductions occur. Expenses net of fee waivers reflect expenses after reimbursement by the investment adviser but prior to reductions from expense offset arrangements. Expenses net of all reductions represent the net expenses paid by the class but do not include expenses of the underlying funds in which the Fund invests.
F Amount represents less than .005%.
G Annualized
See accompanying notes which are an integral part of the financial statements.
Financial Highlights — Fidelity Income Replacement 2020 Fund Class I
| | Six months ended (Unaudited) January 31, | Years ended July 31, | | | | |
| | 2017 | 2016 | 2015 | 2014 | 2013 | 2012 |
| Selected Per–Share Data | | | | | | |
| Net asset value, beginning of period | $55.34 | $56.15 | $55.94 | $53.59 | $50.69 | $50.00 |
| Income from Investment Operations | | | | | | |
| Net investment income (loss)A | .404 | .800 | .793 | .814 | .901 | .917 |
| Net realized and unrealized gain (loss) | .054 | .380 | .868 | 2.761 | 3.160 | .874 |
| Total from investment operations | .458 | 1.180 | 1.661 | 3.575 | 4.061 | 1.791 |
| Distributions from net investment income | (.397) | (.792) | (.787) | (.805) | (.908) | (.918) |
| Distributions from net realized gain | (.471) | (1.198) | (.664) | (.420) | (.253) | (.183) |
| Total distributions | (.868) | (1.990) | (1.451) | (1.225) | (1.161) | (1.101) |
| Net asset value, end of period | $54.93 | $55.34 | $56.15 | $55.94 | $53.59 | $50.69 |
| Total ReturnB,C | .84% | 2.24% | 3.01% | 6.74% | 8.11% | 3.68% |
| Ratios to Average Net AssetsD,E | | | | | | |
| Expenses before reductionsF | - %G | -% | -% | -% | -% | -% |
| Expenses net of fee waivers, if any | - %G | -% | -% | -% | -% | -% |
| Expenses net of all reductions | - %G | -% | -% | -% | -% | -% |
| Net investment income (loss) | 1.47%G | 1.47% | 1.42% | 1.48% | 1.72% | 1.86% |
| Supplemental Data | | | | | | |
| Net assets, end of period (000 omitted) | $65 | $70 | $191 | $87 | $14 | $13 |
| Portfolio turnover rateD | 36%G | 66% | 41% | 25% | 44% | 35% |
A Calculated based on average shares outstanding during the period.
B Total returns for periods of less than one year are not annualized.
C Total returns would have been lower if certain expenses had not been reduced during the applicable periods shown.
D Amounts do not include the activity of the Underlying Funds.
E Expense ratios reflect operating expenses of the class. Expenses before reductions do not reflect amounts reimbursed by the investment adviser or reductions from expense offset arrangements and do not represent the amount paid by the class during periods when reimbursements or reductions occur. Expenses net of fee waivers reflect expenses after reimbursement by the investment adviser but prior to reductions from expense offset arrangements. Expenses net of all reductions represent the net expenses paid by the class but do not include expenses of the underlying funds in which the Fund invests.
F Amount represents less than .005%.
G Annualized
See accompanying notes which are an integral part of the financial statements.
Fidelity Income Replacement 2022 Fund℠
Investment Summary (Unaudited)
The information in the following tables is based on the direct investments of the Fund.
Top Holdings as of January 31, 2017
| | % of fund's net assets | % of fund's net assets 6 months ago |
| Fidelity Total Bond Fund | 25.4 | 25.0 |
| Fidelity Investments Money Market Government Portfolio Institutional Class 0.47% | 16.7 | 15.9 |
| Fidelity Short-Term Bond Fund | 16.6 | 15.8 |
| Fidelity Strategic Real Return Fund | 8.5 | 8.4 |
| Fidelity Government Income Fund | 8.5 | 8.4 |
| Fidelity Series Broad Market Opportunities Fund | 5.2 | 5.6 |
| Fidelity Equity-Income Fund | 4.5 | 4.9 |
| Fidelity Large Cap Stock Fund | 3.4 | 3.6 |
| Fidelity Advisor Mid Cap II Fund Class I | 3.2 | 3.4 |
| Fidelity Series 100 Index Fund | 2.9 | 3.2 |
| | 94.9 | 94.2 |
Asset Allocation (% of fund's net assets)
| Period end |
| | Domestic Equity Funds | 22.5% |
| | International Equity Funds | 1.8% |
| | Investment Grade Fixed-Income Funds | 42.4% |
| | Short-Term Funds | 33.3% |
| Six months ago |
| | Domestic Equity Funds | 24.3% |
| | International Equity Funds | 2.2% |
| | Investment Grade Fixed-Income Funds | 41.8% |
| | Short-Term Funds | 31.7% |
Fidelity Income Replacement 2022 Fund℠
Investments January 31, 2017 (Unaudited)
Showing Percentage of Net Assets
| Equity Funds - 24.3% | | | |
| | | Shares | Value |
| Domestic Equity Funds - 22.5% | | | |
| Fidelity Advisor Mid Cap II Fund Class I (a) | | 20,651 | $409,518 |
| Fidelity Blue Chip Growth Fund (a) | | 5,394 | 380,916 |
| Fidelity Equity-Income Fund (a) | | 10,129 | 585,025 |
| Fidelity Large Cap Stock Fund (a) | | 14,756 | 439,419 |
| Fidelity Series 100 Index Fund (a) | | 25,842 | 380,916 |
| Fidelity Series Broad Market Opportunities Fund (a) | | 41,570 | 673,429 |
| Fidelity Series Small Cap Opportunities Fund (a) | | 4,152 | 58,503 |
|
| TOTAL DOMESTIC EQUITY FUNDS | | | 2,927,726 |
|
| International Equity Funds - 1.8% | | | |
| Fidelity Advisor International Discovery Fund Class I (a) | | 6,247 | 235,310 |
| TOTAL EQUITY FUNDS | | | |
| (Cost $2,492,900) | | | 3,163,036 |
|
| Fixed-Income Funds - 42.4% | | | |
| Investment Grade Fixed-Income Funds - 42.4% | | | |
| Fidelity Government Income Fund (a) | | 108,295 | 1,102,447 |
| Fidelity Strategic Real Return Fund (a) | | 124,994 | 1,102,448 |
| Fidelity Total Bond Fund (a) | | 313,122 | 3,303,440 |
| TOTAL INVESTMENT GRADE FIXED-INCOME FUNDS | | | |
| (Cost $5,609,979) | | | 5,508,335 |
|
| Short-Term Funds - 33.3% | | | |
| Fidelity Investments Money Market Government Portfolio Institutional Class 0.47% (a)(b) | | 2,164,593 | 2,164,593 |
| Fidelity Short-Term Bond Fund (a) | | 251,990 | 2,164,592 |
| TOTAL SHORT-TERM FUNDS | | | |
| (Cost $4,326,186) | | | 4,329,185 |
| TOTAL INVESTMENT PORTFOLIO - 100.0% | | | |
| (Cost $12,429,065) | | | 13,000,556 |
| NET OTHER ASSETS (LIABILITIES) - 0.0% | | | (144) |
| NET ASSETS - 100% | | | $13,000,412 |
Legend
(a) Affiliated Fund
(b) The rate quoted is the annualized seven-day yield of the fund at period end.
Affiliated Underlying Funds
Information regarding the Fund's fiscal year to date purchases and sales of the affiliated Underlying Funds and income earned by the Fund from investments in affiliated Underlying Funds is as follows:
| Affiliate | Value, beginning of period | Purchases | Sales Proceeds | Dividend Income | Value, end of period |
| Fidelity Advisor International Discovery Fund Class I | $300,747 | $21,379 | $81,761 | $4,361 | $235,310 |
| Fidelity Advisor Mid Cap II Fund Class I | 469,055 | 43,570 | 121,249 | 1,986 | 409,518 |
| Fidelity Blue Chip Growth Fund | 435,945 | 39,832 | 101,241 | 906 | 380,916 |
| Fidelity Equity-Income Fund | 670,473 | 45,633 | 168,680 | 9,116 | 585,025 |
| Fidelity Government Income Fund | 1,154,703 | 141,034 | 136,483 | 9,222 | 1,102,447 |
| Fidelity Investments Money Market Government Portfolio Institutional Class 0.47% | 2,185,245 | 242,903 | 263,555 | 3,794 | 2,164,593 |
| Fidelity Large Cap Stock Fund | 502,165 | 33,195 | 135,905 | 4,111 | 439,419 |
| Fidelity Series 100 Index Fund | 435,945 | 29,160 | 97,156 | 8,675 | 380,916 |
| Fidelity Series Broad Market Opportunities Fund | 771,182 | 45,510 | 186,629 | 3,408 | 673,429 |
| Fidelity Series Small Cap Opportunities Fund | 67,599 | 5,826 | 20,456 | 316 | 58,503 |
| Fidelity Short-Term Bond Fund | 2,185,245 | 260,111 | 263,153 | 12,555 | 2,164,592 |
| Fidelity Strategic Real Return Fund | 1,154,703 | 99,217 | 151,153 | 15,722 | 1,102,448 |
| Fidelity Total Bond Fund | 3,462,729 | 358,855 | 422,771 | 50,307 | 3,303,440 |
| Total | $13,795,736 | $1,366,225 | $2,150,192 | $124,479 | $13,000,556 |
Investment Valuation
All investments are categorized as Level 1 under the Fair Value Hierarchy. The inputs or methodology used for valuing securities may not be an indication of the risk associated with investing in those securities. For more information on valuation inputs please refer to the Investment Valuation section in the accompanying Notes to Financial Statements.
See accompanying notes which are an integral part of the financial statements.
Fidelity Income Replacement 2022 Fund℠
Financial Statements
Statement of Assets and Liabilities
| | | January 31, 2017 (Unaudited) |
| Assets | | |
| Investment in securities, at value (cost $12,429,065) — See accompanying schedule | | $13,000,556 |
| Cash | | 1 |
| Receivable for investments sold | | 111,795 |
| Total assets | | 13,112,352 |
| Liabilities | | |
| Payable for investments purchased | $111,797 | |
| Distribution and service plan fees payable | 143 | |
| Total liabilities | | 111,940 |
| Net Assets | | $13,000,412 |
| Net Assets consist of: | | |
| Paid in capital | | $12,500,214 |
| Undistributed net investment income | | 3,346 |
| Accumulated undistributed net realized gain (loss) on investments | | (74,639) |
| Net unrealized appreciation (depreciation) on investments | | 571,491 |
| Net Assets | | $13,000,412 |
| Calculation of Maximum Offering Price | | |
| Class A: | | |
| Net Asset Value and redemption price per share ($292,837 ÷ 4,947.60 shares) | | $59.19 |
| Maximum offering price per share (100/94.25 of $59.19) | | $62.80 |
| Class T: | | |
| Net Asset Value and redemption price per share ($81,385 ÷ 1,373.80 shares) | | $59.24 |
| Maximum offering price per share (100/96.50 of $59.24) | | $61.39 |
| Class C: | | |
| Net Asset Value and offering price per share ($58,221 ÷ 985.50 shares)(a) | | $59.08 |
| Income Replacement 2022: | | |
| Net Asset Value, offering price and redemption price per share ($12,476,747 ÷ 210,828.00 shares) | | $59.18 |
| Class I: | | |
| Net Asset Value, offering price and redemption price per share ($91,222 ÷ 1,541.90 shares) | | $59.16 |
(a) Redemption price per share is equal to net asset value less any applicable contingent deferred sales charge.
See accompanying notes which are an integral part of the financial statements.
Statement of Operations
| | | Six months ended January 31, 2017 (Unaudited) |
| Investment Income | | |
| Income distributions from underlying funds | | $124,479 |
| Expenses | | |
| Distribution and service plan fees | $868 | |
| Independent trustees' fees and expenses | 31 | |
| Total expenses before reductions | 899 | |
| Expense reductions | (31) | 868 |
| Net investment income (loss) | | 123,611 |
| Realized and Unrealized Gain (Loss) | | |
| Realized gain (loss) on sale of underlying fund shares | 21,766 | |
| Capital gain distributions from underlying funds | 62,396 | |
| Total net realized gain (loss) | | 84,162 |
| Change in net unrealized appreciation (depreciation) on underlying funds | | (32,976) |
| Net gain (loss) | | 51,186 |
| Net increase (decrease) in net assets resulting from operations | | $174,797 |
See accompanying notes which are an integral part of the financial statements.
Statement of Changes in Net Assets
| | Six months ended January 31, 2017 (Unaudited) | Year ended July 31, 2016 |
| Increase (Decrease) in Net Assets | | |
| Operations | | |
| Net investment income (loss) | $123,611 | $222,097 |
| Net realized gain (loss) | 84,162 | 106,833 |
| Change in net unrealized appreciation (depreciation) | (32,976) | (18,250) |
| Net increase (decrease) in net assets resulting from operations | 174,797 | 310,680 |
| Distributions to shareholders from net investment income | (123,933) | (221,870) |
| Distributions to shareholders from net realized gain | (14,929) | (12,857) |
| Total distributions | (138,862) | (234,727) |
| Share transactions - net increase (decrease) | (831,110) | (1,159,698) |
| Total increase (decrease) in net assets | (795,175) | (1,083,745) |
| Net Assets | | |
| Beginning of period | 13,795,587 | 14,879,332 |
| End of period | $13,000,412 | $13,795,587 |
| Other Information | | |
| Undistributed net investment income end of period | $3,346 | $3,668 |
See accompanying notes which are an integral part of the financial statements.
Financial Highlights — Fidelity Income Replacement 2022 Fund Class A
| | Six months ended (Unaudited) January 31, | Years ended July 31, | | | | |
| | 2017 | 2016 | 2015 | 2014 | 2013 | 2012 |
| Selected Per–Share Data | | | | | | |
| Net asset value, beginning of period | $59.02 | $58.61 | $57.41 | $54.16 | $50.46 | $49.79 |
| Income from Investment Operations | | | | | | |
| Net investment income (loss)A | .465 | .758 | .686 | .708 | .825 | .783 |
| Net realized and unrealized gain (loss) | .248 | .457 | 1.311 | 3.351 | 3.933 | .842 |
| Total from investment operations | .713 | 1.215 | 1.997 | 4.059 | 4.758 | 1.625 |
| Distributions from net investment income | (.476) | (.754) | (.658) | (.686) | (.804) | (.784) |
| Distributions from net realized gain | (.067) | (.051) | (.139) | (.123) | (.254) | (.171) |
| Total distributions | (.543) | (.805) | (.797) | (.809) | (1.058) | (.955) |
| Net asset value, end of period | $59.19 | $59.02 | $58.61 | $57.41 | $54.16 | $50.46 |
| Total ReturnB,C,D | 1.22% | 2.12% | 3.50% | 7.54% | 9.54% | 3.35% |
| Ratios to Average Net AssetsE,F | | | | | | |
| Expenses before reductions | .25%G | .25% | .25% | .25% | .25% | .25% |
| Expenses net of fee waivers, if any | .25%G | .25% | .25% | .25% | .25% | .25% |
| Expenses net of all reductions | .25%G | .25% | .25% | .25% | .25% | .25% |
| Net investment income (loss) | 1.58%G | 1.32% | 1.18% | 1.26% | 1.57% | 1.59% |
| Supplemental Data | | | | | | |
| Net assets, end of period (000 omitted) | $293 | $293 | $432 | $419 | $391 | $386 |
| Portfolio turnover rateE | 20%G | 47% | 33% | 26% | 38% | 43% |
A Calculated based on average shares outstanding during the period.
B Total returns for periods of less than one year are not annualized.
C Total returns would have been lower if certain expenses had not been reduced during the applicable periods shown.
D Total returns do not include the effect of the sales charges.
E Amounts do not include the activity of the Underlying Funds.
F Expense ratios reflect operating expenses of the class. Expenses before reductions do not reflect amounts reimbursed by the investment adviser or reductions from expense offset arrangements and do not represent the amount paid by the class during periods when reimbursements or reductions occur. Expenses net of fee waivers reflect expenses after reimbursement by the investment adviser but prior to reductions from expense offset arrangements. Expenses net of all reductions represent the net expenses paid by the class but do not include expenses of the underlying funds in which the Fund invests.
G Annualized
See accompanying notes which are an integral part of the financial statements.
Financial Highlights — Fidelity Income Replacement 2022 Fund Class T
| | Six months ended (Unaudited) January 31, | Years ended July 31, | | | | |
| | 2017 | 2016 | 2015 | 2014 | 2013 | 2012 |
| Selected Per–Share Data | | | | | | |
| Net asset value, beginning of period | $59.07 | $58.67 | $57.46 | $54.24 | $50.53 | $49.82 |
| Income from Investment Operations | | | | | | |
| Net investment income (loss)A | .391 | .615 | .540 | .581 | .686 | .653 |
| Net realized and unrealized gain (loss) | .247 | .450 | 1.318 | 3.339 | 3.958 | .871 |
| Total from investment operations | .638 | 1.065 | 1.858 | 3.920 | 4.644 | 1.524 |
| Distributions from net investment income | (.401) | (.614) | (.509) | (.577) | (.680) | (.643) |
| Distributions from net realized gain | (.067) | (.051) | (.139) | (.123) | (.254) | (.171) |
| Total distributions | (.468) | (.665) | (.648) | (.700) | (.934) | (.814) |
| Net asset value, end of period | $59.24 | $59.07 | $58.67 | $57.46 | $54.24 | $50.53 |
| Total ReturnB,C,D | 1.09% | 1.86% | 3.25% | 7.26% | 9.29% | 3.13% |
| Ratios to Average Net AssetsE,F | | | | | | |
| Expenses before reductions | .50%G | .50% | .50% | .49%H | .49%H | .50% |
| Expenses net of fee waivers, if any | .50%G | .50% | .50% | .49%H | .49%H | .50% |
| Expenses net of all reductions | .50%G | .50% | .50% | .49%H | .49%H | .50% |
| Net investment income (loss) | 1.32%G | 1.07% | .93% | 1.02% | 1.30% | 1.34% |
| Supplemental Data | | | | | | |
| Net assets, end of period (000 omitted) | $81 | $86 | $90 | $26 | $1 | $5 |
| Portfolio turnover rateE | 20%G | 47% | 33% | 26% | 38% | 43% |
A Calculated based on average shares outstanding during the period.
B Total returns for periods of less than one year are not annualized.
C Total returns would have been lower if certain expenses had not been reduced during the applicable periods shown.
D Total returns do not include the effect of the sales charges.
E Amounts do not include the activity of the Underlying Funds.
F Expense ratios reflect operating expenses of the class. Expenses before reductions do not reflect amounts reimbursed by the investment adviser or reductions from expense offset arrangements and do not represent the amount paid by the class during periods when reimbursements or reductions occur. Expenses net of fee waivers reflect expenses after reimbursement by the investment adviser but prior to reductions from expense offset arrangements. Expenses net of all reductions represent the net expenses paid by the class but do not include expenses of the underlying funds in which the Fund invests.
G Annualized
H On certain classes, the size and fluctuation of net assets may cause rounding of expense amounts and ratios to differ from contractual rates.
See accompanying notes which are an integral part of the financial statements.
Financial Highlights — Fidelity Income Replacement 2022 Fund Class C
| | Six months ended (Unaudited) January 31, | Years ended July 31, | | | | |
| | 2017 | 2016 | 2015 | 2014 | 2013 | 2012 |
| Selected Per–Share Data | | | | | | |
| Net asset value, beginning of period | $58.91 | $58.53 | $57.34 | $54.13 | $50.49 | $49.81 |
| Income from Investment Operations | | | | | | |
| Net investment income (loss)A | .244 | .328 | .245 | .293 | .434 | .411 |
| Net realized and unrealized gain (loss) | .250 | .435 | 1.323 | 3.354 | 3.919 | .845 |
| Total from investment operations | .494 | .763 | 1.568 | 3.647 | 4.353 | 1.256 |
| Distributions from net investment income | (.257) | (.332) | (.239) | (.314) | (.459) | (.405) |
| Distributions from net realized gain | (.067) | (.051) | (.139) | (.123) | (.254) | (.171) |
| Total distributions | (.324) | (.383) | (.378) | (.437) | (.713) | (.576) |
| Net asset value, end of period | $59.08 | $58.91 | $58.53 | $57.34 | $54.13 | $50.49 |
| Total ReturnB,C,D | .84% | 1.34% | 2.72% | 6.76% | 8.70% | 2.58% |
| Ratios to Average Net AssetsE,F | | | | | | |
| Expenses before reductions | 1.00%G | 1.00% | 1.01%H | .99%H | 1.00% | 1.00% |
| Expenses net of fee waivers, if any | 1.00%G | 1.00% | 1.01%H | .99%H | 1.00% | 1.00% |
| Expenses net of all reductions | 1.00%G | 1.00% | 1.01%H | .99%H | 1.00% | 1.00% |
| Net investment income (loss) | .83%G | .57% | .42% | .52% | .83% | .84% |
| Supplemental Data | | | | | | |
| Net assets, end of period (000 omitted) | $58 | $58 | $60 | $325 | $54 | $28 |
| Portfolio turnover rateE | 20%G | 47% | 33% | 26% | 38% | 43% |
A Calculated based on average shares outstanding during the period.
B Total returns for periods of less than one year are not annualized.
C Total returns would have been lower if certain expenses had not been reduced during the applicable periods shown.
D Total returns do not include the effect of the contingent deferred sales charge.
E Amounts do not include the activity of the Underlying Funds.
F Expense ratios reflect operating expenses of the class. Expenses before reductions do not reflect amounts reimbursed by the investment adviser or reductions from expense offset arrangements and do not represent the amount paid by the class during periods when reimbursements or reductions occur. Expenses net of fee waivers reflect expenses after reimbursement by the investment adviser but prior to reductions from expense offset arrangements. Expenses net of all reductions represent the net expenses paid by the class but do not include expenses of the underlying funds in which the Fund invests.
G Annualized
H On certain classes, the size and fluctuation of net assets may cause rounding of expense amounts and ratios to differ from contractual rates.
See accompanying notes which are an integral part of the financial statements.
Financial Highlights — Fidelity Income Replacement 2022 Fund
| | Six months ended (Unaudited) January 31, | Years ended July 31, | | | | |
| | 2017 | 2016 | 2015 | 2014 | 2013 | 2012 |
| Selected Per–Share Data | | | | | | |
| Net asset value, beginning of period | $59.01 | $58.61 | $57.41 | $54.15 | $50.46 | $49.78 |
| Income from Investment Operations | | | | | | |
| Net investment income (loss)A | .539 | .901 | .831 | .851 | .956 | .901 |
| Net realized and unrealized gain (loss) | .247 | .452 | 1.313 | 3.358 | 3.922 | .849 |
| Total from investment operations | .786 | 1.353 | 2.144 | 4.209 | 4.878 | 1.750 |
| Distributions from net investment income | (.549) | (.902) | (.805) | (.826) | (.934) | (.899) |
| Distributions from net realized gain | (.067) | (.051) | (.139) | (.123) | (.254) | (.171) |
| Total distributions | (.616) | (.953) | (.944) | (.949) | (1.188) | (1.070) |
| Net asset value, end of period | $59.18 | $59.01 | $58.61 | $57.41 | $54.15 | $50.46 |
| Total ReturnB,C | 1.34% | 2.37% | 3.76% | 7.82% | 9.80% | 3.62% |
| Ratios to Average Net AssetsD,E | | | | | | |
| Expenses before reductionsF | - %G | -% | -% | -% | -% | -% |
| Expenses net of fee waivers, if any | - %G | -% | -% | -% | -% | -% |
| Expenses net of all reductions | - %G | -% | -% | -% | -% | -% |
| Net investment income (loss) | 1.83%G | 1.57% | 1.43% | 1.51% | 1.82% | 1.84% |
| Supplemental Data | | | | | | |
| Net assets, end of period (000 omitted) | $12,477 | $13,227 | $14,208 | $9,774 | $4,474 | $3,892 |
| Portfolio turnover rateD | 20%G | 47% | 33% | 26% | 38% | 43% |
A Calculated based on average shares outstanding during the period.
B Total returns for periods of less than one year are not annualized.
C Total returns would have been lower if certain expenses had not been reduced during the applicable periods shown.
D Amounts do not include the activity of the Underlying Funds.
E Expense ratios reflect operating expenses of the class. Expenses before reductions do not reflect amounts reimbursed by the investment adviser or reductions from expense offset arrangements and do not represent the amount paid by the class during periods when reimbursements or reductions occur. Expenses net of fee waivers reflect expenses after reimbursement by the investment adviser but prior to reductions from expense offset arrangements. Expenses net of all reductions represent the net expenses paid by the class but do not include expenses of the underlying funds in which the Fund invests.
F Amount represents less than .005%.
G Annualized
See accompanying notes which are an integral part of the financial statements.
Financial Highlights — Fidelity Income Replacement 2022 Fund Class I
| | Six months ended (Unaudited) January 31, | Years ended July 31, | | | | |
| | 2017 | 2016 | 2015 | 2014 | 2013 | 2012 |
| Selected Per–Share Data | | | | | | |
| Net asset value, beginning of period | $58.99 | $58.59 | $57.39 | $54.14 | $50.45 | $49.77 |
| Income from Investment Operations | | | | | | |
| Net investment income (loss)A | .540 | .899 | .830 | .856 | .957 | .900 |
| Net realized and unrealized gain (loss) | .246 | .454 | 1.314 | 3.343 | 3.921 | .850 |
| Total from investment operations | .786 | 1.353 | 2.144 | 4.199 | 4.878 | 1.750 |
| Distributions from net investment income | (.549) | (.902) | (.805) | (.826) | (.934) | (.899) |
| Distributions from net realized gain | (.067) | (.051) | (.139) | (.123) | (.254) | (.171) |
| Total distributions | (.616) | (.953) | (.944) | (.949) | (1.188) | (1.070) |
| Net asset value, end of period | $59.16 | $58.99 | $58.59 | $57.39 | $54.14 | $50.45 |
| Total ReturnB,C | 1.34% | 2.37% | 3.76% | 7.81% | 9.80% | 3.62% |
| Ratios to Average Net AssetsD,E | | | | | | |
| Expenses before reductionsF | - %G | -% | -% | -% | -% | -% |
| Expenses net of fee waivers, if any | - %G | -% | -% | -% | -% | -% |
| Expenses net of all reductions | - %G | -% | -% | -% | -% | -% |
| Net investment income (loss) | 1.83%G | 1.57% | 1.43% | 1.51% | 1.82% | 1.84% |
| Supplemental Data | | | | | | |
| Net assets, end of period (000 omitted) | $91 | $131 | $90 | $61 | $4 | $3 |
| Portfolio turnover rateD | 20%G | 47% | 33% | 26% | 38% | 43% |
A Calculated based on average shares outstanding during the period.
B Total returns for periods of less than one year are not annualized.
C Total return would have been lower if certain expenses had not been reduced during the applicable periods shown.
D Amounts do not include the activity of the Underlying Funds.
E Expense ratios reflect operating expenses of the class. Expenses before reductions do not reflect amounts reimbursed by the investment adviser or reductions from expense offset arrangements and do not represent the amount paid by the class during periods when reimbursements or reductions occur. Expenses net of fee waivers reflect expenses after reimbursement by the investment adviser but prior to reductions from expense offset arrangements. Expenses net of all reductions represent the net expenses paid by the class but do not include expenses of the underlying funds in which the Fund invests.
F Amount represents less than .005%.
G Annualized
See accompanying notes which are an integral part of the financial statements.
Fidelity Income Replacement 2024 Fund℠
Investment Summary (Unaudited)
The information in the following tables is based on the direct investments of the Fund.
Top Holdings as of January 31, 2017
| | % of fund's net assets | % of fund's net assets 6 months ago |
| Fidelity Total Bond Fund | 23.3 | 22.9 |
| Fidelity Investments Money Market Government Portfolio Institutional Class 0.47% | 13.5 | 12.9 |
| Fidelity Short-Term Bond Fund | 13.5 | 12.9 |
| Fidelity Strategic Real Return Fund | 7.8 | 7.6 |
| Fidelity Government Income Fund | 7.8 | 7.6 |
| Fidelity Series Broad Market Opportunities Fund | 6.8 | 7.1 |
| Fidelity Equity-Income Fund | 5.9 | 6.2 |
| Fidelity Large Cap Stock Fund | 4.4 | 4.7 |
| Fidelity Advisor Mid Cap II Fund Class I | 4.1 | 4.3 |
| Fidelity Series 100 Index Fund | 3.8 | 4.0 |
| | 90.9 | 90.2 |
Asset Allocation (% of fund's net assets)
| Period end |
| | Domestic Equity Funds | 29.5% |
| | International Equity Funds | 2.9% |
| | High Yield Fixed-Income Funds | 1.7% |
| | Investment Grade Fixed-Income Funds | 38.9% |
| | Short-Term Funds | 27.0% |
| Six months ago |
| | Domestic Equity Funds | 30.9% |
| | International Equity Funds | 3.1% |
| | High Yield Fixed-Income Funds | 2.1% |
| | Investment Grade Fixed-Income Funds | 38.1% |
| | Short-Term Funds | 25.8% |
Fidelity Income Replacement 2024 Fund℠
Investments January 31, 2017 (Unaudited)
Showing Percentage of Net Assets
| Equity Funds - 32.4% | | | |
| | | Shares | Value |
| Domestic Equity Funds - 29.5% | | | |
| Fidelity Advisor Mid Cap II Fund Class I (a) | | 21,225 | $420,892 |
| Fidelity Blue Chip Growth Fund (a) | | 5,540 | 391,266 |
| Fidelity Equity-Income Fund (a) | | 10,417 | 601,712 |
| Fidelity Large Cap Stock Fund (a) | | 15,163 | 451,540 |
| Fidelity Series 100 Index Fund (a) | | 26,545 | 391,266 |
| Fidelity Series Broad Market Opportunities Fund (a) | | 42,692 | 691,611 |
| Fidelity Series Small Cap Opportunities Fund (a) | | 4,278 | 60,273 |
|
| TOTAL DOMESTIC EQUITY FUNDS | | | 3,008,560 |
|
| International Equity Funds - 2.9% | | | |
| Fidelity Advisor International Discovery Fund Class I (a) | | 7,865 | 296,259 |
| TOTAL EQUITY FUNDS | | | |
| (Cost $2,769,127) | | | 3,304,819 |
|
| Fixed-Income Funds - 40.6% | | | |
| High Yield Fixed-Income Funds - 1.7% | | | |
| Fidelity Capital & Income Fund (a) | | 8,968 | 88,877 |
| Fidelity Strategic Income Fund (a) | | 8,252 | 88,877 |
|
| TOTAL HIGH YIELD FIXED-INCOME FUNDS | | | 177,754 |
|
| Investment Grade Fixed-Income Funds - 38.9% | | | |
| Fidelity Government Income Fund (a) | | 77,973 | 793,769 |
| Fidelity Strategic Real Return Fund (a) | | 89,997 | 793,770 |
| Fidelity Total Bond Fund (a) | | 225,910 | 2,383,348 |
|
| TOTAL INVESTMENT GRADE FIXED-INCOME FUNDS | | | 3,970,887 |
|
| TOTAL FIXED-INCOME FUNDS | | | |
| (Cost $4,204,952) | | | 4,148,641 |
|
| Short-Term Funds - 27.0% | | | |
| Fidelity Investments Money Market Government Portfolio Institutional Class 0.47% (a)(b) | | 1,381,179 | 1,381,179 |
| Fidelity Short-Term Bond Fund (a) | | 160,789 | 1,381,178 |
| TOTAL SHORT-TERM FUNDS | | | |
| (Cost $2,761,438) | | | 2,762,357 |
| TOTAL INVESTMENT PORTFOLIO - 100.0% | | | |
| (Cost $9,735,517) | | | 10,215,817 |
| NET OTHER ASSETS (LIABILITIES) - 0.0% | | | (246) |
| NET ASSETS - 100% | | | $10,215,571 |
Legend
(a) Affiliated Fund
(b) The rate quoted is the annualized seven-day yield of the fund at period end.
Affiliated Underlying Funds
Information regarding the Fund's fiscal year to date purchases and sales of the affiliated Underlying Funds and income earned by the Fund from investments in affiliated Underlying Funds is as follows:
| Affiliate | Value, beginning of period | Purchases | Sales Proceeds | Dividend Income | Value, end of period |
| Fidelity Advisor International Discovery Fund Class I | $292,353 | $76,922 | $68,156 | $5,002 | $296,259 |
| Fidelity Advisor Mid Cap II Fund Class I | 403,149 | 112,793 | 112,915 | 2,007 | 420,892 |
| Fidelity Blue Chip Growth Fund | 374,286 | 105,632 | 95,934 | 888 | 391,266 |
| Fidelity Capital & Income Fund | 98,692 | 23,932 | 37,856 | 2,231 | 88,877 |
| Fidelity Equity-Income Fund | 575,395 | 144,124 | 153,743 | 8,948 | 601,712 |
| Fidelity Government Income Fund | 708,536 | 219,436 | 95,999 | 6,295 | 793,769 |
| Fidelity Investments Money Market Government Portfolio Institutional Class 0.47% | 1,200,136 | 342,770 | 161,726 | 2,339 | 1,381,179 |
| Fidelity Large Cap Stock Fund | 432,012 | 107,154 | 126,166 | 4,051 | 451,540 |
| Fidelity Series 100 Index Fund | 374,286 | 93,583 | 89,463 | 8,973 | 391,266 |
| Fidelity Series Broad Market Opportunities Fund | 661,983 | 159,547 | 173,386 | 3,443 | 691,611 |
| Fidelity Series Small Cap Opportunities Fund | 57,726 | 14,159 | 16,972 | 310 | 60,273 |
| Fidelity Short-Term Bond Fund | 1,200,136 | 356,612 | 164,836 | 7,770 | 1,381,178 |
| Fidelity Strategic Income Fund | 98,692 | 23,469 | 33,182 | 1,768 | 88,877 |
| Fidelity Strategic Real Return Fund | 708,536 | 193,783 | 109,510 | 10,858 | 793,770 |
| Fidelity Total Bond Fund | 2,124,676 | 628,328 | 305,057 | 34,427 | 2,383,348 |
| Total | $9,310,594 | $2,602,244 | $1,744,901 | $99,310 | $10,215,817 |
Investment Valuation
All investments are categorized as Level 1 under the Fair Value Hierarchy. The inputs or methodology used for valuing securities may not be an indication of the risk associated with investing in those securities. For more information on valuation inputs please refer to the Investment Valuation section in the accompanying Notes to Financial Statements.
See accompanying notes which are an integral part of the financial statements.
Fidelity Income Replacement 2024 Fund℠
Financial Statements
Statement of Assets and Liabilities
| | | January 31, 2017 (Unaudited) |
| Assets | | |
| Investment in securities, at value (cost $9,735,517) — See accompanying schedule | | $10,215,817 |
| Cash | | 3 |
| Receivable for investments sold | | 161,938 |
| Total assets | | 10,377,758 |
| Liabilities | | |
| Payable for investments purchased | $18,068 | |
| Payable for fund shares redeemed | 143,891 | |
| Distribution and service plan fees payable | 228 | |
| Total liabilities | | 162,187 |
| Net Assets | | $10,215,571 |
| Net Assets consist of: | | |
| Paid in capital | | $9,737,623 |
| Undistributed net investment income | | 2,611 |
| Accumulated undistributed net realized gain (loss) on investments | | (4,963) |
| Net unrealized appreciation (depreciation) on investments | | 480,300 |
| Net Assets | | $10,215,571 |
| Calculation of Maximum Offering Price | | |
| Class A: | | |
| Net Asset Value and redemption price per share ($189,429 ÷ 3,207.92 shares) | | $59.05 |
| Maximum offering price per share (100/94.25 of $59.05) | | $62.65 |
| Class T: | | |
| Net Asset Value and redemption price per share ($146,253 ÷ 2,477.36 shares) | | $59.04 |
| Maximum offering price per share (100/96.50 of $59.04) | | $61.18 |
| Class C: | | |
| Net Asset Value and offering price per share ($151,406 ÷ 2,573.88 shares)(a) | | $58.82 |
| Income Replacement 2024: | | |
| Net Asset Value, offering price and redemption price per share ($9,674,650 ÷ 163,858.25 shares) | | $59.04 |
| Class I: | | |
| Net Asset Value, offering price and redemption price per share ($53,833 ÷ 911.84 shares) | | $59.04 |
(a) Redemption price per share is equal to net asset value less any applicable contingent deferred sales charge.
See accompanying notes which are an integral part of the financial statements.
Statement of Operations
| | | Six months ended January 31, 2017 (Unaudited) |
| Investment Income | | |
| Income distributions from underlying funds | | $99,310 |
| Expenses | | |
| Distribution and service plan fees | $1,374 | |
| Independent trustees' fees and expenses | 23 | |
| Total expenses before reductions | 1,397 | |
| Expense reductions | (23) | 1,374 |
| Net investment income (loss) | | 97,936 |
| Realized and Unrealized Gain (Loss) | | |
| Realized gain (loss) on sale of underlying fund shares | (198) | |
| Capital gain distributions from underlying funds | 56,232 | |
| Total net realized gain (loss) | | 56,034 |
| Change in net unrealized appreciation (depreciation) on underlying funds | | 48,074 |
| Net gain (loss) | | 104,108 |
| Net increase (decrease) in net assets resulting from operations | | $202,044 |
See accompanying notes which are an integral part of the financial statements.
Statement of Changes in Net Assets
| | Six months ended January 31, 2017 (Unaudited) | Year ended July 31, 2016 |
| Increase (Decrease) in Net Assets | | |
| Operations | | |
| Net investment income (loss) | $97,936 | $151,030 |
| Net realized gain (loss) | 56,034 | 63,128 |
| Change in net unrealized appreciation (depreciation) | 48,074 | (57,966) |
| Net increase (decrease) in net assets resulting from operations | 202,044 | 156,192 |
| Distributions to shareholders from net investment income | (97,662) | (150,769) |
| Distributions to shareholders from net realized gain | (31,846) | (167,848) |
| Total distributions | (129,508) | (318,617) |
| Share transactions - net increase (decrease) | 832,663 | (703,127) |
| Total increase (decrease) in net assets | 905,199 | (865,552) |
| Net Assets | | |
| Beginning of period | 9,310,372 | 10,175,924 |
| End of period | $10,215,571 | $9,310,372 |
| Other Information | | |
| Undistributed net investment income end of period | $2,611 | $2,337 |
See accompanying notes which are an integral part of the financial statements.
Financial Highlights — Fidelity Income Replacement 2024 Fund Class A
| | Six months ended (Unaudited) January 31, | Years ended July 31, | | | | |
| | 2017 | 2016 | 2015 | 2014 | 2013 | 2012 |
| Selected Per–Share Data | | | | | | |
| Net asset value, beginning of period | $58.63 | $59.28 | $58.28 | $54.77 | $50.48 | $49.85 |
| Income from Investment Operations | | | | | | |
| Net investment income (loss)A | .500 | .779 | .718 | .718 | .840 | .821 |
| Net realized and unrealized gain (loss) | .585 | .322 | 1.623 | 3.808 | 4.571 | .771 |
| Total from investment operations | 1.085 | 1.101 | 2.341 | 4.526 | 5.411 | 1.592 |
| Distributions from net investment income | (.486) | (.768) | (.704) | (.677) | (.900) | (.794) |
| Distributions from net realized gain | (.179) | (.983) | (.637) | (.339) | (.221) | (.168) |
| Total distributions | (.665) | (1.751) | (1.341) | (1.016) | (1.121) | (.962) |
| Net asset value, end of period | $59.05 | $58.63 | $59.28 | $58.28 | $54.77 | $50.48 |
| Total ReturnB,C,D | 1.87% | 1.99% | 4.06% | 8.32% | 10.86% | 3.29% |
| Ratios to Average Net AssetsE,F | | | | | | |
| Expenses before reductions | .25%G | .25% | .25% | .25% | .25% | .25% |
| Expenses net of fee waivers, if any | .25%G | .25% | .25% | .25% | .25% | .25% |
| Expenses net of all reductions | .25%G | .25% | .25% | .25% | .25% | .25% |
| Net investment income (loss) | 1.70%G | 1.37% | 1.22% | 1.27% | 1.59% | 1.68% |
| Supplemental Data | | | | | | |
| Net assets, end of period (000 omitted) | $189 | $190 | $467 | $220 | $424 | $213 |
| Portfolio turnover rate E | 35%G | 49% | 29% | 30% | 49% | 65% |
A Calculated based on average shares outstanding during the period.
B Total returns for periods of less than one year are not annualized.
C Total returns would have been lower if certain expenses had not been reduced during the applicable periods shown.
D Total returns do not include the effect of the sales charges.
E Amounts do not include the activity of the Underlying Funds.
F Expense ratios reflect operating expenses of the class. Expenses before reductions do not reflect amounts reimbursed by the investment adviser or reductions from expense offset arrangements and do not represent the amount paid by the class during periods when reimbursements or reductions occur. Expenses net of fee waivers reflect expenses after reimbursement by the investment adviser but prior to reductions from expense offset arrangements. Expenses net of all reductions represent the net expenses paid by the class but do not include expenses of the underlying funds in which the Fund invests.
G Annualized
See accompanying notes which are an integral part of the financial statements.
Financial Highlights — Fidelity Income Replacement 2024 Fund Class T
| | Six months ended (Unaudited) January 31, | Years ended July 31, | | | | |
| | 2017 | 2016 | 2015 | 2014 | 2013 | 2012 |
| Selected Per–Share Data | | | | | | |
| Net asset value, beginning of period | $58.61 | $59.27 | $58.27 | $54.78 | $50.49 | $49.87 |
| Income from Investment Operations | | | | | | |
| Net investment income (loss)A | .426 | .640 | .572 | .579 | .706 | .699 |
| Net realized and unrealized gain (loss) | .595 | .310 | 1.631 | 3.796 | 4.576 | .769 |
| Total from investment operations | 1.021 | .950 | 2.203 | 4.375 | 5.282 | 1.468 |
| Distributions from net investment income | (.412) | (.627) | (.566) | (.546) | (.771) | (.680) |
| Distributions from net realized gain | (.179) | (.983) | (.637) | (.339) | (.221) | (.168) |
| Total distributions | (.591) | (1.610) | (1.203) | (.885) | (.992) | (.848) |
| Net asset value, end of period | $59.04 | $58.61 | $59.27 | $58.27 | $54.78 | $50.49 |
| Total ReturnB,C,D | 1.76% | 1.72% | 3.82% | 8.04% | 10.59% | 3.03% |
| Ratios to Average Net AssetsE,F | | | | | | |
| Expenses before reductions | .50%G | .50% | .50% | .50% | .50% | .50% |
| Expenses net of fee waivers, if any | .50%G | .50% | .50% | .50% | .50% | .50% |
| Expenses net of all reductions | .50%G | .50% | .50% | .50% | .50% | .50% |
| Net investment income (loss) | 1.45%G | 1.12% | .97% | 1.02% | 1.34% | 1.43% |
| Supplemental Data | | | | | | |
| Net assets, end of period (000 omitted) | $146 | $153 | $334 | $190 | $190 | $175 |
| Portfolio turnover rate E | 35%G | 49% | 29% | 30% | 49% | 65% |
A Calculated based on average shares outstanding during the period.
B Total returns for periods of less than one year are not annualized.
C Total returns would have been lower if certain expenses had not been reduced during the applicable periods shown.
D Total returns do not include the effect of the sales charges.
E Amounts do not include the activity of the Underlying Funds.
F Expense ratios reflect operating expenses of the class. Expenses before reductions do not reflect amounts reimbursed by the investment adviser or reductions from expense offset arrangements and do not represent the amount paid by the class during periods when reimbursements or reductions occur. Expenses net of fee waivers reflect expenses after reimbursement by the investment adviser but prior to reductions from expense offset arrangements. Expenses net of all reductions represent the net expenses paid by the class but do not include expenses of the underlying funds in which the Fund invests.
G Annualized
See accompanying notes which are an integral part of the financial statements.
Financial Highlights — Fidelity Income Replacement 2024 Fund Class C
| | Six months ended (Unaudited) January 31, | Years ended July 31, | | | | |
| | 2017 | 2016 | 2015 | 2014 | 2013 | 2012 |
| Selected Per–Share Data | | | | | | |
| Net asset value, beginning of period | $58.41 | $59.07 | $58.11 | $54.66 | $50.43 | $49.82 |
| Income from Investment Operations | | | | | | |
| Net investment income (loss)A | .278 | .351 | .276 | .295 | .444 | .454 |
| Net realized and unrealized gain (loss) | .583 | .321 | 1.618 | 3.791 | 4.564 | .761 |
| Total from investment operations | .861 | .672 | 1.894 | 4.086 | 5.008 | 1.215 |
| Distributions from net investment income | (.272) | (.349) | (.297) | (.297) | (.557) | (.437) |
| Distributions from net realized gain | (.179) | (.983) | (.637) | (.339) | (.221) | (.168) |
| Total distributions | (.451) | (1.332) | (.934) | (.636) | (.778) | (.605) |
| Net asset value, end of period | $58.82 | $58.41 | $59.07 | $58.11 | $54.66 | $50.43 |
| Total ReturnB,C,D | 1.48% | 1.23% | 3.29% | 7.51% | 10.03% | 2.50% |
| Ratios to Average Net AssetsE,F | | | | | | |
| Expenses before reductions | 1.00%G | 1.00% | 1.00% | 1.00% | 1.00% | 1.00% |
| Expenses net of fee waivers, if any | 1.00%G | 1.00% | 1.00% | 1.00% | 1.00% | 1.00% |
| Expenses net of all reductions | 1.00%G | 1.00% | 1.00% | 1.00% | 1.00% | 1.00% |
| Net investment income (loss) | .95%G | .62% | .47% | .52% | .84% | .93% |
| Supplemental Data | | | | | | |
| Net assets, end of period (000 omitted) | $151 | $159 | $168 | $156 | $113 | $170 |
| Portfolio turnover rate E | 35%G | 49% | 29% | 30% | 49% | 65% |
A Calculated based on average shares outstanding during the period.
B Total returns for periods of less than one year are not annualized.
C Total returns would have been lower if certain expenses had not been reduced during the applicable periods shown.
D Total returns do not include the effect of the contingent deferred sales charge.
E Amounts do not include the activity of the Underlying Funds.
F Expense ratios reflect operating expenses of the class. Expenses before reductions do not reflect amounts reimbursed by the investment adviser or reductions from expense offset arrangements and do not represent the amount paid by the class during periods when reimbursements or reductions occur. Expenses net of fee waivers reflect expenses after reimbursement by the investment adviser but prior to reductions from expense offset arrangements. Expenses net of all reductions represent the net expenses paid by the class but do not include expenses of the underlying funds in which the Fund invests.
G Annualized
See accompanying notes which are an integral part of the financial statements.
Financial Highlights — Fidelity Income Replacement 2024 Fund
| | Six months ended (Unaudited) January 31, | Years ended July 31, | | | | |
| | 2017 | 2016 | 2015 | 2014 | 2013 | 2012 |
| Selected Per–Share Data | | | | | | |
| Net asset value, beginning of period | $58.62 | $59.28 | $58.27 | $54.77 | $50.49 | $49.86 |
| Income from Investment Operations | | | | | | |
| Net investment income (loss)A | .573 | .920 | .866 | .866 | .969 | .942 |
| Net realized and unrealized gain (loss) | .585 | .317 | 1.628 | 3.805 | 4.563 | .775 |
| Total from investment operations | 1.158 | 1.237 | 2.494 | 4.671 | 5.532 | 1.717 |
| Distributions from net investment income | (.559) | (.914) | (.847) | (.832) | (1.031) | (.919) |
| Distributions from net realized gain | (.179) | (.983) | (.637) | (.339) | (.221) | (.168) |
| Total distributions | (.738) | (1.897) | (1.484) | (1.171) | (1.252) | (1.087) |
| Net asset value, end of period | $59.04 | $58.62 | $59.28 | $58.27 | $54.77 | $50.49 |
| Total ReturnB,C | 1.99% | 2.24% | 4.33% | 8.60% | 11.12% | 3.55% |
| Ratios to Average Net AssetsD,E | | | | | | |
| Expenses before reductions F | - %G | -% | -% | -% | -% | -% |
| Expenses net of fee waivers, if any | - %G | -% | -% | -% | -% | -% |
| Expenses net of all reductions | - %G | -% | -% | -% | -% | -% |
| Net investment income (loss) | 1.95%G | 1.62% | 1.47% | 1.52% | 1.84% | 1.93% |
| Supplemental Data | | | | | | |
| Net assets, end of period (000 omitted) | $9,675 | $8,756 | $9,139 | $6,818 | $2,108 | $1,521 |
| Portfolio turnover rate D | 35%G | 49% | 29% | 30% | 49% | 65% |
A Calculated based on average shares outstanding during the period.
B Total returns for periods of less than one year are not annualized.
C Total returns would have been lower if certain expenses had not been reduced during the applicable periods shown.
D Amounts do not include the activity of the Underlying Funds.
E Expense ratios reflect operating expenses of the class. Expenses before reductions do not reflect amounts reimbursed by the investment adviser or reductions from expense offset arrangements and do not represent the amount paid by the class during periods when reimbursements or reductions occur. Expenses net of fee waivers reflect expenses after reimbursement by the investment adviser but prior to reductions from expense offset arrangements. Expenses net of all reductions represent the net expenses paid by the class but do not include expenses of the underlying funds in which the Fund invests.
F Amount represents less than .005%.
G Annualized
See accompanying notes which are an integral part of the financial statements.
Financial Highlights — Fidelity Income Replacement 2024 Fund Class I
| | Six months ended (Unaudited) January 31, | Years ended July 31, | | | | |
| | 2017 | 2016 | 2015 | 2014 | 2013 | 2012 |
| Selected Per–Share Data | | | | | | |
| Net asset value, beginning of period | $58.62 | $59.27 | $58.26 | $54.77 | $50.48 | $49.86 |
| Income from Investment Operations | | | | | | |
| Net investment income (loss)A | .573 | .921 | .864 | .863 | .969 | .944 |
| Net realized and unrealized gain (loss) | .585 | .326 | 1.630 | 3.798 | 4.573 | .763 |
| Total from investment operations | 1.158 | 1.247 | 2.494 | 4.661 | 5.542 | 1.707 |
| Distributions from net investment income | (.559) | (.914) | (.847) | (.832) | (1.031) | (.919) |
| Distributions from net realized gain | (.179) | (.983) | (.637) | (.339) | (.221) | (.168) |
| Total distributions | (.738) | (1.897) | (1.484) | (1.171) | (1.252) | (1.087) |
| Net asset value, end of period | $59.04 | $58.62 | $59.27 | $58.26 | $54.77 | $50.48 |
| Total ReturnB,C | 1.99% | 2.26% | 4.33% | 8.58% | 11.14% | 3.53% |
| Ratios to Average Net AssetsD,E | | | | | | |
| Expenses before reductions F | - %G | -% | -% | -% | -% | -% |
| Expenses net of fee waivers, if any | - %G | -% | -% | -% | -% | -% |
| Expenses net of all reductions | - %G | -% | -% | -% | -% | -% |
| Net investment income (loss) | 1.95%G | 1.62% | 1.47% | 1.52% | 1.84% | 1.93% |
| Supplemental Data | | | | | | |
| Net assets, end of period (000 omitted) | $54 | $53 | $68 | $30 | $27 | $25 |
| Portfolio turnover rate D | 35%G | 49% | 29% | 30% | 49% | 65% |
A Calculated based on average shares outstanding during the period.
B Total returns for periods of less than one year are not annualized.
C Total returns would have been lower if certain expenses had not been reduced during the applicable periods shown.
D Amounts do not include the activity of the Underlying Funds.
E Expense ratios reflect operating expenses of the class. Expenses before reductions do not reflect amounts reimbursed by the investment adviser or reductions from expense offset arrangements and do not represent the amount paid by the class during periods when reimbursements or reductions occur. Expenses net of fee waivers reflect expenses after reimbursement by the investment adviser but prior to reductions from expense offset arrangements. Expenses net of all reductions represent the net expenses paid by the class but do not include expenses of the underlying funds in which the Fund invests.
F Amount represents less than .005%.
G Annualized
See accompanying notes which are an integral part of the financial statements.
Fidelity Income Replacement 2026 Fund℠
Investment Summary (Unaudited)
The information in the following tables is based on the direct investments of the Fund.
Top Holdings as of January 31, 2017
| | % of fund's net assets | % of fund's net assets 6 months ago |
| Fidelity Total Bond Fund | 21.6 | 21.2 |
| Fidelity Short-Term Bond Fund | 11.3 | 10.8 |
| Fidelity Investments Money Market Government Portfolio Institutional Class 0.47% | 11.2 | 10.8 |
| Fidelity Series Broad Market Opportunities Fund | 8.0 | 8.2 |
| Fidelity Strategic Real Return Fund | 7.2 | 7.1 |
| Fidelity Government Income Fund | 7.2 | 7.1 |
| Fidelity Equity-Income Fund | 7.0 | 7.2 |
| Fidelity Large Cap Stock Fund | 5.2 | 5.4 |
| Fidelity Advisor Mid Cap II Fund Class I | 4.9 | 5.0 |
| Fidelity Series 100 Index Fund | 4.5 | 4.7 |
| | 88.1 | 87.5 |
Asset Allocation (% of fund's net assets)
| Period end |
| | Domestic Equity Funds | 34.8% |
| | International Equity Funds | 3.9% |
| | High Yield Fixed-Income Funds | 2.8% |
| | Investment Grade Fixed-Income Funds | 36.0% |
| | Short-Term Funds | 22.5% |
| Six months ago |
| | Domestic Equity Funds | 35.9% |
| | International Equity Funds | 4.1% |
| | High Yield Fixed-Income Funds | 3.0% |
| | Investment Grade Fixed-Income Funds | 35.4% |
| | Short-Term Funds | 21.6% |
Fidelity Income Replacement 2026 Fund℠
Investments January 31, 2017 (Unaudited)
Showing Percentage of Net Assets
| Equity Funds - 38.7% | | | |
| | | Shares | Value |
| Domestic Equity Funds - 34.8% | | | |
| Fidelity Advisor Mid Cap II Fund Class I (a) | | 27,549 | $546,290 |
| Fidelity Blue Chip Growth Fund (a) | | 7,196 | 508,150 |
| Fidelity Equity-Income Fund (a) | | 13,517 | 780,734 |
| Fidelity Large Cap Stock Fund (a) | | 19,663 | 585,551 |
| Fidelity Series 100 Index Fund (a) | | 34,474 | 508,150 |
| Fidelity Series Broad Market Opportunities Fund (a) | | 55,464 | 898,517 |
| Fidelity Series Small Cap Opportunities Fund (a) | | 5,573 | 78,522 |
|
| TOTAL DOMESTIC EQUITY FUNDS | | | 3,905,914 |
|
| International Equity Funds - 3.9% | | | |
| Fidelity Advisor International Discovery Fund Class I (a) | | 11,465 | 431,872 |
| TOTAL EQUITY FUNDS | | | |
| (Cost $3,800,661) | | | 4,337,786 |
|
| Fixed-Income Funds - 38.8% | | | |
| High Yield Fixed-Income Funds - 2.8% | | | |
| Fidelity Capital & Income Fund (a) | | 15,847 | 157,044 |
| Fidelity Strategic Income Fund (a) | | 14,582 | 157,044 |
|
| TOTAL HIGH YIELD FIXED-INCOME FUNDS | | | 314,088 |
|
| Investment Grade Fixed-Income Funds - 36.0% | | | |
| Fidelity Government Income Fund (a) | | 79,338 | 807,656 |
| Fidelity Strategic Real Return Fund (a) | | 91,571 | 807,656 |
| Fidelity Total Bond Fund (a) | | 229,772 | 2,424,092 |
|
| TOTAL INVESTMENT GRADE FIXED-INCOME FUNDS | | | 4,039,404 |
|
| TOTAL FIXED-INCOME FUNDS | | | |
| (Cost $4,387,922) | | | 4,353,492 |
|
| Short-Term Funds - 22.5% | | | |
| Fidelity Investments Money Market Government Portfolio Institutional Class 0.47% (a)(b) | | 1,262,825 | 1,262,825 |
| Fidelity Short-Term Bond Fund (a) | | 147,041 | 1,263,085 |
| TOTAL SHORT-TERM FUNDS | | | |
| (Cost $2,525,804) | | | 2,525,910 |
| TOTAL INVESTMENT PORTFOLIO - 100.0% | | | |
| (Cost $10,714,387) | | | 11,217,188 |
| NET OTHER ASSETS (LIABILITIES) - 0.0% | | | (433) |
| NET ASSETS - 100% | | | $11,216,755 |
Legend
(a) Affiliated Fund
(b) The rate quoted is the annualized seven-day yield of the fund at period end.
Affiliated Underlying Funds
Information regarding the Fund's fiscal year to date purchases and sales of the affiliated Underlying Funds and income earned by the Fund from investments in affiliated Underlying Funds is as follows:
| Affiliate | Value, beginning of period | Purchases | Sales Proceeds | Dividend Income | Value, end of period |
| Fidelity Advisor International Discovery Fund Class I | $341,529 | $152,504 | $57,822 | $6,351 | $431,872 |
| Fidelity Advisor Mid Cap II Fund Class I | 420,215 | 190,429 | 86,429 | 2,269 | 546,290 |
| Fidelity Blue Chip Growth Fund | 390,917 | 177,169 | 70,341 | 909 | 508,150 |
| Fidelity Capital & Income Fund | 125,562 | 50,901 | 25,405 | 2,971 | 157,044 |
| Fidelity Equity-Income Fund | 601,025 | 249,986 | 111,756 | 9,506 | 780,734 |
| Fidelity Government Income Fund | 593,491 | 304,151 | 57,828 | 5,348 | 807,656 |
| Fidelity Investments Money Market Government Portfolio Institutional Class 0.47% | 903,211 | 448,830 | 89,216 | 1,793 | 1,262,825 |
| Fidelity Large Cap Stock Fund | 450,350 | 186,990 | 94,566 | 4,700 | 585,551 |
| Fidelity Series 100 Index Fund | 390,917 | 163,505 | 61,996 | 10,091 | 508,150 |
| Fidelity Series Broad Market Opportunities Fund | 690,592 | 284,971 | 129,226 | 3,888 | 898,517 |
| Fidelity Series Small Cap Opportunities Fund | 60,270 | 26,292 | 14,382 | 322 | 78,522 |
| Fidelity Short-Term Bond Fund | 903,211 | 457,249 | 89,043 | 5,978 | 1,263,085 |
| Fidelity Strategic Income Fund | 125,562 | 51,232 | 19,859 | 2,348 | 157,044 |
| Fidelity Strategic Real Return Fund | 593,491 | 274,383 | 62,039 | 9,058 | 807,656 |
| Fidelity Total Bond Fund | 1,780,471 | 871,462 | 174,573 | 29,266 | 2,424,092 |
| Total | $8,370,814 | $3,890,054 | $1,144,481 | $94,798 | $11,217,188 |
Investment Valuation
All investments are categorized as Level 1 under the Fair Value Hierarchy. The inputs or methodology used for valuing securities may not be an indication of the risk associated with investing in those securities. For more information on valuation inputs please refer to the Investment Valuation section in the accompanying Notes to Financial Statements.
See accompanying notes which are an integral part of the financial statements.
Fidelity Income Replacement 2026 Fund℠
Financial Statements
Statement of Assets and Liabilities
| | | January 31, 2017 (Unaudited) |
| Assets | | |
| Investment in securities, at value (cost $10,714,387) — See accompanying schedule | | $11,217,188 |
| Cash | | 2 |
| Receivable for investments sold | | 80,404 |
| Total assets | | 11,297,594 |
| Liabilities | | |
| Payable for investments purchased | $77,076 | |
| Payable for fund shares redeemed | 3,308 | |
| Distribution and service plan fees payable | 455 | |
| Total liabilities | | 80,839 |
| Net Assets | | $11,216,755 |
| Net Assets consist of: | | |
| Paid in capital | | $10,765,610 |
| Undistributed net investment income | | 2,559 |
| Accumulated undistributed net realized gain (loss) on investments | | (54,215) |
| Net unrealized appreciation (depreciation) on investments | | 502,801 |
| Net Assets | | $11,216,755 |
| Calculation of Maximum Offering Price | | |
| Class A: | | |
| Net Asset Value and redemption price per share ($560,176 ÷ 9,211.30 shares) | | $60.81 |
| Maximum offering price per share (100/94.25 of $60.81) | | $64.52 |
| Class T: | | |
| Net Asset Value and redemption price per share ($299,287 ÷ 4,918.28 shares) | | $60.85 |
| Maximum offering price per share (100/96.50 of $60.85) | | $63.06 |
| Class C: | | |
| Net Asset Value and offering price per share ($255,222 ÷ 4,214.34 shares)(a) | | $60.56 |
| Income Replacement 2026: | | |
| Net Asset Value, offering price and redemption price per share ($10,071,055 ÷ 165,577.26 shares) | | $60.82 |
| Class I: | | |
| Net Asset Value, offering price and redemption price per share ($31,015 ÷ 509.92 shares) | | $60.82 |
(a) Redemption price per share is equal to net asset value less any applicable contingent deferred sales charge.
See accompanying notes which are an integral part of the financial statements.
Statement of Operations
| | | Six months ended January 31, 2017 (Unaudited) |
| Investment Income | | |
| Income distributions from underlying funds | | $94,798 |
| Expenses | | |
| Distribution and service plan fees | $2,722 | |
| Independent trustees' fees and expenses | 21 | |
| Total expenses before reductions | 2,743 | |
| Expense reductions | (21) | 2,722 |
| Net investment income (loss) | | 92,076 |
| Realized and Unrealized Gain (Loss) | | |
| Realized gain (loss) on sale of underlying fund shares | (1,182) | |
| Capital gain distributions from underlying funds | 58,878 | |
| Total net realized gain (loss) | | 57,696 |
| Change in net unrealized appreciation (depreciation) on underlying funds | | 101,978 |
| Net gain (loss) | | 159,674 |
| Net increase (decrease) in net assets resulting from operations | | $251,750 |
See accompanying notes which are an integral part of the financial statements.
Statement of Changes in Net Assets
| | Six months ended January 31, 2017 (Unaudited) | Year ended July 31, 2016 |
| Increase (Decrease) in Net Assets | | |
| Operations | | |
| Net investment income (loss) | $92,076 | $126,792 |
| Net realized gain (loss) | 57,696 | 71,839 |
| Change in net unrealized appreciation (depreciation) | 101,978 | 18,448 |
| Net increase (decrease) in net assets resulting from operations | 251,750 | 217,079 |
| Distributions to shareholders from net investment income | (91,535) | (126,167) |
| Distributions to shareholders from net realized gain | (48,306) | (79,217) |
| Total distributions | (139,841) | (205,384) |
| Share transactions - net increase (decrease) | 2,734,503 | 1,027,483 |
| Total increase (decrease) in net assets | 2,846,412 | 1,039,178 |
| Net Assets | | |
| Beginning of period | 8,370,343 | 7,331,165 |
| End of period | $11,216,755 | $8,370,343 |
| Other Information | | |
| Undistributed net investment income end of period | $2,559 | $2,018 |
See accompanying notes which are an integral part of the financial statements.
Financial Highlights — Fidelity Income Replacement 2026 Fund Class A
| | Six months ended (Unaudited) January 31, | Years ended July 31, | | | | |
| | 2017 | 2016 | 2015 | 2014 | 2013 | 2012 |
| Selected Per–Share Data | | | | | | |
| Net asset value, beginning of period | $60.26 | $60.57 | $58.78 | $54.81 | $50.09 | $49.53 |
| Income from Investment Operations | | | | | | |
| Net investment income (loss)A | .543 | .801 | .724 | .735 | .906 | .793 |
| Net realized and unrealized gain (loss) | .851 | .274 | 1.910 | 4.084 | 4.920 | .712 |
| Total from investment operations | 1.394 | 1.075 | 2.634 | 4.819 | 5.826 | 1.505 |
| Distributions from net investment income | (.517) | (.785) | (.698) | (.708) | (.879) | (.789) |
| Distributions from net realized gain | (.327) | (.600) | (.146) | (.141) | (.227) | (.156) |
| Total distributions | (.844) | (1.385) | (.844) | (.849) | (1.106) | (.945) |
| Net asset value, end of period | $60.81 | $60.26 | $60.57 | $58.78 | $54.81 | $50.09 |
| Total ReturnB,C,D | 2.34% | 1.88% | 4.50% | 8.84% | 11.79% | 3.13% |
| Ratios to Average Net AssetsE,F | | | | | | |
| Expenses before reductions | .25%G | .25% | .25% | .25% | .25% | .25% |
| Expenses net of fee waivers, if any | .25%G | .25% | .25% | .25% | .25% | .25% |
| Expenses net of all reductions | .25%G | .25% | .25% | .25% | .25% | .25% |
| Net investment income (loss) | 1.80%G | 1.38% | 1.21% | 1.28% | 1.73% | 1.64% |
| Supplemental Data | | | | | | |
| Net assets, end of period (000 omitted) | $560 | $577 | $727 | $526 | $304 | $139 |
| Portfolio turnover rateE | 25%G | 45% | 35% | 27% | 45% | 60% |
A Calculated based on average shares outstanding during the period.
B Total returns for periods of less than one year are not annualized.
C Total returns would have been lower if certain expenses had not been reduced during the applicable periods shown.
D Total returns do not include the effect of the sales charges.
E Amounts do not include the activity of the Underlying Funds.
F Expense ratios reflect operating expenses of the class. Expenses before reductions do not reflect amounts reimbursed by the investment adviser or reductions from expense offset arrangements and do not represent the amount paid by the class during periods when reimbursements or reductions occur. Expenses net of fee waivers reflect expenses after reimbursement by the investment adviser but prior to reductions from expense offset arrangements. Expenses net of all reductions represent the net expenses paid by the class but do not include expenses of the underlying funds in which the Fund invests.
G Annualized
See accompanying notes which are an integral part of the financial statements.
Financial Highlights — Fidelity Income Replacement 2026 Fund Class T
| | Six months ended (Unaudited) January 31, | Years ended July 31, | | | | |
| | 2017 | 2016 | 2015 | 2014 | 2013 | 2012 |
| Selected Per–Share Data | | | | | | |
| Net asset value, beginning of period | $60.30 | $60.61 | $58.83 | $54.82 | $50.08 | $49.53 |
| Income from Investment Operations | | | | | | |
| Net investment income (loss)A | .468 | .655 | .574 | .587 | .781 | .668 |
| Net realized and unrealized gain (loss) | .851 | .276 | 1.910 | 4.098 | 4.911 | .713 |
| Total from investment operations | 1.319 | .931 | 2.484 | 4.685 | 5.692 | 1.381 |
| Distributions from net investment income | (.442) | (.641) | (.558) | (.534) | (.725) | (.675) |
| Distributions from net realized gain | (.327) | (.600) | (.146) | (.141) | (.227) | (.156) |
| Total distributions | (.769) | (1.241) | (.704) | (.675) | (.952) | (.831) |
| Net asset value, end of period | $60.85 | $60.30 | $60.61 | $58.83 | $54.82 | $50.08 |
| Total ReturnB,C,D | 2.21% | 1.63% | 4.24% | 8.58% | 11.50% | 2.87% |
| Ratios to Average Net AssetsE,F | | | | | | |
| Expenses before reductions | .50%G | .50% | .50% | .50% | .50% | .50% |
| Expenses net of fee waivers, if any | .50%G | .50% | .50% | .50% | .50% | .50% |
| Expenses net of all reductions | .50%G | .50% | .50% | .50% | .50% | .50% |
| Net investment income (loss) | 1.55%G | 1.13% | .96% | 1.03% | 1.48% | 1.39% |
| Supplemental Data | | | | | | |
| Net assets, end of period (000 omitted) | $299 | $308 | $328 | $39 | $85 | $298 |
| Portfolio turnover rateE | 25%G | 45% | 35% | 27% | 45% | 60% |
A Calculated based on average shares outstanding during the period.
B Total returns for periods of less than one year are not annualized.
C Total returns would have been lower if certain expenses had not been reduced during the applicable periods shown.
D Total returns do not include the effect of the sales charges.
E Amounts do not include the activity of the Underlying Funds.
F Expense ratios reflect operating expenses of the class. Expenses before reductions do not reflect amounts reimbursed by the investment adviser or reductions from expense offset arrangements and do not represent the amount paid by the class during periods when reimbursements or reductions occur. Expenses net of fee waivers reflect expenses after reimbursement by the investment adviser but prior to reductions from expense offset arrangements. Expenses net of all reductions represent the net expenses paid by the class but do not include expenses of the underlying funds in which the Fund invests.
G Annualized
See accompanying notes which are an integral part of the financial statements.
Financial Highlights — Fidelity Income Replacement 2026 Fund Class C
| | Six months ended (Unaudited) January 31, | Years ended July 31, | | | | |
| | 2017 | 2016 | 2015 | 2014 | 2013 | 2012 |
| Selected Per–Share Data | | | | | | |
| Net asset value, beginning of period | $60.03 | $60.40 | $58.69 | $54.76 | $50.12 | $49.49 |
| Income from Investment Operations | | | | | | |
| Net investment income (loss)A | .316 | .360 | .278 | .303 | .508 | .430 |
| Net realized and unrealized gain (loss) | .849 | .276 | 1.899 | 4.086 | 4.915 | .730 |
| Total from investment operations | 1.165 | .636 | 2.177 | 4.389 | 5.423 | 1.160 |
| Distributions from net investment income | (.308) | (.406) | (.321) | (.318) | (.556) | (.374) |
| Distributions from net realized gain | (.327) | (.600) | (.146) | (.141) | (.227) | (.156) |
| Total distributions | (.635) | (1.006) | (.467) | (.459) | (.783) | (.530) |
| Net asset value, end of period | $60.56 | $60.03 | $60.40 | $58.69 | $54.76 | $50.12 |
| Total ReturnB,C,D | 1.96% | 1.12% | 3.72% | 8.04% | 10.93% | 2.40% |
| Ratios to Average Net AssetsE,F | | | | | | |
| Expenses before reductions | 1.00%G | 1.00% | .99%H | 1.00% | 1.00% | 1.00% |
| Expenses net of fee waivers, if any | 1.00%G | 1.00% | .99%H | 1.00% | 1.00% | 1.00% |
| Expenses net of all reductions | 1.00%G | 1.00% | .99%H | 1.00% | 1.00% | 1.00% |
| Net investment income (loss) | 1.05%G | .62% | .47% | .53% | .97% | .89% |
| Supplemental Data | | | | | | |
| Net assets, end of period (000 omitted) | $255 | $250 | $86 | $33 | $31 | $9 |
| Portfolio turnover rateE | 25%G | 45% | 35% | 27% | 45% | 60% |
A Calculated based on average shares outstanding during the period.
B Total returns for periods of less than one year are not annualized.
C Total returns would have been lower if certain expenses had not been reduced during the applicable periods shown.
D Total returns do not include the effect of the contingent deferred sales charge.
E Amounts do not include the activity of the Underlying Funds.
F Expense ratios reflect operating expenses of the class. Expenses before reductions do not reflect amounts reimbursed by the investment adviser or reductions from expense offset arrangements and do not represent the amount paid by the class during periods when reimbursements or reductions occur. Expenses net of fee waivers reflect expenses after reimbursement by the investment adviser but prior to reductions from expense offset arrangements. Expenses net of all reductions represent the net expenses paid by the class but do not include expenses of the underlying funds in which the Fund invests.
G Annualized
H On certain classes, the size and fluctuations of net assets may cause rounding of expense amounts and ratios to differ from contractual rates.
See accompanying notes which are an integral part of the financial statements.
Financial Highlights — Fidelity Income Replacement 2026 Fund
| | Six months ended (Unaudited) January 31, | Years ended July 31, | | | | |
| | 2017 | 2016 | 2015 | 2014 | 2013 | 2012 |
| Selected Per–Share Data | | | | | | |
| Net asset value, beginning of period | $60.27 | $60.58 | $58.79 | $54.81 | $50.09 | $49.53 |
| Income from Investment Operations | | | | | | |
| Net investment income (loss)A | .617 | .945 | .874 | .878 | 1.040 | .913 |
| Net realized and unrealized gain (loss) | .852 | .277 | 1.909 | 4.094 | 4.914 | .711 |
| Total from investment operations | 1.469 | 1.222 | 2.783 | 4.972 | 5.954 | 1.624 |
| Distributions from net investment income | (.592) | (.932) | (.847) | (.851) | (1.007) | (.908) |
| Distributions from net realized gain | (.327) | (.600) | (.146) | (.141) | (.227) | (.156) |
| Total distributions | (.919) | (1.532) | (.993) | (.992) | (1.234) | (1.064) |
| Net asset value, end of period | $60.82 | $60.27 | $60.58 | $58.79 | $54.81 | $50.09 |
| Total ReturnB,C | 2.47% | 2.14% | 4.76% | 9.13% | 12.06% | 3.39% |
| Ratios to Average Net AssetsD,E | | | | | | |
| Expenses before reductionsF | - %G | -% | -% | -% | -% | -% |
| Expenses net of fee waivers, if any | - %G | -% | -% | -% | -% | -% |
| Expenses net of all reductions | - %G | -% | -% | -% | -% | -% |
| Net investment income (loss) | 2.05%G | 1.63% | 1.46% | 1.53% | 1.98% | 1.88% |
| Supplemental Data | | | | | | |
| Net assets, end of period (000 omitted) | $10,071 | $7,205 | $6,160 | $3,677 | $1,702 | $1,309 |
| Portfolio turnover rateD | 25%G | 45% | 35% | 27% | 45% | 60% |
A Calculated based on average shares outstanding during the period.
B Total returns for periods of less than one year are not annualized.
C Total returns would have been lower if certain expenses had not been reduced during the applicable periods shown.
D Amounts do not include the activity of the Underlying Funds.
E Expense ratios reflect operating expenses of the class. Expenses before reductions do not reflect amounts reimbursed by the investment adviser or reductions from expense offset arrangements and do not represent the amount paid by the class during periods when reimbursements or reductions occur. Expenses net of fee waivers reflect expenses after reimbursement by the investment adviser but prior to reductions from expense offset arrangements. Expenses net of all reductions represent the net expenses paid by the class but do not include expenses of the underlying funds in which the Fund invests.
F Amount represents less than .005%.
G Annualized
See accompanying notes which are an integral part of the financial statements.
Financial Highlights — Fidelity Income Replacement 2026 Fund Class I
| | Six months ended (Unaudited) January 31, | Years ended July 31, | | | | |
| | 2017 | 2016 | 2015 | 2014 | 2013 | 2012 |
| Selected Per–Share Data | | | | | | |
| Net asset value, beginning of period | $60.27 | $60.58 | $58.79 | $54.81 | $50.09 | $49.53 |
| Income from Investment Operations | | | | | | |
| Net investment income (loss)A | .617 | .945 | .875 | .877 | 1.039 | .912 |
| Net realized and unrealized gain (loss) | .852 | .277 | 1.908 | 4.095 | 4.915 | .712 |
| Total from investment operations | 1.469 | 1.222 | 2.783 | 4.972 | 5.954 | 1.624 |
| Distributions from net investment income | (.592) | (.932) | (.847) | (.851) | (1.007) | (.908) |
| Distributions from net realized gain | (.327) | (.600) | (.146) | (.141) | (.227) | (.156) |
| Total distributions | (.919) | (1.532) | (.993) | (.992) | (1.234) | (1.064) |
| Net asset value, end of period | $60.82 | $60.27 | $60.58 | $58.79 | $54.81 | $50.09 |
| Total ReturnB,C | 2.47% | 2.14% | 4.76% | 9.13% | 12.06% | 3.39% |
| Ratios to Average Net AssetsD,E | | | | | | |
| Expenses before reductionsF | - %G | -% | -% | -% | -% | -% |
| Expenses net of fee waivers, if any | - %G | -% | -% | -% | -% | -% |
| Expenses net of all reductions | - %G | -% | -% | -% | -% | -% |
| Net investment income (loss) | 2.05%G | 1.63% | 1.46% | 1.53% | 1.98% | 1.88% |
| Supplemental Data | | | | | | |
| Net assets, end of period (000 omitted) | $31 | $30 | $31 | $30 | $27 | $24 |
| Portfolio turnover rateD | 25%G | 45% | 35% | 27% | 45% | 60% |
A Calculated based on average shares outstanding during the period.
B Total returns for periods of less than one year are not annualized.
C Total returns would have been lower if certain expenses had not been reduced during the applicable periods shown.
D Amounts do not include the activity of the Underlying Funds.
E Expense ratios reflect operating expenses of the class. Expenses before reductions do not reflect amounts reimbursed by the investment adviser or reductions from expense offset arrangements and do not represent the amount paid by the class during periods when reimbursements or reductions occur. Expenses net of fee waivers reflect expenses after reimbursement by the investment adviser but prior to reductions from expense offset arrangements. Expenses net of all reductions represent the net expenses paid by the class but do not include expenses of the underlying funds in which the Fund invests.
F Amount represents less than .005%.
G Annualized
See accompanying notes which are an integral part of the financial statements.
Fidelity Income Replacement 2028 Fund℠
Investment Summary (Unaudited)
The information in the following tables is based on the direct investments of the Fund.
Top Holdings as of January 31, 2017
| | % of fund's net assets | % of fund's net assets 6 months ago |
| Fidelity Total Bond Fund | 20.3 | 19.9 |
| Fidelity Investments Money Market Government Portfolio Institutional Class 0.47% | 9.6 | 9.3 |
| Fidelity Short-Term Bond Fund | 9.6 | 9.3 |
| Fidelity Series Broad Market Opportunities Fund | 8.9 | 9.1 |
| Fidelity Equity-Income Fund | 7.8 | 7.9 |
| Fidelity Strategic Real Return Fund | 6.8 | 6.7 |
| Fidelity Government Income Fund | 6.7 | 6.7 |
| Fidelity Large Cap Stock Fund | 5.8 | 5.9 |
| Fidelity Advisor Mid Cap II Fund Class I | 5.4 | 5.5 |
| Fidelity Series 100 Index Fund | 5.0 | 5.1 |
| | 85.9 | 85.4 |
Asset Allocation (% of fund's net assets)
| Period end |
| | Domestic Equity Funds | 38.8% |
| | International Equity Funds | 4.7% |
| | High Yield Fixed-Income Funds | 3.5% |
| | Investment Grade Fixed-Income Funds | 33.8% |
| | Short-Term Funds | 19.2% |
| Six months ago |
| | Domestic Equity Funds | 39.4% |
| | International Equity Funds | 5.0% |
| | High Yield Fixed-Income Funds | 3.7% |
| | Investment Grade Fixed-Income Funds | 33.3% |
| | Short-Term Funds | 18.6% |
Fidelity Income Replacement 2028 Fund℠
Investments January 31, 2017 (Unaudited)
Showing Percentage of Net Assets
| Equity Funds - 43.5% | | | |
| | | Shares | Value |
| Domestic Equity Funds - 38.8% | | | |
| Fidelity Advisor Mid Cap II Fund Class I (a) | | 67,434 | $1,337,213 |
| Fidelity Blue Chip Growth Fund (a) | | 17,575 | 1,241,170 |
| Fidelity Equity-Income Fund (a) | | 33,043 | 1,908,545 |
| Fidelity Large Cap Stock Fund (a) | | 48,128 | 1,433,256 |
| Fidelity Series 100 Index Fund (a) | | 84,204 | 1,241,170 |
| Fidelity Series Broad Market Opportunities Fund (a) | | 135,597 | 2,196,674 |
| Fidelity Series Small Cap Opportunities Fund (a) | | 13,633 | 192,086 |
|
| TOTAL DOMESTIC EQUITY FUNDS | | | 9,550,114 |
|
| International Equity Funds - 4.7% | | | |
| Fidelity Advisor International Discovery Fund Class I (a) | | 31,183 | 1,174,679 |
| TOTAL EQUITY FUNDS | | | |
| (Cost $9,003,721) | | | 10,724,793 |
|
| Fixed-Income Funds - 37.3% | | | |
| High Yield Fixed-Income Funds - 3.5% | | | |
| Fidelity Capital & Income Fund (a) | | 43,984 | 435,884 |
| Fidelity Strategic Income Fund (a) | | 40,472 | 435,885 |
|
| TOTAL HIGH YIELD FIXED-INCOME FUNDS | | | 871,769 |
|
| Investment Grade Fixed-Income Funds - 33.8% | | | |
| Fidelity Government Income Fund (a) | | 163,288 | 1,662,276 |
| Fidelity Strategic Real Return Fund (a) | | 188,467 | 1,662,281 |
| Fidelity Total Bond Fund (a) | | 472,684 | 4,986,820 |
|
| TOTAL INVESTMENT GRADE FIXED-INCOME FUNDS | | | 8,311,377 |
|
| TOTAL FIXED-INCOME FUNDS | | | |
| (Cost $9,261,542) | | | 9,183,146 |
|
| Short-Term Funds - 19.2% | | | |
| Fidelity Investments Money Market Government Portfolio Institutional Class 0.47% (a)(b) | | 2,359,206 | 2,359,206 |
| Fidelity Short-Term Bond Fund (a) | | 274,645 | 2,359,203 |
| TOTAL SHORT-TERM FUNDS | | | |
| (Cost $4,711,021) | | | 4,718,409 |
| TOTAL INVESTMENT PORTFOLIO - 100.0% | | | |
| (Cost $22,976,284) | | | 24,626,348 |
| NET OTHER ASSETS (LIABILITIES) - 0.0% | | | (437) |
| NET ASSETS - 100% | | | $24,625,911 |
Legend
(a) Affiliated Fund
(b) The rate quoted is the annualized seven-day yield of the fund at period end.
Affiliated Underlying Funds
Information regarding the Fund's fiscal year to date purchases and sales of the affiliated Underlying Funds and income earned by the Fund from investments in affiliated Underlying Funds is as follows:
| Affiliate | Value, beginning of period | Purchases | Sales Proceeds | Dividend Income | Value, end of period |
| Fidelity Advisor International Discovery Fund Class I | $1,470,389 | $102,288 | $373,905 | $21,033 | $1,174,679 |
| Fidelity Advisor Mid Cap II Fund Class I | 1,629,829 | 106,787 | 458,117 | 6,758 | 1,337,213 |
| Fidelity Blue Chip Growth Fund | 1,514,678 | 101,885 | 396,991 | 3,042 | 1,241,170 |
| Fidelity Capital & Income Fund | 543,276 | 17,139 | 144,560 | 10,870 | 435,884 |
| Fidelity Equity-Income Fund | 2,329,592 | 79,800 | 625,399 | 30,925 | 1,908,545 |
| Fidelity Government Income Fund | 1,966,423 | 182,249 | 395,277 | 14,762 | 1,662,276 |
| Fidelity Investments Money Market Government Portfolio Institutional Class 0.47% | 2,742,954 | 182,459 | 566,207 | 4,469 | 2,359,206 |
| Fidelity Large Cap Stock Fund | 1,747,932 | 52,887 | 500,723 | 13,982 | 1,433,256 |
| Fidelity Series 100 Index Fund | 1,514,678 | 57,290 | 373,709 | 29,963 | 1,241,170 |
| Fidelity Series Broad Market Opportunities Fund | 2,680,950 | 84,681 | 713,898 | 11,579 | 2,196,674 |
| Fidelity Series Small Cap Opportunities Fund | 233,254 | 9,412 | 68,678 | 1,069 | 192,086 |
| Fidelity Short-Term Bond Fund | 2,742,954 | 201,201 | 564,265 | 14,789 | 2,359,203 |
| Fidelity Strategic Income Fund | 543,276 | 21,066 | 127,977 | 8,631 | 435,885 |
| Fidelity Strategic Real Return Fund | 1,966,424 | 105,045 | 407,015 | 25,137 | 1,662,281 |
| Fidelity Total Bond Fund | 5,899,267 | 448,837 | 1,208,444 | 80,493 | 4,986,820 |
| Total | $29,525,876 | $1,753,026 | $6,925,165 | $277,502 | $24,626,348 |
Investment Valuation
All investments are categorized as Level 1 under the Fair Value Hierarchy. The inputs or methodology used for valuing securities may not be an indication of the risk associated with investing in those securities. For more information on valuation inputs please refer to the Investment Valuation section in the accompanying Notes to Financial Statements.
See accompanying notes which are an integral part of the financial statements.
Fidelity Income Replacement 2028 Fund℠
Financial Statements
Statement of Assets and Liabilities
| | | January 31, 2017 (Unaudited) |
| Assets | | |
| Investment in securities, at value (cost $22,976,284) — See accompanying schedule | | $24,626,348 |
| Cash | | 2 |
| Receivable for investments sold | | 215,807 |
| Receivable for fund shares sold | | 802 |
| Total assets | | 24,842,959 |
| Liabilities | | |
| Payable for investments purchased | $158,719 | |
| Payable for fund shares redeemed | 57,927 | |
| Distribution and service plan fees payable | 402 | |
| Total liabilities | | 217,048 |
| Net Assets | | $24,625,911 |
| Net Assets consist of: | | |
| Paid in capital | | $22,985,104 |
| Undistributed net investment income | | 5,561 |
| Accumulated undistributed net realized gain (loss) on investments | | (14,818) |
| Net unrealized appreciation (depreciation) on investments | | 1,650,064 |
| Net Assets | | $24,625,911 |
| Calculation of Maximum Offering Price | | |
| Class A: | | |
| Net Asset Value and redemption price per share ($378,542 ÷ 6,139.10 shares) | | $61.66 |
| Maximum offering price per share (100/94.25 of $61.66) | | $65.42 |
| Class T: | | |
| Net Asset Value and redemption price per share ($367,195 ÷ 5,955.70 shares) | | $61.65 |
| Maximum offering price per share (100/96.50 of $61.65) | | $63.89 |
| Class C: | | |
| Net Asset Value and offering price per share ($204,643 ÷ 3,332.30 shares)(a) | | $61.41 |
| Income Replacement 2028: | | |
| Net Asset Value, offering price and redemption price per share ($23,620,056 ÷ 383,127.50 shares) | | $61.65 |
| Class I: | | |
| Net Asset Value, offering price and redemption price per share ($55,475 ÷ 899.80 shares) | | $61.65 |
(a) Redemption price per share is equal to net asset value less any applicable contingent deferred sales charge.
See accompanying notes which are an integral part of the financial statements.
Statement of Operations
| | | Six months ended January 31, 2017 (Unaudited) |
| Investment Income | | |
| Income distributions from underlying funds | | $277,502 |
| Expenses | | |
| Distribution and service plan fees | $2,604 | |
| Independent trustees' fees and expenses | 62 | |
| Total expenses before reductions | 2,666 | |
| Expense reductions | (62) | 2,604 |
| Net investment income (loss) | | 274,898 |
| Realized and Unrealized Gain (Loss) | | |
| Realized gain (loss) on sale of underlying fund shares | (42,281) | |
| Capital gain distributions from underlying funds | 176,825 | |
| Total net realized gain (loss) | | 134,544 |
| Change in net unrealized appreciation (depreciation) on underlying funds | | 314,891 |
| Net gain (loss) | | 449,435 |
| Net increase (decrease) in net assets resulting from operations | | $724,333 |
See accompanying notes which are an integral part of the financial statements.
Statement of Changes in Net Assets
| | Six months ended January 31, 2017 (Unaudited) | Year ended July 31, 2016 |
| Increase (Decrease) in Net Assets | | |
| Operations | | |
| Net investment income (loss) | $274,898 | $478,240 |
| Net realized gain (loss) | 134,544 | 330,471 |
| Change in net unrealized appreciation (depreciation) | 314,891 | (163,247) |
| Net increase (decrease) in net assets resulting from operations | 724,333 | 645,464 |
| Distributions to shareholders from net investment income | (276,567) | (476,597) |
| Distributions to shareholders from net realized gain | (164,913) | (478,870) |
| Total distributions | (441,480) | (955,467) |
| Share transactions - net increase (decrease) | (5,182,337) | 2,040,175 |
| Total increase (decrease) in net assets | (4,899,484) | 1,730,172 |
| Net Assets | | |
| Beginning of period | 29,525,395 | 27,795,223 |
| End of period | $24,625,911 | $29,525,395 |
| Other Information | | |
| Undistributed net investment income end of period | $5,561 | $7,230 |
See accompanying notes which are an integral part of the financial statements.
Financial Highlights — Fidelity Income Replacement 2028 Fund Class A
| | Six months ended (Unaudited) January 31, | Years ended July 31, | | | | |
| | 2017 | 2016 | 2015 | 2014 | 2013 | 2012 |
| Selected Per–Share Data | | | | | | |
| Net asset value, beginning of period | $60.95 | $61.71 | $59.76 | $55.54 | $50.43 | $49.92 |
| Income from Investment Operations | | | | | | |
| Net investment income (loss)A | .538 | .815 | .758 | .733 | .868 | .792 |
| Net realized and unrealized gain (loss) | 1.084 | .196 | 2.089 | 4.363 | 5.348 | .666 |
| Total from investment operations | 1.622 | 1.011 | 2.847 | 5.096 | 6.216 | 1.458 |
| Distributions from net investment income | (.553) | (.798) | (.749) | (.713) | (.879) | (.794) |
| Distributions from net realized gain | (.359) | (.973) | (.148) | (.163) | (.227) | (.154) |
| Total distributions | (.912) | (1.771) | (.897) | (.876) | (1.106) | (.948) |
| Net asset value, end of period | $61.66 | $60.95 | $61.71 | $59.76 | $55.54 | $50.43 |
| Total ReturnB,C,D | 2.69% | 1.78% | 4.79% | 9.23% | 12.49% | 3.02% |
| Ratios to Average Net AssetsE,F | | | | | | |
| Expenses before reductions | .25%G | .25% | .25% | .25% | .25% | .25% |
| Expenses net of fee waivers, if any | .25%G | .25% | .25% | .25% | .25% | .25% |
| Expenses net of all reductions | .25%G | .25% | .25% | .25% | .25% | .25% |
| Net investment income (loss) | 1.76%G | 1.38% | 1.24% | 1.25% | 1.64% | 1.63% |
| Supplemental Data | | | | | | |
| Net assets, end of period (000 omitted) | $379 | $494 | $832 | $699 | $122 | $133 |
| Portfolio turnover rateE | 13%G | 47% | 28% | 18% | 34% | 46% |
A Calculated based on average shares outstanding during the period.
B Total returns for periods of less than one year are not annualized.
C Total returns would have been lower if certain expenses had not been reduced during the applicable periods shown.
D Total returns do not include the effect of the sales charges.
E Amounts do not include the activity of the Underlying Funds.
F Expense ratios reflect operating expenses of the class. Expenses before reductions do not reflect amounts reimbursed by the investment adviser or reductions from expense offset arrangements and do not represent the amount paid by the class during periods when reimbursements or reductions occur. Expenses net of fee waivers reflect expenses after reimbursement by the investment adviser but prior to reductions from expense offset arrangements. Expenses net of all reductions represent the net expenses paid by the class but do not include expenses of the underlying funds in which the Fund invests.
G Annualized
See accompanying notes which are an integral part of the financial statements.
Financial Highlights — Fidelity Income Replacement 2028 Fund Class T
| | Six months ended (Unaudited) January 31, | Years ended July 31, | | | | |
| | 2017 | 2016 | 2015 | 2014 | 2013 | 2012 |
| Selected Per–Share Data | | | | | | |
| Net asset value, beginning of period | $60.94 | $61.71 | $59.77 | $55.55 | $50.46 | $49.94 |
| Income from Investment Operations | | | | | | |
| Net investment income (loss)A | .462 | .667 | .604 | .580 | .738 | .672 |
| Net realized and unrealized gain (loss) | 1.082 | .189 | 2.087 | 4.379 | 5.346 | .678 |
| Total from investment operations | 1.544 | .856 | 2.691 | 4.959 | 6.084 | 1.350 |
| Distributions from net investment income | (.475) | (.653) | (.603) | (.576) | (.767) | (.676) |
| Distributions from net realized gain | (.359) | (.973) | (.148) | (.163) | (.227) | (.154) |
| Total distributions | (.834) | (1.626) | (.751) | (.739) | (.994) | (.830) |
| Net asset value, end of period | $61.65 | $60.94 | $61.71 | $59.77 | $55.55 | $50.46 |
| Total ReturnB,C,D | 2.56% | 1.51% | 4.52% | 8.97% | 12.21% | 2.79% |
| Ratios to Average Net AssetsE,F | | | | | | |
| Expenses before reductions | .50%G | .50% | .50% | .50% | .50% | .50% |
| Expenses net of fee waivers, if any | .50%G | .50% | .50% | .50% | .50% | .50% |
| Expenses net of all reductions | .50%G | .50% | .50% | .50% | .50% | .50% |
| Net investment income (loss) | 1.51%G | 1.13% | .99% | 1.00% | 1.39% | 1.38% |
| Supplemental Data | | | | | | |
| Net assets, end of period (000 omitted) | $367 | $419 | $466 | $338 | $326 | $128 |
| Portfolio turnover rateE | 13%G | 47% | 28% | 18% | 34% | 46% |
A Calculated based on average shares outstanding during the period.
B Total returns for periods of less than one year are not annualized.
C Total returns would have been lower if certain expenses had not been reduced during the applicable periods shown.
D Total returns do not include the effect of the sales charges.
E Amounts do not include the activity of the Underlying Funds.
F Expense ratios reflect operating expenses of the class. Expenses before reductions do not reflect amounts reimbursed by the investment adviser or reductions from expense offset arrangements and do not represent the amount paid by the class during periods when reimbursements or reductions occur. Expenses net of fee waivers reflect expenses after reimbursement by the investment adviser but prior to reductions from expense offset arrangements. Expenses net of all reductions represent the net expenses paid by the class but do not include expenses of the underlying funds in which the Fund invests.
G Annualized
See accompanying notes which are an integral part of the financial statements.
Financial Highlights — Fidelity Income Replacement 2028 Fund Class C
| | Six months ended (Unaudited) January 31, | Years ended July 31, | | | | |
| | 2017 | 2016 | 2015 | 2014 | 2013 | 2012 |
| Selected Per–Share Data | | | | | | |
| Net asset value, beginning of period | $60.72 | $61.52 | $59.65 | $55.49 | $50.44 | $49.94 |
| Income from Investment Operations | | | | | | |
| Net investment income (loss)A | .308 | .370 | .296 | .293 | .471 | .427 |
| Net realized and unrealized gain (loss) | 1.077 | .197 | 2.081 | 4.369 | 5.346 | .662 |
| Total from investment operations | 1.385 | .567 | 2.377 | 4.662 | 5.817 | 1.089 |
| Distributions from net investment income | (.336) | (.394) | (.359) | (.339) | (.540) | (.435) |
| Distributions from net realized gain | (.359) | (.973) | (.148) | (.163) | (.227) | (.154) |
| Total distributions | (.695) | (1.367) | (.507) | (.502) | (.767) | (.589) |
| Net asset value, end of period | $61.41 | $60.72 | $61.52 | $59.65 | $55.49 | $50.44 |
| Total ReturnB,C,D | 2.30% | 1.02% | 4.00% | 8.43% | 11.65% | 2.24% |
| Ratios to Average Net AssetsE,F | | | | | | |
| Expenses before reductions | 1.00%G | 1.00% | 1.00% | 1.00% | 1.00% | 1.00% |
| Expenses net of fee waivers, if any | 1.00%G | 1.00% | 1.00% | 1.00% | 1.00% | 1.00% |
| Expenses net of all reductions | 1.00%G | 1.00% | 1.00% | 1.00% | 1.00% | 1.00% |
| Net investment income (loss) | 1.01%G | .63% | .49% | .50% | .89% | .88% |
| Supplemental Data | | | | | | |
| Net assets, end of period (000 omitted) | $205 | $213 | $177 | $37 | $18 | $33 |
| Portfolio turnover rateE | 13%G | 47% | 28% | 18% | 34% | 46% |
A Calculated based on average shares outstanding during the period.
B Total returns for periods of less than one year are not annualized.
C Total returns would have been lower if certain expenses had not been reduced during the applicable periods shown.
D Total returns do not include the effect of the contingent deferred sales charge.
E Amounts do not include the activity of the Underlying Funds.
F Expense ratios reflect operating expenses of the class. Expenses before reductions do not reflect amounts reimbursed by the investment adviser or reductions from expense offset arrangements and do not represent the amount paid by the class during periods when reimbursements or reductions occur. Expenses net of fee waivers reflect expenses after reimbursement by the investment adviser but prior to reductions from expense offset arrangements. Expenses net of all reductions represent the net expenses paid by the class but do not include expenses of the underlying funds in which the Fund invests.
G Annualized
See accompanying notes which are an integral part of the financial statements.
Financial Highlights — Fidelity Income Replacement 2028 Fund
| | Six months ended (Unaudited) January 31, | Years ended July 31, | | | | |
| | 2017 | 2016 | 2015 | 2014 | 2013 | 2012 |
| Selected Per–Share Data | | | | | | |
| Net asset value, beginning of period | $60.94 | $61.71 | $59.76 | $55.54 | $50.44 | $49.92 |
| Income from Investment Operations | | | | | | |
| Net investment income (loss)A | .614 | .959 | .910 | .874 | 1.003 | .914 |
| Net realized and unrealized gain (loss) | 1.086 | .194 | 2.088 | 4.376 | 5.340 | .680 |
| Total from investment operations | 1.700 | 1.153 | 2.998 | 5.250 | 6.343 | 1.594 |
| Distributions from net investment income | (.631) | (.950) | (.900) | (.867) | (1.016) | (.920) |
| Distributions from net realized gain | (.359) | (.973) | (.148) | (.163) | (.227) | (.154) |
| Total distributions | (.990) | (1.923) | (1.048) | (1.030) | (1.243) | (1.074) |
| Net asset value, end of period | $61.65 | $60.94 | $61.71 | $59.76 | $55.54 | $50.44 |
| Total ReturnB,C | 2.82% | 2.03% | 5.05% | 9.52% | 12.76% | 3.30% |
| Ratios to Average Net AssetsD,E | | | | | | |
| Expenses before reductionsF | - %G | -% | -% | -% | -% | -% |
| Expenses net of fee waivers, if any | - %G | -% | -% | -% | -% | -% |
| Expenses net of all reductions | - %G | -% | -% | -% | -% | -% |
| Net investment income (loss) | 2.01%G | 1.63% | 1.49% | 1.50% | 1.89% | 1.88% |
| Supplemental Data | | | | | | |
| Net assets, end of period (000 omitted) | $23,620 | $28,337 | $26,020 | $21,766 | $7,494 | $5,405 |
| Portfolio turnover rateD | 13%G | 47% | 28% | 18% | 34% | 46% |
A Calculated based on average shares outstanding during the period.
B Total returns for periods of less than one year are not annualized.
C Total returns would have been lower if certain expenses had not been reduced during the applicable periods shown.
D Amounts do not include the activity of the Underlying Funds.
E Expense ratios reflect operating expenses of the class. Expenses before reductions do not reflect amounts reimbursed by the investment adviser or reductions from expense offset arrangements and do not represent the amount paid by the class during periods when reimbursements or reductions occur. Expenses net of fee waivers reflect expenses after reimbursement by the investment adviser but prior to reductions from expense offset arrangements. Expenses net of all reductions represent the net expenses paid by the class but do not include expenses of the underlying funds in which the Fund invests.
F Amount represents less than .005%.
G Annualized
See accompanying notes which are an integral part of the financial statements.
Financial Highlights — Fidelity Income Replacement 2028 Fund Class I
| | Six months ended (Unaudited) January 31, | Years ended July 31, | | | | |
| | 2017 | 2016 | 2015 | 2014 | 2013 | 2012 |
| Selected Per–Share Data | | | | | | |
| Net asset value, beginning of period | $60.94 | $61.71 | $59.76 | $55.54 | $50.44 | $49.92 |
| Income from Investment Operations | | | | | | |
| Net investment income (loss)A | .614 | .978 | .906 | .871 | 1.011 | .916 |
| Net realized and unrealized gain (loss) | 1.086 | .175 | 2.092 | 4.379 | 5.332 | .678 |
| Total from investment operations | 1.700 | 1.153 | 2.998 | 5.250 | 6.343 | 1.594 |
| Distributions from net investment income | (.631) | (.950) | (.900) | (.867) | (1.016) | (.920) |
| Distributions from net realized gain | (.359) | (.973) | (.148) | (.163) | (.227) | (.154) |
| Total distributions | (.990) | (1.923) | (1.048) | (1.030) | (1.243) | (1.074) |
| Net asset value, end of period | $61.65 | $60.94 | $61.71 | $59.76 | $55.54 | $50.44 |
| Total ReturnB,C | 2.82% | 2.03% | 5.05% | 9.52% | 12.76% | 3.30% |
| Ratios to Average Net AssetsD,E | | | | | | |
| Expenses before reductionsF | - %G | -% | -% | -% | -% | -% |
| Expenses net of fee waivers, if any | - %G | -% | -% | -% | -% | -% |
| Expenses net of all reductions | - %G | -% | -% | -% | -% | -% |
| Net investment income (loss) | 2.01%G | 1.63% | 1.49% | 1.50% | 1.89% | 1.88% |
| Supplemental Data | | | | | | |
| Net assets, end of period (000 omitted) | $55 | $62 | $300 | $91 | $83 | $24 |
| Portfolio turnover rateD | 13%G | 47% | 28% | 18% | 34% | 46% |
A Calculated based on average shares outstanding during the period.
B Total returns for periods of less than one year are not annualized.
C Total returns would have been lower if certain expenses had not been reduced during the applicable periods shown.
D Amounts do not include the activity of the Underlying Funds.
E Expense ratios reflect operating expenses of the class. Expenses before reductions do not reflect amounts reimbursed by the investment adviser or reductions from expense offset arrangements and do not represent the amount paid by the class during periods when reimbursements or reductions occur. Expenses net of fee waivers reflect expenses after reimbursement by the investment adviser but prior to reductions from expense offset arrangements. Expenses net of all reductions represent the net expenses paid by the class but do not include expenses of the underlying funds in which the Fund invests.
F Amount represents less than .005%.
G Annualized
See accompanying notes which are an integral part of the financial statements.
Fidelity Income Replacement 2030 Fund℠
Investment Summary (Unaudited)
The information in the following tables is based on the direct investments of the Fund.
Top Holdings as of January 31, 2017
| | % of fund's net assets | % of fund's net assets 6 months ago |
| Fidelity Total Bond Fund | 19.4 | 19.0 |
| Fidelity Series Broad Market Opportunities Fund | 9.5 | 9.6 |
| Fidelity Investments Money Market Government Portfolio Institutional Class 0.47% | 8.5 | 8.3 |
| Fidelity Short-Term Bond Fund | 8.4 | 8.3 |
| Fidelity Equity-Income Fund | 8.2 | 8.4 |
| Fidelity Strategic Real Return Fund | 6.5 | 6.4 |
| Fidelity Government Income Fund | 6.4 | 6.4 |
| Fidelity Large Cap Stock Fund | 6.2 | 6.3 |
| Fidelity Advisor Mid Cap II Fund Class I | 5.8 | 5.8 |
| Fidelity Advisor International Discovery Fund Class I | 5.6 | 5.8 |
| | 84.5 | 84.3 |
Asset Allocation (% of fund's net assets)
| Period end |
| | Domestic Equity Funds | 41.2% |
| | International Equity Funds | 5.6% |
| | High Yield Fixed-Income Funds | 4.0% |
| | Investment Grade Fixed-Income Funds | 32.3% |
| | Short-Term Funds | 16.9% |
| Six months ago |
| | Domestic Equity Funds | 41.7% |
| | International Equity Funds | 5.8% |
| | High Yield Fixed-Income Funds | 4.1% |
| | Investment Grade Fixed-Income Funds | 31.8% |
| | Short-Term Funds | 16.6% |
Fidelity Income Replacement 2030 Fund℠
Investments January 31, 2017 (Unaudited)
Showing Percentage of Net Assets
| Equity Funds - 46.8% | | | |
| | | Shares | Value |
| Domestic Equity Funds - 41.2% | | | |
| Fidelity Advisor Mid Cap II Fund Class I (a) | | 39,229 | $777,910 |
| Fidelity Blue Chip Growth Fund (a) | | 10,233 | 722,634 |
| Fidelity Equity-Income Fund (a) | | 19,257 | 1,112,263 |
| Fidelity Large Cap Stock Fund (a) | | 27,978 | 833,186 |
| Fidelity Series 100 Index Fund (a) | | 49,025 | 722,634 |
| Fidelity Series Broad Market Opportunities Fund (a) | | 78,895 | 1,278,092 |
| Fidelity Series Small Cap Opportunities Fund (a) | | 7,846 | 110,552 |
|
| TOTAL DOMESTIC EQUITY FUNDS | | | 5,557,271 |
|
| International Equity Funds - 5.6% | | | |
| Fidelity Advisor International Discovery Fund Class I (a) | | 20,042 | 754,991 |
| TOTAL EQUITY FUNDS | | | |
| (Cost $5,068,115) | | | 6,312,262 |
|
| Fixed-Income Funds - 36.3% | | | |
| High Yield Fixed-Income Funds - 4.0% | | | |
| Fidelity Capital & Income Fund (a) | | 27,345 | 270,988 |
| Fidelity Strategic Income Fund (a) | | 25,161 | 270,988 |
|
| TOTAL HIGH YIELD FIXED-INCOME FUNDS | | | 541,976 |
|
| Investment Grade Fixed-Income Funds - 32.3% | | | |
| Fidelity Government Income Fund (a) | | 85,289 | 868,239 |
| Fidelity Strategic Real Return Fund (a) | | 98,440 | 868,239 |
| Fidelity Total Bond Fund (a) | | 247,148 | 2,607,414 |
|
| TOTAL INVESTMENT GRADE FIXED-INCOME FUNDS | | | 4,343,892 |
|
| TOTAL FIXED-INCOME FUNDS | | | |
| (Cost $4,919,286) | | | 4,885,868 |
|
| Short-Term Funds - 16.9% | | | |
| Fidelity Investments Money Market Government Portfolio Institutional Class 0.47% (a)(b) | | 1,141,924 | 1,141,924 |
| Fidelity Short-Term Bond Fund (a) | | 132,936 | 1,141,923 |
| TOTAL SHORT-TERM FUNDS | | | |
| (Cost $2,278,115) | | | 2,283,847 |
| TOTAL INVESTMENT PORTFOLIO - 100.0% | | | |
| (Cost $12,265,516) | | | 13,481,977 |
| NET OTHER ASSETS (LIABILITIES) - 0.0% | | | (190) |
| NET ASSETS - 100% | | | $13,481,787 |
Legend
(a) Affiliated Fund
(b) The rate quoted is the annualized seven-day yield of the fund at period end.
Affiliated Underlying Funds
Information regarding the Fund's fiscal year to date purchases and sales of the affiliated Underlying Funds and income earned by the Fund from investments in affiliated Underlying Funds is as follows:
| Affiliate | Value, beginning of period | Purchases | Sales Proceeds | Dividend Income | Value, end of period |
| Fidelity Advisor International Discovery Fund Class I | $824,854 | $73,804 | $131,528 | $12,160 | $754,991 |
| Fidelity Advisor Mid Cap II Fund Class I | 830,543 | 68,275 | 151,727 | 3,540 | 777,910 |
| Fidelity Blue Chip Growth Fund | 770,812 | 65,577 | 125,933 | 1,581 | 722,634 |
| Fidelity Capital & Income Fund | 294,387 | 14,432 | 49,102 | 6,040 | 270,988 |
| Fidelity Equity-Income Fund | 1,186,083 | 71,779 | 209,999 | 16,081 | 1,112,263 |
| Fidelity Government Income Fund | 903,073 | 110,500 | 103,276 | 6,925 | 868,239 |
| Fidelity Investments Money Market Government Portfolio Institutional Class 0.47% | 1,181,817 | 105,160 | 145,053 | 1,958 | 1,141,924 |
| Fidelity Large Cap Stock Fund | 888,851 | 42,744 | 167,100 | 7,349 | 833,186 |
| Fidelity Series 100 Index Fund | 770,812 | 42,986 | 113,462 | 15,740 | 722,634 |
| Fidelity Series Broad Market Opportunities Fund | 1,363,854 | 66,933 | 229,445 | 6,071 | 1,278,092 |
| Fidelity Series Small Cap Opportunities Fund | 118,039 | 7,502 | 24,479 | 554 | 110,552 |
| Fidelity Short-Term Bond Fund | 1,181,817 | 113,289 | 144,197 | 6,479 | 1,141,923 |
| Fidelity Strategic Income Fund | 294,387 | 17,321 | 40,631 | 4,795 | 270,988 |
| Fidelity Strategic Real Return Fund | 903,073 | 74,348 | 108,593 | 11,753 | 868,239 |
| Fidelity Total Bond Fund | 2,709,220 | 287,541 | 319,073 | 37,794 | 2,607,414 |
| Total | $14,221,622 | $1,162,191 | $2,063,598 | $138,820 | $13,481,977 |
Investment Valuation
All investments are categorized as Level 1 under the Fair Value Hierarchy. The inputs or methodology used for valuing securities may not be an indication of the risk associated with investing in those securities. For more information on valuation inputs please refer to the Investment Valuation section in the accompanying Notes to Financial Statements.
See accompanying notes which are an integral part of the financial statements.
Fidelity Income Replacement 2030 Fund℠
Financial Statements
Statement of Assets and Liabilities
| | | January 31, 2017 (Unaudited) |
| Assets | | |
| Investment in securities, at value (cost $12,265,516) — See accompanying schedule | | $13,481,977 |
| Cash | | 2 |
| Receivable for investments sold | | 77,752 |
| Receivable for fund shares sold | | 59,849 |
| Total assets | | 13,619,580 |
| Liabilities | | |
| Payable for investments purchased | $112,445 | |
| Payable for fund shares redeemed | 25,146 | |
| Distribution and service plan fees payable | 202 | |
| Total liabilities | | 137,793 |
| Net Assets | | $13,481,787 |
| Net Assets consist of: | | |
| Paid in capital | | $12,234,895 |
| Undistributed net investment income | | 2,998 |
| Accumulated undistributed net realized gain (loss) on investments | | 27,433 |
| Net unrealized appreciation (depreciation) on investments | | 1,216,461 |
| Net Assets | | $13,481,787 |
| Calculation of Maximum Offering Price | | |
| Class A: | | |
| Net Asset Value and redemption price per share ($129,451 ÷ 2,130.09 shares) | | $60.77 |
| Maximum offering price per share (100/94.25 of $60.77) | | $64.48 |
| Class T: | | |
| Net Asset Value and redemption price per share ($16,336 ÷ 268.33 shares) | | $60.88 |
| Maximum offering price per share (100/96.50 of $60.88) | | $63.09 |
| Class C: | | |
| Net Asset Value and offering price per share ($199,903 ÷ 3,307.95 shares)(a) | | $60.43 |
| Income Replacement 2030: | | |
| Net Asset Value, offering price and redemption price per share ($13,104,467 ÷ 215,650.47 shares) | | $60.77 |
| Class I: | | |
| Net Asset Value, offering price and redemption price per share ($31,630 ÷ 520.47 shares) | | $60.77 |
(a) Redemption price per share is equal to net asset value less any applicable contingent deferred sales charge.
See accompanying notes which are an integral part of the financial statements.
Statement of Operations
| | | Six months ended January 31, 2017 (Unaudited) |
| Investment Income | | |
| Income distributions from underlying funds | | $138,820 |
| Expenses | | |
| Distribution and service plan fees | $1,206 | |
| Independent trustees' fees and expenses | 31 | |
| Total expenses before reductions | 1,237 | |
| Expense reductions | (31) | 1,206 |
| Net investment income (loss) | | 137,614 |
| Realized and Unrealized Gain (Loss) | | |
| Realized gain (loss) on sale of underlying fund shares | 12,345 | |
| Capital gain distributions from underlying funds | 90,637 | |
| Total net realized gain (loss) | | 102,982 |
| Change in net unrealized appreciation (depreciation) on underlying funds | | 149,416 |
| Net gain (loss) | | 252,398 |
| Net increase (decrease) in net assets resulting from operations | | $390,012 |
See accompanying notes which are an integral part of the financial statements.
Statement of Changes in Net Assets
| | Six months ended January 31, 2017 (Unaudited) | Year ended July 31, 2016 |
| Increase (Decrease) in Net Assets | | |
| Operations | | |
| Net investment income (loss) | $137,614 | $248,184 |
| Net realized gain (loss) | 102,982 | 184,594 |
| Change in net unrealized appreciation (depreciation) | 149,416 | (282,030) |
| Net increase (decrease) in net assets resulting from operations | 390,012 | 150,748 |
| Distributions to shareholders from net investment income | (137,952) | (248,283) |
| Distributions to shareholders from net realized gain | (107,778) | (388,383) |
| Total distributions | (245,730) | (636,666) |
| Share transactions - net increase (decrease) | (883,930) | (3,054,764) |
| Total increase (decrease) in net assets | (739,648) | (3,540,682) |
| Net Assets | | |
| Beginning of period | 14,221,435 | 17,762,117 |
| End of period | $13,481,787 | $14,221,435 |
| Other Information | | |
| Undistributed net investment income end of period | $2,998 | $3,336 |
See accompanying notes which are an integral part of the financial statements.
Financial Highlights — Fidelity Income Replacement 2030 Fund Class A
| | Six months ended (Unaudited) January 31, | Years ended July 31, | | | | |
| | 2017 | 2016 | 2015 | 2014 | 2013 | 2012 |
| Selected Per–Share Data | | | | | | |
| Net asset value, beginning of period | $60.07 | $61.33 | $59.84 | $55.45 | $50.12 | $49.65 |
| Income from Investment Operations | | | | | | |
| Net investment income (loss)A | .542 | .799 | .747 | .740 | .886 | .815 |
| Net realized and unrealized gain (loss) | 1.185 | .112B | 2.210 | 4.505 | 5.568 | .598 |
| Total from investment operations | 1.727 | .911 | 2.957 | 5.245 | 6.454 | 1.413 |
| Distributions from net investment income | (.552) | (.794) | (.746) | (.700) | (.896) | (.796) |
| Distributions from net realized gain | (.475) | (1.377) | (.721) | (.155) | (.228) | (.147) |
| Total distributions | (1.027) | (2.171) | (1.467) | (.855) | (1.124) | (.943) |
| Net asset value, end of period | $60.77 | $60.07 | $61.33 | $59.84 | $55.45 | $50.12 |
| Total ReturnC,D,E | 2.91% | 1.67% | 5.00% | 9.51% | 13.06% | 2.94% |
| Ratios to Average Net AssetsF,G | | | | | | |
| Expenses before reductions | .25%H | .25% | .25% | .25% | .25% | .25% |
| Expenses net of fee waivers, if any | .25%H | .25% | .25% | .25% | .25% | .25% |
| Expenses net of all reductions | .25%H | .25% | .25% | .25% | .25% | .25% |
| Net investment income (loss) | 1.80%H | 1.38% | 1.23% | 1.27% | 1.67% | 1.68% |
| Supplemental Data | | | | | | |
| Net assets, end of period (000 omitted) | $129 | $156 | $285 | $257 | $145 | $86 |
| Portfolio turnover rate F | 17%H | 26% | 26% | 27% | 32% | 50% |
A Calculated based on average shares outstanding during the period.
B The amount shown for a share outstanding does not correspond with the aggregate net gain (loss) on investments for the period due to the timing of sales and repurchases of shares in relation to fluctuating market values of the investments of the Fund.
C Total returns for periods of less than one year are not annualized.
D Total returns would have been lower if certain expenses had not been reduced during the applicable periods shown.
E Total returns do not include the effect of the sales charges.
F Amounts do not include the activity of the Underlying Funds.
G Expense ratios reflect operating expenses of the class. Expenses before reductions do not reflect amounts reimbursed by the investment adviser or reductions from expense offset arrangements and do not represent the amount paid by the class during periods when reimbursements or reductions occur. Expenses net of fee waivers reflect expenses after reimbursement by the investment adviser but prior to reductions from expense offset arrangements. Expenses net of all reductions represent the net expenses paid by the class but do not include expenses of the underlying funds in which the Fund invests.
H Annualized
See accompanying notes which are an integral part of the financial statements.
Financial Highlights — Fidelity Income Replacement 2030 Fund Class T
| | Six months ended (Unaudited) January 31, | Years ended July 31, | | | | |
| | 2017 | 2016 | 2015 | 2014 | 2013 | 2012 |
| Selected Per–Share Data | | | | | | |
| Net asset value, beginning of period | $60.19 | $61.44 | $59.95 | $55.55 | $50.20 | $49.67 |
| Income from Investment Operations | | | | | | |
| Net investment income (loss)A | .467 | .658 | .600 | .597 | .745 | .715 |
| Net realized and unrealized gain (loss) | 1.182 | .118B | 2.211 | 4.507 | 5.590 | .598 |
| Total from investment operations | 1.649 | .776 | 2.811 | 5.104 | 6.335 | 1.313 |
| Distributions from net investment income | (.484) | (.649) | (.600) | (.549) | (.757) | (.636) |
| Distributions from net realized gain | (.475) | (1.377) | (.721) | (.155) | (.228) | (.147) |
| Total distributions | (.959) | (2.026) | (1.321) | (.704) | (.985) | (.783) |
| Net asset value, end of period | $60.88 | $60.19 | $61.44 | $59.95 | $55.55 | $50.20 |
| Total ReturnC,D,E | 2.77% | 1.43% | 4.74% | 9.23% | 12.78% | 2.72% |
| Ratios to Average Net AssetsF,G | | | | | | |
| Expenses before reductions | .50%H | .50% | .50% | .50% | .51%I | .50% |
| Expenses net of fee waivers, if any | .50%H | .50% | .50% | .50% | .51%I | .46% |
| Expenses net of all reductions | .50%H | .50% | .50% | .50% | .51%I | .46% |
| Net investment income (loss) | 1.55%H | 1.13% | .99% | 1.03% | 1.41% | 1.48% |
| Supplemental Data | | | | | | |
| Net assets, end of period (000 omitted) | $16 | $16 | $21 | $17 | $15 | $13 |
| Portfolio turnover rate F | 17%H | 26% | 26% | 27% | 32% | 50% |
A Calculated based on average shares outstanding during the period.
B The amount shown for a share outstanding does not correspond with the aggregate net gain (loss) on investments for the period due to the timing of sales and repurchases of shares in relation to fluctuating market values of the investments of the Fund.
C Total returns for periods of less than one year are not annualized.
D Total returns would have been lower if certain expenses had not been reduced during the applicable periods shown.
E Total returns do not include the effect of the sales charges.
F Amounts do not include the activity of the Underlying Funds.
G Expense ratios reflect operating expenses of the class. Expenses before reductions do not reflect amounts reimbursed by the investment adviser or reductions from expense offset arrangements and do not represent the amount paid by the class during periods when reimbursements or reductions occur. Expenses net of fee waivers reflect expenses after reimbursement by the investment adviser but prior to reductions from expense offset arrangements. Expenses net of all reductions represent the net expenses paid by the class but do not include expenses of the underlying funds in which the Fund invests.
H Annualized
I On certain classes, the size and fluctuation of net assets may cause rounding of expense amounts and ratios to differ from contractual rates.
See accompanying notes which are an integral part of the financial statements.
Financial Highlights — Fidelity Income Replacement 2030 Fund Class C
| | Six months ended (Unaudited) January 31, | Years ended July 31, | | | | |
| | 2017 | 2016 | 2015 | 2014 | 2013 | 2012 |
| Selected Per–Share Data | | | | | | |
| Net asset value, beginning of period | $59.76 | $61.06 | $59.64 | $55.33 | $50.07 | $49.61 |
| Income from Investment Operations | | | | | | |
| Net investment income (loss)A | .314 | .361 | .291 | .303 | .486 | .451 |
| Net realized and unrealized gain (loss) | 1.174 | .115B | 2.202 | 4.486 | 5.561 | .604 |
| Total from investment operations | 1.488 | .476 | 2.493 | 4.789 | 6.047 | 1.055 |
| Distributions from net investment income | (.343) | (.399) | (.352) | (.324) | (.559) | (.448) |
| Distributions from net realized gain | (.475) | (1.377) | (.721) | (.155) | (.228) | (.147) |
| Total distributions | (.818) | (1.776) | (1.073) | (.479) | (.787) | (.595) |
| Net asset value, end of period | $60.43 | $59.76 | $61.06 | $59.64 | $55.33 | $50.07 |
| Total ReturnC,D,E | 2.52% | .92% | 4.22% | 8.68% | 12.21% | 2.19% |
| Ratios to Average Net AssetsF,G | | | | | | |
| Expenses before reductions | 1.00%H | 1.00% | 1.00% | 1.00% | 1.00% | 1.00% |
| Expenses net of fee waivers, if any | 1.00%H | 1.00% | 1.00% | 1.00% | 1.00% | 1.00% |
| Expenses net of all reductions | 1.00%H | 1.00% | 1.00% | 1.00% | 1.00% | 1.00% |
| Net investment income (loss) | 1.05%H | .63% | .48% | .52% | .92% | .93% |
| Supplemental Data | | | | | | |
| Net assets, end of period (000 omitted) | $200 | $200 | $345 | $353 | $315 | $312 |
| Portfolio turnover rate F | 17%H | 26% | 26% | 27% | 32% | 50% |
A Calculated based on average shares outstanding during the period.
B The amount shown for a share outstanding does not correspond with the aggregate net gain (loss) on investments for the period due to the timing of sales and repurchases of shares in relation to fluctuating market values of the investments of the Fund.
C Total returns for periods of less than one year are not annualized.
D Total returns would have been lower if certain expenses had not been reduced during the applicable periods shown.
E Total returns do not include the effect of the contingent deferred sales charge.
F Amounts do not include the activity of the Underlying Funds.
G Expense ratios reflect operating expenses of the class. Expenses before reductions do not reflect amounts reimbursed by the investment adviser or reductions from expense offset arrangements and do not represent the amount paid by the class during periods when reimbursements or reductions occur. Expenses net of fee waivers reflect expenses after reimbursement by the investment adviser but prior to reductions from expense offset arrangements. Expenses net of all reductions represent the net expenses paid by the class but do not include expenses of the underlying funds in which the Fund invests.
H Annualized
See accompanying notes which are an integral part of the financial statements.
Financial Highlights — Fidelity Income Replacement 2030 Fund
| | Six months ended (Unaudited) January 31, | Years ended July 31, | | | | |
| | 2017 | 2016 | 2015 | 2014 | 2013 | 2012 |
| Selected Per–Share Data | | | | | | |
| Net asset value, beginning of period | $60.07 | $61.33 | $59.84 | $55.45 | $50.12 | $49.64 |
| Income from Investment Operations | | | | | | |
| Net investment income (loss)A | .617 | .944 | .900 | .888 | 1.015 | .935 |
| Net realized and unrealized gain (loss) | 1.186 | .116B | 2.209 | 4.502 | 5.567 | .608 |
| Total from investment operations | 1.803 | 1.060 | 3.109 | 5.390 | 6.582 | 1.543 |
| Distributions from net investment income | (.628) | (.943) | (.898) | (.845) | (1.024) | (.916) |
| Distributions from net realized gain | (.475) | (1.377) | (.721) | (.155) | (.228) | (.147) |
| Total distributions | (1.103) | (2.320) | (1.619) | (1.000) | (1.252) | (1.063) |
| Net asset value, end of period | $60.77 | $60.07 | $61.33 | $59.84 | $55.45 | $50.12 |
| Total ReturnC,D | 3.04% | 1.93% | 5.27% | 9.78% | 13.33% | 3.22% |
| Ratios to Average Net AssetsE,F | | | | | | |
| Expenses before reductions G | - %H | -% | -% | -% | -% | -% |
| Expenses net of fee waivers, if any | - %H | -% | -% | -% | -% | -% |
| Expenses net of all reductions | - %H | -% | -% | -% | -% | -% |
| Net investment income (loss) | 2.05%H | 1.63% | 1.48% | 1.52% | 1.92% | 1.93% |
| Supplemental Data | | | | | | |
| Net assets, end of period (000 omitted) | $13,104 | $13,819 | $17,079 | $15,175 | $5,367 | $3,558 |
| Portfolio turnover rate E | 17%H | 26% | 26% | 27% | 32% | 50% |
A Calculated based on average shares outstanding during the period.
B The amount shown for a share outstanding does not correspond with the aggregate net gain (loss) on investments for the period due to the timing of sales and repurchases of shares in relation to fluctuating market values of the investments of the Fund.
C Total returns for periods of less than one year are not annualized.
D Total returns would have been lower if certain expenses had not been reduced during the applicable periods shown.
E Amounts do not include the activity of the Underlying Funds.
F Expense ratios reflect operating expenses of the class. Expenses before reductions do not reflect amounts reimbursed by the investment adviser or reductions from expense offset arrangements and do not represent the amount paid by the class during periods when reimbursements or reductions occur. Expenses net of fee waivers reflect expenses after reimbursement by the investment adviser but prior to reductions from expense offset arrangements. Expenses net of all reductions represent the net expenses paid by the class but do not include expenses of the underlying funds in which the Fund invests.
G Amount represents less than .005%.
H Annualized
See accompanying notes which are an integral part of the financial statements.
Financial Highlights — Fidelity Income Replacement 2030 Fund Class I
| | Six months ended (Unaudited) January 31, | Years ended July 31, | | | | |
| | 2017 | 2016 | 2015 | 2014 | 2013 | 2012 |
| Selected Per–Share Data | | | | | | |
| Net asset value, beginning of period | $60.07 | $61.33 | $59.84 | $55.45 | $50.12 | $49.64 |
| Income from Investment Operations | | | | | | |
| Net investment income (loss)A | .616 | .942 | .902 | .885 | 1.020 | .936 |
| Net realized and unrealized gain (loss) | 1.187 | .118B | 2.207 | 4.505 | 5.562 | .607 |
| Total from investment operations | 1.803 | 1.060 | 3.109 | 5.390 | 6.582 | 1.543 |
| Distributions from net investment income | (.628) | (.943) | (.898) | (.845) | (1.024) | (.916) |
| Distributions from net realized gain | (.475) | (1.377) | (.721) | (.155) | (.228) | (.147) |
| Total distributions | (1.103) | (2.320) | (1.619) | (1.000) | (1.252) | (1.063) |
| Net asset value, end of period | $60.77 | $60.07 | $61.33 | $59.84 | $55.45 | $50.12 |
| Total ReturnC,D | 3.04% | 1.93% | 5.26% | 9.78% | 13.33% | 3.22% |
| Ratios to Average Net AssetsE,F | | | | | | |
| Expenses before reductions G | - %H | -% | -% | -% | -% | -% |
| Expenses net of fee waivers, if any | - %H | -% | -% | -% | -% | -% |
| Expenses net of all reductions | - %H | -% | -% | -% | -% | -% |
| Net investment income (loss) | 2.05%H | 1.63% | 1.48% | 1.52% | 1.92% | 1.93% |
| Supplemental Data | | | | | | |
| Net assets, end of period (000 omitted) | $32 | $31 | $32 | $63 | $57 | $24 |
| Portfolio turnover rate E | 17%H | 26% | 26% | 27% | 32% | 50% |
A Calculated based on average shares outstanding during the period.
B The amount shown for a share outstanding does not correspond with the aggregate net gain (loss) on investments for the period due to the timing of sales and repurchases of shares in relation to fluctuating market values of the investments of the Fund.
C Total returns for periods of less than one year are not annualized.
D Total returns would have been lower if certain expenses had not been reduced during the applicable periods shown.
E Amounts do not include the activity of the Underlying Funds.
F Expense ratios reflect operating expenses of the class. Expenses before reductions do not reflect amounts reimbursed by the investment adviser or reductions from expense offset arrangements and do not represent the amount paid by the class during periods when reimbursements or reductions occur. Expenses net of fee waivers reflect expenses after reimbursement by the investment adviser but prior to reductions from expense offset arrangements. Expenses net of all reductions represent the net expenses paid by the class but do not include expenses of the underlying funds in which the Fund invests.
G Amount represents less than .005%.
H Annualized
See accompanying notes which are an integral part of the financial statements.
Fidelity Income Replacement 2032 Fund℠
Investment Summary (Unaudited)
The information in the following tables is based on the direct investments of the Fund.
Top Holdings as of January 31, 2017
| | % of fund's net assets | % of fund's net assets 6 months ago |
| Fidelity Total Bond Fund | 18.4 | 18.1 |
| Fidelity Series Broad Market Opportunities Fund | 9.9 | 10.0 |
| Fidelity Equity-Income Fund | 8.6 | 8.7 |
| Fidelity Investments Money Market Government Portfolio Institutional Class 0.47% | 7.8 | 7.7 |
| Fidelity Short-Term Bond Fund | 7.8 | 7.6 |
| Fidelity Large Cap Stock Fund | 6.4 | 6.5 |
| Fidelity Advisor International Discovery Fund Class I | 6.4 | 6.6 |
| Fidelity Strategic Real Return Fund | 6.1 | 6.1 |
| Fidelity Government Income Fund | 6.1 | 6.1 |
| Fidelity Advisor Mid Cap II Fund Class I | 6.0 | 6.0 |
| | 83.5 | 83.4 |
Asset Allocation (% of fund's net assets)
| Period end |
| | Domestic Equity Funds | 43.0% |
| | International Equity Funds | 6.4% |
| | High Yield Fixed-Income Funds | 4.4% |
| | Investment Grade Fixed-Income Funds | 30.6% |
| | Short-Term Funds | 15.6% |
| Six months ago |
| | Domestic Equity Funds | 43.3% |
| | International Equity Funds | 6.6% |
| | High Yield Fixed-Income Funds | 4.5% |
| | Investment Grade Fixed-Income Funds | 30.3% |
| | Short-Term Funds | 15.3% |
Fidelity Income Replacement 2032 Fund℠
Investments January 31, 2017 (Unaudited)
Showing Percentage of Net Assets
| Equity Funds - 49.4% | | | |
| | | Shares | Value |
| Domestic Equity Funds - 43.0% | | | |
| Fidelity Advisor Mid Cap II Fund Class I (a) | | 22,202 | $440,257 |
| Fidelity Blue Chip Growth Fund (a) | | 5,788 | 408,758 |
| Fidelity Equity-Income Fund (a) | | 10,894 | 629,253 |
| Fidelity Large Cap Stock Fund (a) | | 15,841 | 471,756 |
| Fidelity Series 100 Index Fund (a) | | 27,731 | 408,758 |
| Fidelity Series Broad Market Opportunities Fund (a) | | 44,676 | 723,750 |
| Fidelity Series Small Cap Opportunities Fund (a) | | 4,471 | 62,999 |
|
| TOTAL DOMESTIC EQUITY FUNDS | | | 3,145,531 |
|
| International Equity Funds - 6.4% | | | |
| Fidelity Advisor International Discovery Fund Class I (a) | | 12,446 | 468,826 |
| TOTAL EQUITY FUNDS | | | |
| (Cost $2,755,618) | | | 3,614,357 |
|
| Fixed-Income Funds - 35.0% | | | |
| High Yield Fixed-Income Funds - 4.4% | | | |
| Fidelity Capital & Income Fund (a) | | 16,262 | 161,159 |
| Fidelity Strategic Income Fund (a) | | 14,964 | 161,159 |
|
| TOTAL HIGH YIELD FIXED-INCOME FUNDS | | | 322,318 |
|
| Investment Grade Fixed-Income Funds - 30.6% | | | |
| Fidelity Government Income Fund (a) | | 44,039 | 448,315 |
| Fidelity Strategic Real Return Fund (a) | | 50,829 | 448,315 |
| Fidelity Total Bond Fund (a) | | 127,622 | 1,346,410 |
|
| TOTAL INVESTMENT GRADE FIXED-INCOME FUNDS | | | 2,243,040 |
|
| TOTAL FIXED-INCOME FUNDS | | | |
| (Cost $2,607,868) | | | 2,565,358 |
|
| Short-Term Funds - 15.6% | | | |
| Fidelity Investments Money Market Government Portfolio Institutional Class 0.47% (a)(b) | | 572,847 | 572,847 |
| Fidelity Short-Term Bond Fund (a) | | 66,688 | 572,847 |
| TOTAL SHORT-TERM FUNDS | | | |
| (Cost $1,143,672) | | | 1,145,694 |
| TOTAL INVESTMENT PORTFOLIO - 100.0% | | | |
| (Cost $6,507,158) | | | 7,325,409 |
| NET OTHER ASSETS (LIABILITIES) - 0.0% | | | (189) |
| NET ASSETS - 100% | | | $7,325,220 |
Legend
(a) Affiliated Fund
(b) The rate quoted is the annualized seven-day yield of the fund at period end.
Affiliated Underlying Funds
Information regarding the Fund's fiscal year to date purchases and sales of the affiliated Underlying Funds and income earned by the Fund from investments in affiliated Underlying Funds is as follows:
| Affiliate | Value, beginning of period | Purchases | Sales Proceeds | Dividend Income | Value, end of period |
| Fidelity Advisor International Discovery Fund Class I | $486,247 | $50,028 | $59,860 | $7,793 | $468,826 |
| Fidelity Advisor Mid Cap II Fund Class I | 447,141 | 43,493 | 69,401 | 2,070 | 440,257 |
| Fidelity Blue Chip Growth Fund | 415,413 | 40,251 | 54,407 | 893 | 408,758 |
| Fidelity Capital & Income Fund | 166,018 | 9,922 | 21,580 | 3,588 | 161,159 |
| Fidelity Equity-Income Fund | 638,983 | 44,435 | 92,671 | 9,130 | 629,253 |
| Fidelity Government Income Fund | 447,879 | 58,850 | 36,312 | 3,586 | 448,315 |
| Fidelity Investments Money Market Government Portfolio Institutional Class 0.47% | 564,460 | 58,677 | 50,290 | 983 | 572,847 |
| Fidelity Large Cap Stock Fund | 478,869 | 28,478 | 75,755 | 4,348 | 471,756 |
| Fidelity Series 100 Index Fund | 415,413 | 27,806 | 48,190 | 9,180 | 408,758 |
| Fidelity Series Broad Market Opportunities Fund | 734,905 | 42,006 | 98,904 | 3,551 | 723,750 |
| Fidelity Series Small Cap Opportunities Fund | 64,193 | 5,086 | 12,003 | 314 | 62,999 |
| Fidelity Short-Term Bond Fund | 564,460 | 62,864 | 49,880 | 3,263 | 572,847 |
| Fidelity Strategic Income Fund | 166,018 | 11,949 | 16,701 | 2,842 | 161,159 |
| Fidelity Strategic Real Return Fund | 447,879 | 39,687 | 39,439 | 6,082 | 448,315 |
| Fidelity Total Bond Fund | 1,340,683 | 157,464 | 114,489 | 19,598 | 1,346,410 |
| Total | $7,378,561 | $680,996 | $839,882 | $77,221 | $7,325,409 |
Investment Valuation
All investments are categorized as Level 1 under the Fair Value Hierarchy. The inputs or methodology used for valuing securities may not be an indication of the risk associated with investing in those securities. For more information on valuation inputs please refer to the Investment Valuation section in the accompanying Notes to Financial Statements.
See accompanying notes which are an integral part of the financial statements.
Fidelity Income Replacement 2032 Fund℠
Financial Statements
Statement of Assets and Liabilities
| | | January 31, 2017 (Unaudited) |
| Assets | | |
| Investment in securities, at value (cost $6,507,158) — See accompanying schedule | | $7,325,409 |
| Receivable for investments sold | | 50,375 |
| Total assets | | 7,375,784 |
| Liabilities | | |
| Payable for investments purchased | $50,371 | |
| Distribution and service plan fees payable | 193 | |
| Total liabilities | | 50,564 |
| Net Assets | | $7,325,220 |
| Net Assets consist of: | | |
| Paid in capital | | $6,476,969 |
| Undistributed net investment income | | 1,488 |
| Accumulated undistributed net realized gain (loss) on investments | | 28,512 |
| Net unrealized appreciation (depreciation) on investments | | 818,251 |
| Net Assets | | $7,325,220 |
| Calculation of Maximum Offering Price | | |
| Class A: | | |
| Net Asset Value and redemption price per share ($380,514 ÷ 6,595.35 shares) | | $57.69 |
| Maximum offering price per share (100/94.25 of $57.69) | | $61.21 |
| Class T: | | |
| Net Asset Value and redemption price per share ($21,778 ÷ 377.14 shares) | | $57.75 |
| Maximum offering price per share (100/96.50 of $57.75) | | $59.84 |
| Class C: | | |
| Net Asset Value and offering price per share ($125,820 ÷ 2,189.73 shares)(a) | | $57.46 |
| Income Replacement 2032: | | |
| Net Asset Value, offering price and redemption price per share ($6,739,063 ÷ 116,767.89 shares) | | $57.71 |
| Class I: | | |
| Net Asset Value, offering price and redemption price per share ($58,045 ÷ 1,005.73 shares) | | $57.71 |
(a) Redemption price per share is equal to net asset value less any applicable contingent deferred sales charge.
See accompanying notes which are an integral part of the financial statements.
Statement of Operations
| | | Six months ended January 31, 2017 (Unaudited) |
| Investment Income | | |
| Income distributions from underlying funds | | $77,221 |
| Expenses | | |
| Distribution and service plan fees | $1,206 | |
| Independent trustees' fees and expenses | 17 | |
| Total expenses before reductions | 1,223 | |
| Expense reductions | (17) | 1,206 |
| Net investment income (loss) | | 76,015 |
| Realized and Unrealized Gain (Loss) | | |
| Realized gain (loss) on sale of underlying fund shares | 15,589 | |
| Capital gain distributions from underlying funds | 51,916 | |
| Total net realized gain (loss) | | 67,505 |
| Change in net unrealized appreciation (depreciation) on underlying funds | | 90,145 |
| Net gain (loss) | | 157,650 |
| Net increase (decrease) in net assets resulting from operations | | $233,665 |
See accompanying notes which are an integral part of the financial statements.
Statement of Changes in Net Assets
| | Six months ended January 31, 2017 (Unaudited) | Year ended July 31, 2016 |
| Increase (Decrease) in Net Assets | | |
| Operations | | |
| Net investment income (loss) | $76,015 | $121,337 |
| Net realized gain (loss) | 67,505 | 114,028 |
| Change in net unrealized appreciation (depreciation) | 90,145 | (155,017) |
| Net increase (decrease) in net assets resulting from operations | 233,665 | 80,348 |
| Distributions to shareholders from net investment income | (76,236) | (121,233) |
| Distributions to shareholders from net realized gain | (87,566) | (198,372) |
| Total distributions | (163,802) | (319,605) |
| Share transactions - net increase (decrease) | (123,006) | (929,485) |
| Total increase (decrease) in net assets | (53,143) | (1,168,742) |
| Net Assets | | |
| Beginning of period | 7,378,363 | 8,547,105 |
| End of period | $7,325,220 | $7,378,363 |
| Other Information | | |
| Undistributed net investment income end of period | $1,488 | $1,709 |
See accompanying notes which are an integral part of the financial statements.
Financial Highlights — Fidelity Income Replacement 2032 Fund Class A
| | Six months ended (Unaudited) January 31, | Years ended July 31, | | | | |
| | 2017 | 2016 | 2015 | 2014 | 2013 | 2012 |
| Selected Per–Share Data | | | | | | |
| Net asset value, beginning of period | $57.18 | $58.52 | $56.72 | $53.04 | $47.91 | $49.07 |
| Income from Investment Operations | | | | | | |
| Net investment income (loss)A | .528 | .758 | .738 | .718 | .906 | .717 |
| Net realized and unrealized gain (loss) | 1.197 | .040B | 2.196 | 4.379 | 5.480 | .618 |
| Total from investment operations | 1.725 | .798 | 2.934 | 5.097 | 6.386 | 1.335 |
| Distributions from net investment income | (.535) | (.756) | (.740) | (.704) | (.852) | (.770) |
| Distributions from net realized gain | (.680) | (1.382) | (.394) | (.713) | (.404) | (1.725) |
| Total distributions | (1.215) | (2.138) | (1.134) | (1.417) | (1.256) | (2.495) |
| Net asset value, end of period | $57.69 | $57.18 | $58.52 | $56.72 | $53.04 | $47.91 |
| Total ReturnC,D,E | 3.07% | 1.55% | 5.22% | 9.76% | 13.55% | 2.85% |
| Ratios to Average Net AssetsF,G | | | | | | |
| Expenses before reductions | .25%H | .25% | .25% | .25% | .25% | .37% |
| Expenses net of fee waivers, if any | .25%H | .25% | .25% | .25% | .25% | .25% |
| Expenses net of all reductions | .25%H | .25% | .25% | .25% | .25% | .25% |
| Net investment income (loss) | 1.85%H | 1.37% | 1.28% | 1.30% | 1.80% | 1.51% |
| Supplemental Data | | | | | | |
| Net assets, end of period (000 omitted) | $381 | $395 | $427 | $267 | $229 | $217 |
| Portfolio turnover rateF | 19%H | 24% | 33% | 29% | 30% | 37% |
A Calculated based on average shares outstanding during the period.
B The amount shown for a share outstanding does not correspond with the aggregate net gain (loss) on investments for the period due to the timing of sales and repurchases of shares in relation to fluctuating market values of the investments of the Fund.
C Total returns for periods of less than one year are not annualized.
D Total returns would have been lower if certain expenses had not been reduced during the applicable periods shown.
E Total returns do not include the effect of the sales charges.
F Amounts do not include the activity of the Underlying Funds.
G Expense ratios reflect operating expenses of the class. Expenses before reductions do not reflect amounts reimbursed by the investment adviser or reductions from expense offset arrangements and do not represent the amount paid by the class during periods when reimbursements or reductions occur. Expenses net of fee waivers reflect expenses after reimbursement by the investment adviser but prior to reductions from expense offset arrangements. Expenses net of all reductions represent the net expenses paid by the class but do not include expenses of the underlying funds in which the Fund invests.
H Annualized
See accompanying notes which are an integral part of the financial statements.
Financial Highlights — Fidelity Income Replacement 2032 Fund Class T
| | Six months ended (Unaudited) January 31, | Years ended July 31, | | | | |
| | 2017 | 2016 | 2015 | 2014 | 2013 | 2012 |
| Selected Per–Share Data | | | | | | |
| Net asset value, beginning of period | $57.22 | $58.55 | $56.76 | $53.08 | $47.94 | $49.10 |
| Income from Investment Operations | | | | | | |
| Net investment income (loss)A | .460 | .620 | .592 | .581 | .781 | .599 |
| Net realized and unrealized gain (loss) | 1.203 | .047B | 2.190 | 4.386 | 5.484 | .599 |
| Total from investment operations | 1.663 | .667 | 2.782 | 4.967 | 6.265 | 1.198 |
| Distributions from net investment income | (.453) | (.615) | (.598) | (.574) | (.721) | (.633) |
| Distributions from net realized gain | (.680) | (1.382) | (.394) | (.713) | (.404) | (1.725) |
| Total distributions | (1.133) | (1.997) | (.992) | (1.287) | (1.125) | (2.358) |
| Net asset value, end of period | $57.75 | $57.22 | $58.55 | $56.76 | $53.08 | $47.94 |
| Total ReturnC,D,E | 2.95% | 1.31% | 4.94% | 9.50% | 13.27% | 2.55% |
| Ratios to Average Net AssetsF,G | | | | | | |
| Expenses before reductions | .50%H | .50% | .50% | .50% | .50% | .62% |
| Expenses net of fee waivers, if any | .50%H | .50% | .50% | .50% | .50% | .50% |
| Expenses net of all reductions | .50%H | .50% | .50% | .50% | .50% | .50% |
| Net investment income (loss) | 1.60%H | 1.12% | 1.03% | 1.05% | 1.55% | 1.26% |
| Supplemental Data | | | | | | |
| Net assets, end of period (000 omitted) | $22 | $58 | $67 | $36 | $27 | $24 |
| Portfolio turnover rateF | 19%H | 24% | 33% | 29% | 30% | 37% |
A Calculated based on average shares outstanding during the period.
B The amount shown for a share outstanding does not correspond with the aggregate net gain (loss) on investments for the period due to the timing of sales and repurchases of shares in relation to fluctuating market values of the investments of the Fund.
C Total returns for periods of less than one year are not annualized.
D Total returns would have been lower if certain expenses had not been reduced during the applicable periods shown.
E Total returns do not include the effect of the sales charges.
F Amounts do not include the activity of the Underlying Funds.
G Expense ratios reflect operating expenses of the class. Expenses before reductions do not reflect amounts reimbursed by the investment adviser or reductions from expense offset arrangements and do not represent the amount paid by the class during periods when reimbursements or reductions occur. Expenses net of fee waivers reflect expenses after reimbursement by the investment adviser but prior to reductions from expense offset arrangements. Expenses net of all reductions represent the net expenses paid by the class but do not include expenses of the underlying funds in which the Fund invests.
H Annualized
See accompanying notes which are an integral part of the financial statements.
Financial Highlights — Fidelity Income Replacement 2032 Fund Class C
| | Six months ended (Unaudited) January 31, | Years ended July 31, | | | | |
| | 2017 | 2016 | 2015 | 2014 | 2013 | 2012 |
| Selected Per–Share Data | | | | | | |
| Net asset value, beginning of period | $56.97 | $58.35 | $56.62 | $52.99 | $47.93 | $49.12 |
| Income from Investment Operations | | | | | | |
| Net investment income (loss)A | .312 | .344 | .303 | .305 | .529 | .358 |
| Net realized and unrealized gain (loss) | 1.198 | .043B | 2.182 | 4.382 | 5.469 | .615 |
| Total from investment operations | 1.510 | .387 | 2.485 | 4.687 | 5.998 | .973 |
| Distributions from net investment income | (.340) | (.385) | (.361) | (.344) | (.534) | (.438) |
| Distributions from net realized gain | (.680) | (1.382) | (.394) | (.713) | (.404) | (1.725) |
| Total distributions | (1.020) | (1.767) | (.755) | (1.057) | (.938) | (2.163) |
| Net asset value, end of period | $57.46 | $56.97 | $58.35 | $56.62 | $52.99 | $47.93 |
| Total ReturnC,D,E | 2.69% | .81% | 4.42% | 8.96% | 12.68% | 2.07% |
| Ratios to Average Net AssetsF,G | | | | | | |
| Expenses before reductions | 1.00%H | 1.00% | 1.00% | 1.00% | 1.00% | 1.12% |
| Expenses net of fee waivers, if any | 1.00%H | 1.00% | 1.00% | 1.00% | 1.00% | 1.00% |
| Expenses net of all reductions | 1.00%H | 1.00% | 1.00% | 1.00% | 1.00% | 1.00% |
| Net investment income (loss) | 1.10%H | .63% | .53% | .55% | 1.05% | .76% |
| Supplemental Data | | | | | | |
| Net assets, end of period (000 omitted) | $126 | $124 | $137 | $122 | $69 | $52 |
| Portfolio turnover rateF | 19%H | 24% | 33% | 29% | 30% | 37% |
A Calculated based on average shares outstanding during the period.
B The amount shown for a share outstanding does not correspond with the aggregate net gain (loss) on investments for the period due to the timing of sales and repurchases of shares in relation to fluctuating market values of the investments of the Fund.
C Total returns for periods of less than one year are not annualized.
D Total returns would have been lower if certain expenses had not been reduced during the applicable periods shown.
E Total returns do not include the effect of the contingent deferred sales charge.
F Amounts do not include the activity of the Underlying Funds.
G Expense ratios reflect operating expenses of the class. Expenses before reductions do not reflect amounts reimbursed by the investment adviser or reductions from expense offset arrangements and do not represent the amount paid by the class during periods when reimbursements or reductions occur. Expenses net of fee waivers reflect expenses after reimbursement by the investment adviser but prior to reductions from expense offset arrangements. Expenses net of all reductions represent the net expenses paid by the class but do not include expenses of the underlying funds in which the Fund invests.
H Annualized
See accompanying notes which are an integral part of the financial statements.
Financial Highlights — Fidelity Income Replacement 2032 Fund
| | Six months ended (Unaudited) January 31, | Years ended July 31, | | | | |
| | 2017 | 2016 | 2015 | 2014 | 2013 | 2012 |
| Selected Per–Share Data | | | | | | |
| Net asset value, beginning of period | $57.20 | $58.53 | $56.73 | $53.05 | $47.92 | $49.08 |
| Income from Investment Operations | | | | | | |
| Net investment income (loss)A | .600 | .897 | .882 | .856 | 1.033 | .836 |
| Net realized and unrealized gain (loss) | 1.196 | .048B | 2.192 | 4.380 | 5.479 | .618 |
| Total from investment operations | 1.796 | .945 | 3.074 | 5.236 | 6.512 | 1.454 |
| Distributions from net investment income | (.606) | (.893) | (.880) | (.843) | (.978) | (.889) |
| Distributions from net realized gain | (.680) | (1.382) | (.394) | (.713) | (.404) | (1.725) |
| Total distributions | (1.286) | (2.275) | (1.274) | (1.556) | (1.382) | (2.614) |
| Net asset value, end of period | $57.71 | $57.20 | $58.53 | $56.73 | $53.05 | $47.92 |
| Total ReturnC,D | 3.20% | 1.82% | 5.48% | 10.04% | 13.83% | 3.10% |
| Ratios to Average Net AssetsE,F | | | | | | |
| Expenses before reductions | - %G,H | - %H | - %H | - %H | - %H | .12% |
| Expenses net of fee waivers, if any | - %G | -% | -% | -% | -% | -% |
| Expenses net of all reductions | - %G | -% | -% | -% | -% | -% |
| Net investment income (loss) | 2.10%G | 1.62% | 1.53% | 1.55% | 2.05% | 1.76% |
| Supplemental Data | | | | | | |
| Net assets, end of period (000 omitted) | $6,739 | $6,745 | $7,858 | $7,608 | $4,418 | $2,991 |
| Portfolio turnover rateE | 19%G | 24% | 33% | 29% | 30% | 37% |
A Calculated based on average shares outstanding during the period.
B The amount shown for a share outstanding does not correspond with the aggregate net gain (loss) on investments for the period due to the timing of sales and repurchases of shares in relation to fluctuating market values of the investments of the Fund.
C Total returns for periods of less than one year are not annualized.
D Total returns would have been lower if certain expenses had not been reduced during the applicable periods shown.
E Amounts do not include the activity of the Underlying Funds.
F Expense ratios reflect operating expenses of the class. Expenses before reductions do not reflect amounts reimbursed by the investment adviser or reductions from expense offset arrangements and do not represent the amount paid by the class during periods when reimbursements or reductions occur. Expenses net of fee waivers reflect expenses after reimbursement by the investment adviser but prior to reductions from expense offset arrangements. Expenses net of all reductions represent the net expenses paid by the class but do not include expenses of the underlying funds in which the Fund invests.
G Annualized
H Amount represents less than .005%.
See accompanying notes which are an integral part of the financial statements.
Financial Highlights — Fidelity Income Replacement 2032 Fund Class I
| | Six months ended (Unaudited) January 31, | Years ended July 31, | | | | |
| | 2017 | 2016 | 2015 | 2014 | 2013 | 2012 |
| Selected Per–Share Data | | | | | | |
| Net asset value, beginning of period | $57.20 | $58.53 | $56.73 | $53.05 | $47.92 | $49.08 |
| Income from Investment Operations | | | | | | |
| Net investment income (loss)A | .600 | .896 | .880 | .856 | 1.032 | .835 |
| Net realized and unrealized gain (loss) | 1.196 | .049B | 2.194 | 4.380 | 5.480 | .619 |
| Total from investment operations | 1.796 | .945 | 3.074 | 5.236 | 6.512 | 1.454 |
| Distributions from net investment income | (.606) | (.893) | (.880) | (.843) | (.978) | (.889) |
| Distributions from net realized gain | (.680) | (1.382) | (.394) | (.713) | (.404) | (1.725) |
| Total distributions | (1.286) | (2.275) | (1.274) | (1.556) | (1.382) | (2.614) |
| Net asset value, end of period | $57.71 | $57.20 | $58.53 | $56.73 | $53.05 | $47.92 |
| Total ReturnC,D | 3.20% | 1.82% | 5.48% | 10.04% | 13.83% | 3.10% |
| Ratios to Average Net AssetsE,F | | | | | | |
| Expenses before reductions | - %G,H | - %H | - %H | - %H | - %H | .12% |
| Expenses net of fee waivers, if any | - %G | -% | -% | -% | -% | -% |
| Expenses net of all reductions | - %G | -% | -% | -% | -% | -% |
| Net investment income (loss) | 2.10%G | 1.62% | 1.53% | 1.55% | 2.05% | 1.76% |
| Supplemental Data | | | | | | |
| Net assets, end of period (000 omitted) | $58 | $56 | $58 | $21 | $19 | $17 |
| Portfolio turnover rateE | 19%G | 24% | 33% | 29% | 30% | 37% |
A Calculated based on average shares outstanding during the period.
B The amount shown for a share outstanding does not correspond with the aggregate net gain (loss) on investments for the period due to the timing of sales and repurchases of shares in relation to fluctuating market values of the investments of the Fund.
C Total returns for periods of less than one year are not annualized.
D Total returns would have been lower if certain expenses had not been reduced during the applicable periods shown.
E Amounts do not include the activity of the Underlying Funds.
F Expense ratios reflect operating expenses of the class. Expenses before reductions do not reflect amounts reimbursed by the investment adviser or reductions from expense offset arrangements and do not represent the amount paid by the class during periods when reimbursements or reductions occur. Expenses net of fee waivers reflect expenses after reimbursement by the investment adviser but prior to reductions from expense offset arrangements. Expenses net of all reductions represent the net expenses paid by the class but do not include expenses of the underlying funds in which the Fund invests.
G Annualized
H Amount represents less than .005%.
See accompanying notes which are an integral part of the financial statements.
Fidelity Income Replacement 2034 Fund℠
Investment Summary (Unaudited)
The information in the following tables is based on the direct investments of the Fund.
Top Holdings as of January 31, 2017
| | % of fund's net assets | % of fund's net assets 6 months ago |
| Fidelity Total Bond Fund | 17.8 | 17.7 |
| Fidelity Series Broad Market Opportunities Fund | 10.2 | 10.2 |
| Fidelity Equity-Income Fund | 8.8 | 8.9 |
| Fidelity Advisor International Discovery Fund Class I | 7.2 | 7.3 |
| Fidelity Investments Money Market Government Portfolio Institutional Class 0.47% | 7.1 | 7.0 |
| Fidelity Short-Term Bond Fund | 7.1 | 6.9 |
| Fidelity Large Cap Stock Fund | 6.6 | 6.7 |
| Fidelity Advisor Mid Cap II Fund Class I | 6.2 | 6.2 |
| Fidelity Strategic Real Return Fund | 6.0 | 5.9 |
| Fidelity Government Income Fund | 5.9 | 5.9 |
| | 82.9 | 82.7 |
Asset Allocation (% of fund's net assets)
| Period end |
| | Domestic Equity Funds | 44.2% |
| | International Equity Funds | 7.2% |
| | High Yield Fixed-Income Funds | 4.7% |
| | Investment Grade Fixed-Income Funds | 29.7% |
| | Short-Term Funds | 14.2% |
| Six months ago |
| | Domestic Equity Funds | 44.5% |
| | International Equity Funds | 7.3% |
| | High Yield Fixed-Income Funds | 4.8% |
| | Investment Grade Fixed-Income Funds | 29.5% |
| | Short-Term Funds | 13.9% |
Fidelity Income Replacement 2034 Fund℠
Investments January 31, 2017 (Unaudited)
Showing Percentage of Net Assets
| Equity Funds - 51.4% | | | |
| | | Shares | Value |
| Domestic Equity Funds - 44.2% | | | |
| Fidelity Advisor Mid Cap II Fund Class I (a) | | 20,988 | $416,197 |
| Fidelity Blue Chip Growth Fund (a) | | 5,475 | 386,612 |
| Fidelity Equity-Income Fund (a) | | 10,290 | 594,374 |
| Fidelity Large Cap Stock Fund (a) | | 14,969 | 445,781 |
| Fidelity Series 100 Index Fund (a) | | 26,229 | 386,612 |
| Fidelity Series Broad Market Opportunities Fund (a) | | 42,210 | 683,800 |
| Fidelity Series Small Cap Opportunities Fund (a) | | 4,199 | 59,169 |
|
| TOTAL DOMESTIC EQUITY FUNDS | | | 2,972,545 |
|
| International Equity Funds - 7.2% | | | |
| Fidelity Advisor International Discovery Fund Class I (a) | | 12,816 | 482,761 |
| TOTAL EQUITY FUNDS | | | |
| (Cost $2,580,042) | | | 3,455,306 |
|
| Fixed-Income Funds - 34.4% | | | |
| High Yield Fixed-Income Funds - 4.7% | | | |
| Fidelity Capital & Income Fund (a) | | 16,012 | 158,679 |
| Fidelity Strategic Income Fund (a) | | 14,733 | 158,679 |
|
| TOTAL HIGH YIELD FIXED-INCOME FUNDS | | | 317,358 |
|
| Investment Grade Fixed-Income Funds - 29.7% | | | |
| Fidelity Government Income Fund (a) | | 39,166 | 398,715 |
| Fidelity Strategic Real Return Fund (a) | | 45,206 | 398,715 |
| Fidelity Total Bond Fund (a) | | 113,379 | 1,196,145 |
|
| TOTAL INVESTMENT GRADE FIXED-INCOME FUNDS | | | 1,993,575 |
|
| TOTAL FIXED-INCOME FUNDS | | | |
| (Cost $2,285,271) | | | 2,310,933 |
|
| Short-Term Funds - 14.2% | | | |
| Fidelity Investments Money Market Government Portfolio Institutional Class 0.47% (a)(b) | | 478,727 | 478,727 |
| Fidelity Short-Term Bond Fund (a) | | 55,731 | 478,727 |
| TOTAL SHORT-TERM FUNDS | | | |
| (Cost $952,846) | | | 957,454 |
| TOTAL INVESTMENT PORTFOLIO - 100.0% | | | |
| (Cost $5,818,159) | | | 6,723,693 |
| NET OTHER ASSETS (LIABILITIES) - 0.0% | | | (179) |
| NET ASSETS - 100% | | | $6,723,514 |
Legend
(a) Affiliated Fund
(b) The rate quoted is the annualized seven-day yield of the fund at period end.
Affiliated Underlying Funds
Information regarding the Fund's fiscal year to date purchases and sales of the affiliated Underlying Funds and income earned by the Fund from investments in affiliated Underlying Funds is as follows:
| Affiliate | Value, beginning of period | Purchases | Sales Proceeds | Dividend Income | Value, end of period |
| Fidelity Advisor International Discovery Fund Class I | $570,895 | $42,953 | $122,504 | $8,142 | $482,761 |
| Fidelity Advisor Mid Cap II Fund Class I | 482,589 | 32,427 | 115,765 | 1,985 | 416,197 |
| Fidelity Blue Chip Growth Fund | 447,731 | 31,648 | 99,205 | 917 | 386,612 |
| Fidelity Capital & Income Fund | 185,134 | 6,348 | 39,719 | 3,743 | 158,679 |
| Fidelity Equity-Income Fund | 689,412 | 28,274 | 159,294 | 9,228 | 594,374 |
| Fidelity Government Income Fund | 457,026 | 43,185 | 80,789 | 3,409 | 398,715 |
| Fidelity Investments Money Market Government Portfolio Institutional Class 0.47% | 537,587 | 39,518 | 98,378 | 872 | 478,727 |
| Fidelity Large Cap Stock Fund | 516,672 | 16,812 | 126,662 | 4,090 | 445,781 |
| Fidelity Series 100 Index Fund | 447,731 | 18,638 | 92,120 | 8,736 | 386,612 |
| Fidelity Series Broad Market Opportunities Fund | 792,437 | 24,868 | 175,901 | 3,401 | 683,800 |
| Fidelity Series Small Cap Opportunities Fund | 68,941 | 3,174 | 18,247 | 321 | 59,169 |
| Fidelity Short-Term Bond Fund | 537,587 | 43,129 | 97,976 | 2,884 | 478,727 |
| Fidelity Strategic Income Fund | 185,134 | 8,422 | 34,815 | 2,975 | 158,679 |
| Fidelity Strategic Real Return Fund | 457,026 | 26,047 | 83,682 | 5,828 | 398,715 |
| Fidelity Total Bond Fund | 1,370,302 | 106,834 | 246,545 | 18,590 | 1,196,145 |
| Total | $7,746,204 | $472,277 | $1,591,602 | $75,121 | $6,723,693 |
Investment Valuation
All investments are categorized as Level 1 under the Fair Value Hierarchy. The inputs or methodology used for valuing securities may not be an indication of the risk associated with investing in those securities. For more information on valuation inputs please refer to the Investment Valuation section in the accompanying Notes to Financial Statements.
See accompanying notes which are an integral part of the financial statements.
Fidelity Income Replacement 2034 Fund℠
Financial Statements
Statement of Assets and Liabilities
| | | January 31, 2017 (Unaudited) |
| Assets | | |
| Investment in securities, at value (cost $5,818,159) — See accompanying schedule | | $6,723,693 |
| Receivable for investments sold | | 57,383 |
| Total assets | | 6,781,076 |
| Liabilities | | |
| Payable for investments purchased | $32,086 | |
| Payable for fund shares redeemed | 25,287 | |
| Distribution and service plan fees payable | 189 | |
| Total liabilities | | 57,562 |
| Net Assets | | $6,723,514 |
| Net Assets consist of: | | |
| Paid in capital | | $5,812,221 |
| Undistributed net investment income | | 1,342 |
| Accumulated undistributed net realized gain (loss) on investments | | 4,417 |
| Net unrealized appreciation (depreciation) on investments | | 905,534 |
| Net Assets | | $6,723,514 |
| Calculation of Maximum Offering Price | | |
| Class A: | | |
| Net Asset Value and redemption price per share ($272,749 ÷ 4,477.70 shares) | | $60.91 |
| Maximum offering price per share (100/94.25 of $60.91) | | $64.63 |
| Class T: | | |
| Net Asset Value and redemption price per share ($23,325 ÷ 382.50 shares) | | $60.98 |
| Maximum offering price per share (100/96.50 of $60.98) | | $63.19 |
| Class C: | | |
| Net Asset Value and offering price per share ($147,668 ÷ 2,435.30 shares)(a) | | $60.64 |
| Income Replacement 2034: | | |
| Net Asset Value, offering price and redemption price per share ($6,041,955 ÷ 99,218.70 shares) | | $60.90 |
| Class I: | | |
| Net Asset Value, offering price and redemption price per share ($237,817 ÷ 3,905.00 shares) | | $60.90 |
(a) Redemption price per share is equal to net asset value less any applicable contingent deferred sales charge.
See accompanying notes which are an integral part of the financial statements.
Statement of Operations
| | | Six months ended January 31, 2017 (Unaudited) |
| Investment Income | | |
| Income distributions from underlying funds | | $75,121 |
| Expenses | | |
| Distribution and service plan fees | $1,260 | |
| Independent trustees' fees and expenses | 18 | |
| Total expenses before reductions | 1,278 | |
| Expense reductions | (18) | 1,260 |
| Net investment income (loss) | | 73,861 |
| Realized and Unrealized Gain (Loss) | | |
| Realized gain (loss) on sale of underlying fund shares | 20,403 | |
| Capital gain distributions from underlying funds | 50,169 | |
| Total net realized gain (loss) | | 70,572 |
| Change in net unrealized appreciation (depreciation) on underlying funds | | 76,410 |
| Net gain (loss) | | 146,982 |
| Net increase (decrease) in net assets resulting from operations | | $220,843 |
See accompanying notes which are an integral part of the financial statements.
Statement of Changes in Net Assets
| | Six months ended January 31, 2017 (Unaudited) | Year ended July 31, 2016 |
| Increase (Decrease) in Net Assets | | |
| Operations | | |
| Net investment income (loss) | $73,861 | $142,550 |
| Net realized gain (loss) | 70,572 | 77,443 |
| Change in net unrealized appreciation (depreciation) | 76,410 | (131,537) |
| Net increase (decrease) in net assets resulting from operations | 220,843 | 88,456 |
| Distributions to shareholders from net investment income | (74,230) | (142,540) |
| Distributions to shareholders from net realized gain | (26,704) | (259,010) |
| Total distributions | (100,934) | (401,550) |
| Share transactions - net increase (decrease) | (1,142,400) | (1,324,530) |
| Total increase (decrease) in net assets | (1,022,491) | (1,637,624) |
| Net Assets | | |
| Beginning of period | 7,746,005 | 9,383,629 |
| End of period | $6,723,514 | $7,746,005 |
| Other Information | | |
| Undistributed net investment income end of period | $1,342 | $1,711 |
See accompanying notes which are an integral part of the financial statements.
Financial Highlights — Fidelity Income Replacement 2034 Fund Class A
| | Six months ended (Unaudited) January 31, | Years ended July 31, | | | | |
| | 2017 | 2016 | 2015 | 2014 | 2013 | 2012 |
| Selected Per–Share Data | | | | | | |
| Net asset value, beginning of period | $59.82 | $61.43 | $59.85 | $55.44 | $49.70 | $49.33 |
| Income from Investment Operations | | | | | | |
| Net investment income (loss)A | .549 | .797 | .753 | .741 | .840 | .782 |
| Net realized and unrealized gain (loss) | 1.341 | (.018) | 2.384 | 4.748 | 6.014 | .504 |
| Total from investment operations | 1.890 | .779 | 3.137 | 5.489 | 6.854 | 1.286 |
| Distributions from net investment income | (.571) | (.795) | (.751) | (.723) | (.903) | (.775) |
| Distributions from net realized gain | (.229) | (1.594) | (.806) | (.356) | (.211) | (.141) |
| Total distributions | (.800) | (2.389) | (1.557) | (1.079) | (1.114) | (.916) |
| Net asset value, end of period | $60.91 | $59.82 | $61.43 | $59.85 | $55.44 | $49.70 |
| Total ReturnB,C,D | 3.19% | 1.47% | 5.31% | 9.97% | 13.98% | 2.71% |
| Ratios to Average Net AssetsE,F | | | | | | |
| Expenses before reductions | .25%G | .25% | .25% | .25% | .25% | .25% |
| Expenses net of fee waivers, if any | .25%G | .25% | .25% | .25% | .25% | .25% |
| Expenses net of all reductions | .25%G | .25% | .25% | .25% | .25% | .25% |
| Net investment income (loss) | 1.83%G | 1.38% | 1.24% | 1.27% | 1.60% | 1.63% |
| Supplemental Data | | | | | | |
| Net assets, end of period (000 omitted) | $273 | $280 | $300 | $126 | $20 | $18 |
| Portfolio turnover rate E | 13%G | 33% | 24% | 19% | 35% | 34% |
A Calculated based on average shares outstanding during the period.
B Total returns for periods of less than one year are not annualized.
C Total returns would have been lower if certain expenses had not been reduced during the applicable periods shown.
D Total returns do not include the effect of the sales charges.
E Amounts do not include the activity of the Underlying Funds.
F Expense ratios reflect operating expenses of the class. Expenses before reductions do not reflect amounts reimbursed by the investment adviser or reductions from expense offset arrangements and do not represent the amount paid by the class during periods when reimbursements or reductions occur. Expenses net of fee waivers reflect expenses after reimbursement by the investment adviser but prior to reductions from expense offset arrangements. Expenses net of all reductions represent the net expenses paid by the class but do not include expenses of the underlying funds in which the Fund invests.
G Annualized
See accompanying notes which are an integral part of the financial statements.
Financial Highlights — Fidelity Income Replacement 2034 Fund Class T
| | Six months ended (Unaudited) January 31, | Years ended July 31, | | | | |
| | 2017 | 2016 | 2015 | 2014 | 2013 | 2012 |
| Selected Per–Share Data | | | | | | |
| Net asset value, beginning of period | $59.85 | $61.44 | $59.85 | $55.44 | $49.70 | $49.34 |
| Income from Investment Operations | | | | | | |
| Net investment income (loss)A | .477 | .647 | .602 | .592 | .719 | .662 |
| Net realized and unrealized gain (loss) | 1.319 | (.008) | 2.387 | 4.742 | 6.008 | .490 |
| Total from investment operations | 1.796 | .639 | 2.989 | 5.334 | 6.727 | 1.152 |
| Distributions from net investment income | (.437) | (.635) | (.593) | (.568) | (.776) | (.651) |
| Distributions from net realized gain | (.229) | (1.594) | (.806) | (.356) | (.211) | (.141) |
| Total distributions | (.666) | (2.229) | (1.399) | (.924) | (.987) | (.792) |
| Net asset value, end of period | $60.98 | $59.85 | $61.44 | $59.85 | $55.44 | $49.70 |
| Total ReturnB,C,D | 3.02% | 1.23% | 5.06% | 9.68% | 13.71% | 2.42% |
| Ratios to Average Net AssetsE,F | | | | | | |
| Expenses before reductions | .50%G | .50% | .50% | .50% | .50% | .50% |
| Expenses net of fee waivers, if any | .50%G | .50% | .50% | .50% | .50% | .50% |
| Expenses net of all reductions | .50%G | .50% | .50% | .50% | .50% | .50% |
| Net investment income (loss) | 1.58%G | 1.13% | .99% | 1.02% | 1.35% | 1.38% |
| Supplemental Data | | | | | | |
| Net assets, end of period (000 omitted) | $23 | $94 | $101 | $96 | $88 | $23 |
| Portfolio turnover rate E | 13%G | 33% | 24% | 19% | 35% | 34% |
A Calculated based on average shares outstanding during the period.
B Total returns for periods of less than one year are not annualized.
C Total returns do not include the effect of the sales charges.
D Total returns would have been lower if certain expenses had not been reduced during the applicable periods shown.
E Amounts do not include the activity of the Underlying Funds.
F Expense ratios reflect operating expenses of the class. Expenses before reductions do not reflect amounts reimbursed by the investment adviser or reductions from expense offset arrangements and do not represent the amount paid by the class during periods when reimbursements or reductions occur. Expenses net of fee waivers reflect expenses after reimbursement by the investment adviser but prior to reductions from expense offset arrangements. Expenses net of all reductions represent the net expenses paid by the class but do not include expenses of the underlying funds in which the Fund invests.
G Annualized
See accompanying notes which are an integral part of the financial statements.
Financial Highlights — Fidelity Income Replacement 2034 Fund Class C
| | Six months ended (Unaudited) January 31, | Years ended July 31, | | | | |
| | 2017 | 2016 | 2015 | 2014 | 2013 | 2012 |
| Selected Per–Share Data | | | | | | |
| Net asset value, beginning of period | $59.58 | $61.23 | $59.74 | $55.39 | $49.70 | $49.37 |
| Income from Investment Operations | | | | | | |
| Net investment income (loss)A | .322 | .363 | .298 | .300 | .448 | .424 |
| Net realized and unrealized gain (loss) | 1.337 | (.014) | 2.370 | 4.746 | 6.020 | .490 |
| Total from investment operations | 1.659 | .349 | 2.668 | 5.046 | 6.468 | .914 |
| Distributions from net investment income | (.370) | (.405) | (.372) | (.340) | (.567) | (.443) |
| Distributions from net realized gain | (.229) | (1.594) | (.806) | (.356) | (.211) | (.141) |
| Total distributions | (.599) | (1.999) | (1.178) | (.696) | (.778) | (.584) |
| Net asset value, end of period | $60.64 | $59.58 | $61.23 | $59.74 | $55.39 | $49.70 |
| Total ReturnB,C,D | 2.80% | .73% | 4.52% | 9.15% | 13.15% | 1.92% |
| Ratios to Average Net AssetsE,F | | | | | | |
| Expenses before reductions | 1.00%G | 1.00% | 1.00% | 1.00% | 1.00% | 1.00% |
| Expenses net of fee waivers, if any | 1.00%G | 1.00% | 1.00% | 1.00% | 1.00% | 1.00% |
| Expenses net of all reductions | 1.00%G | 1.00% | 1.00% | 1.00% | 1.00% | 1.00% |
| Net investment income (loss) | 1.08%G | .63% | .49% | .52% | .86% | .89% |
| Supplemental Data | | | | | | |
| Net assets, end of period (000 omitted) | $148 | $144 | $132 | $54 | $49 | $43 |
| Portfolio turnover rate E | 13%G | 33% | 24% | 19% | 35% | 34% |
A Calculated based on average shares outstanding during the period.
B Total returns for periods of less than one year are not annualized.
C Total returns would have been lower if certain expenses had not been reduced during the applicable periods shown.
D Total returns do not include the effect of the contingent deferred sales charge.
E Amounts do not include the activity of the Underlying Funds.
F Expense ratios reflect operating expenses of the class. Expenses before reductions do not reflect amounts reimbursed by the investment adviser or reductions from expense offset arrangements and do not represent the amount paid by the class during periods when reimbursements or reductions occur. Expenses net of fee waivers reflect expenses after reimbursement by the investment adviser but prior to reductions from expense offset arrangements. Expenses net of all reductions represent the net expenses paid by the class but do not include expenses of the underlying funds in which the Fund invests.
G Annualized
See accompanying notes which are an integral part of the financial statements.
Financial Highlights — Fidelity Income Replacement 2034 Fund
| | Six months ended (Unaudited) January 31, | Years ended July 31, | | | | |
| | 2017 | 2016 | 2015 | 2014 | 2013 | 2012 |
| Selected Per–Share Data | | | | | | |
| Net asset value, beginning of period | $59.81 | $61.42 | $59.82 | $55.41 | $49.67 | $49.31 |
| Income from Investment Operations | | | | | | |
| Net investment income (loss)A | .625 | .940 | .905 | .885 | .975 | .903 |
| Net realized and unrealized gain (loss) | 1.343 | (.017) | 2.396 | 4.738 | 6.009 | .505 |
| Total from investment operations | 1.968 | .923 | 3.301 | 5.623 | 6.984 | 1.408 |
| Distributions from net investment income | (.649) | (.939) | (.895) | (.857) | (1.033) | (.907) |
| Distributions from net realized gain | (.229) | (1.594) | (.806) | (.356) | (.211) | (.141) |
| Total distributions | (.878) | (2.533) | (1.701) | (1.213) | (1.244) | (1.048) |
| Net asset value, end of period | $60.90 | $59.81 | $61.42 | $59.82 | $55.41 | $49.67 |
| Total ReturnB,C | 3.32% | 1.73% | 5.60% | 10.23% | 14.27% | 2.97% |
| Ratios to Average Net AssetsD,E | | | | | | |
| Expenses before reductions F | - %G | -% | -% | -% | -% | -% |
| Expenses net of fee waivers, if any | - %G | -% | -% | -% | -% | -% |
| Expenses net of all reductions | - %G | -% | -% | -% | -% | -% |
| Net investment income (loss) | 2.08%G | 1.63% | 1.49% | 1.52% | 1.85% | 1.89% |
| Supplemental Data | | | | | | |
| Net assets, end of period (000 omitted) | $6,042 | $6,996 | $8,622 | $8,313 | $3,894 | $2,123 |
| Portfolio turnover rate D | 13%G | 33% | 24% | 19% | 35% | 34% |
A Calculated based on average shares outstanding during the period.
B Total returns for periods of less than one year are not annualized.
C Total returns would have been lower if certain expenses had not been reduced during the applicable periods shown.
D Amounts do not include the activity of the Underlying Funds.
E Expense ratios reflect operating expenses of the class. Expenses before reductions do not reflect amounts reimbursed by the investment adviser or reductions from expense offset arrangements and do not represent the amount paid by the class during periods when reimbursements or reductions occur. Expenses net of fee waivers reflect expenses after reimbursement by the investment adviser but prior to reductions from expense offset arrangements. Expenses net of all reductions represent the net expenses paid by the class but do not include expenses of the underlying funds in which the Fund invests.
F Amount represents less than .005%.
G Annualized
See accompanying notes which are an integral part of the financial statements.
Financial Highlights — Fidelity Income Replacement 2034 Fund Class I
| | Six months ended (Unaudited) January 31, | Years ended July 31, | | | | |
| | 2017 | 2016 | 2015 | 2014 | 2013 | 2012 |
| Selected Per–Share Data | | | | | | |
| Net asset value, beginning of period | $59.81 | $61.42 | $59.83 | $55.42 | $49.67 | $49.31 |
| Income from Investment Operations | | | | | | |
| Net investment income (loss)A | .624 | .940 | .906 | .884 | .972 | .904 |
| Net realized and unrealized gain (loss) | 1.344 | (.017) | 2.385 | 4.739 | 6.022 | .504 |
| Total from investment operations | 1.968 | .923 | 3.291 | 5.623 | 6.994 | 1.408 |
| Distributions from net investment income | (.649) | (.939) | (.895) | (.857) | (1.033) | (.907) |
| Distributions from net realized gain | (.229) | (1.594) | (.806) | (.356) | (.211) | (.141) |
| Total distributions | (.878) | (2.533) | (1.701) | (1.213) | (1.244) | (1.048) |
| Net asset value, end of period | $60.90 | $59.81 | $61.42 | $59.83 | $55.42 | $49.67 |
| Total ReturnB,C | 3.32% | 1.73% | 5.58% | 10.23% | 14.29% | 2.97% |
| Ratios to Average Net AssetsD,E | | | | | | |
| Expenses before reductions F | - %G | -% | -% | -% | -% | -% |
| Expenses net of fee waivers, if any | - %G | -% | -% | -% | -% | -% |
| Expenses net of all reductions | - %G | -% | -% | -% | -% | -% |
| Net investment income (loss) | 2.08%G | 1.63% | 1.49% | 1.52% | 1.85% | 1.89% |
| Supplemental Data | | | | | | |
| Net assets, end of period (000 omitted) | $238 | $232 | $228 | $217 | $139 | $122 |
| Portfolio turnover rate D | 13%G | 33% | 24% | 19% | 35% | 34% |
A Calculated based on average shares outstanding during the period.
B Total returns for periods of less than one year are not annualized.
C Total returns would have been lower if certain expenses had not been reduced during the applicable periods shown.
D Amounts do not include the activity of the Underlying Funds.
E Expense ratios reflect operating expenses of the class. Expenses before reductions do not reflect amounts reimbursed by the investment adviser or reductions from expense offset arrangements and do not represent the amount paid by the class during periods when reimbursements or reductions occur. Expenses net of fee waivers reflect expenses after reimbursement by the investment adviser but prior to reductions from expense offset arrangements. Expenses net of all reductions represent the net expenses paid by the class but do not include expenses of the underlying funds in which the Fund invests.
F Amount represents less than .005%.
G Annualized
See accompanying notes which are an integral part of the financial statements.
Fidelity Income Replacement 2036 Fund℠
Investment Summary (Unaudited)
The information in the following tables is based on the direct investments of the Fund.
Top Holdings as of January 31, 2017
| | % of fund's net assets | % of fund's net assets 6 months ago |
| Fidelity Total Bond Fund | 17.1 | 17.0 |
| Fidelity Series Broad Market Opportunities Fund | 10.4 | 10.4 |
| Fidelity Equity-Income Fund | 9.0 | 9.1 |
| Fidelity Advisor International Discovery Fund Class I | 8.0 | 8.1 |
| Fidelity Large Cap Stock Fund | 6.8 | 6.8 |
| Fidelity Investments Money Market Government Portfolio Institutional Class 0.47% | 6.7 | 6.6 |
| Fidelity Short-Term Bond Fund | 6.6 | 6.5 |
| Fidelity Advisor Mid Cap II Fund Class I | 6.3 | 6.4 |
| Fidelity Series 100 Index Fund | 5.9 | 5.9 |
| Fidelity Blue Chip Growth Fund | 5.9 | 5.9 |
| | 82.7 | 82.7 |
Asset Allocation (% of fund's net assets)
| Period end |
| | Domestic Equity Funds | 45.2% |
| | International Equity Funds | 8.0% |
| | High Yield Fixed-Income Funds | 5.0% |
| | Investment Grade Fixed-Income Funds | 28.5% |
| | Short-Term Funds | 13.3% |
| Six months ago |
| | Domestic Equity Funds | 45.4% |
| | International Equity Funds | 8.1% |
| | High Yield Fixed-Income Funds | 5.1% |
| | Investment Grade Fixed-Income Funds | 28.3% |
| | Short-Term Funds | 13.1% |
Fidelity Income Replacement 2036 Fund℠
Investments January 31, 2017 (Unaudited)
Showing Percentage of Net Assets
| Equity Funds - 53.2% | | | |
| | | Shares | Value |
| Domestic Equity Funds - 45.2% | | | |
| Fidelity Advisor Mid Cap II Fund Class I (a) | | 31,413 | $622,919 |
| Fidelity Blue Chip Growth Fund (a) | | 8,194 | 578,636 |
| Fidelity Equity-Income Fund (a) | | 15,402 | 889,604 |
| Fidelity Large Cap Stock Fund (a) | | 22,404 | 667,203 |
| Fidelity Series 100 Index Fund (a) | | 39,256 | 578,636 |
| Fidelity Series Broad Market Opportunities Fund (a) | | 63,175 | 1,023,438 |
| Fidelity Series Small Cap Opportunities Fund (a) | | 6,286 | 88,567 |
|
| TOTAL DOMESTIC EQUITY FUNDS | | | 4,449,003 |
|
| International Equity Funds - 8.0% | | | |
| Fidelity Advisor International Discovery Fund Class I (a) | | 20,768 | 782,339 |
| TOTAL EQUITY FUNDS | | | |
| (Cost $4,367,359) | | | 5,231,342 |
|
| Fixed-Income Funds - 33.5% | | | |
| High Yield Fixed-Income Funds - 5.0% | | | |
| Fidelity Capital & Income Fund (a) | | 24,726 | 245,035 |
| Fidelity Strategic Income Fund (a) | | 22,752 | 245,035 |
|
| TOTAL HIGH YIELD FIXED-INCOME FUNDS | | | 490,070 |
|
| Investment Grade Fixed-Income Funds - 28.5% | | | |
| Fidelity Government Income Fund (a) | | 55,197 | 561,907 |
| Fidelity Strategic Real Return Fund (a) | | 63,708 | 561,907 |
| Fidelity Total Bond Fund (a) | | 159,691 | 1,684,733 |
|
| TOTAL INVESTMENT GRADE FIXED-INCOME FUNDS | | | 2,808,547 |
|
| TOTAL FIXED-INCOME FUNDS | | | |
| (Cost $3,347,192) | | | 3,298,617 |
|
| Short-Term Funds - 13.3% | | | |
| Fidelity Investments Money Market Government Portfolio Institutional Class 0.47% (a)(b) | | 655,394 | 655,394 |
| Fidelity Short-Term Bond Fund (a) | | 76,297 | 655,394 |
| TOTAL SHORT-TERM FUNDS | | | |
| (Cost $1,310,038) | | | 1,310,788 |
| TOTAL INVESTMENT PORTFOLIO - 100.0% | | | |
| (Cost $9,024,589) | | | 9,840,747 |
| NET OTHER ASSETS (LIABILITIES) - 0.0% | | | (643) |
| NET ASSETS - 100% | | | $9,840,104 |
Legend
(a) Affiliated Fund
(b) The rate quoted is the annualized seven-day yield of the fund at period end.
Affiliated Underlying Funds
Information regarding the Fund's fiscal year to date purchases and sales of the affiliated Underlying Funds and income earned by the Fund from investments in affiliated Underlying Funds is as follows:
| Affiliate | Value, beginning of period | Purchases | Sales Proceeds | Dividend Income | Value, end of period |
| Fidelity Advisor International Discovery Fund Class I | $894,729 | $77,058 | $176,497 | $13,191 | $782,339 |
| Fidelity Advisor Mid Cap II Fund Class I | 698,218 | 53,741 | 155,069 | 2,973 | 622,919 |
| Fidelity Blue Chip Growth Fund | 647,718 | 50,658 | 130,117 | 1,285 | 578,636 |
| Fidelity Capital & Income Fund | 276,652 | 12,918 | 55,033 | 5,530 | 245,035 |
| Fidelity Equity-Income Fund | 996,826 | 54,099 | 216,351 | 13,193 | 889,604 |
| Fidelity Government Income Fund | 622,467 | 68,686 | 100,844 | 4,600 | 561,907 |
| Fidelity Investments Money Market Government Portfolio Institutional Class 0.47% | 717,978 | 58,091 | 120,676 | 1,152 | 655,394 |
| Fidelity Large Cap Stock Fund | 747,620 | 31,932 | 170,281 | 6,147 | 667,203 |
| Fidelity Series 100 Index Fund | 647,718 | 34,938 | 123,221 | 13,218 | 578,636 |
| Fidelity Series Broad Market Opportunities Fund | 1,146,131 | 46,224 | 233,771 | 5,091 | 1,023,438 |
| Fidelity Series Small Cap Opportunities Fund | 99,902 | 5,476 | 24,856 | 455 | 88,567 |
| Fidelity Short-Term Bond Fund | 717,978 | 62,978 | 120,188 | 3,814 | 655,394 |
| Fidelity Strategic Income Fund | 276,652 | 17,176 | 48,736 | 4,389 | 245,035 |
| Fidelity Strategic Real Return Fund | 622,468 | 43,926 | 104,373 | 7,788 | 561,907 |
| Fidelity Total Bond Fund | 1,865,206 | 176,502 | 309,643 | 25,071 | 1,684,733 |
| Total | $10,978,263 | $794,403 | $2,089,656 | $107,897 | $9,840,747 |
Investment Valuation
All investments are categorized as Level 1 under the Fair Value Hierarchy. The inputs or methodology used for valuing securities may not be an indication of the risk associated with investing in those securities. For more information on valuation inputs please refer to the Investment Valuation section in the accompanying Notes to Financial Statements.
See accompanying notes which are an integral part of the financial statements.
Fidelity Income Replacement 2036 Fund℠
Financial Statements
Statement of Assets and Liabilities
| | | January 31, 2017 (Unaudited) |
| Assets | | |
| Investment in securities, at value (cost $9,024,589) — See accompanying schedule | | $9,840,747 |
| Receivable for investments sold | | 64,758 |
| Total assets | | 9,905,505 |
| Liabilities | | |
| Payable for investments purchased | $64,753 | |
| Distribution and service plan fees payable | 648 | |
| Total liabilities | | 65,401 |
| Net Assets | | $9,840,104 |
| Net Assets consist of: | | |
| Paid in capital | | $9,046,438 |
| Undistributed net investment income | | 1,862 |
| Accumulated undistributed net realized gain (loss) on investments | | (24,354) |
| Net unrealized appreciation (depreciation) on investments | | 816,158 |
| Net Assets | | $9,840,104 |
| Calculation of Maximum Offering Price | | |
| Class A: | | |
| Net Asset Value and redemption price per share ($499,120.74 ÷ 8,145.949 shares) | | $61.27 |
| Maximum offering price per share (100/94.25 of $61.27) | | $65.01 |
| Class T: | | |
| Net Asset Value and redemption price per share ($546,279.40 ÷ 8,918.179 shares) | | $61.25 |
| Maximum offering price per share (100/96.50 of $61.25) | | $63.47 |
| Class C: | | |
| Net Asset Value and offering price per share ($377,687.95 ÷ 6,203.897 shares)(a) | | $60.88 |
| Income Replacement 2036: | | |
| Net Asset Value, offering price and redemption price per share ($8,416,208.55 ÷ 137,331.323 shares) | | $61.28 |
| Class I: | | |
| Net Asset Value, offering price and redemption price per share ($807.08 ÷ 13.147 shares) | | $61.39 |
(a) Redemption price per share is equal to net asset value less any applicable contingent deferred sales charge.
See accompanying notes which are an integral part of the financial statements.
Statement of Operations
| | | Six months ended January 31, 2017 (Unaudited) |
| Investment Income | | |
| Income distributions from underlying funds | | $107,897 |
| Expenses | | |
| Distribution and service plan fees | $4,787 | |
| Independent trustees' fees and expenses | 24 | |
| Total expenses before reductions | 4,811 | |
| Expense reductions | (24) | 4,787 |
| Net investment income (loss) | | 103,110 |
| Realized and Unrealized Gain (Loss) | | |
| Realized gain (loss) on sale of underlying fund shares | (22,160) | |
| Capital gain distributions from underlying funds | 73,456 | |
| Total net realized gain (loss) | | 51,296 |
| Change in net unrealized appreciation (depreciation) on underlying funds | | 179,895 |
| Net gain (loss) | | 231,191 |
| Net increase (decrease) in net assets resulting from operations | | $334,301 |
See accompanying notes which are an integral part of the financial statements.
Statement of Changes in Net Assets
| | Six months ended January 31, 2017 (Unaudited) | Year ended July 31, 2016 |
| Increase (Decrease) in Net Assets | | |
| Operations | | |
| Net investment income (loss) | $103,110 | $160,587 |
| Net realized gain (loss) | 51,296 | 129,588 |
| Change in net unrealized appreciation (depreciation) | 179,895 | (133,017) |
| Net increase (decrease) in net assets resulting from operations | 334,301 | 157,158 |
| Distributions to shareholders from net investment income | (103,414) | (160,249) |
| Distributions to shareholders from net realized gain | (118,111) | (238,984) |
| Total distributions | (221,525) | (399,233) |
| Share transactions - net increase (decrease) | (1,250,096) | (63,577) |
| Total increase (decrease) in net assets | (1,137,320) | (305,652) |
| Net Assets | | |
| Beginning of period | 10,977,424 | 11,283,076 |
| End of period | $9,840,104 | $10,977,424 |
| Other Information | | |
| Undistributed net investment income end of period | $1,862 | $2,166 |
See accompanying notes which are an integral part of the financial statements.
Financial Highlights — Fidelity Income Replacement 2036 Fund Class A
| | Six months ended (Unaudited) January 31, | Years ended July 31, | | | | |
| | 2017 | 2016 | 2015 | 2014 | 2013 | 2012 |
| Selected Per–Share Data | | | | | | |
| Net asset value, beginning of period | $60.61 | $62.00 | $59.79 | $55.12 | $49.20 | $48.92 |
| Income from Investment Operations | | | | | | |
| Net investment income (loss)A | .569 | .790 | .753 | .751 | .939 | .760 |
| Net realized and unrealized gain (loss) | 1.385 | (.055) | 2.474 | 4.831 | 6.075 | .441 |
| Total from investment operations | 1.954 | .735 | 3.227 | 5.582 | 7.014 | 1.201 |
| Distributions from net investment income | (.587) | (.788) | (.743) | (.734) | (.913) | (.784) |
| Distributions from net realized gain | (.707) | (1.337) | (.274) | (.178) | (.181) | (.137) |
| Total distributions | (1.294) | (2.125) | (1.017) | (.912) | (1.094) | (.921) |
| Net asset value, end of period | $61.27 | $60.61 | $62.00 | $59.79 | $55.12 | $49.20 |
| Total ReturnB,C,D | 3.28% | 1.37% | 5.44% | 10.18% | 14.45% | 2.56% |
| Ratios to Average Net AssetsE,F | | | | | | |
| Expenses before reductions | .25%G | .25% | .25% | .25% | .25% | .25% |
| Expenses net of fee waivers, if any | .25%G | .25% | .25% | .25% | .25% | .25% |
| Expenses net of all reductions | .25%G | .25% | .25% | .25% | .25% | .25% |
| Net investment income (loss) | 1.88%G | 1.36% | 1.23% | 1.29% | 1.80% | 1.60% |
| Supplemental Data | | | | | | |
| Net assets, end of period (000 omitted) | $499 | $501 | $452 | $181 | $25 | $27 |
| Portfolio turnover rateE | 16%G | 27% | 20% | 25% | 25% | 62% |
A Calculated based on average shares outstanding during the period.
B Total returns for periods of less than one year are not annualized.
C Total returns would have been lower if certain expenses had not been reduced during the applicable periods shown.
D Total returns do not include the effect of the sales charges.
E Amounts do not include the activity of the Underlying Funds.
F Expense ratios reflect operating expenses of the class. Expenses before reductions do not reflect amounts reimbursed by the investment adviser or reductions from expense offset arrangements and do not represent the amount paid by the class during periods when reimbursements or reductions occur. Expenses net of fee waivers reflect expenses after reimbursement by the investment adviser but prior to reductions from expense offset arrangements. Expenses net of all reductions represent the net expenses paid by the class but do not include expenses of the underlying funds in which the Fund invests.
G Annualized
See accompanying notes which are an integral part of the financial statements.
Financial Highlights — Fidelity Income Replacement 2036 Fund Class T
| | Six months ended (Unaudited) January 31, | Years ended July 31, | | | | |
| | 2017 | 2016 | 2015 | 2014 | 2013 | 2012 |
| Selected Per–Share Data | | | | | | |
| Net asset value, beginning of period | $60.57 | $61.96 | $59.75 | $55.09 | $49.17 | $48.89 |
| Income from Investment Operations | | | | | | |
| Net investment income (loss)A | .495 | .645 | .600 | .601 | .809 | .641 |
| Net realized and unrealized gain (loss) | 1.383 | (.056) | 2.475 | 4.822 | 6.077 | .448 |
| Total from investment operations | 1.878 | .589 | 3.075 | 5.423 | 6.886 | 1.089 |
| Distributions from net investment income | (.491) | (.642) | (.591) | (.585) | (.785) | (.672) |
| Distributions from net realized gain | (.707) | (1.337) | (.274) | (.178) | (.181) | (.137) |
| Total distributions | (1.198) | (1.979) | (.865) | (.763) | (.966) | (.809) |
| Net asset value, end of period | $61.25 | $60.57 | $61.96 | $59.75 | $55.09 | $49.17 |
| Total ReturnB,C,D | 3.15% | 1.11% | 5.18% | 9.89% | 14.18% | 2.32% |
| Ratios to Average Net AssetsE,F | | | | | | |
| Expenses before reductions | .50%G | .50% | .50% | .50% | .50% | .50% |
| Expenses net of fee waivers, if any | .50%G | .50% | .50% | .50% | .50% | .50% |
| Expenses net of all reductions | .50%G | .50% | .50% | .50% | .50% | .50% |
| Net investment income (loss) | 1.63%G | 1.11% | .98% | 1.04% | 1.55% | 1.35% |
| Supplemental Data | | | | | | |
| Net assets, end of period (000 omitted) | $546 | $1,030 | $1,088 | $420 | $295 | $278 |
| Portfolio turnover rateE | 16%G | 27% | 20% | 25% | 25% | 62% |
A Calculated based on average shares outstanding during the period.
B Total returns for periods of less than one year are not annualized.
C Total returns would have been lower if certain expenses had not been reduced during the applicable periods shown.
D Total returns do not include the effect of the sales charges.
E Amounts do not include the activity of the Underlying Funds.
F Expense ratios reflect operating expenses of the class. Expenses before reductions do not reflect amounts reimbursed by the investment adviser or reductions from expense offset arrangements and do not represent the amount paid by the class during periods when reimbursements or reductions occur. Expenses net of fee waivers reflect expenses after reimbursement by the investment adviser but prior to reductions from expense offset arrangements. Expenses net of all reductions represent the net expenses paid by the class but do not include expenses of the underlying funds in which the Fund invests.
G Annualized
See accompanying notes which are an integral part of the financial statements.
Financial Highlights — Fidelity Income Replacement 2036 Fund Class C
| | Six months ended (Unaudited) January 31, | Years ended July 31, | | | | |
| | 2017 | 2016 | 2015 | 2014 | 2013 | 2012 |
| Selected Per–Share Data | | | | | | |
| Net asset value, beginning of period | $60.25 | $61.71 | $59.58 | $54.98 | $49.14 | $48.88 |
| Income from Investment Operations | | | | | | |
| Net investment income (loss)A | .340 | .352 | .294 | .310 | .553 | .404 |
| Net realized and unrealized gain (loss) | 1.380 | (.066) | 2.471 | 4.816 | 6.061 | .445 |
| Total from investment operations | 1.720 | .286 | 2.765 | 5.126 | 6.614 | .849 |
| Distributions from net investment income | (.383) | (.409) | (.361) | (.348) | (.593) | (.452) |
| Distributions from net realized gain | (.707) | (1.337) | (.274) | (.178) | (.181) | (.137) |
| Total distributions | (1.090) | (1.746) | (.635) | (.526) | (.774) | (.589) |
| Net asset value, end of period | $60.88 | $60.25 | $61.71 | $59.58 | $54.98 | $49.14 |
| Total ReturnB,C,D | 2.90% | .60% | 4.66% | 9.35% | 13.60% | 1.80% |
| Ratios to Average Net AssetsE,F | | | | | | |
| Expenses before reductions | 1.00%G | 1.00% | 1.00% | 1.00% | 1.00% | 1.00% |
| Expenses net of fee waivers, if any | 1.00%G | 1.00% | 1.00% | 1.00% | 1.00% | 1.00% |
| Expenses net of all reductions | 1.00%G | 1.00% | 1.00% | 1.00% | 1.00% | 1.00% |
| Net investment income (loss) | 1.13%G | .61% | .48% | .54% | 1.06% | .85% |
| Supplemental Data | | | | | | |
| Net assets, end of period (000 omitted) | $378 | $384 | $444 | $358 | $357 | $174 |
| Portfolio turnover rateE | 16%G | 27% | 20% | 25% | 25% | 62% |
A Calculated based on average shares outstanding during the period.
B Total returns for periods of less than one year are not annualized.
C Total returns would have been lower if certain expenses had not been reduced during the applicable periods shown.
D Total returns do not include the effect of the contingent deferred sales charge.
E Amounts do not include the activity of the Underlying Funds.
F Expense ratios reflect operating expenses of the class. Expenses before reductions do not reflect amounts reimbursed by the investment adviser or reductions from expense offset arrangements and do not represent the amount paid by the class during periods when reimbursements or reductions occur. Expenses net of fee waivers reflect expenses after reimbursement by the investment adviser but prior to reductions from expense offset arrangements. Expenses net of all reductions represent the net expenses paid by the class but do not include expenses of the underlying funds in which the Fund invests.
G Annualized
See accompanying notes which are an integral part of the financial statements.
Financial Highlights — Fidelity Income Replacement 2036 Fund
| | Six months ended (Unaudited) January 31, | Years ended July 31, | | | | |
| | 2017 | 2016 | 2015 | 2014 | 2013 | 2012 |
| Selected Per–Share Data | | | | | | |
| Net asset value, beginning of period | $60.62 | $62.01 | $59.79 | $55.11 | $49.19 | $48.91 |
| Income from Investment Operations | | | | | | |
| Net investment income (loss)A | .645 | .938 | .907 | .893 | 1.073 | .880 |
| Net realized and unrealized gain (loss) | 1.385 | (.057) | 2.472 | 4.833 | 6.070 | .445 |
| Total from investment operations | 2.030 | .881 | 3.379 | 5.726 | 7.143 | 1.325 |
| Distributions from net investment income | (.663) | (.934) | (.885) | (.868) | (1.042) | (.908) |
| Distributions from net realized gain | (.707) | (1.337) | (.274) | (.178) | (.181) | (.137) |
| Total distributions | (1.370) | (2.271) | (1.159) | (1.046) | (1.223) | (1.045) |
| Net asset value, end of period | $61.28 | $60.62 | $62.01 | $59.79 | $55.11 | $49.19 |
| Total ReturnB,C | 3.41% | 1.62% | 5.70% | 10.46% | 14.74% | 2.82% |
| Ratios to Average Net AssetsD,E | | | | | | |
| Expenses before reductionsF | - %G | -% | -% | -% | -% | -% |
| Expenses net of fee waivers, if any | - %G | -% | -% | -% | -% | -% |
| Expenses net of all reductions | - %G | -% | -% | -% | -% | -% |
| Net investment income (loss) | 2.13%G | 1.61% | 1.48% | 1.54% | 2.05% | 1.85% |
| Supplemental Data | | | | | | |
| Net assets, end of period (000 omitted) | $8,416 | $9,061 | $9,298 | $6,327 | $3,904 | $2,363 |
| Portfolio turnover rateD | 16%G | 27% | 20% | 25% | 25% | 62% |
A Calculated based on average shares outstanding during the period.
B Total returns for periods of less than one year are not annualized.
C Total returns would have been lower if certain expenses had not been reduced during the applicable periods shown.
D Amounts do not include the activity of the Underlying Funds.
E Expense ratios reflect operating expenses of the class. Expenses before reductions do not reflect amounts reimbursed by the investment adviser or reductions from expense offset arrangements and do not represent the amount paid by the class during periods when reimbursements or reductions occur. Expenses net of fee waivers reflect expenses after reimbursement by the investment adviser but prior to reductions from expense offset arrangements. Expenses net of all reductions represent the net expenses paid by the class but do not include expenses of the underlying funds in which the Fund invests.
F Amount represents less than .005%.
G Annualized
See accompanying notes which are an integral part of the financial statements.
Financial Highlights — Fidelity Income Replacement 2036 Fund Class I
| | Six months ended (Unaudited) January 31, | Years ended July 31, | | | | |
| | 2017 | 2016 | 2015 | 2014 | 2013 | 2012 |
| Selected Per–Share Data | | | | | | |
| Net asset value, beginning of period | $60.71 | $62.07 | $59.83 | $55.13 | $49.18 | $48.90 |
| Income from Investment Operations | | | | | | |
| Net investment income (loss)A | .646 | .940 | .901 | .869 | 1.108 | .873 |
| Net realized and unrealized gain (loss) | 1.404 | (.029) | 2.498 | 4.877 | 6.065 | .452 |
| Total from investment operations | 2.050 | .911 | 3.399 | 5.746 | 7.173 | 1.325 |
| Distributions from net investment income | (.663) | (.934) | (.885) | (.868) | (1.042) | (.908) |
| Distributions from net realized gain | (.707) | (1.337) | (.274) | (.178) | (.181) | (.137) |
| Total distributions | (1.370) | (2.271) | (1.159) | (1.046) | (1.223) | (1.045) |
| Net asset value, end of period | $61.39 | $60.71 | $62.07 | $59.83 | $55.13 | $49.18 |
| Total ReturnB | 3.44% | 1.67% | 5.73% | 10.49% | 14.80% | 2.82% |
| Ratios to Average Net AssetsC,D | | | | | | |
| Expenses before reductionsE | - %F | -% | -% | -% | -% | -% |
| Expenses net of fee waivers, if any | - %F | -% | -% | -% | -% | -% |
| Expenses net of all reductions | - %F | -% | -% | -% | -% | -% |
| Net investment income (loss) | 2.13%F | 1.61% | 1.48% | 1.54% | 2.05% | 1.85% |
| Supplemental Data | | | | | | |
| Net assets, end of period (000 omitted) | $1 | $1 | $1 | $1 | $1 | $1 |
| Portfolio turnover rateC | 16%F | 27% | 20% | 25% | 25% | 62% |
A Calculated based on average shares outstanding during the period.
B Total returns for periods of less than one year are not annualized.
C Amounts do not include the activity of the Underlying Funds.
D Expense ratios reflect operating expenses of the class. Expenses before reductions do not reflect amounts reimbursed by the investment adviser or reductions from expense offset arrangements and do not represent the amount paid by the class during periods when reimbursements or reductions occur. Expenses net of fee waivers reflect expenses after reimbursement by the investment adviser but prior to reductions from expense offset arrangements. Expenses net of all reductions represent the net expenses paid by the class but do not include expenses of the underlying funds in which the Fund invests.
E Amount represents less than .005%.
F Annualized
See accompanying notes which are an integral part of the financial statements.
Fidelity Income Replacement 2038 Fund℠
Investment Summary (Unaudited)
The information in the following tables is based on the direct investments of the Fund.
Top Holdings as of January 31, 2017
| | % of fund's net assets | % of fund's net assets 6 months ago |
| Fidelity Total Bond Fund | 16.7 | 16.7 |
| Fidelity Series Broad Market Opportunities Fund | 10.6 | 10.6 |
| Fidelity Equity-Income Fund | 9.2 | 9.3 |
| Fidelity Advisor International Discovery Fund Class I | 8.7 | 9.0 |
| Fidelity Large Cap Stock Fund | 6.9 | 6.9 |
| Fidelity Advisor Mid Cap II Fund Class I | 6.4 | 6.5 |
| Fidelity Investments Money Market Government Portfolio Institutional Class 0.47% | 6.1 | 5.9 |
| Fidelity Short-Term Bond Fund | 6.1 | 5.9 |
| Fidelity Series 100 Index Fund | 6.0 | 6.0 |
| Fidelity Blue Chip Growth Fund | 6.0 | 6.0 |
| | 82.7 | 82.8 |
Asset Allocation (% of fund's net assets)
| Period end |
| | Domestic Equity Funds | 46.0% |
| | International Equity Funds | 8.7% |
| | High Yield Fixed-Income Funds | 5.2% |
| | Investment Grade Fixed-Income Funds | 27.9% |
| | Short-Term Funds | 12.2% |
| Six months ago |
| | Domestic Equity Funds | 46.2% |
| | International Equity Funds | 9.0% |
| | High Yield Fixed-Income Funds | 5.3% |
| | Investment Grade Fixed-Income Funds | 27.7% |
| | Short-Term Funds | 11.8% |
Fidelity Income Replacement 2038 Fund℠
Investments January 31, 2017 (Unaudited)
Showing Percentage of Net Assets
| Equity Funds - 54.7% | | | |
| | | Shares | Value |
| Domestic Equity Funds - 46.0% | | | |
| Fidelity Advisor Mid Cap II Fund Class I (a) | | 15,128 | $299,980 |
| Fidelity Blue Chip Growth Fund (a) | | 3,944 | 278,553 |
| Fidelity Equity-Income Fund (a) | | 7,419 | 428,543 |
| Fidelity Large Cap Stock Fund (a) | | 10,793 | 321,407 |
| Fidelity Series 100 Index Fund (a) | | 18,898 | 278,553 |
| Fidelity Series Broad Market Opportunities Fund (a) | | 30,421 | 492,825 |
| Fidelity Series Small Cap Opportunities Fund (a) | | 3,041 | 42,854 |
|
| TOTAL DOMESTIC EQUITY FUNDS | | | 2,142,715 |
|
| International Equity Funds - 8.7% | | | |
| Fidelity Advisor International Discovery Fund Class I (a) | | 10,807 | 407,116 |
| TOTAL EQUITY FUNDS | | | |
| (Cost $1,944,635) | | | 2,549,831 |
|
| Fixed-Income Funds - 33.1% | | | |
| High Yield Fixed-Income Funds - 5.2% | | | |
| Fidelity Capital & Income Fund (a) | | 12,268 | 121,576 |
| Fidelity Strategic Income Fund (a) | | 11,288 | 121,576 |
|
| TOTAL HIGH YIELD FIXED-INCOME FUNDS | | | 243,152 |
|
| Investment Grade Fixed-Income Funds - 27.9% | | | |
| Fidelity Government Income Fund (a) | | 25,532 | 259,921 |
| Fidelity Strategic Real Return Fund (a) | | 29,469 | 259,921 |
| Fidelity Total Bond Fund (a) | | 73,823 | 778,832 |
|
| TOTAL INVESTMENT GRADE FIXED-INCOME FUNDS | | | 1,298,674 |
|
| TOTAL FIXED-INCOME FUNDS | | | |
| (Cost $1,525,614) | | | 1,541,826 |
|
| Short-Term Funds - 12.2% | | | |
| Fidelity Investments Money Market Government Portfolio Institutional Class 0.47% (a)(b) | | 283,211 | 283,211 |
| Fidelity Short-Term Bond Fund (a) | | 32,970 | 283,211 |
| TOTAL SHORT-TERM FUNDS | | | |
| (Cost $563,681) | | | 566,422 |
| TOTAL INVESTMENT PORTFOLIO - 100.0% | | | |
| (Cost $4,033,930) | | | 4,658,079 |
| NET OTHER ASSETS (LIABILITIES) - 0.0% | | | (154) |
| NET ASSETS - 100% | | | $4,657,925 |
Legend
(a) Affiliated Fund
(b) The rate quoted is the annualized seven-day yield of the fund at period end.
Affiliated Underlying Funds
Information regarding the Fund's fiscal year to date purchases and sales of the affiliated Underlying Funds and income earned by the Fund from investments in affiliated Underlying Funds is as follows:
| Affiliate | Value, beginning of period | Purchases | Sales Proceeds | Dividend Income | Value, end of period |
| Fidelity Advisor International Discovery Fund Class I | $444,172 | $36,543 | $66,791 | $6,904 | $407,116 |
| Fidelity Advisor Mid Cap II Fund Class I | 321,454 | 22,738 | 57,031 | 1,440 | 299,980 |
| Fidelity Blue Chip Growth Fund | 298,599 | 22,152 | 47,417 | 618 | 278,553 |
| Fidelity Capital & Income Fund | 131,164 | 5,265 | 20,092 | 2,763 | 121,576 |
| Fidelity Equity-Income Fund | 459,077 | 22,001 | 78,963 | 6,403 | 428,543 |
| Fidelity Government Income Fund | 275,744 | 29,553 | 32,236 | 2,141 | 259,921 |
| Fidelity Investments Money Market Government Portfolio Institutional Class 0.47% | 293,134 | 25,808 | 35,730 | 498 | 283,211 |
| Fidelity Large Cap Stock Fund | 344,308 | 12,205 | 63,070 | 2,965 | 321,407 |
| Fidelity Series 100 Index Fund | 298,599 | 13,249 | 42,632 | 6,417 | 278,553 |
| Fidelity Series Broad Market Opportunities Fund | 528,138 | 17,584 | 84,314 | 2,467 | 492,825 |
| Fidelity Series Small Cap Opportunities Fund | 45,709 | 2,597 | 9,327 | 217 | 42,854 |
| Fidelity Short-Term Bond Fund | 293,133 | 27,910 | 35,520 | 1,651 | 283,211 |
| Fidelity Strategic Income Fund | 131,164 | 7,465 | 17,014 | 2,189 | 121,576 |
| Fidelity Strategic Real Return Fund | 275,745 | 18,568 | 34,366 | 3,648 | 259,921 |
| Fidelity Total Bond Fund | 828,221 | 72,291 | 99,740 | 11,708 | 778,832 |
| Total | $4,968,361 | $335,929 | $724,243 | $52,029 | $4,658,079 |
Investment Valuation
All investments are categorized as Level 1 under the Fair Value Hierarchy. The inputs or methodology used for valuing securities may not be an indication of the risk associated with investing in those securities. For more information on valuation inputs please refer to the Investment Valuation section in the accompanying Notes to Financial Statements.
See accompanying notes which are an integral part of the financial statements.
Fidelity Income Replacement 2038 Fund℠
Financial Statements
Statement of Assets and Liabilities
| | | January 31, 2017 (Unaudited) |
| Assets | | |
| Investment in securities, at value (cost $4,033,930) — See accompanying schedule | | $4,658,079 |
| Cash | | 2 |
| Receivable for investments sold | | 32,249 |
| Total assets | | 4,690,330 |
| Liabilities | | |
| Payable for investments purchased | $32,250 | |
| Distribution and service plan fees payable | 155 | |
| Total liabilities | | 32,405 |
| Net Assets | | $4,657,925 |
| Net Assets consist of: | | |
| Paid in capital | | $4,015,172 |
| Undistributed net investment income | | 909 |
| Accumulated undistributed net realized gain (loss) on investments | | 17,695 |
| Net unrealized appreciation (depreciation) on investments | | 624,149 |
| Net Assets | | $4,657,925 |
| Calculation of Maximum Offering Price | | |
| Class A: | | |
| Net Asset Value and redemption price per share ($6,474 ÷ 109.81 shares) | | $58.96 |
| Maximum offering price per share (100/94.25 of $58.96) | | $62.56 |
| Class T: | | |
| Net Asset Value and redemption price per share ($184,530 ÷ 3,132.57 shares) | | $58.91 |
| Maximum offering price per share (100/96.50 of $58.91) | | $61.05 |
| Class C: | | |
| Net Asset Value and offering price per share ($92,123 ÷ 1,573.27 shares)(a) | | $58.56 |
| Income Replacement 2038: | | |
| Net Asset Value, offering price and redemption price per share ($4,340,540 ÷ 73,655.45 shares) | | $58.93 |
| Class I: | | |
| Net Asset Value, offering price and redemption price per share ($34,258 ÷ 581.37 shares) | | $58.93 |
(a) Redemption price per share is equal to net asset value less any applicable contingent deferred sales charge.
See accompanying notes which are an integral part of the financial statements.
Statement of Operations
| | | Six months ended January 31, 2017 (Unaudited) |
| Investment Income | | |
| Income distributions from underlying funds | | $52,029 |
| Expenses | | |
| Distribution and service plan fees | $934 | |
| Independent trustees' fees and expenses | 12 | |
| Total expenses before reductions | 946 | |
| Expense reductions | (12) | 934 |
| Net investment income (loss) | | 51,095 |
| Realized and Unrealized Gain (Loss) | | |
| Realized gain (loss) on sale of underlying fund shares | 15,339 | |
| Capital gain distributions from underlying funds | 35,401 | |
| Total net realized gain (loss) | | 50,740 |
| Change in net unrealized appreciation (depreciation) on underlying funds | | 62,692 |
| Net gain (loss) | | 113,432 |
| Net increase (decrease) in net assets resulting from operations | | $164,527 |
See accompanying notes which are an integral part of the financial statements.
Statement of Changes in Net Assets
| | Six months ended January 31, 2017 (Unaudited) | Year ended July 31, 2016 |
| Increase (Decrease) in Net Assets | | |
| Operations | | |
| Net investment income (loss) | $51,095 | $93,261 |
| Net realized gain (loss) | 50,740 | 62,002 |
| Change in net unrealized appreciation (depreciation) | 62,692 | (142,555) |
| Net increase (decrease) in net assets resulting from operations | 164,527 | 12,708 |
| Distributions to shareholders from net investment income | (51,267) | (93,349) |
| Distributions to shareholders from net realized gain | (29,677) | (167,598) |
| Total distributions | (80,944) | (260,947) |
| Share transactions - net increase (decrease) | (393,856) | (1,464,806) |
| Total increase (decrease) in net assets | (310,273) | (1,713,045) |
| Net Assets | | |
| Beginning of period | 4,968,198 | 6,681,243 |
| End of period | $4,657,925 | $4,968,198 |
| Other Information | | |
| Undistributed net investment income end of period | $909 | $1,081 |
See accompanying notes which are an integral part of the financial statements.
Financial Highlights — Fidelity Income Replacement 2038 Fund Class A
| | Six months ended (Unaudited) January 31, | Years ended July 31, | | | | |
| | 2017 | 2016 | 2015 | 2014 | 2013 | 2012 |
| Selected Per–Share Data | | | | | | |
| Net asset value, beginning of period | $57.92 | $59.57 | $57.74 | $54.44 | $48.41 | $48.19 |
| Income from Investment Operations | | | | | | |
| Net investment income (loss)A | .574 | .774 | .718 | .738 | .953 | .739 |
| Net realized and unrealized gain (loss) | 1.354 | (.138) | 2.463 | 4.763 | 6.186 | .384 |
| Total from investment operations | 1.928 | .636 | 3.181 | 5.501 | 7.139 | 1.123 |
| Distributions from net investment income | (.527) | (.766) | (.712) | (.688) | (.909) | (.769) |
| Distributions from net realized gain | (.361) | (1.520) | (.639) | (1.513) | (.200) | (.134) |
| Total distributions | (.888) | (2.286) | (1.351) | (2.201) | (1.109) | (.903) |
| Net asset value, end of period | $58.96 | $57.92 | $59.57 | $57.74 | $54.44 | $48.41 |
| Total ReturnB,C,D | 3.36% | 1.27% | 5.58% | 10.39% | 14.95% | 2.44% |
| Ratios to Average Net AssetsE,F | | | | | | |
| Expenses before reductions | .24%G,H | .25% | .25% | .25% | .25% | .25% |
| Expenses net of fee waivers, if any | .24%G,H | .25% | .25% | .25% | .25% | .25% |
| Expenses net of all reductions | .24%G,H | .25% | .25% | .25% | .25% | .25% |
| Net investment income (loss) | 1.92%G | 1.39% | 1.22% | 1.31% | 1.85% | 1.59% |
| Supplemental Data | | | | | | |
| Net assets, end of period (000 omitted) | $6 | $62 | $172 | $178 | $121 | $76 |
| Portfolio turnover rate E | 14%G | 23% | 41% | 39% | 49% | 57% |
A Calculated based on average shares outstanding during the period.
B Total returns for periods of less than one year are not annualized.
C Total returns would have been lower if certain expenses had not been reduced during the applicable periods shown.
D Total returns do not include the effect of the sales charges.
E Amounts do not include the activity of the Underlying Funds.
F Expense ratios reflect operating expenses of the class. Expenses before reductions do not reflect amounts reimbursed by the investment adviser or reductions from expense offset arrangements and do not represent the amount paid by the class during periods when reimbursements or reductions occur. Expenses net of fee waivers reflect expenses after reimbursement by the investment adviser but prior to reductions from expense offset arrangements. Expenses net of all reductions represent the net expenses paid by the class but do not include expenses of the underlying funds in which the Fund invests.
G Annualized
H On certain classes, the size and fluctuation of net assets may cause rounding of expense amounts and ratios to differ from contractual rates.
See accompanying notes which are an integral part of the financial statements.
Financial Highlights — Fidelity Income Replacement 2038 Fund Class T
| | Six months ended (Unaudited) January 31, | Years ended July 31, | | | | |
| | 2017 | 2016 | 2015 | 2014 | 2013 | 2012 |
| Selected Per–Share Data | | | | | | |
| Net asset value, beginning of period | $57.90 | $59.56 | $57.74 | $54.44 | $48.40 | $48.19 |
| Income from Investment Operations | | | | | | |
| Net investment income (loss)A | .483 | .635 | .571 | .599 | .820 | .624 |
| Net realized and unrealized gain (loss) | 1.376 | (.140) | 2.456 | 4.761 | 6.201 | .367 |
| Total from investment operations | 1.859 | .495 | 3.027 | 5.360 | 7.021 | .991 |
| Distributions from net investment income | (.488) | (.635) | (.568) | (.547) | (.781) | (.647) |
| Distributions from net realized gain | (.361) | (1.520) | (.639) | (1.513) | (.200) | (.134) |
| Total distributions | (.849) | (2.155) | (1.207) | (2.060) | (.981) | (.781) |
| Net asset value, end of period | $58.91 | $57.90 | $59.56 | $57.74 | $54.44 | $48.40 |
| Total ReturnB,C,D | 3.24% | 1.02% | 5.30% | 10.11% | 14.69% | 2.15% |
| Ratios to Average Net AssetsE,F | | | | | | |
| Expenses before reductions | .50%G | .50% | .50% | .50% | .50% | .50% |
| Expenses net of fee waivers, if any | .50%G | .50% | .50% | .50% | .50% | .50% |
| Expenses net of all reductions | .50%G | .50% | .50% | .50% | .50% | .50% |
| Net investment income (loss) | 1.66%G | 1.14% | .97% | 1.07% | 1.59% | 1.34% |
| Supplemental Data | | | | | | |
| Net assets, end of period (000 omitted) | $185 | $183 | $191 | $190 | $135 | $105 |
| Portfolio turnover rate E | 14%G | 23% | 41% | 39% | 49% | 57% |
A Calculated based on average shares outstanding during the period.
B Total returns for periods of less than one year are not annualized.
C Total returns would have been lower if certain expenses had not been reduced during the applicable periods shown.
D Total returns do not include the effect of the sales charges.
E Amounts do not include the activity of the Underlying Funds.
F Expense ratios reflect operating expenses of the class. Expenses before reductions do not reflect amounts reimbursed by the investment adviser or reductions from expense offset arrangements and do not represent the amount paid by the class during periods when reimbursements or reductions occur. Expenses net of fee waivers reflect expenses after reimbursement by the investment adviser but prior to reductions from expense offset arrangements. Expenses net of all reductions represent the net expenses paid by the class but do not include expenses of the underlying funds in which the Fund invests.
G Annualized
See accompanying notes which are an integral part of the financial statements.
Financial Highlights — Fidelity Income Replacement 2038 Fund Class C
| | Six months ended (Unaudited) January 31, | Years ended July 31, | | | | |
| | 2017 | 2016 | 2015 | 2014 | 2013 | 2012 |
| Selected Per–Share Data | | | | | | |
| Net asset value, beginning of period | $57.58 | $59.30 | $57.56 | $54.33 | $48.37 | $48.17 |
| Income from Investment Operations | | | | | | |
| Net investment income (loss)A | .336 | .355 | .276 | .315 | .561 | .390 |
| Net realized and unrealized gain (loss) | 1.375 | (.151) | 2.444 | 4.755 | 6.186 | .379 |
| Total from investment operations | 1.711 | .204 | 2.720 | 5.070 | 6.747 | .769 |
| Distributions from net investment income | (.370) | (.404) | (.341) | (.327) | (.587) | (.435) |
| Distributions from net realized gain | (.361) | (1.520) | (.639) | (1.513) | (.200) | (.134) |
| Total distributions | (.731) | (1.924) | (.980) | (1.840) | (.787) | (.569) |
| Net asset value, end of period | $58.56 | $57.58 | $59.30 | $57.56 | $54.33 | $48.37 |
| Total ReturnB,C,D | 3.00% | .50% | 4.77% | 9.57% | 14.10% | 1.67% |
| Ratios to Average Net AssetsE,F | | | | | | |
| Expenses before reductions | 1.00%G | 1.00% | 1.00% | 1.00% | 1.00% | 1.00% |
| Expenses net of fee waivers, if any | 1.00%G | 1.00% | 1.00% | 1.00% | 1.00% | 1.00% |
| Expenses net of all reductions | 1.00%G | 1.00% | 1.00% | 1.00% | 1.00% | 1.00% |
| Net investment income (loss) | 1.16%G | .64% | .47% | .56% | 1.09% | .84% |
| Supplemental Data | | | | | | |
| Net assets, end of period (000 omitted) | $92 | $93 | $104 | $110 | $84 | $74 |
| Portfolio turnover rate E | 14%G | 23% | 41% | 39% | 49% | 57% |
A Calculated based on average shares outstanding during the period.
B Total returns for periods of less than one year are not annualized.
C Total returns do not include the effect of the contingent deferred sales charge.
D Total returns would have been lower if certain expenses had not been reduced during the applicable periods shown.
E Amounts do not include the activity of the Underlying Funds.
F Expense ratios reflect operating expenses of the class. Expenses before reductions do not reflect amounts reimbursed by the investment adviser or reductions from expense offset arrangements and do not represent the amount paid by the class during periods when reimbursements or reductions occur. Expenses net of fee waivers reflect expenses after reimbursement by the investment adviser but prior to reductions from expense offset arrangements. Expenses net of all reductions represent the net expenses paid by the class but do not include expenses of the underlying funds in which the Fund invests.
G Annualized
See accompanying notes which are an integral part of the financial statements.
Financial Highlights — Fidelity Income Replacement 2038 Fund
| | Six months ended (Unaudited) January 31, | Years ended July 31, | | | | |
| | 2017 | 2016 | 2015 | 2014 | 2013 | 2012 |
| Selected Per–Share Data | | | | | | |
| Net asset value, beginning of period | $57.92 | $59.58 | $57.75 | $54.45 | $48.41 | $48.19 |
| Income from Investment Operations | | | | | | |
| Net investment income (loss)A | .629 | .915 | .865 | .881 | 1.076 | .857 |
| Net realized and unrealized gain (loss) | 1.375 | (.145) | 2.464 | 4.759 | 6.200 | .377 |
| Total from investment operations | 2.004 | .770 | 3.329 | 5.640 | 7.276 | 1.234 |
| Distributions from net investment income | (.633) | (.910) | (.860) | (.827) | (1.036) | (.880) |
| Distributions from net realized gain | (.361) | (1.520) | (.639) | (1.513) | (.200) | (.134) |
| Total distributions | (.994) | (2.430) | (1.499) | (2.340) | (1.236) | (1.014) |
| Net asset value, end of period | $58.93 | $57.92 | $59.58 | $57.75 | $54.45 | $48.41 |
| Total ReturnB,C | 3.50% | 1.52% | 5.84% | 10.66% | 15.26% | 2.68% |
| Ratios to Average Net AssetsD,E | | | | | | |
| Expenses before reductionsF | - %G | -% | -% | -% | -% | -% |
| Expenses net of fee waivers, if any | - %G | -% | -% | -% | -% | -% |
| Expenses net of all reductions | - %G | -% | -% | -% | -% | -% |
| Net investment income (loss) | 2.16%G | 1.64% | 1.47% | 1.56% | 2.10% | 1.84% |
| Supplemental Data | | | | | | |
| Net assets, end of period (000 omitted) | $4,341 | $4,597 | $6,181 | $6,017 | $1,942 | $1,811 |
| Portfolio turnover rate D | 14%G | 23% | 41% | 39% | 49% | 57% |
A Calculated based on average shares outstanding during the period.
B Total returns for periods of less than one year are not annualized.
C Total returns would have been lower if certain expenses had not been reduced during the applicable periods shown.
D Amounts do not include the activity of the Underlying Funds.
E Expense ratios reflect operating expenses of the class. Expenses before reductions do not reflect amounts reimbursed by the investment adviser or reductions from expense offset arrangements and do not represent the amount paid by the class during periods when reimbursements or reductions occur. Expenses net of fee waivers reflect expenses after reimbursement by the investment adviser but prior to reductions from expense offset arrangements. Expenses net of all reductions represent the net expenses paid by the class but do not include expenses of the underlying funds in which the Fund invests.
F Amount represents less than .005%.
G Annualized
See accompanying notes which are an integral part of the financial statements.
Financial Highlights — Fidelity Income Replacement 2038 Fund Class I
| | Six months ended (Unaudited) January 31, | Years ended July 31, | | | | |
| | 2017 | 2016 | 2015 | 2014 | 2013 | 2012 |
| Selected Per–Share Data | | | | | | |
| Net asset value, beginning of period | $57.92 | $59.58 | $57.75 | $54.45 | $48.41 | $48.19 |
| Income from Investment Operations | | | | | | |
| Net investment income (loss)A | .628 | .913 | .865 | .879 | 1.078 | .857 |
| Net realized and unrealized gain (loss) | 1.376 | (.143) | 2.464 | 4.761 | 6.198 | .377 |
| Total from investment operations | 2.004 | .770 | 3.329 | 5.640 | 7.276 | 1.234 |
| Distributions from net investment income | (.633) | (.910) | (.860) | (.827) | (1.036) | (.880) |
| Distributions from net realized gain | (.361) | (1.520) | (.639) | (1.513) | (.200) | (.134) |
| Total distributions | (.994) | (2.430) | (1.499) | (2.340) | (1.236) | (1.014) |
| Net asset value, end of period | $58.93 | $57.92 | $59.58 | $57.75 | $54.45 | $48.41 |
| Total ReturnB,C | 3.50% | 1.52% | 5.84% | 10.66% | 15.26% | 2.68% |
| Ratios to Average Net AssetsD,E | | | | | | |
| Expenses before reductions F | - %G | -% | -% | -% | -% | -% |
| Expenses net of fee waivers, if any | - %G | -% | -% | -% | -% | -% |
| Expenses net of all reductions | - %G | -% | -% | -% | -% | -% |
| Net investment income (loss) | 2.16%G | 1.64% | 1.47% | 1.56% | 2.10% | 1.84% |
| Supplemental Data | | | | | | |
| Net assets, end of period (000 omitted) | $34 | $33 | $34 | $32 | $29 | $25 |
| Portfolio turnover rate D | 14%G | 23% | 41% | 39% | 49% | 57% |
A Calculated based on average shares outstanding during the period.
B Total returns for periods of less than one year are not annualized.
C Total returns would have been lower if certain expenses had not been reduced during the applicable periods shown.
D Amounts do not include the activity of the Underlying Funds.
E Expense ratios reflect operating expenses of the class. Expenses before reductions do not reflect amounts reimbursed by the investment adviser or reductions from expense offset arrangements and do not represent the amount paid by the class during periods when reimbursements or reductions occur. Expenses net of fee waivers reflect expenses after reimbursement by the investment adviser but prior to reductions from expense offset arrangements. Expenses net of all reductions represent the net expenses paid by the class but do not include expenses of the underlying funds in which the Fund invests.
F Amount represents less than .005%.
G Annualized
See accompanying notes which are an integral part of the financial statements.
Fidelity Income Replacement 2040 Fund℠
Investment Summary (Unaudited)
The information in the following tables is based on the direct investments of the Fund.
Top Holdings as of January 31, 2017
| | % of fund's net assets | % of fund's net assets 6 months ago |
| Fidelity Total Bond Fund | 16.6 | 16.3 |
| Fidelity Series Broad Market Opportunities Fund | 10.8 | 10.8 |
| Fidelity Advisor International Discovery Fund Class I | 9.6 | 9.8 |
| Fidelity Equity-Income Fund | 9.4 | 9.4 |
| Fidelity Large Cap Stock Fund | 7.0 | 7.1 |
| Fidelity Advisor Mid Cap II Fund Class I | 6.5 | 6.6 |
| Fidelity Series 100 Index Fund | 6.1 | 6.1 |
| Fidelity Blue Chip Growth Fund | 6.1 | 6.1 |
| Fidelity Strategic Real Return Fund | 5.5 | 5.5 |
| Fidelity Government Income Fund | 5.5 | 5.5 |
| | 83.1 | 83.2 |
Asset Allocation (% of fund's net assets)
| Period end |
| | Domestic Equity Funds | 46.8% |
| | International Equity Funds | 9.6% |
| | High Yield Fixed-Income Funds | 5.4% |
| | Investment Grade Fixed-Income Funds | 27.6% |
| | Short-Term Funds | 10.6% |
| Six months ago |
| | Domestic Equity Funds | 47.0% |
| | International Equity Funds | 9.8% |
| | High Yield Fixed-Income Funds | 5.5% |
| | Investment Grade Fixed-Income Funds | 27.3% |
| | Short-Term Funds | 10.4% |
Fidelity Income Replacement 2040 Fund℠
Investments January 31, 2017 (Unaudited)
Showing Percentage of Net Assets
| Equity Funds - 56.4% | | | |
| | | Shares | Value |
| Domestic Equity Funds - 46.8% | | | |
| Fidelity Advisor Mid Cap II Fund Class I (a) | | 30,356 | $601,952 |
| Fidelity Blue Chip Growth Fund (a) | | 7,925 | 559,678 |
| Fidelity Equity-Income Fund (a) | | 14,893 | 860,195 |
| Fidelity Large Cap Stock Fund (a) | | 21,664 | 645,146 |
| Fidelity Series 100 Index Fund (a) | | 37,970 | 559,678 |
| Fidelity Series Broad Market Opportunities Fund (a) | | 61,097 | 989,775 |
| Fidelity Series Small Cap Opportunities Fund (a) | | 6,131 | 86,387 |
|
| TOTAL DOMESTIC EQUITY FUNDS | | | 4,302,811 |
|
| International Equity Funds - 9.6% | | | |
| Fidelity Advisor International Discovery Fund Class I (a) | | 23,323 | 878,575 |
| TOTAL EQUITY FUNDS | | | |
| (Cost $4,329,899) | | | 5,181,386 |
|
| Fixed-Income Funds - 33.0% | | | |
| High Yield Fixed-Income Funds - 5.4% | | | |
| Fidelity Capital & Income Fund (a) | | 25,317 | 250,890 |
| Fidelity Strategic Income Fund (a) | | 23,295 | 250,890 |
|
| TOTAL HIGH YIELD FIXED-INCOME FUNDS | | | 501,780 |
|
| Investment Grade Fixed-Income Funds - 27.6% | | | |
| Fidelity Government Income Fund (a) | | 49,742 | 506,375 |
| Fidelity Strategic Real Return Fund (a) | | 57,412 | 506,375 |
| Fidelity Total Bond Fund (a) | | 144,080 | 1,520,043 |
|
| TOTAL INVESTMENT GRADE FIXED-INCOME FUNDS | | | 2,532,793 |
|
| TOTAL FIXED-INCOME FUNDS | | | |
| (Cost $3,067,766) | | | 3,034,573 |
|
| Short-Term Funds - 10.6% | | | |
| Fidelity Investments Money Market Government Portfolio Institutional Class 0.47% (a)(b) | | 487,076 | 487,076 |
| Fidelity Short-Term Bond Fund (a) | | 56,703 | 487,076 |
| TOTAL SHORT-TERM FUNDS | | | |
| (Cost $973,517) | | | 974,152 |
| TOTAL INVESTMENT PORTFOLIO - 100.0% | | | |
| (Cost $8,371,182) | | | 9,190,111 |
| NET OTHER ASSETS (LIABILITIES) - 0.0% | | | (481) |
| NET ASSETS - 100% | | | $9,189,630 |
Legend
(a) Affiliated Fund
(b) The rate quoted is the annualized seven-day yield of the fund at period end.
Affiliated Underlying Funds
Information regarding the Fund's fiscal year to date purchases and sales of the affiliated Underlying Funds and income earned by the Fund from investments in affiliated Underlying Funds is as follows:
| Affiliate | Value, beginning of period | Purchases | Sales Proceeds | Dividend Income | Value, end of period |
| Fidelity Advisor International Discovery Fund Class I | $955,013 | $86,053 | $147,934 | $14,427 | $878,575 |
| Fidelity Advisor Mid Cap II Fund Class I | 643,511 | 51,062 | 116,952 | 2,796 | 601,952 |
| Fidelity Blue Chip Growth Fund | 597,616 | 48,084 | 95,952 | 1,248 | 559,678 |
| Fidelity Capital & Income Fund | 269,513 | 13,366 | 42,650 | 5,636 | 250,890 |
| Fidelity Equity-Income Fund | 918,883 | 53,463 | 162,484 | 12,779 | 860,195 |
| Fidelity Government Income Fund | 533,167 | 61,815 | 63,497 | 4,115 | 506,375 |
| Fidelity Investments Money Market Government Portfolio Institutional Class 0.47% | 506,801 | 44,053 | 63,779 | 847 | 487,076 |
| Fidelity Large Cap Stock Fund | 689,406 | 31,146 | 129,531 | 5,780 | 645,146 |
| Fidelity Series 100 Index Fund | 597,615 | 32,487 | 88,101 | 12,449 | 559,678 |
| Fidelity Series Broad Market Opportunities Fund | 1,056,569 | 44,263 | 171,476 | 4,789 | 989,775 |
| Fidelity Series Small Cap Opportunities Fund | 91,791 | 6,058 | 18,979 | 438 | 86,387 |
| Fidelity Short-Term Bond Fund | 506,801 | 47,721 | 63,530 | 2,807 | 487,076 |
| Fidelity Strategic Income Fund | 269,513 | 16,939 | 35,500 | 4,470 | 250,890 |
| Fidelity Strategic Real Return Fund | 533,167 | 41,120 | 67,589 | 7,082 | 506,375 |
| Fidelity Total Bond Fund | 1,595,591 | 165,374 | 199,197 | 22,448 | 1,520,043 |
| Total | $9,764,957 | $743,004 | $1,467,151 | $102,111 | $9,190,111 |
Investment Valuation
All investments are categorized as Level 1 under the Fair Value Hierarchy. The inputs or methodology used for valuing securities may not be an indication of the risk associated with investing in those securities. For more information on valuation inputs please refer to the Investment Valuation section in the accompanying Notes to Financial Statements.
See accompanying notes which are an integral part of the financial statements.
Fidelity Income Replacement 2040 Fund℠
Financial Statements
Statement of Assets and Liabilities
| | | January 31, 2017 (Unaudited) |
| Assets | | |
| Investment in securities, at value (cost $8,371,182) — See accompanying schedule | | $9,190,111 |
| Receivable for investments sold | | 62,675 |
| Total assets | | 9,252,786 |
| Liabilities | | |
| Payable for investments purchased | $62,675 | |
| Distribution and service plan fees payable | 481 | |
| Total liabilities | | 63,156 |
| Net Assets | | $9,189,630 |
| Net Assets consist of: | | |
| Paid in capital | | $8,353,148 |
| Undistributed net investment income | | 1,754 |
| Accumulated undistributed net realized gain (loss) on investments | | 15,799 |
| Net unrealized appreciation (depreciation) on investments | | 818,929 |
| Net Assets | | $9,189,630 |
| Calculation of Maximum Offering Price | | |
| Class A: | | |
| Net Asset Value and redemption price per share ($95,183 ÷ 1,583.23 shares) | | $60.12 |
| Maximum offering price per share (100/94.25 of $60.12) | | $63.79 |
| Class T: | | |
| Net Asset Value and redemption price per share ($747,618 ÷ 12,421.55 shares) | | $60.19 |
| Maximum offering price per share (100/96.50 of $60.19) | | $62.37 |
| Class C: | | |
| Net Asset Value and offering price per share ($178,738 ÷ 2,995.50 shares)(a) | | $59.67 |
| Income Replacement 2040: | | |
| Net Asset Value, offering price and redemption price per share ($8,166,214 ÷ 135,928.64 shares) | | $60.08 |
| Class I: | | |
| Net Asset Value, offering price and redemption price per share ($1,877 ÷ 31.24 shares) | | $60.08 |
(a) Redemption price per share is equal to net asset value less any applicable contingent deferred sales charge.
See accompanying notes which are an integral part of the financial statements.
Statement of Operations
| | | Six months ended January 31, 2017 (Unaudited) |
| Investment Income | | |
| Income distributions from underlying funds | | $102,111 |
| Expenses | | |
| Distribution and service plan fees | $2,857 | |
| Independent trustees' fees and expenses | 22 | |
| Total expenses before reductions | 2,879 | |
| Expense reductions | (22) | 2,857 |
| Net investment income (loss) | | 99,254 |
| Realized and Unrealized Gain (Loss) | | |
| Realized gain (loss) on sale of underlying fund shares | (1,449) | |
| Capital gain distributions from underlying funds | 69,123 | |
| Total net realized gain (loss) | | 67,674 |
| Change in net unrealized appreciation (depreciation) on underlying funds | | 150,751 |
| Net gain (loss) | | 218,425 |
| Net increase (decrease) in net assets resulting from operations | | $317,679 |
See accompanying notes which are an integral part of the financial statements.
Statement of Changes in Net Assets
| | Six months ended January 31, 2017 (Unaudited) | Year ended July 31, 2016 |
| Increase (Decrease) in Net Assets | | |
| Operations | | |
| Net investment income (loss) | $99,254 | $153,024 |
| Net realized gain (loss) | 67,674 | 137,577 |
| Change in net unrealized appreciation (depreciation) | 150,751 | (166,274) |
| Net increase (decrease) in net assets resulting from operations | 317,679 | 124,327 |
| Distributions to shareholders from net investment income | (99,473) | (152,794) |
| Distributions to shareholders from net realized gain | (89,994) | (242,649) |
| Total distributions | (189,467) | (395,443) |
| Share transactions - net increase (decrease) | (703,070) | 169,969 |
| Total increase (decrease) in net assets | (574,858) | (101,147) |
| Net Assets | | |
| Beginning of period | 9,764,488 | 9,865,635 |
| End of period | $9,189,630 | $9,764,488 |
| Other Information | | |
| Undistributed net investment income end of period | $1,754 | $1,973 |
See accompanying notes which are an integral part of the financial statements.
Financial Highlights — Fidelity Income Replacement 2040 Fund Class A
| | Six months ended (Unaudited) January 31, | Years ended July 31, | | | | |
| | 2017 | 2016 | 2015 | 2014 | 2013 | 2012 |
| Selected Per–Share Data | | | | | | |
| Net asset value, beginning of period | $59.25 | $60.93 | $59.08 | $54.91 | $48.63 | $48.44 |
| Income from Investment Operations | | | | | | |
| Net investment income (loss)A | .571 | .786 | .748 | .742 | .927 | .762 |
| Net realized and unrealized gain (loss) | 1.439 | (.202) | 2.585 | 5.022 | 6.538 | .331 |
| Total from investment operations | 2.010 | .584 | 3.333 | 5.764 | 7.465 | 1.093 |
| Distributions from net investment income | (.585) | (.773) | (.742) | (.712) | (.933) | (.771) |
| Distributions from net realized gain | (.555) | (1.491) | (.741) | (.882) | (.252) | (.132) |
| Total distributions | (1.140) | (2.264) | (1.483) | (1.594) | (1.185) | (.903) |
| Net asset value, end of period | $60.12 | $59.25 | $60.93 | $59.08 | $54.91 | $48.63 |
| Total ReturnB,C | 3.44% | 1.16% | 5.72% | 10.68% | 15.58% | 2.36% |
| Ratios to Average Net AssetsD,E | | | | | | |
| Expenses before reductions | .25%F | .25% | .25% | .25% | .24%G | .25% |
| Expenses net of fee waivers, if any | .25%F | .25% | .25% | .25% | .24%G | .25% |
| Expenses net of all reductions | .25%F | .25% | .25% | .25% | .24%G | .25% |
| Net investment income (loss) | 1.93%F | 1.38% | 1.25% | 1.28% | 1.79% | 1.64% |
| Supplemental Data | | | | | | |
| Net assets, end of period (000 omitted) | $95 | $92 | $109 | $109 | $10 | $7 |
| Portfolio turnover rateD | 16%F | 29% | 31% | 34% | 30% | 63% |
A Calculated based on average shares outstanding during the period.
B Total returns for periods of less than one year are not annualized.
C Total returns do not include the effect of the sales charges.
D Amounts do not include the activity of the Underlying Funds.
E Expense ratios reflect operating expenses of the class. Expenses before reductions do not reflect amounts reimbursed by the investment adviser or reductions from expense offset arrangements and do not represent the amount paid by the class during periods when reimbursements or reductions occur. Expenses net of fee waivers reflect expenses after reimbursement by the investment adviser but prior to reductions from expense offset arrangements. Expenses net of all reductions represent the net expenses paid by the class but do not include expenses of the underlying funds in which the Fund invests.
F Annualized
G On certain classes, the size and fluctuation of net assets may cause rounding of expense amounts and ratios to differ from contractual rates.
See accompanying notes which are an integral part of the financial statements.
Financial Highlights — Fidelity Income Replacement 2040 Fund Class T
| | Six months ended (Unaudited) January 31, | Years ended July 31, | | | | |
| | 2017 | 2016 | 2015 | 2014 | 2013 | 2012 |
| Selected Per–Share Data | | | | | | |
| Net asset value, beginning of period | $59.31 | $61.00 | $59.15 | $55.00 | $48.61 | $48.43 |
| Income from Investment Operations | | | | | | |
| Net investment income (loss)A | .497 | .642 | .599 | .605 | .781 | .649 |
| Net realized and unrealized gain (loss) | 1.447 | (.205) | 2.586 | 5.021 | 6.563 | .312 |
| Total from investment operations | 1.944 | .437 | 3.185 | 5.626 | 7.344 | .961 |
| Distributions from net investment income | (.509) | (.636) | (.594) | (.594) | (.702) | (.649) |
| Distributions from net realized gain | (.555) | (1.491) | (.741) | (.882) | (.252) | (.132) |
| Total distributions | (1.064) | (2.127) | (1.335) | (1.476) | (.954) | (.781) |
| Net asset value, end of period | $60.19 | $59.31 | $61.00 | $59.15 | $55.00 | $48.61 |
| Total ReturnB,C,D | 3.33% | .90% | 5.45% | 10.40% | 15.30% | 2.08% |
| Ratios to Average Net AssetsE,F | | | | | | |
| Expenses before reductions | .50%G | .50% | .50% | .49%H | .50% | .50% |
| Expenses net of fee waivers, if any | .50%G | .50% | .50% | .49%H | .50% | .50% |
| Expenses net of all reductions | .50%G | .50% | .50% | .49%H | .50% | .50% |
| Net investment income (loss) | 1.68%G | 1.13% | 1.00% | 1.04% | 1.53% | 1.39% |
| Supplemental Data | | | | | | |
| Net assets, end of period (000 omitted) | $748 | $752 | $544 | $451 | $10 | $51 |
| Portfolio turnover rateE | 16%G | 29% | 31% | 34% | 30% | 63% |
A Calculated based on average shares outstanding during the period.
B Total returns for periods of less than one year are not annualized.
C Total returns would have been lower if certain expenses had not been reduced during the applicable periods shown.
D Total returns do not include the effect of the sales charges.
E Amounts do not include the activity of the Underlying Funds.
F Expense ratios reflect operating expenses of the class. Expenses before reductions do not reflect amounts reimbursed by the investment adviser or reductions from expense offset arrangements and do not represent the amount paid by the class during periods when reimbursements or reductions occur. Expenses net of fee waivers reflect expenses after reimbursement by the investment adviser but prior to reductions from expense offset arrangements. Expenses net of all reductions represent the net expenses paid by the class but do not include expenses of the underlying funds in which the Fund invests.
G Annualized
H On certain classes, the size and fluctuation of net assets may cause rounding of expense amounts and ratios to differ from contractual rates.
See accompanying notes which are an integral part of the financial statements.
Financial Highlights — Fidelity Income Replacement 2040 Fund Class C
| | Six months ended (Unaudited) January 31, | Years ended July 31, | | | | |
| | 2017 | 2016 | 2015 | 2014 | 2013 | 2012 |
| Selected Per–Share Data | | | | | | |
| Net asset value, beginning of period | $58.84 | $60.60 | $58.82 | $54.75 | $48.55 | $48.42 |
| Income from Investment Operations | | | | | | |
| Net investment income (loss)A | .346 | .357 | .296 | .304 | .532 | .415 |
| Net realized and unrealized gain (loss) | 1.433 | (.216) | 2.580 | 5.003 | 6.524 | .310 |
| Total from investment operations | 1.779 | .141 | 2.876 | 5.307 | 7.056 | .725 |
| Distributions from net investment income | (.394) | (.410) | (.355) | (.355) | (.604) | (.463) |
| Distributions from net realized gain | (.555) | (1.491) | (.741) | (.882) | (.252) | (.132) |
| Total distributions | (.949) | (1.901) | (1.096) | (1.237) | (.856) | (.595) |
| Net asset value, end of period | $59.67 | $58.84 | $60.60 | $58.82 | $54.75 | $48.55 |
| Total ReturnB,C,D | 3.07% | .39% | 4.94% | 9.84% | 14.71% | 1.57% |
| Ratios to Average Net AssetsE,F | | | | | | |
| Expenses before reductions | 1.00%G | 1.00% | 1.00% | 1.00% | 1.00% | 1.00% |
| Expenses net of fee waivers, if any | 1.00%G | 1.00% | 1.00% | 1.00% | 1.00% | 1.00% |
| Expenses net of all reductions | 1.00%G | 1.00% | 1.00% | 1.00% | 1.00% | 1.00% |
| Net investment income (loss) | 1.18%G | .63% | .49% | .53% | 1.03% | .89% |
| Supplemental Data | | | | | | |
| Net assets, end of period (000 omitted) | $179 | $175 | $177 | $205 | $154 | $107 |
| Portfolio turnover rateE | 16%G | 29% | 31% | 34% | 30% | 63% |
A Calculated based on average shares outstanding during the period.
B Total returns for periods of less than one year are not annualized.
C Total returns would have been lower if certain expenses had not been reduced during the applicable periods shown.
D Total returns do not include the effect of the contingent deferred sales charge.
E Amounts do not include the activity of the Underlying Funds.
F Expense ratios reflect operating expenses of the class. Expenses before reductions do not reflect amounts reimbursed by the investment adviser or reductions from expense offset arrangements and do not represent the amount paid by the class during periods when reimbursements or reductions occur. Expenses net of fee waivers reflect expenses after reimbursement by the investment adviser but prior to reductions from expense offset arrangements. Expenses net of all reductions represent the net expenses paid by the class but do not include expenses of the underlying funds in which the Fund invests.
G Annualized
See accompanying notes which are an integral part of the financial statements.
Financial Highlights — Fidelity Income Replacement 2040 Fund
| | Six months ended (Unaudited) January 31, | Years ended July 31, | | | | |
| | 2017 | 2016 | 2015 | 2014 | 2013 | 2012 |
| Selected Per–Share Data | | | | | | |
| Net asset value, beginning of period | $59.21 | $60.89 | $59.04 | $54.87 | $48.59 | $48.42 |
| Income from Investment Operations | | | | | | |
| Net investment income (loss)A | .645 | .928 | .898 | .880 | 1.051 | .885 |
| Net realized and unrealized gain (loss) | 1.438 | (.202) | 2.584 | 5.027 | 6.531 | .317 |
| Total from investment operations | 2.083 | .726 | 3.482 | 5.907 | 7.582 | 1.202 |
| Distributions from net investment income | (.658) | (.915) | (.891) | (.855) | (1.050) | (.900) |
| Distributions from net realized gain | (.555) | (1.491) | (.741) | (.882) | (.252) | (.132) |
| Total distributions | (1.213) | (2.406) | (1.632) | (1.737) | (1.302) | (1.032) |
| Net asset value, end of period | $60.08 | $59.21 | $60.89 | $59.04 | $54.87 | $48.59 |
| Total ReturnB,C | 3.57% | 1.41% | 5.98% | 10.97% | 15.86% | 2.60% |
| Ratios to Average Net AssetsD,E | | | | | | |
| Expenses before reductionsF | - %G | -% | -% | -% | -% | -% |
| Expenses net of fee waivers, if any | - %G | -% | -% | -% | -% | -% |
| Expenses net of all reductions | - %G | -% | -% | -% | -% | -% |
| Net investment income (loss) | 2.18%G | 1.63% | 1.50% | 1.53% | 2.03% | 1.89% |
| Supplemental Data | | | | | | |
| Net assets, end of period (000 omitted) | $8,166 | $8,744 | $9,019 | $7,882 | $3,925 | $2,462 |
| Portfolio turnover rateD | 16%G | 29% | 31% | 34% | 30% | 63% |
A Calculated based on average shares outstanding during the period.
B Total returns for periods of less than one year are not annualized.
C Total returns would have been lower if certain expenses had not been reduced during the applicable periods shown.
D Amounts do not include the activity of the Underlying Funds.
E Expense ratios reflect operating expenses of the class. Expenses before reductions do not reflect amounts reimbursed by the investment adviser or reductions from expense offset arrangements and do not represent the amount paid by the class during periods when reimbursements or reductions occur. Expenses net of fee waivers reflect expenses after reimbursement by the investment adviser but prior to reductions from expense offset arrangements. Expenses net of all reductions represent the net expenses paid by the class but do not include expenses of the underlying funds in which the Fund invests.
F Amount represents less than .005%.
G Annualized
See accompanying notes which are an integral part of the financial statements.
Financial Highlights — Fidelity Income Replacement 2040 Fund Class I
| | Six months ended (Unaudited) January 31, | Years ended July 31, | | | | |
| | 2017 | 2016 | 2015 | 2014 | 2013 | 2012 |
| Selected Per–Share Data | | | | | | |
| Net asset value, beginning of period | $59.21 | $60.89 | $59.04 | $54.88 | $48.59 | $48.43 |
| Income from Investment Operations | | | | | | |
| Net investment income (loss)A | .642 | .929 | .897 | .887 | 1.040 | .865 |
| Net realized and unrealized gain (loss) | 1.441 | (.203) | 2.585 | 5.010 | 6.552 | .327 |
| Total from investment operations | 2.083 | .726 | 3.482 | 5.897 | 7.592 | 1.192 |
| Distributions from net investment income | (.658) | (.915) | (.891) | (.855) | (1.050) | (.900) |
| Distributions from net realized gain | (.555) | (1.491) | (.741) | (.882) | (.252) | (.132) |
| Total distributions | (1.213) | (2.406) | (1.632) | (1.737) | (1.302) | (1.032) |
| Net asset value, end of period | $60.08 | $59.21 | $60.89 | $59.04 | $54.88 | $48.59 |
| Total ReturnB | 3.57% | 1.41% | 5.98% | 10.95% | 15.88% | 2.58% |
| Ratios to Average Net AssetsC,D | | | | | | |
| Expenses before reductionsE | - %F | -% | -% | -% | -% | -% |
| Expenses net of fee waivers, if any | - %F | -% | -% | -% | -% | -% |
| Expenses net of all reductions | - %F | -% | -% | -% | -% | -% |
| Net investment income (loss) | 2.18%F | 1.63% | 1.50% | 1.53% | 2.03% | 1.89% |
| Supplemental Data | | | | | | |
| Net assets, end of period (000 omitted) | $2 | $2 | $18 | $17 | $2 | $2 |
| Portfolio turnover rateC | 16%F | 29% | 31% | 34% | 30% | 63% |
A Calculated based on average shares outstanding during the period.
B Total returns for periods of less than one year are not annualized.
C Amounts do not include the activity of the Underlying Funds.
D Expense ratios reflect operating expenses of the class. Expenses before reductions do not reflect amounts reimbursed by the investment adviser or reductions from expense offset arrangements and do not represent the amount paid by the class during periods when reimbursements or reductions occur. Expenses net of fee waivers reflect expenses after reimbursement by the investment adviser but prior to reductions from expense offset arrangements. Expenses net of all reductions represent the net expenses paid by the class but do not include expenses of the underlying funds in which the Fund invests.
E Amount represents less than .005%.
F Annualized
See accompanying notes which are an integral part of the financial statements.
Fidelity Income Replacement 2042 Fund℠
Investment Summary (Unaudited)
The information in the following tables is based on the direct investments of the Fund.
Top Holdings as of January 31, 2017
| | % of fund's net assets | % of fund's net assets 6 months ago |
| Fidelity Total Bond Fund | 16.0 | 16.0 |
| Fidelity Series Broad Market Opportunities Fund | 11.0 | 11.1 |
| Fidelity Advisor International Discovery Fund Class I | 10.5 | 10.7 |
| Fidelity Equity-Income Fund | 9.5 | 9.6 |
| Fidelity Large Cap Stock Fund | 7.2 | 7.2 |
| Fidelity Advisor Mid Cap II Fund Class I | 6.7 | 6.7 |
| Fidelity Series 100 Index Fund | 6.2 | 6.2 |
| Fidelity Blue Chip Growth Fund | 6.2 | 6.2 |
| Fidelity Strategic Real Return Fund | 5.4 | 5.3 |
| Fidelity Government Income Fund | 5.3 | 5.3 |
| | 84.0 | 84.3 |
Asset Allocation (% of fund's net assets)
| Period end |
| | Domestic Equity Funds | 47.7% |
| | International Equity Funds | 10.5% |
| | High Yield Fixed-Income Funds | 5.7% |
| | Investment Grade Fixed-Income Funds | 26.7% |
| | Short-Term Funds | 9.4% |
| Six months ago |
| | Domestic Equity Funds | 48.0% |
| | International Equity Funds | 10.7% |
| | High Yield Fixed-Income Funds | 5.8% |
| | Investment Grade Fixed-Income Funds | 26.6% |
| | Short-Term Funds | 8.9% |
Fidelity Income Replacement 2042 Fund℠
Investments January 31, 2017 (Unaudited)
Showing Percentage of Net Assets
| Equity Funds - 58.2% | | | |
| | | Shares | Value |
| Domestic Equity Funds - 47.7% | | | |
| Fidelity Advisor Mid Cap II Fund Class I (a) | | 93,001 | $1,844,206 |
| Fidelity Blue Chip Growth Fund (a) | | 24,238 | 1,711,688 |
| Fidelity Equity-Income Fund (a) | | 45,599 | 2,633,791 |
| Fidelity Large Cap Stock Fund (a) | | 66,378 | 1,976,724 |
| Fidelity Series 100 Index Fund (a) | | 116,125 | 1,711,688 |
| Fidelity Series Broad Market Opportunities Fund (a) | | 187,120 | 3,031,344 |
| Fidelity Series Small Cap Opportunities Fund (a) | | 18,614 | 262,275 |
|
| TOTAL DOMESTIC EQUITY FUNDS | | | 13,171,716 |
|
| International Equity Funds - 10.5% | | | |
| Fidelity Advisor International Discovery Fund Class I (a) | | 76,587 | 2,885,023 |
| TOTAL EQUITY FUNDS | | | |
| (Cost $12,804,482) | | | 16,056,739 |
|
| Fixed-Income Funds - 32.4% | | | |
| High Yield Fixed-Income Funds - 5.7% | | | |
| Fidelity Capital & Income Fund (a) | | 79,954 | 792,343 |
| Fidelity Strategic Income Fund (a) | | 73,570 | 792,344 |
|
| TOTAL HIGH YIELD FIXED-INCOME FUNDS | | | 1,584,687 |
|
| Investment Grade Fixed-Income Funds - 26.7% | | | |
| Fidelity Government Income Fund (a) | | 144,819 | 1,474,258 |
| Fidelity Strategic Real Return Fund (a) | | 167,150 | 1,474,260 |
| Fidelity Total Bond Fund (a) | | 418,697 | 4,417,250 |
|
| TOTAL INVESTMENT GRADE FIXED-INCOME FUNDS | | | 7,365,768 |
|
| TOTAL FIXED-INCOME FUNDS | | | |
| (Cost $8,959,937) | | | 8,950,455 |
|
| Short-Term Funds - 9.4% | | | |
| Fidelity Investments Money Market Government Portfolio Institutional Class 0.47% (a)(b) | | 1,300,330 | 1,300,330 |
| Fidelity Short-Term Bond Fund (a) | | 151,377 | 1,300,329 |
| TOTAL SHORT-TERM FUNDS | | | |
| (Cost $2,598,150) | | | 2,600,659 |
| TOTAL INVESTMENT PORTFOLIO - 100.0% | | | |
| (Cost $24,362,569) | | | 27,607,853 |
| NET OTHER ASSETS (LIABILITIES) - 0.0% | | | (707) |
| NET ASSETS - 100% | | | $27,607,146 |
Legend
(a) Affiliated Fund
(b) The rate quoted is the annualized seven-day yield of the fund at period end.
Affiliated Underlying Funds
Information regarding the Fund's fiscal year to date purchases and sales of the affiliated Underlying Funds and income earned by the Fund from investments in affiliated Underlying Funds is as follows:
| Affiliate | Value, beginning of period | Purchases | Sales Proceeds | Dividend Income | Value, end of period |
| Fidelity Advisor International Discovery Fund Class I | $3,139,114 | $290,616 | $495,304 | $49,044 | $2,885,023 |
| Fidelity Advisor Mid Cap II Fund Class I | 1,973,325 | 159,490 | 367,902 | 8,870 | 1,844,206 |
| Fidelity Blue Chip Growth Fund | 1,832,373 | 152,339 | 304,829 | 3,859 | 1,711,688 |
| Fidelity Capital & Income Fund | 851,585 | 43,014 | 136,483 | 18,187 | 792,343 |
| Fidelity Equity-Income Fund | 2,819,036 | 176,718 | 524,570 | 39,744 | 2,633,791 |
| Fidelity Government Income Fund | 1,562,216 | 186,217 | 199,038 | 12,267 | 1,474,258 |
| Fidelity Investments Money Market Government Portfolio Institutional Class 0.47% | 1,309,677 | 162,266 | 171,613 | 2,279 | 1,300,330 |
| Fidelity Large Cap Stock Fund | 2,114,277 | 104,285 | 414,179 | 18,394 | 1,976,724 |
| Fidelity Series 100 Index Fund | 1,832,373 | 106,827 | 285,032 | 39,431 | 1,711,688 |
| Fidelity Series Broad Market Opportunities Fund | 3,241,891 | 136,229 | 540,390 | 15,202 | 3,031,344 |
| Fidelity Series Small Cap Opportunities Fund | 281,904 | 15,927 | 59,746 | 1,362 | 262,275 |
| Fidelity Short-Term Bond Fund | 1,309,677 | 171,851 | 170,647 | 7,562 | 1,300,329 |
| Fidelity Strategic Income Fund | 851,585 | 58,677 | 117,413 | 14,409 | 792,344 |
| Fidelity Strategic Real Return Fund | 1,562,216 | 122,076 | 209,847 | 20,919 | 1,474,260 |
| Fidelity Total Bond Fund | 4,683,712 | 487,475 | 628,413 | 67,013 | 4,417,250 |
| Total | $29,364,961 | $2,374,007 | $4,625,406 | $318,542 | $27,607,853 |
Investment Valuation
All investments are categorized as Level 1 under the Fair Value Hierarchy. The inputs or methodology used for valuing securities may not be an indication of the risk associated with investing in those securities. For more information on valuation inputs please refer to the Investment Valuation section in the accompanying Notes to Financial Statements.
See accompanying notes which are an integral part of the financial statements.
Fidelity Income Replacement 2042 Fund℠
Financial Statements
Statement of Assets and Liabilities
| | | January 31, 2017 (Unaudited) |
| Assets | | |
| Investment in securities, at value (cost $24,362,569) — See accompanying schedule | | $27,607,853 |
| Receivable for investments sold | | 200,575 |
| Receivable for fund shares sold | | 387 |
| Total assets | | 27,808,815 |
| Liabilities | | |
| Payable for investments purchased | $197,971 | |
| Payable for fund shares redeemed | 3,010 | |
| Distribution and service plan fees payable | 688 | |
| Total liabilities | | 201,669 |
| Net Assets | | $27,607,146 |
| Net Assets consist of: | | |
| Paid in capital | | $24,276,985 |
| Undistributed net investment income | | 5,156 |
| Accumulated undistributed net realized gain (loss) on investments | | 79,721 |
| Net unrealized appreciation (depreciation) on investments | | 3,245,284 |
| Net Assets | | $27,607,146 |
| Calculation of Maximum Offering Price | | |
| Class A: | | |
| Net Asset Value and redemption price per share ($554,402 ÷ 9,207.50 shares) | | $60.21 |
| Maximum offering price per share (100/94.25 of $60.21) | | $63.88 |
| Class T: | | |
| Net Asset Value and redemption price per share ($481,296 ÷ 7,990.70 shares) | | $60.23 |
| Maximum offering price per share (100/96.50 of $60.23) | | $62.41 |
| Class C: | | |
| Net Asset Value and offering price per share ($444,866 ÷ 7,434.10 shares)(a) | | $59.84 |
| Income Replacement 2042: | | |
| Net Asset Value, offering price and redemption price per share ($26,053,134 ÷ 432,531.20 shares) | | $60.23 |
| Class I: | | |
| Net Asset Value, offering price and redemption price per share ($73,448 ÷ 1,219.40 shares) | | $60.23 |
(a) Redemption price per share is equal to net asset value less any applicable contingent deferred sales charge.
See accompanying notes which are an integral part of the financial statements.
Statement of Operations
| | | Six months ended January 31, 2017 (Unaudited) |
| Investment Income | | |
| Income distributions from underlying funds | | $318,542 |
| Expenses | | |
| Distribution and service plan fees | $4,197 | |
| Independent trustees' fees and expenses | 63 | |
| Total expenses before reductions | 4,260 | |
| Expense reductions | (63) | 4,197 |
| Net investment income (loss) | | 314,345 |
| Realized and Unrealized Gain (Loss) | | |
| Realized gain (loss) on sale of underlying fund shares | 76,641 | |
| Capital gain distributions from underlying funds | 217,266 | |
| Total net realized gain (loss) | | 293,907 |
| Change in net unrealized appreciation (depreciation) on underlying funds | | 417,648 |
| Net gain (loss) | | 711,555 |
| Net increase (decrease) in net assets resulting from operations | | $1,025,900 |
See accompanying notes which are an integral part of the financial statements.
Statement of Changes in Net Assets
| | Six months ended January 31, 2017 (Unaudited) | Year ended July 31, 2016 |
| Increase (Decrease) in Net Assets | | |
| Operations | | |
| Net investment income (loss) | $314,345 | $485,731 |
| Net realized gain (loss) | 293,907 | 286,914 |
| Change in net unrealized appreciation (depreciation) | 417,648 | (732,245) |
| Net increase (decrease) in net assets resulting from operations | 1,025,900 | 40,400 |
| Distributions to shareholders from net investment income | (315,208) | (486,226) |
| Distributions to shareholders from net realized gain | (227,253) | (866,030) |
| Total distributions | (542,461) | (1,352,256) |
| Share transactions - net increase (decrease) | (2,240,545) | (5,332,017) |
| Total increase (decrease) in net assets | (1,757,106) | (6,643,873) |
| Net Assets | | |
| Beginning of period | 29,364,252 | 36,008,125 |
| End of period | $27,607,146 | $29,364,252 |
| Other Information | | |
| Undistributed net investment income end of period | $5,156 | $6,019 |
See accompanying notes which are an integral part of the financial statements.
Financial Highlights — Fidelity Income Replacement 2042 Fund Class A
| | Six months ended (Unaudited) January 31, | Years ended July 31, | | | | |
| | 2017 | 2016 | 2015 | 2014 | 2013 | 2012 |
| Selected Per–Share Data | | | | | | |
| Net asset value, beginning of period | $59.20 | $61.04 | $59.16 | $55.32 | $48.66 | $48.52 |
| Income from Investment Operations | | | | | | |
| Net investment income (loss)A | .582 | .798 | .756 | .755 | .977 | .782 |
| Net realized and unrealized gain (loss) | 1.480 | (.292) | 2.687 | 5.194 | 6.833 | .281 |
| Total from investment operations | 2.062 | .506 | 3.443 | 5.949 | 7.810 | 1.063 |
| Distributions from net investment income | (.584) | (.802) | (.750) | (.747) | (.973) | (.791) |
| Distributions from net realized gain | (.468) | (1.544) | (.813) | (1.362) | (.177) | (.132) |
| Total distributions | (1.052) | (2.346) | (1.563) | (2.109) | (1.150) | (.923) |
| Net asset value, end of period | $60.21 | $59.20 | $61.04 | $59.16 | $55.32 | $48.66 |
| Total ReturnB,C,D | 3.53% | 1.03% | 5.90% | 11.01% | 16.28% | 2.30% |
| Ratios to Average Net AssetsE,F | | | | | | |
| Expenses before reductions | .25%G | .25% | .25% | .25% | .25% | .25% |
| Expenses net of fee waivers, if any | .25%G | .25% | .25% | .25% | .25% | .25% |
| Expenses net of all reductions | .25%G | .25% | .25% | .25% | .25% | .25% |
| Net investment income (loss) | 1.96%G | 1.40% | 1.26% | 1.30% | 1.86% | 1.66% |
| Supplemental Data | | | | | | |
| Net assets, end of period (000 omitted) | $554 | $536 | $636 | $565 | $70 | $20 |
| Portfolio turnover rateE | 17%G | 29% | 39% | 16% | 34% | 40% |
A Calculated based on average shares outstanding during the period.
B Total returns for periods of less than one year are not annualized.
C Total returns would have been lower if certain expenses had not been reduced during the applicable periods shown.
D Total returns do not include the effect of the sales charges.
E Amounts do not include the activity of the Underlying Funds.
F Expense ratios reflect operating expenses of the class. Expenses before reductions do not reflect amounts reimbursed by the investment adviser or reductions from expense offset arrangements and do not represent the amount paid by the class during periods when reimbursements or reductions occur. Expenses net of fee waivers reflect expenses after reimbursement by the investment adviser but prior to reductions from expense offset arrangements. Expenses net of all reductions represent the net expenses paid by the class but do not include expenses of the underlying funds in which the Fund invests.
G Annualized
See accompanying notes which are an integral part of the financial statements.
Financial Highlights — Fidelity Income Replacement 2042 Fund Class T
| | Six months ended (Unaudited) January 31, | Years ended July 31, | | | | |
| | 2017 | 2016 | 2015 | 2014 | 2013 | 2012 |
| Selected Per–Share Data | | | | | | |
| Net asset value, beginning of period | $59.21 | $61.05 | $59.18 | $55.33 | $48.67 | $48.53 |
| Income from Investment Operations | | | | | | |
| Net investment income (loss)A | .508 | .655 | .605 | .605 | .836 | .660 |
| Net realized and unrealized gain (loss) | 1.488 | (.294) | 2.677 | 5.216 | 6.839 | .287 |
| Total from investment operations | 1.996 | .361 | 3.282 | 5.821 | 7.675 | .947 |
| Distributions from net investment income | (.508) | (.657) | (.599) | (.609) | (.838) | (.675) |
| Distributions from net realized gain | (.468) | (1.544) | (.813) | (1.362) | (.177) | (.132) |
| Total distributions | (.976) | (2.201) | (1.412) | (1.971) | (1.015) | (.807) |
| Net asset value, end of period | $60.23 | $59.21 | $61.05 | $59.18 | $55.33 | $48.67 |
| Total ReturnB,C,D | 3.41% | .78% | 5.62% | 10.77% | 15.98% | 2.05% |
| Ratios to Average Net AssetsE,F | | | | | | |
| Expenses before reductions | .50%G | .50% | .50% | .50% | .50% | .50% |
| Expenses net of fee waivers, if any | .50%G | .50% | .50% | .50% | .50% | .50% |
| Expenses net of all reductions | .50%G | .50% | .50% | .50% | .50% | .50% |
| Net investment income (loss) | 1.71%G | 1.15% | 1.01% | 1.05% | 1.61% | 1.42% |
| Supplemental Data | | | | | | |
| Net assets, end of period (000 omitted) | $481 | $479 | $543 | $482 | $153 | $132 |
| Portfolio turnover rateE | 17%G | 29% | 39% | 16% | 34% | 40% |
A Calculated based on average shares outstanding during the period.
B Total returns for periods of less than one year are not annualized.
C Total returns would have been lower if certain expenses had not been reduced during the applicable periods shown.
D Total returns do not include the effect of the sales charges.
E Amounts do not include the activity of the Underlying Funds.
F Expense ratios reflect operating expenses of the class. Expenses before reductions do not reflect amounts reimbursed by the investment adviser or reductions from expense offset arrangements and do not represent the amount paid by the class during periods when reimbursements or reductions occur. Expenses net of fee waivers reflect expenses after reimbursement by the investment adviser but prior to reductions from expense offset arrangements. Expenses net of all reductions represent the net expenses paid by the class but do not include expenses of the underlying funds in which the Fund invests.
G Annualized
See accompanying notes which are an integral part of the financial statements.
Financial Highlights — Fidelity Income Replacement 2042 Fund Class C
| | Six months ended (Unaudited) January 31, | Years ended July 31, | | | | |
| | 2017 | 2016 | 2015 | 2014 | 2013 | 2012 |
| Selected Per–Share Data | | | | | | |
| Net asset value, beginning of period | $58.87 | $60.79 | $59.00 | $55.21 | $48.64 | $48.52 |
| Income from Investment Operations | | | | | | |
| Net investment income (loss)A | .358 | .368 | .306 | .317 | .582 | .427 |
| Net realized and unrealized gain (loss) | 1.471 | (.293) | 2.673 | 5.194 | 6.821 | .290 |
| Total from investment operations | 1.829 | .075 | 2.979 | 5.511 | 7.403 | .717 |
| Distributions from net investment income | (.391) | (.451) | (.376) | (.359) | (.656) | (.465) |
| Distributions from net realized gain | (.468) | (1.544) | (.813) | (1.362) | (.177) | (.132) |
| Total distributions | (.859) | (1.995) | (1.189) | (1.721) | (.833) | (.597) |
| Net asset value, end of period | $59.84 | $58.87 | $60.79 | $59.00 | $55.21 | $48.64 |
| Total ReturnB,C,D | 3.14% | .28% | 5.11% | 10.19% | 15.40% | 1.55% |
| Ratios to Average Net AssetsE,F | | | | | | |
| Expenses before reductions | 1.00%G | 1.00% | 1.00% | 1.00% | .99%H | 1.00% |
| Expenses net of fee waivers, if any | 1.00%G | 1.00% | 1.00% | 1.00% | .99%H | 1.00% |
| Expenses net of all reductions | 1.00%G | 1.00% | 1.00% | 1.00% | .99%H | 1.00% |
| Net investment income (loss) | 1.21%G | .65% | .51% | .55% | 1.12% | .91% |
| Supplemental Data | | | | | | |
| Net assets, end of period (000 omitted) | $445 | $498 | $594 | $366 | $97 | $24 |
| Portfolio turnover rateE | 17%G | 29% | 39% | 16% | 34% | 40% |
A Calculated based on average shares outstanding during the period.
B Total returns for periods of less than one year are not annualized.
C Total returns would have been lower if certain expenses had not been reduced during the applicable periods shown.
D Total returns do not include the effect of the contingent deferred sales charge.
E Amounts do not include the activity of the Underlying Funds.
F Expense ratios reflect operating expenses of the class. Expenses before reductions do not reflect amounts reimbursed by the investment adviser or reductions from expense offset arrangements and do not represent the amount paid by the class during periods when reimbursements or reductions occur. Expenses net of fee waivers reflect expenses after reimbursement by the investment adviser but prior to reductions from expense offset arrangements. Expenses net of all reductions represent the net expenses paid by the class but do not include expenses of the underlying funds in which the Fund invests.
G Annualized
H On certain classes, the size and fluctuations of net assets may cause rounding of expense amounts and ratios to differ from contractual rates.
See accompanying notes which are an integral part of the financial statements.
Financial Highlights — Fidelity Income Replacement 2042 Fund
| | Six months ended (Unaudited) January 31, | Years ended July 31, | | | | |
| | 2017 | 2016 | 2015 | 2014 | 2013 | 2012 |
| Selected Per–Share Data | | | | | | |
| Net asset value, beginning of period | $59.22 | $61.06 | $59.18 | $55.32 | $48.65 | $48.51 |
| Income from Investment Operations | | | | | | |
| Net investment income (loss)A | .657 | .941 | .906 | .896 | 1.099 | .897 |
| Net realized and unrealized gain (loss) | 1.480 | (.293) | 2.687 | 5.202 | 6.837 | .284 |
| Total from investment operations | 2.137 | .648 | 3.593 | 6.098 | 7.936 | 1.181 |
| Distributions from net investment income | (.659) | (.944) | (.900) | (.876) | (1.089) | (.909) |
| Distributions from net realized gain | (.468) | (1.544) | (.813) | (1.362) | (.177) | (.132) |
| Total distributions | (1.127) | (2.488) | (1.713) | (2.238) | (1.266) | (1.041) |
| Net asset value, end of period | $60.23 | $59.22 | $61.06 | $59.18 | $55.32 | $48.65 |
| Total ReturnB,C | 3.66% | 1.29% | 6.17% | 11.30% | 16.57% | 2.56% |
| Ratios to Average Net AssetsD,E | | | | | | |
| Expenses before reductionsF | - %G | -% | -% | -% | -% | -% |
| Expenses net of fee waivers, if any | - %G | -% | -% | -% | -% | -% |
| Expenses net of all reductions | - %G | -% | -% | -% | -% | -% |
| Net investment income (loss) | 2.21%G | 1.65% | 1.51% | 1.55% | 2.11% | 1.91% |
| Supplemental Data | | | | | | |
| Net assets, end of period (000 omitted) | $26,053 | $27,774 | $34,087 | $32,313 | $13,862 | $7,139 |
| Portfolio turnover rateD | 17%G | 29% | 39% | 16% | 34% | 40% |
A Calculated based on average shares outstanding during the period.
B Total returns for periods of less than one year are not annualized.
C Total returns would have been lower if certain expenses had not been reduced during the applicable periods shown.
D Amounts do not include the activity of the Underlying Funds.
E Expense ratios reflect operating expenses of the class. Expenses before reductions do not reflect amounts reimbursed by the investment adviser or reductions from expense offset arrangements and do not represent the amount paid by the class during periods when reimbursements or reductions occur. Expenses net of fee waivers reflect expenses after reimbursement by the investment adviser but prior to reductions from expense offset arrangements. Expenses net of all reductions represent the net expenses paid by the class but do not include expenses of the underlying funds in which the Fund invests.
F Amount represents less than .005%.
G Annualized
See accompanying notes which are an integral part of the financial statements.
Financial Highlights — Fidelity Income Replacement 2042 Fund Class I
| | Six months ended (Unaudited) January 31, | Years ended July 31, | | | | |
| | 2017 | 2016 | 2015 | 2014 | 2013 | 2012 |
| Selected Per–Share Data | | | | | | |
| Net asset value, beginning of period | $59.21 | $61.06 | $59.18 | $55.31 | $48.64 | $48.51 |
| Income from Investment Operations | | | | | | |
| Net investment income (loss)A | .657 | .943 | .906 | .897 | 1.095 | .896 |
| Net realized and unrealized gain (loss) | 1.490 | (.305) | 2.687 | 5.211 | 6.841 | .275 |
| Total from investment operations | 2.147 | .638 | 3.593 | 6.108 | 7.936 | 1.171 |
| Distributions from net investment income | (.659) | (.944) | (.900) | (.876) | (1.089) | (.909) |
| Distributions from net realized gain | (.468) | (1.544) | (.813) | (1.362) | (.177) | (.132) |
| Total distributions | (1.127) | (2.488) | (1.713) | (2.238) | (1.266) | (1.041) |
| Net asset value, end of period | $60.23 | $59.21 | $61.06 | $59.18 | $55.31 | $48.64 |
| Total ReturnB,C | 3.68% | 1.27% | 6.17% | 11.32% | 16.57% | 2.54% |
| Ratios to Average Net AssetsD,E | | | | | | |
| Expenses before reductionsF | - %G | -% | -% | -% | -% | -% |
| Expenses net of fee waivers, if any | - %G | -% | -% | -% | -% | -% |
| Expenses net of all reductions | - %G | -% | -% | -% | -% | -% |
| Net investment income (loss) | 2.21%G | 1.65% | 1.51% | 1.55% | 2.11% | 1.91% |
| Supplemental Data | | | | | | |
| Net assets, end of period (000 omitted) | $73 | $78 | $148 | $109 | $30 | $26 |
| Portfolio turnover rateD | 17%G | 29% | 39% | 16% | 34% | 40% |
A Calculated based on average shares outstanding during the period.
B Total returns for periods of less than one year are not annualized.
C Total returns would have been lower if certain expenses had not been reduced during the applicable periods shown.
D Amounts do not include the activity of the Underlying Funds.
E Expense ratios reflect operating expenses of the class. Expenses before reductions do not reflect amounts reimbursed by the investment adviser or reductions from expense offset arrangements and do not represent the amount paid by the class during periods when reimbursements or reductions occur. Expenses net of fee waivers reflect expenses after reimbursement by the investment adviser but prior to reductions from expense offset arrangements. Expenses net of all reductions represent the net expenses paid by the class but do not include expenses of the underlying funds in which the Fund invests.
F Amount represents less than .005%.
G Annualized
See accompanying notes which are an integral part of the financial statements.
Notes to Financial Statements (Unaudited)
For the period ended January 31, 2017
1. Organization.
Fidelity Income Replacement 2018 Fund, Fidelity Income Replacement 2020 Fund, Fidelity Income Replacement 2022 Fund, Fidelity Income Replacement 2024 Fund, Fidelity Income Replacement 2026 Fund, Fidelity Income Replacement 2028 Fund, Fidelity Income Replacement 2030 Fund, Fidelity Income Replacement 2032 Fund, Fidelity Income Replacement 2034 Fund, Fidelity Income Replacement 2036 Fund, Fidelity Income Replacement 2038 Fund, Fidelity Income Replacement 2040 Fund and Fidelity Income Replacement 2042 Fund (the Funds) are funds of Fidelity Income Fund (the Trust). The Trust is registered under the Investment Company Act of 1940, as amended (the 1940 Act), as an open-end management investment company organized as a Massachusetts business trust. Each Fund is authorized to issue an unlimited number of shares. The Funds invest primarily in a combination of other Fidelity equity, bond, and short-term funds (the Underlying Funds) managed by Fidelity Management & Research Company (FMR).
The Funds are designed for investors who seek to convert accumulated assets into regular payments over a defined period of time. The payment strategy for each Fund is designed to be implemented through a shareholder's voluntary participation in the Smart Payment Program. Participation in the Smart Payment Program will result in the gradual liquidation of the shareholder's entire investment in the Fund by its horizon date. Each Fund's name refers to the year of its horizon date.
Each Fund is closed to new accounts and additional purchases, except for reinvestments, effective after the close of business on the dates listed below. Each class has equal rights as to assets and voting privileges, except for matters affecting a single class.
| Class A, Class T, Class C and Class I Shares | Date Closed |
| Income Replacement 2018 Fund | May 30, 2014 |
| All Other Funds | January 29, 2016 |
| Income Replacement Shares | Date Closed |
| All Funds | January 31, 2017 |
In March 2017 the Board of Trustees approved a change in the name of Class T to Class M effective after the close of business on March 24, 2017.
2. Significant Accounting Policies.
The financial statements have been prepared in conformity with accounting principles generally accepted in the United States of America (GAAP), which require management to make certain estimates and assumptions at the date of the financial statements. Actual results could differ from those estimates. Subsequent events, if any, through the date that the financial statements were issued have been evaluated in the preparation of the financial statements. The Fund's Schedule of Investments lists each of the Underlying Funds as an investment of the Fund but does not include the underlying holdings of each Underlying Fund. The following summarizes the significant accounting policies of the Funds:
Investment Valuation. Investments are valued as of 4:00 p.m. Eastern time on the last calendar day of the period. Each Fund categorizes the inputs to valuation techniques used to value its investments into a disclosure hierarchy consisting of three levels as shown below:
Level 1 – quoted prices in active markets for identical investments
Level 2 – other significant observable inputs (including quoted prices for similar investments, interest rates, prepayment speeds, etc.)
Level 3 – unobservable inputs (including the Fund's own assumptions based on the best information available)
Valuation techniques used to value each Fund's investments by major category are as follows. Investments in the Underlying Funds are valued at their closing net asset value (NAV) each business day and are categorized as Level 1 in the hierarchy.
Investment Transactions and Income. For financial reporting purposes, the Funds' investment holdings and NAV include trades executed through the end of the last business day of the period. The NAV per share for processing shareholder transactions is calculated as of the close of business of the New York Stock Exchange (NYSE), normally 4:00 p.m. Eastern time and includes trades executed through the end of the prior business day. Gains and losses on securities sold are determined on the basis of identified cost. Income and capital gain distributions from the Underlying Funds, if any, are recorded on the ex-dividend date. Distributions from the Underlying Funds that are deemed to be return of capital are recorded as a reduction of cost of investments.
Class Allocations and Expenses. Investment income, realized and unrealized capital gains and losses, common expenses of each Fund, and certain fund-level expense reductions, if any, are allocated daily on a pro-rata basis to each class based on the relative net assets of each class to the total net assets of each Fund. Each class differs with respect to distribution and service plan fees incurred. Certain expense reductions may also differ by class. For the reporting period, the allocated portion of income and expenses to each class as a percent of its average net assets may vary due to the timing of recording these transactions in relation to fluctuating net assets of the classes. Expenses directly attributable to a fund are charged to that fund. Expenses attributable to more than one fund are allocated among the respective funds on the basis of relative net assets or other appropriate methods. Expenses included in the accompanying financial statements reflect the expenses of each Fund and do not include any expenses associated with the Underlying Funds. Although not included in each Fund's expenses, each Fund indirectly bears its proportionate share of the Underlying Funds' expenses through the impact of these expenses on each Underlying Fund's NAV. Expense estimates are accrued in the period to which they relate and adjustments are made when actual amounts are known.
Income Tax Information and Distributions to Shareholders. Each year, each Fund intends to qualify as a regulated investment company under Subchapter M of the Internal Revenue Code, including distributing substantially all of its taxable income and realized gains. As a result, no provision for U.S. Federal income taxes is required. Each Fund files a U.S. federal tax return, in addition to state and local tax returns as required. Each Fund's federal income tax returns are subject to examination by the Internal Revenue Service (IRS) for a period of three fiscal years after they are filed. State and local tax returns may be subject to examination for an additional fiscal year depending on the jurisdiction.
Distributions are declared and recorded on the ex-dividend date. Income dividends and capital gain distributions are declared separately for each class. Income and capital gain distributions are determined in accordance with income tax regulations, which may differ from GAAP.
Capital accounts within the financial statements are adjusted for permanent book-tax differences. These adjustments have no impact on net assets or the results of operations. Capital accounts are not adjusted for temporary book-tax differences which will reverse in a subsequent period.
Book-tax differences are primarily due to the short-term gain distributions from the Underlying Funds, capital loss carryforwards and losses deferred due to wash sales.
The federal tax cost of investment securities and unrealized appreciation (depreciation) as of period end were as follows for each Fund:
| | Tax cost | Gross unrealized appreciation | Gross unrealized depreciation | Net unrealized appreciation (depreciation) on securities |
| Fidelity Income Replacement 2018 Fund | $5,254,498 | $100,472 | $(2,774) | $97,698 |
| Fidelity Income Replacement 2020 Fund | 9,557,464 | 592,182 | (57,940) | 534,242 |
| Fidelity Income Replacement 2022 Fund | 12,470,908 | 663,884 | (134,236) | 529,648 |
| Fidelity Income Replacement 2024 Fund | 9,763,253 | 551,701 | (99,137) | 452,564 |
| Fidelity Income Replacement 2026 Fund | 10,763,870 | 537,042 | (83,724) | 453,318 |
| Fidelity Income Replacement 2028 Fund | 23,042,813 | 1,784,538 | (201,003) | 1,583,535 |
| Fidelity Income Replacement 2030 Fund | 12,304,109 | 1,262,350 | (84,482) | 1,177,868 |
| Fidelity Income Replacement 2032 Fund | 6,525,604 | 868,666 | (68,861) | 799,805 |
| Fidelity Income Replacement 2034 Fund | 5,857,806 | 898,432 | (32,545) | 865,887 |
| Fidelity Income Replacement 2036 Fund | 9,074,037 | 869,946 | (103,236) | 766,710 |
| Fidelity Income Replacement 2038 Fund | 4,049,333 | 629,482 | (20,736) | 608,746 |
| Fidelity Income Replacement 2040 Fund | 8,402,018 | 865,787 | (77,694) | 788,093 |
| Fidelity Income Replacement 2042 Fund | 24,485,179 | 3,280,018 | (157,344) | 3,122,674 |
Capital loss carryforwards are only available to offset future capital gains of the Funds to the extent provided by regulations and may be limited. Under the Regulated Investment Company Modernization Act of 2010 (the Act), the Funds are permitted to carry forward capital losses incurred in taxable years beginning after December 22, 2010 for an unlimited period and such capital losses are required to be used prior to any losses that expire. The capital loss carryforward information presented below, including any applicable limitation, is estimated as of prior fiscal period end and is subject to adjustment.
| | Fiscal year of expiration | |
| | 2018 | 2019 | Total with expiration |
| Fidelity Income Replacement 2018 Fund | $(32,634) | $(37,212) | $(69,846) |
| Fidelity Income Replacement 2022 Fund | (8,036) | (74,118) | (82,154) |
| Fidelity Income Replacement 2026 Fund | (47,905) | – | (47,905) |
Due to large redemptions or subscriptions in a prior period, $47,905 of capital losses that will be available to offset future capital gains of Fidelity Income Replacement 2026 will be limited to approximately $28,019 per year.
3. Purchases and Redemptions of Underlying Fund Shares.
Purchases and redemptions of the Underlying Fund shares, are noted in the table below.
| | Purchases ($) | Redemptions ($) |
| Fidelity Income Replacement 2018 Fund | 1,931,927 | 1,474,409 |
| Fidelity Income Replacement 2020 Fund | 2,068,409 | 1,776,627 |
| Fidelity Income Replacement 2022 Fund | 1,366,225 | 2,150,192 |
| Fidelity Income Replacement 2024 Fund | 2,602,244 | 1,744,901 |
| Fidelity Income Replacement 2026 Fund | 3,890,054 | 1,144,481 |
| Fidelity Income Replacement 2028 Fund | 1,753,026 | 6,925,165 |
| Fidelity Income Replacement 2030 Fund | 1,162,191 | 2,063,598 |
| Fidelity Income Replacement 2032 Fund | 680,996 | 839,882 |
| Fidelity Income Replacement 2034 Fund | 472,277 | 1,591,602 |
| Fidelity Income Replacement 2036 Fund | 794,403 | 2,089,656 |
| Fidelity Income Replacement 2038 Fund | 335,929 | 724,243 |
| Fidelity Income Replacement 2040 Fund | 743,004 | 1,467,151 |
| Fidelity Income Replacement 2042 Fund | 2,374,007 | 4,625,406 |
4. Fees and Other Transactions with Affiliates.
Management Fee. FMR Co., Inc. (the investment adviser), an affiliate of Fidelity Management & Research Company (FMR), provides the Funds with investment management related services. The Funds do not pay any fees for these services. Under the management contract, the investment adviser pays all other fund-level expenses, except the compensation of the independent Trustees and certain other expenses such as interest expense.
Distribution and Service Plan Fees. In accordance with Rule 12b-1 of the 1940 Act, each Fund has adopted separate Distribution and Service Plans for each class of shares. Certain classes pay Fidelity Distributors Corporation (FDC), an affiliate of the investment adviser, separate Distribution and Service Fees, each of which is based on an annual percentage of each class' average net assets. In addition, FDC may pay financial intermediaries for selling shares of each Fund and providing shareholder support services. For the period, the Distribution and Service Fee rates, total fees and amounts retained by FDC were as follows:
| | Distribution
Fee | Service
Fee | Total Fees | Retained
by FDC |
| Fidelity Income Replacement 2018 Fund | | | | |
| Class A | -% | .25% | $583 | $– |
| Class T | .25% | .25% | 584 | – |
| Class C | .75% | .25% | 1,545 | – |
| | | | $2,712 | $– |
| Fidelity Income Replacement 2020 Fund | | | | |
| Class A | -% | .25% | $1,414 | $125 |
| Class T | .25% | .25% | 474 | – |
| Class C | .75% | .25% | 3,895 | 48 |
| | | | $5,783 | $173 |
| Fidelity Income Replacement 2022 Fund | | | | |
| Class A | -% | .25% | $365 | $– |
| Class T | .25% | .25% | 214 | 2 |
| Class C | .75% | .25% | 289 | – |
| | | | $868 | $2 |
| Fidelity Income Replacement 2024 Fund | | | | |
| Class A | -% | .25% | $236 | $– |
| Class T | .25% | .25% | 374 | 18 |
| Class C | .75% | .25% | 764 | – |
| | | | $1,374 | $18 |
| Fidelity Income Replacement 2026 Fund | | | | |
| Class A | -% | .25% | $711 | $– |
| Class T | .25% | .25% | 754 | 16 |
| Class C | .75% | .25% | 1,257 | 402 |
| | | | $2,722 | $418 |
| Fidelity Income Replacement 2028 Fund | | | | |
| Class A | -% | .25% | $568 | $– |
| Class T | .25% | .25% | 1,020 | – |
| Class C | .75% | .25% | 1,016 | 19 |
| | | | $2,604 | $19 |
| Fidelity Income Replacement 2030 Fund | | | | |
| Class A | -% | .25% | $171 | $– |
| Class T | .25% | .25% | 40 | 18 |
| Class C | .75% | .25% | 995 | 190 |
| | | | $1,206 | $208 |
| Fidelity Income Replacement 2032 Fund | | | | |
| Class A | -% | .25% | $467 | $– |
| Class T | .25% | .25% | 115 | 52 |
| Class C | .75% | .25% | 624 | 55 |
| | | | $1,206 | $107 |
| Fidelity Income Replacement 2034 Fund | | | | |
| Class A | -% | .25% | $344 | $10 |
| Class T | .25% | .25% | 192 | 60 |
| Class C | .75% | .25% | 724 | 65 |
| | | | $1,260 | $135 |
| Fidelity Income Replacement 2036 Fund | | | | |
| Class A | -% | .25% | $621 | $– |
| Class T | .25% | .25% | 2,270 | – |
| Class C | .75% | .25% | 1,896 | – |
| | | | $4,787 | $– |
| Fidelity Income Replacement 2038 Fund | | | | |
| Class A | -% | .25% | $18 | $1 |
| Class T | .25% | .25% | 456 | 14 |
| Class C | .75% | .25% | 460 | 5 |
| | | | $934 | $20 |
| Fidelity Income Replacement 2040 Fund | | | | |
| Class A | -% | .25% | $116 | $4 |
| Class T | .25% | .25% | 1,864 | 10 |
| Class C | .75% | .25% | 877 | – |
| | | | $2,857 | $14 |
| Fidelity Income Replacement 2042 Fund | | | | |
| Class A | -% | .25% | $676 | $– |
| Class T | .25% | .25% | 1,201 | 10 |
| Class C | .75% | .25% | 2,320 | 96 |
| | | | $4,197 | $106 |
Sales Load. FDC may receive a front-end sales charge of up to 5.75% for selling Class A shares and 3.50% for selling Class T shares, some of which is paid to financial intermediaries for selling shares of each Fund. Depending on the holding period, FDC may receive contingent deferred sales charges levied on Class A, Class T, and Class C redemptions. The deferred sales charges are 1.00% for Class C shares, 1.00% for certain purchases of Class A shares and .25% for certain purchases of Class T shares. For the period, there were no sales charge amounts retained by FDC.
5. Expense Reductions.
FMR voluntarily agreed to reimburse the Funds to the extent annual operating expenses exceeded distribution and service plan fees applicable to each class. Some expenses, for example interest expense, are excluded from this reimbursement.
The following Funds were in reimbursement during the period:
| | Reimbursement(a) |
| Fidelity Income Replacement 2018 Fund | $12 |
| Fidelity Income Replacement 2020 Fund | 22 |
| Fidelity Income Replacement 2022 Fund | 31 |
| Fidelity Income Replacement 2024 Fund | 23 |
| Fidelity Income Replacement 2026 Fund | 21 |
| Fidelity Income Replacement 2028 Fund | 62 |
| Fidelity Income Replacement 2030 Fund | 31 |
| Fidelity Income Replacement 2032 Fund | 17 |
| Fidelity Income Replacement 2034 Fund | 18 |
| Fidelity Income Replacement 2036 Fund | 24 |
| Fidelity Income Replacement 2038 Fund | 12 |
| Fidelity Income Replacement 2040 Fund | 22 |
| Fidelity Income Replacement 2042 Fund | 63 |
(a) Represents total amount reimbursed to the Fund. Each class has received a pro-rata allocation of reimbursement.
6. Distributions to Shareholders.
Distributions to shareholders of each class were as follows:
| | Six months ended
January 31, 2017 | Year ended July 31, 2016 |
| Fidelity Income Replacement 2018 Fund | | |
| From net investment income | | |
| Class A | $1,264 | $3,571 |
| Class T | 335 | 1,333 |
| Class C | 77 | 653 |
| Income Replacement 2018 | 14,804 | 38,034 |
| Class I | 813 | 2,415 |
| Total | $17,293 | $46,006 |
| From net realized gain | | |
| Class A | $– | $235 |
| Class T | – | 140 |
| Class C | – | 217 |
| Income Replacement 2018 | – | 1,759 |
| Class I | – | 118 |
| Total | $– | $2,469 |
| Fidelity Income Replacement 2020 Fund | | |
| From net investment income | | |
| Class A | $6,709 | $13,988 |
| Class T | 888 | 1,870 |
| Class C | 1,831 | 4,242 |
| Income Replacement 2020 | 57,036 | 95,316 |
| Class I | 482 | 2,119 |
| Total | $66,946 | $117,535 |
| From net realized gain | | |
| Class A | $9,654 | $23,499 |
| Class T | 1,623 | 4,347 |
| Class C | 6,756 | 18,056 |
| Income Replacement 2020 | 65,972 | 141,250 |
| Class I | 582 | 4,068 |
| Total | $84,587 | $191,220 |
| Fidelity Income Replacement 2022 Fund | | |
| From net investment income | | |
| Class A | $2,356 | $4,847 |
| Class T | 563 | 938 |
| Class C | $253 | $337 |
| Income Replacement 2022 | 119,845 | 214,082 |
| Class I | 916 | 1,666 |
| Total | $123,933 | $221,870 |
| From net realized gain | | |
| Class A | $331 | $375 |
| Class T | 97 | 78 |
| Class C | 66 | 52 |
| Income Replacement 2022 | 14,332 | 12,274 |
| Class I | 103 | 78 |
| Total | $14,929 | $12,857 |
| Fidelity Income Replacement 2024 Fund | | |
| From net investment income | | |
| Class A | $1,564 | $4,661 |
| Class T | 1,040 | 2,666 |
| Class C | 710 | 949 |
| Income Replacement 2024 | 93,840 | 141,578 |
| Class I | 508 | 915 |
| Total | $97,662 | $150,769 |
| From net realized gain | | |
| Class A | $575 | $7,591 |
| Class T | 454 | 5,214 |
| Class C | 467 | 2,769 |
| Income Replacement 2024 | 30,188 | 151,262 |
| Class I | 162 | 1,012 |
| Total | $31,846 | $167,848 |
| Fidelity Income Replacement 2026 Fund | | |
| From net investment income | | |
| Class A | $4,828 | $8,571 |
| Class T | 2,192 | 3,397 |
| Class C | 1,292 | 1,628 |
| Income Replacement 2026 | 82,923 | 112,093 |
| Class I | 300 | 478 |
| Total | $91,535 | $126,167 |
| From net realized gain | | |
| Class A | $3,090 | $7,102 |
| Class T | 1,636 | 3,213 |
| Class C | 1,365 | 1,456 |
| Income Replacement 2026 | 42,050 | 67,136 |
| Class I | 165 | 310 |
| Total | $48,306 | $79,217 |
| Fidelity Income Replacement 2028 Fund | | |
| From net investment income | | |
| Class A | $3,751 | $10,860 |
| Class T | 2,967 | 4,711 |
| Class C | 1,114 | 1,570 |
| Income Replacement 2028 | 268,137 | 458,398 |
| Class I | 598 | 1,058 |
| Total | $276,567 | $476,597 |
| From net realized gain | | |
| Class A | $2,747 | $14,148 |
| Class T | 2,461 | 7,542 |
| Class C | 1,197 | 3,748 |
| Income Replacement 2028 | 158,149 | 449,213 |
| Class I | 359 | 4,219 |
| Total | $164,913 | $478,870 |
| Fidelity Income Replacement 2030 Fund | | |
| From net investment income | | |
| Class A | $1,254 | $3,026 |
| Class T | 129 | 213 |
| Class C | 1,138 | 2,244 |
| Income Replacement 2030 | 135,107 | 242,309 |
| Class I | 324 | 491 |
| Total | $137,952 | $248,283 |
| From net realized gain | | |
| Class A | $1,079 | $6,194 |
| Class T | 126 | 482 |
| Class C | 1,579 | 7,690 |
| Income Replacement 2030 | 104,750 | 373,301 |
| Class I | 244 | 716 |
| Total | $107,778 | $388,383 |
| Fidelity Income Replacement 2032 Fund | | |
| From net investment income | | |
| Class A | $3,504 | $5,451 |
| Class T | 248 | 931 |
| Class C | 742 | 878 |
| Income Replacement 2032 | 71,138 | 113,077 |
| Class I | 604 | 896 |
| Total | $76,236 | $121,233 |
| From net realized gain | | |
| Class A | $4,415 | $10,055 |
| Class T | 583 | 1,736 |
| Class C | 1,484 | 3,229 |
| Income Replacement 2032 | 80,413 | 181,970 |
| Class I | 671 | 1,382 |
| Total | $87,566 | $198,372 |
| Fidelity Income Replacement 2034 Fund | | |
| From net investment income | | |
| Class A | $2,587 | $3,762 |
| Class T | 324 | 1,059 |
| Class C | 896 | 1,019 |
| Income Replacement 2034 | 67,901 | 133,102 |
| Class I | 2,522 | 3,598 |
| Total | $74,230 | $142,540 |
| From net realized gain | | |
| Class A | $1,036 | $7,727 |
| Class T | 157 | 2,643 |
| Class C | 553 | 3,553 |
| Income Replacement 2034 | 24,070 | 239,145 |
| Class I | 888 | 5,942 |
| Total | $26,704 | $259,010 |
| Fidelity Income Replacement 2036 Fund | | |
| From net investment income | | |
| Class A | $4,797 | $5,910 |
| Class T | 5,382 | 11,291 |
| Class C | 2,393 | 2,752 |
| Income Replacement 2036 | 90,833 | 140,284 |
| Class I | 9 | 12 |
| Total | $103,414 | $160,249 |
| From net realized gain | | |
| Class A | $5,776 | $9,270 |
| Class T | 11,903 | 23,460 |
| Class C | $4,463 | $9,451 |
| Income Replacement 2036 | 95,960 | 196,785 |
| Class I | 9 | 18 |
| Total | $118,111 | $238,984 |
| Fidelity Income Replacement 2038 Fund | | |
| From net investment income | | |
| Class A | $58 | $2,058 |
| Class T | 1,532 | 2,046 |
| Class C | 581 | 658 |
| Income Replacement 2038 | 48,731 | 88,056 |
| Class I | 365 | 531 |
| Total | $51,267 | $93,349 |
| From net realized gain | | |
| Class A | $39 | $4,456 |
| Class T | 1,133 | 4,851 |
| Class C | 573 | 2,624 |
| Income Replacement 2038 | 27,725 | 154,785 |
| Class I | 207 | 882 |
| Total | $29,677 | $167,598 |
| Fidelity Income Replacement 2040 Fund | | |
| From net investment income | | |
| Class A | $919 | $1,339 |
| Class T | 6,359 | 7,925 |
| Class C | 1,176 | 1,221 |
| Income Replacement 2040 | 90,999 | 142,075 |
| Class I | 20 | 234 |
| Total | $99,473 | $152,794 |
| From net realized gain | | |
| Class A | $864 | $2,644 |
| Class T | 6,984 | 14,410 |
| Class C | 1,647 | 4,357 |
| Income Replacement 2040 | 80,482 | 220,792 |
| Class I | 17 | 446 |
| Total | $89,994 | $242,649 |
| Fidelity Income Replacement 2042 Fund | | |
| From net investment income | | |
| Class A | $5,333 | $7,358 |
| Class T | 4,112 | 5,372 |
| Class C | 2,903 | 3,593 |
| Income Replacement 2042 | 302,064 | 468,262 |
| Class I | 796 | 1,641 |
| Total | $315,208 | $486,226 |
| From net realized gain | | |
| Class A | $4,246 | $15,912 |
| Class T | 3,780 | 12,399 |
| Class C | 3,773 | 10,559 |
| Income Replacement 2042 | 214,892 | 824,194 |
| Class I | 562 | 2,966 |
| Total | $227,253 | $866,030 |
7. Share Transactions.
Share transactions for each class were as follows and may contain automatic conversions between classes or exchanges between affiliated funds:
| | Shares | Shares | Dollars | Dollars |
| | Six months ended January 31, 2017 | Year ended July 31, 2016 | Six months ended January 31, 2017 | Year ended July 31, 2016 |
| Fidelity Income Replacement 2018 Fund | | | | |
| Class A | | | | |
| Reinvestment of distributions | 18 | 52 | $1,007 | $2,825 |
| Shares redeemed | (711) | (1,596) | (39,132) | (86,858) |
| Net increase (decrease) | (693) | (1,544) | $(38,125) | $(84,033) |
| Class T | | | | |
| Reinvestment of distributions | 5 | 24 | $299 | $1,289 |
| Shares redeemed | (820) | (1,843) | (45,102) | (100,365) |
| Net increase (decrease) | (815) | (1,819) | $(44,803) | $(99,076) |
| Class C | | | | |
| Reinvestment of distributions | 1 | 15 | $73 | $834 |
| Shares redeemed | (485) | (4,723) | (26,526) | (256,297) |
| Net increase (decrease) | (484) | (4,708) | $(26,453) | $(255,463) |
| Income Replacement 2018 | | | | |
| Shares sold | 27,090 | 39,457 | $1,491,288 | $2,136,458 |
| Reinvestment of distributions | 165 | 364 | 9,105 | 19,788 |
| Shares redeemed | (16,425) | (51,798) | (904,316) | (2,824,986) |
| Net increase (decrease) | 10,830 | (11,977) | $596,077 | $(668,740) |
| Class I | | | | |
| Reinvestment of distributions | 15 | 47 | $813 | $2,532 |
| Shares redeemed | (637) | (1,275) | (35,091) | (69,482) |
| Net increase (decrease) | (622) | (1,228) | $(34,278) | $(66,950) |
| Fidelity Income Replacement 2020 Fund | | | | |
| Class A | | | | |
| Shares sold | – | 5,720 | $– | $309,005 |
| Reinvestment of distributions | 259 | 582 | 14,216 | 31,434 |
| Shares redeemed | (1,893) | (4,418) | (104,299) | (239,085) |
| Net increase (decrease) | (1,634) | 1,884 | $(90,083) | $101,354 |
| Class T | | | | |
| Reinvestment of distributions | 44 | 110 | $2,406 | $5,956 |
| Shares redeemed | (98) | (281) | (5,337) | (15,161) |
| Net increase (decrease) | (54) | (171) | $(2,931) | $(9,205) |
| Class C | | | | |
| Shares sold | – | 2,368 | $– | $127,731 |
| Reinvestment of distributions | 152 | 403 | 8,327 | 21,674 |
| Shares redeemed | (1,488) | (2,159) | (81,738) | (116,978) |
| Net increase (decrease) | (1,336) | 612 | $(73,411) | $32,427 |
| Income Replacement 2020 | | | | |
| Shares sold | 24,046 | 69,087 | $1,320,474 | $3,758,117 |
| Reinvestment of distributions | 1,625 | 3,337 | 89,083 | 180,346 |
| Shares redeemed | (16,265) | (52,032) | (893,230) | (2,823,179) |
| Net increase (decrease) | 9,406 | 20,392 | $516,327 | $1,115,284 |
| Class I | | | | |
| Reinvestment of distributions | 19 | 115 | $1,064 | $6,187 |
| Shares redeemed | (98) | (2,256) | (5,399) | (121,655) |
| Net increase (decrease) | (79) | (2,141) | $(4,335) | $(115,468) |
| Fidelity Income Replacement 2022 Fund | | | | |
| Class A | | | | |
| Reinvestment of distributions | 39 | 78 | $2,322 | $4,469 |
| Shares redeemed | (51) | (2,485) | (3,020) | (138,398) |
| Net increase (decrease) | (12) | (2,407) | $(698) | $(133,929) |
| Class T | | | | |
| Reinvestment of distributions | 11 | 18 | $660 | $1,017 |
| Shares redeemed | (99) | (90) | (5,861) | (5,200) |
| Net increase (decrease) | (88) | (72) | $(5,201) | $(4,183) |
| Class C | | | | |
| Reinvestment of distributions | 3 | 4 | $163 | $206 |
| Shares redeemed | – | (46) | – | (2,674) |
| Net increase (decrease) | 3 | (42) | $163 | $(2,468) |
| Income Replacement 2022 | | | | |
| Shares sold | 13,088 | 51,218 | $771,337 | $2,896,526 |
| Reinvestment of distributions | 1,501 | 2,543 | 88,273 | 145,507 |
| Shares redeemed | (27,916) | (72,020) | (1,644,447) | (4,099,618) |
| Net increase (decrease) | (13,327) | (18,259) | $(784,837) | $(1,057,585) |
| Class I | | | | |
| Shares sold | – | 685 | $– | $37,829 |
| Reinvestment of distributions | 17 | 30 | 1,019 | 1,744 |
| Shares redeemed | (703) | (19) | (41,556) | (1,106) |
| Net increase (decrease) | (686) | 696 | $(40,537) | $38,467 |
| Fidelity Income Replacement 2024 Fund | | | | |
| Class A | | | | |
| Reinvestment of distributions | 26 | 194 | $1,500 | $10,972 |
| Shares redeemed | (52) | (4,831) | (3,027) | (271,160) |
| Net increase (decrease) | (26) | (4,637) | $(1,527) | $(260,188) |
| Class T | | | | |
| Reinvestment of distributions | 12 | 116 | $712 | $6,575 |
| Shares redeemed | (144) | (3,141) | (8,441) | (175,892) |
| Net increase (decrease) | (132) | (3,025) | $(7,729) | $(169,317) |
| Class C | | | | |
| Reinvestment of distributions | 20 | 66 | $1,177 | $3,718 |
| Shares redeemed | (172) | (191) | (10,096) | (10,917) |
| Net increase (decrease) | (152) | (125) | $(8,919) | $(7,199) |
| Income Replacement 2024 | | | | |
| Shares sold | 38,794 | 49,373 | $2,278,635 | $2,825,155 |
| Reinvestment of distributions | 1,467 | 4,112 | 85,864 | 233,011 |
| Shares redeemed | (25,763) | (58,308) | (1,514,021) | (3,311,153) |
| Net increase (decrease) | 14,498 | (4,823) | $850,478 | $(252,987) |
| Class I | | | | |
| Reinvestment of distributions | 6 | 20 | $360 | $1,130 |
| Shares redeemed | – | (254) | – | (14,566) |
| Net increase (decrease) | 6 | (234) | $360 | $(13,436) |
| Fidelity Income Replacement 2026 Fund | | | | |
| Class A | | | | |
| Reinvestment of distributions | 123 | 254 | $7,356 | $14,755 |
| Shares redeemed | (485) | (2,683) | (29,141) | (151,495) |
| Net increase (decrease) | (362) | (2,429) | $(21,785) | $(136,740) |
| Class T | | | | |
| Shares sold | – | 100 | $– | $5,894 |
| Reinvestment of distributions | 64 | 114 | 3,828 | 6,610 |
| Shares redeemed | (249) | (516) | (15,000) | (30,000) |
| Net increase (decrease) | (185) | (302) | $(11,172) | $(17,496) |
| Class C | | | | |
| Shares sold | – | 2,995 | $– | $174,801 |
| Reinvestment of distributions | 45 | 53 | $2,657 | $3,084 |
| Shares redeemed | (1) | (296) | (35) | (17,012) |
| Net increase (decrease) | 44 | 2,752 | $2,622 | $160,873 |
| Income Replacement 2026 | | | | |
| Shares sold | 60,758 | 55,773 | $3,652,284 | $3,236,571 |
| Reinvestment of distributions | 1,457 | 2,321 | 87,524 | 134,899 |
| Shares redeemed | (16,179) | (40,225) | (975,435) | (2,349,933) |
| Net increase (decrease) | 46,036 | 17,869 | $2,764,373 | $1,021,537 |
| Class I | | | | |
| Reinvestment of distributions | 7 | 14 | $465 | $787 |
| Shares redeemed | – | (27) | – | (1,478) |
| Net increase (decrease) | 7 | (13) | $465 | $(691) |
| Fidelity Income Replacement 2028 Fund | | | | |
| Class A | | | | |
| Shares sold | – | 5,853 | $– | $346,051 |
| Reinvestment of distributions | 107 | 426 | 6,498 | 25,007 |
| Shares redeemed | (2,079) | (11,648) | (127,135) | (660,057) |
| Net increase (decrease) | (1,972) | (5,369) | $(120,637) | $(288,999) |
| Class T | | | | |
| Shares sold | – | 1,673 | $– | $98,478 |
| Reinvestment of distributions | 67 | 176 | 4,065 | 10,305 |
| Shares redeemed | (991) | (2,517) | (60,679) | (148,353) |
| Net increase (decrease) | (924) | (668) | $(56,614) | $(39,570) |
| Class C | | | | |
| Shares sold | – | 1,169 | $– | $70,718 |
| Reinvestment of distributions | 38 | 91 | 2,311 | 5,318 |
| Shares redeemed | (209) | (633) | (12,786) | (38,307) |
| Net increase (decrease) | (171) | 627 | $(10,475) | $37,729 |
| Income Replacement 2028 | | | | |
| Shares sold | 11,439 | 195,909 | $696,960 | $11,547,098 |
| Reinvestment of distributions | 5,140 | 12,560 | 312,262 | 737,302 |
| Shares redeemed | (98,413) | (165,141) | (5,996,367) | (9,729,252) |
| Net increase (decrease) | (81,834) | 43,328 | $(4,987,145) | $2,555,148 |
| Class I | | | | |
| Shares sold | – | 4,724 | $– | $284,670 |
| Reinvestment of distributions | 16 | 90 | 957 | 5,277 |
| Shares redeemed | (140) | (8,655) | (8,423) | (514,080) |
| Net increase (decrease) | (124) | (3,841) | $(7,466) | $(224,133) |
| Fidelity Income Replacement 2030 Fund | | | | |
| Class A | | | | |
| Shares sold | – | 55 | $– | $3,199 |
| Reinvestment of distributions | 23 | 113 | 1,401 | 6,525 |
| Shares redeemed | (494) | (2,218) | (29,688) | (127,398) |
| Net increase (decrease) | (471) | (2,050) | $(28,287) | $(117,674) |
| Class T | | | | |
| Shares sold | – | 34 | $– | $2,000 |
| Reinvestment of distributions | 4 | 12 | 255 | 694 |
| Shares redeemed | – | (129) | (1) | (7,200) |
| Net increase (decrease) | 4 | (83) | $254 | $(4,506) |
| Class C | | | | |
| Shares sold | – | 1,610 | $– | $92,155 |
| Reinvestment of distributions | 37 | 162 | 2,215 | 9,314 |
| Shares redeemed | (69) | (4,087) | $(4,108) | $(232,547) |
| Net increase (decrease) | (32) | (2,315) | $(1,893) | $(131,078) |
| Income Replacement 2030 | | | | |
| Shares sold | 10,502 | 22,765 | $634,856 | $1,310,359 |
| Reinvestment of distributions | 3,032 | 8,985 | 181,442 | 519,663 |
| Shares redeemed | (27,933) | (80,152) | (1,670,870) | (4,631,240) |
| Net increase (decrease) | (14,399) | (48,402) | $(854,572) | $(2,801,218) |
| Class I | | | | |
| Reinvestment of distributions | 9 | 21 | $568 | $1,208 |
| Shares redeemed | – | (27) | – | (1,496) |
| Net increase (decrease) | 9 | (6) | $568 | $(288) |
| Fidelity Income Replacement 2032 Fund | | | | |
| Class A | | | | |
| Reinvestment of distributions | 121 | 249 | $6,896 | $13,708 |
| Shares redeemed | (438) | (636) | (25,000) | (35,019) |
| Net increase (decrease) | (317) | (387) | $(18,104) | $(21,311) |
| Class T | | | | |
| Shares sold | – | 1,176 | $– | $64,363 |
| Reinvestment of distributions | 15 | 48 | 831 | 2,667 |
| Shares redeemed | (645) | (1,358) | (36,603) | (71,273) |
| Net increase (decrease) | (630) | (134) | $(35,772) | $(4,243) |
| Class C | | | | |
| Reinvestment of distributions | 39 | 74 | $2,206 | $4,046 |
| Shares redeemed | (35) | (237) | (1,961) | (12,646) |
| Net increase (decrease) | 4 | (163) | $245 | $(8,600) |
| Income Replacement 2032 | | | | |
| Shares sold | 5,321 | 3,094 | $301,439 | $172,900 |
| Reinvestment of distributions | 1,694 | 4,515 | 96,135 | 248,476 |
| Shares redeemed | (8,162) | (23,938) | (468,224) | (1,316,244) |
| Net increase (decrease) | (1,147) | (16,329) | $(70,650) | $(894,868) |
| Class I | | | | |
| Reinvestment of distributions | 22 | 41 | $1,275 | $2,278 |
| Shares redeemed | – | (52) | – | (2,741) |
| Net increase (decrease) | 22 | (11) | $1,275 | $(463) |
| Fidelity Income Replacement 2034 Fund | | | | |
| Class A | | | | |
| Reinvestment of distributions | 16 | 61 | $953 | $3,517 |
| Shares redeemed | (227) | (264) | (13,458) | (15,261) |
| Net increase (decrease) | (211) | (203) | $(12,505) | $(11,744) |
| Class T | | | | |
| Shares sold | – | 2,372 | $- | $132,706 |
| Reinvestment of distributions | 8 | 64 | 481 | 3,703 |
| Shares redeemed | (1,201) | (2,511) | (72,690) | (138,710) |
| Net increase (decrease) | (1,193) | (75) | $(72,209) | $(2,301) |
| Class C | | | | |
| Shares sold | – | 435 | $– | $25,000 |
| Reinvestment of distributions | 24 | 80 | 1,449 | 4,572 |
| Shares redeemed | – | (262) | – | (14,590) |
| Net increase (decrease) | 24 | 253 | $1,449 | $14,982 |
| Income Replacement 2034 | | | | |
| Shares sold | 1,825 | 19,850 | $109,468 | $1,163,917 |
| Reinvestment of distributions | 993 | 5,159 | 59,647 | 296,849 |
| Shares redeemed | (20,575) | (48,419) | $(1,229,940) | $(2,795,141) |
| Net increase (decrease) | (17,757) | (23,410) | $(1,060,825) | $(1,334,375) |
| Class I | | | | |
| Shares sold | – | 570 | $– | $30,763 |
| Reinvestment of distributions | 57 | 166 | 3,410 | 9,540 |
| Shares redeemed | (29) | (566) | (1,720) | (31,395) |
| Net increase (decrease) | 28 | 170 | $1,690 | $8,908 |
| Fidelity Income Replacement 2036 Fund | | | | |
| Class A | | | | |
| Shares sold | – | 1,233 | $– | $70,588 |
| Reinvestment of distributions | 176 | 260 | 10,573 | 15,180 |
| Shares redeemed | (298) | (509) | (17,968) | (30,132) |
| Net increase (decrease) | (122) | 984 | $(7,395) | $55,636 |
| Class T | | | | |
| Shares sold | – | 311 | $– | $18,325 |
| Reinvestment of distributions | 258 | 551 | 15,458 | 32,064 |
| Shares redeemed | (8,341) | (1,416) | (506,544) | (82,028) |
| Net increase (decrease) | (8,083) | (554) | $(491,086) | $(31,639) |
| Class C | | | | |
| Reinvestment of distributions | 92 | 183 | $5,485 | $10,599 |
| Shares redeemed | (270) | (1,005) | (16,194) | (58,699) |
| Net increase (decrease) | (178) | (822) | $(10,709) | $(48,100) |
| Income Replacement 2036 | | | | |
| Shares sold | 4,289 | 12,583 | $259,922 | $727,911 |
| Reinvestment of distributions | 2,303 | 4,205 | 138,319 | 244,970 |
| Shares redeemed | (18,737) | (17,250) | (1,139,165) | (1,012,347) |
| Net increase (decrease) | (12,145) | (462) | $(740,924) | $(39,466) |
| Class I | | | | |
| Reinvestment of distributions | 1 | 1 | $18 | $30 |
| Shares redeemed | – | (2) | – | (38) |
| Net increase (decrease) | 1 | (1) | $18 | $(8) |
| Fidelity Income Replacement 2038 Fund | | | | |
| Class A | | | | |
| Shares sold | – | 141 | $– | $7,909 |
| Reinvestment of distributions | 1 | 115 | 58 | 6,415 |
| Shares redeemed | (969) | (2,057) | (56,471) | (114,735) |
| Net increase (decrease) | (968) | (1,801) | $(56,413) | $(100,411) |
| Class T | | | | |
| Reinvestment of distributions | 33 | 103 | $1,893 | $5,729 |
| Shares redeemed | (64) | (140) | (3,702) | (7,817) |
| Net increase (decrease) | (31) | (37) | $(1,809) | $(2,088) |
| Class C | | | | |
| Reinvestment of distributions | 20 | 59 | $1,154 | $3,281 |
| Shares redeemed | (59) | (200) | (3,382) | (11,180) |
| Net increase (decrease) | (39) | (141) | $(2,228) | $(7,899) |
| Income Replacement 2038 | | | | |
| Shares sold | 1,316 | 4,366 | $76,478 | $246,487 |
| Reinvestment of distributions | 1,114 | 3,916 | 64,577 | 218,216 |
| Shares redeemed | (8,135) | (32,653) | (475,033) | (1,818,911) |
| Net increase (decrease) | (5,705) | (24,371) | $(333,978) | $(1,354,208) |
| Class I | | | | |
| Reinvestment of distributions | 10 | 25 | $572 | $1,412 |
| Shares redeemed | – | (31) | $– | $(1,612) |
| Net increase (decrease) | 10 | (6) | $572 | $(200) |
| Fidelity Income Replacement 2040 Fund | | | | |
| Class A | | | | |
| Reinvestment of distributions | 29 | 64 | $1,690 | $3,649 |
| Shares redeemed | – | (291) | – | (16,674) |
| Net increase (decrease) | 29 | (227) | $1,690 | $(13,025) |
| Class T | | | | |
| Shares sold | – | 9,235 | $– | $527,973 |
| Reinvestment of distributions | 170 | 303 | 10,001 | 17,283 |
| Shares redeemed | (425) | (5,773) | (25,207) | (327,421) |
| Net increase (decrease) | (255) | 3,765 | $(15,206) | $217,835 |
| Class C | | | | |
| Reinvestment of distributions | 44 | 93 | $2,573 | $5,260 |
| Shares redeemed | (18) | (40) | (1,048) | (2,283) |
| Net increase (decrease) | 26 | 53 | $1,525 | $2,977 |
| Income Replacement 2040 | | | | |
| Shares sold | 4,321 | 16,324 | $256,355 | $939,546 |
| Reinvestment of distributions | 2,169 | 5,088 | 127,658 | 289,555 |
| Shares redeemed | (18,249) | (21,837) | (1,075,129) | (1,251,519) |
| Net increase (decrease) | (11,759) | (425) | $(691,116) | $(22,418) |
| Class I | | | | |
| Reinvestment of distributions | 1 | 12 | $37 | $671 |
| Shares redeemed | – | (279) | – | (16,071) |
| Net increase (decrease) | 1 | (267) | $37 | $(15,400) |
| Fidelity Income Replacement 2042 Fund | | | | |
| Class A | | | | |
| Shares sold | – | 48 | $– | $2,788 |
| Reinvestment of distributions | 161 | 406 | 9,540 | 23,116 |
| Shares redeemed | – | (1,820) | – | (105,363) |
| Net increase (decrease) | 161 | (1,366) | $9,540 | $(79,459) |
| Class T | | | | |
| Shares sold | – | 7 | $– | $406 |
| Reinvestment of distributions | 104 | 266 | 6,153 | 15,110 |
| Shares redeemed | (208) | (1,080) | (12,401) | (62,622) |
| Net increase (decrease) | (104) | (807) | $(6,248) | $(47,106) |
| Class C | | | | |
| Shares sold | – | 5,320 | $– | $289,821 |
| Reinvestment of distributions | 95 | 230 | 5,545 | 13,021 |
| Shares redeemed | (1,121) | (6,862) | (65,888) | (385,276) |
| Net increase (decrease) | (1,026) | (1,312) | $(60,343) | $(82,434) |
| Income Replacement 2042 | | | | |
| Shares sold | 17,244 | 76,280 | $1,027,023 | $4,335,174 |
| Reinvestment of distributions | 6,649 | 18,992 | 392,987 | 1,080,834 |
| Shares redeemed | (60,360) | (184,484) | (3,597,862) | (10,474,890) |
| Net increase (decrease) | (36,467) | (89,212) | $(2,177,852) | $(5,058,882) |
| Class I | | | | |
| Reinvestment of distributions | 23 | 81 | $1,358 | $4,598 |
| Shares redeemed | (117) | (1,198) | (7,000) | (68,734) |
| Net increase (decrease) | (94) | (1,117) | $(5,642) | $(64,136) |
8. Other.
The Funds' organizational documents provide former and current trustees and officers with a limited indemnification against liabilities arising in connection with the performance of their duties to the Funds. In the normal course of business, the Funds may also enter into contracts that provide general indemnifications. The Funds' maximum exposure under these arrangements is unknown as this would be dependent on future claims that may be made against the Funds. The risk of material loss from such claims is considered remote.
The Funds do not invest in the Underlying Funds for the purpose of exercising management or control; however, investment by the Fund within their principle investment strategies may represent a significant portion of the underlying Fund's net assets. At the end of the period, the following Funds were the owners of record of 10% or more of the total outstanding shares of the Underlying Funds:
| Fund | Fidelity Income Replacement 2028 Fund | Fidelity Income Replacement 2042 Fund |
| Fidelity Series Broad Market Opportunities Fund | 16% | 23% |
The Funds, in aggregate, were the owners of record of more than 20% of the total outstanding shares of the following Underlying Funds.
| Fund | % of shares held |
| Fidelity Series Broad Market Opportunities Fund | 98% |
In January 2017, the Board of Trustees approved a Plan of Liquidation and Dissolution whereby the Fidelity Income Replacement 2018 Fund and Fidelity Income Replacement 2020 Fund, consistent with the Funds' original design, will distribute all of their net assets to their shareholders on or about March 24, 2017.
Shareholder Expense Example
As a shareholder of a Fund, you incur two types of costs: (1) transaction costs, including sales charges (loads) on purchase payments or redemption proceeds, and (2) ongoing costs, including distribution and/or service (12b-1) fees and other Fund expenses. This Example is intended to help you understand your ongoing costs (in dollars) of investing in the Funds and to compare these costs with the ongoing costs of investing in other mutual funds.
The Example is based on an investment of $1,000 invested at the beginning of the period and held for the entire period (August 1, 2016 to January 31, 2017).
Actual Expenses
The first line of the accompanying table for each class of each fund provides information about actual account values and actual expenses. You may use the information in this line, together with the amount you invested, to estimate the expenses that you paid over the period. Simply divide your account value by $1,000.00 (for example, an $8,600 account value divided by $1,000.00 = 8.6), then multiply the result by the number in the first line for a class of the fund under the heading entitled "Expenses Paid During Period" to estimate the expenses you paid on your account during this period. In addition, each Fund, as a shareholder in underlying Fidelity Funds, will indirectly bear its pro-rata share of the fees and expenses incurred by the underlying Fidelity Funds. These fees and expenses are not included in each Fund's annualized expense ratio used to calculate the expense estimates in the table below.
Hypothetical Example for Comparison Purposes
The second line of the accompanying table for each class of each fund provides information about hypothetical account values and hypothetical expenses based on a Class' actual expense ratio and an assumed rate of return of 5% per year before expenses, which is not the Class' actual return. The hypothetical account values and expenses may not be used to estimate the actual ending account balance or expenses you paid for the period. You may use this information to compare the ongoing costs of investing in the Fund and other funds. To do so, compare this 5% hypothetical example with the 5% hypothetical examples that appear in the shareholder reports of the other funds. In addition, each Fund, as a shareholder in underlying Fidelity Funds, will indirectly bear its pro-rata share of the fees and expenses incurred by the underlying Fidelity Funds. These fees and expenses are not included in each Fund's annualized expense ratio used to calculate the expense estimates in the table below.
Please note that the expenses shown in the table are meant to highlight your ongoing costs only and do not reflect any transaction costs. Therefore, the second line of the table is useful in comparing ongoing costs only, and will not help you determine the relative total costs of owning different funds. In addition, if these transactional costs were included, your costs would have been higher.
| | Annualized Expense Ratio-A | Beginning
Account Value
August 1, 2016 | Ending
Account Value
January 31, 2017 | Expenses Paid
During Period-B
August 1, 2016
to January 31, 2017 |
| Fidelity Income Replacement 2018 Fund | | | | |
| Class A | .25% | | | |
| Actual | | $1,000.00 | $1,003.10 | $1.26 |
| Hypothetical-C | | $1,000.00 | $1,023.95 | $1.28 |
| Class T | .50% | | | |
| Actual | | $1,000.00 | $1,001.70 | $2.52 |
| Hypothetical-C | | $1,000.00 | $1,022.68 | $2.55 |
| Class C | 1.00% | | | |
| Actual | | $1,000.00 | $999.20 | $5.04 |
| Hypothetical-C | | $1,000.00 | $1,020.16 | $5.09 |
| Income Replacement 2018 | - % | | | |
| Actual | | $1,000.00 | $1,004.30 | $- |
| Hypothetical-C | | $1,000.00 | $1,025.21 | $- |
| Class I | - % | | | |
| Actual | | $1,000.00 | $1,004.30 | $- |
| Hypothetical-C | | $1,000.00 | $1,025.21 | $- |
| Fidelity Income Replacement 2020 Fund | | | | |
| Class A | .25% | | | |
| Actual | | $1,000.00 | $1,007.30 | $1.26 |
| Hypothetical-C | | $1,000.00 | $1,023.95 | $1.28 |
| Class T | .50% | | | |
| Actual | | $1,000.00 | $1,006.00 | $2.53 |
| Hypothetical-C | | $1,000.00 | $1,022.68 | $2.55 |
| Class C | 1.00% | | | |
| Actual | | $1,000.00 | $1,003.40 | $5.05 |
| Hypothetical-C | | $1,000.00 | $1,020.16 | $5.09 |
| Income Replacement 2020 | - % | | | |
| Actual | | $1,000.00 | $1,008.40 | $- |
| Hypothetical-C | | $1,000.00 | $1,025.21 | $- |
| Class I | - % | | | |
| Actual | | $1,000.00 | $1,008.40 | $- |
| Hypothetical-C | | $1,000.00 | $1,025.21 | $- |
| Fidelity Income Replacement 2022 Fund | | | | |
| Class A | .25% | | | |
| Actual | | $1,000.00 | $1,012.20 | $1.27 |
| Hypothetical-C | | $1,000.00 | $1,023.95 | $1.28 |
| Class T | .50% | | | |
| Actual | | $1,000.00 | $1,010.90 | $2.53 |
| Hypothetical-C | | $1,000.00 | $1,022.68 | $2.55 |
| Class C | 1.00% | | | |
| Actual | | $1,000.00 | $1,008.40 | $5.06 |
| Hypothetical-C | | $1,000.00 | $1,020.16 | $5.09 |
| Income Replacement 2022 | - % | | | |
| Actual | | $1,000.00 | $1,013.40 | $- |
| Hypothetical-C | | $1,000.00 | $1,025.21 | $- |
| Class I | - % | | | |
| Actual | | $1,000.00 | $1,013.40 | $- |
| Hypothetical-C | | $1,000.00 | $1,025.21 | $- |
| Fidelity Income Replacement 2024 Fund | | | | |
| Class A | .25% | | | |
| Actual | | $1,000.00 | $1,018.70 | $1.27 |
| Hypothetical-C | | $1,000.00 | $1,023.95 | $1.28 |
| Class T | .50% | | | |
| Actual | | $1,000.00 | $1,017.60 | $2.54 |
| Hypothetical-C | | $1,000.00 | $1,022.68 | $2.55 |
| Class C | 1.00% | | | |
| Actual | | $1,000.00 | $1,014.80 | $5.08 |
| Hypothetical-C | | $1,000.00 | $1,020.16 | $5.09 |
| Income Replacement 2024 | - % | | | |
| Actual | | $1,000.00 | $1,019.90 | $- |
| Hypothetical-C | | $1,000.00 | $1,025.21 | $- |
| Class I | - % | | | |
| Actual | | $1,000.00 | $1,019.90 | $- |
| Hypothetical-C | | $1,000.00 | $1,025.21 | $- |
| Fidelity Income Replacement 2026 Fund | | | | |
| Class A | .25% | | | |
| Actual | | $1,000.00 | $1,023.40 | $1.28 |
| Hypothetical-C | | $1,000.00 | $1,023.95 | $1.28 |
| Class T | .50% | | | |
| Actual | | $1,000.00 | $1,022.10 | $2.55 |
| Hypothetical-C | | $1,000.00 | $1,022.68 | $2.55 |
| Class C | 1.00% | | | |
| Actual | | $1,000.00 | $1,019.60 | $5.09 |
| Hypothetical-C | | $1,000.00 | $1,020.16 | $5.09 |
| Income Replacement 2026 | - % | | | |
| Actual | | $1,000.00 | $1,024.70 | $- |
| Hypothetical-C | | $1,000.00 | $1,025.21 | $- |
| Class I | - % | | | |
| Actual | | $1,000.00 | $1,024.70 | $- |
| Hypothetical-C | | $1,000.00 | $1,025.21 | $- |
| Fidelity Income Replacement 2028 Fund | | | | |
| Class A | .25% | | | |
| Actual | | $1,000.00 | $1,026.90 | $1.28 |
| Hypothetical-C | | $1,000.00 | $1,023.95 | $1.28 |
| Class T | .50% | | | |
| Actual | | $1,000.00 | $1,025.60 | $2.55 |
| Hypothetical-C | | $1,000.00 | $1,022.68 | $2.55 |
| Class C | 1.00% | | | |
| Actual | | $1,000.00 | $1,023.00 | $5.10 |
| Hypothetical-C | | $1,000.00 | $1,020.16 | $5.09 |
| Income Replacement 2028 | - % | | | |
| Actual | | $1,000.00 | $1,028.20 | $- |
| Hypothetical-C | | $1,000.00 | $1,025.21 | $- |
| Class I | - % | | | |
| Actual | | $1,000.00 | $1,028.20 | $- |
| Hypothetical-C | | $1,000.00 | $1,025.21 | $- |
| Fidelity Income Replacement 2030 Fund | | | | |
| Class A | .25% | | | |
| Actual | | $1,000.00 | $1,029.10 | $1.28 |
| Hypothetical-C | | $1,000.00 | $1,023.95 | $1.28 |
| Class T | .50% | | | |
| Actual | | $1,000.00 | $1,027.70 | $2.56 |
| Hypothetical-C | | $1,000.00 | $1,022.68 | $2.55 |
| Class C | 1.00% | | | |
| Actual | | $1,000.00 | $1,025.20 | $5.10 |
| Hypothetical-C | | $1,000.00 | $1,020.16 | $5.09 |
| Income Replacement 2030 | - % | | | |
| Actual | | $1,000.00 | $1,030.40 | $- |
| Hypothetical-C | | $1,000.00 | $1,025.21 | $- |
| Class I | - % | | | |
| Actual | | $1,000.00 | $1,030.40 | $- |
| Hypothetical-C | | $1,000.00 | $1,025.21 | $- |
| Fidelity Income Replacement 2032 Fund | | | | |
| Class A | .25% | | | |
| Actual | | $1,000.00 | $1,030.70 | $1.28 |
| Hypothetical-C | | $1,000.00 | $1,023.95 | $1.28 |
| Class T | .50% | | | |
| Actual | | $1,000.00 | $1,029.50 | $2.56 |
| Hypothetical-C | | $1,000.00 | $1,022.68 | $2.55 |
| Class C | 1.00% | | | |
| Actual | | $1,000.00 | $1,026.90 | $5.11 |
| Hypothetical-C | | $1,000.00 | $1,020.16 | $5.09 |
| Income Replacement 2032 | - % | | | |
| Actual | | $1,000.00 | $1,032.00 | $- |
| Hypothetical-C | | $1,000.00 | $1,025.21 | $- |
| Class I | - % | | | |
| Actual | | $1,000.00 | $1,032.00 | $- |
| Hypothetical-C | | $1,000.00 | $1,025.21 | $- |
| Fidelity Income Replacement 2034 Fund | | | | |
| Class A | .25% | | | |
| Actual | | $1,000.00 | $1,031.90 | $1.28 |
| Hypothetical-C | | $1,000.00 | $1,023.95 | $1.28 |
| Class T | .50% | | | |
| Actual | | $1,000.00 | $1,030.20 | $2.56 |
| Hypothetical-C | | $1,000.00 | $1,022.68 | $2.55 |
| Class C | 1.00% | | | |
| Actual | | $1,000.00 | $1,028.00 | $5.11 |
| Hypothetical-C | | $1,000.00 | $1,020.16 | $5.09 |
| Income Replacement 2034 | - % | | | |
| Actual | | $1,000.00 | $1,033.20 | $- |
| Hypothetical-C | | $1,000.00 | $1,025.21 | $- |
| Class I | - % | | | |
| Actual | | $1,000.00 | $1,033.20 | $- |
| Hypothetical-C | | $1,000.00 | $1,025.21 | $- |
| Fidelity Income Replacement 2036 Fund | | | | |
| Class A | .25% | | | |
| Actual | | $1,000.00 | $1,032.80 | $1.28 |
| Hypothetical-C | | $1,000.00 | $1,023.95 | $1.28 |
| Class T | .50% | | | |
| Actual | | $1,000.00 | $1,031.50 | $2.56 |
| Hypothetical-C | | $1,000.00 | $1,022.68 | $2.55 |
| Class C | 1.00% | | | |
| Actual | | $1,000.00 | $1,029.00 | $5.11 |
| Hypothetical-C | | $1,000.00 | $1,020.16 | $5.09 |
| Income Replacement 2036 | - % | | | |
| Actual | | $1,000.00 | $1,034.10 | $- |
| Hypothetical-C | | $1,000.00 | $1,025.21 | $- |
| Class I | - % | | | |
| Actual | | $1,000.00 | $1,034.40 | $- |
| Hypothetical-C | | $1,000.00 | $1,025.21 | $- |
| Fidelity Income Replacement 2038 Fund | | | | |
| Class A | .24%-D | | | |
| Actual | | $1,000.00 | $1,033.60 | $1.23 |
| Hypothetical-C | | $1,000.00 | $1,024.00 | $1.22 |
| Class T | .50% | | | |
| Actual | | $1,000.00 | $1,032.40 | $2.56 |
| Hypothetical-C | | $1,000.00 | $1,022.68 | $2.55 |
| Class C | 1.00% | | | |
| Actual | | $1,000.00 | $1,030.00 | $5.12 |
| Hypothetical-C | | $1,000.00 | $1,020.16 | $5.09 |
| Income Replacement 2038 | - % | | | |
| Actual | | $1,000.00 | $1,035.00 | $- |
| Hypothetical-C | | $1,000.00 | $1,025.21 | $- |
| Class I | - % | | | |
| Actual | | $1,000.00 | $1,035.00 | $- |
| Hypothetical-C | | $1,000.00 | $1,025.21 | $- |
| Fidelity Income Replacement 2040 Fund | | | | |
| Class A | .25% | | | |
| Actual | | $1,000.00 | $1,034.40 | $1.28 |
| Hypothetical-C | | $1,000.00 | $1,023.95 | $1.28 |
| Class T | .50% | | | |
| Actual | | $1,000.00 | $1,033.30 | $2.56 |
| Hypothetical-C | | $1,000.00 | $1,022.68 | $2.55 |
| Class C | 1.00% | | | |
| Actual | | $1,000.00 | $1,030.70 | $5.12 |
| Hypothetical-C | | $1,000.00 | $1,020.16 | $5.09 |
| Income Replacement 2040 | - % | | | |
| Actual | | $1,000.00 | $1,035.70 | $- |
| Hypothetical-C | | $1,000.00 | $1,025.21 | $- |
| Class I | - % | | | |
| Actual | | $1,000.00 | $1,035.70 | $- |
| Hypothetical-C | | $1,000.00 | $1,025.21 | $- |
| Fidelity Income Replacement 2042 Fund | | | | |
| Class A | .25% | | | |
| Actual | | $1,000.00 | $1,035.30 | $1.28 |
| Hypothetical-C | | $1,000.00 | $1,023.95 | $1.28 |
| Class T | .50% | | | |
| Actual | | $1,000.00 | $1,034.10 | $2.56 |
| Hypothetical-C | | $1,000.00 | $1,022.68 | $2.55 |
| Class C | 1.00% | | | |
| Actual | | $1,000.00 | $1,031.40 | $5.12 |
| Hypothetical-C | | $1,000.00 | $1,020.16 | $5.09 |
| Income Replacement 2042 | - % | | | |
| Actual | | $1,000.00 | $1,036.60 | $- |
| Hypothetical-C | | $1,000.00 | $1,025.21 | $- |
| Class I | - % | | | |
| Actual | | $1,000.00 | $1,036.80 | $- |
| Hypothetical-C | | $1,000.00 | $1,025.21 | $- |
| | | | | |
A Annualized expense ratio reflects expenses net of applicable fee waivers.
B Expenses are equal to each Class' annualized expense ratio, multiplied by the average account value over the period, multiplied by 184/ 365 (to reflect the one-half year period). The fees and expenses of the underlying Fidelity Funds in which each Fund invests are not included in each Fund's annualized expense ratio.
C 5% return per year before expenses
D On certain classes, the size and fluctuation of net assets may cause rounding of expenses amounts and ratios to differ from contractual rates.
Board Approval of Investment Advisory Contracts and Management Fees
Fidelity Income Replacement Funds
Each year, the Board of Trustees, including the Independent Trustees (together, the Board), votes on the renewal of the management contract (the Advisory Contract) with FMR Co., Inc. (FMRC), an affiliate of Fidelity Management & Research Company (FMR), for each fund. The Board, assisted by the advice of fund counsel and Independent Trustees' counsel, requests and considers a broad range of information relevant to the renewal of the Advisory Contracts throughout the year.
The Board meets regularly and, at each of its meetings, covers an extensive agenda of topics and materials and considers factors that are relevant to its annual consideration of the renewal of each fund's Advisory Contract, including the services and support provided to each fund and its shareholders. The Board has established four standing committees (Committees) — Operations, Audit, Fair Valuation, and Governance and Nominating — each composed of and chaired by Independent Trustees with varying backgrounds, to which the Board has assigned specific subject matter responsibilities in order to enhance effective decision-making by the Board. The Operations Committee, of which all of the Independent Trustees are members, meets regularly throughout the year and considers, among other matters, information specifically related to the annual consideration of the renewal of each fund's Advisory Contract. The Board, acting directly and through its Committees, requests and receives information concerning the annual consideration of the renewal of each fund's Advisory Contract. The Board also meets as needed to consider matters specifically related to the Board's annual consideration of the renewal of the Advisory Contracts. Members of the Board may also meet with trustees of other Fidelity funds through ad hoc joint committees to discuss certain matters relevant to all of the Fidelity funds.
At its September 2016 meeting, the Board unanimously determined to renew each fund's Advisory Contract. In reaching its determination, the Board considered all factors it believed relevant and reached a determination, with the assistance of fund counsel and Independent Trustees' counsel and through the exercise of its business judgment, that the renewal of the Advisory Contract was in the best interests of each fund and its shareholders and that the fact that no fees are payable under the Advisory Contracts was fair and reasonable. The Board's decision to renew the Advisory Contracts was not based on any single factor, but rather was based on a comprehensive consideration of all the information provided to the Board at its meetings throughout the year. In reaching its determination, the Board was aware that shareholders of each fund have a broad range of investment choices available to them, including a wide choice among funds offered by Fidelity's competitors, and that each fund's shareholders, who have the opportunity to review and weigh the disclosure provided by the fund in its prospectus and other public disclosures, have chosen to invest in that fund, which is part of the Fidelity family of funds.
Nature, Extent, and Quality of Services Provided. The Board considered Fidelity's staffing as it relates to the funds, including the backgrounds of investment personnel of FMRC, and also considered the funds' investment objectives, strategies, and related investment philosophies. The Independent Trustees also had discussions with senior management of Fidelity's investment operations and investment groups with responsibility for the underlying Fidelity funds in which each fund invests. The Board considered the structure of the investment personnel compensation program and whether this structure provides appropriate incentives to act in the best interests of each fund. Additionally, the Board considered the portfolio managers' investments, if any, in the funds that they manage.
Resources Dedicated to Investment Management and Support Services. The Board reviewed the general qualifications and capabilities of Fidelity's investment staff, including its size, education, experience, and resources, as well as Fidelity's approach to recruiting, managing, and compensating investment personnel. The Board noted that Fidelity has continued to increase the resources devoted to non-U.S. offices, including expansion of Fidelity's global investment organization. The Board also noted that Fidelity's analysts have extensive resources, tools and capabilities that allow them to conduct sophisticated quantitative and fundamental analysis, as well as credit analysis of issuers, counterparties and guarantors. Further, the Board considered that Fidelity's investment professionals have sufficient access to global information and data so as to provide competitive investment results over time, and that those professionals also have access to sophisticated tools that permit them to assess portfolio construction and risk and performance attribution characteristics continuously, as well as to transmit new information and research conclusions rapidly around the world. Additionally, in its deliberations, the Board considered Fidelity's risk management, compliance, and technology and operations capabilities and resources, which are integral parts of the investment management process.
Shareholder and Administrative Services. The Board considered (i) the nature, extent, quality, and cost of advisory, administrative, and shareholder services performed by Fidelity under the Advisory Contract and under separate agreements covering transfer agency and pricing and bookkeeping services for each fund; (ii) the nature and extent of the supervision of third party service providers, principally custodians, subcustodians, and pricing vendors; and (iii) the resources devoted to, and the record of compliance with, each fund's compliance policies and procedures.
The Board noted that the growth of fund assets over time across the complex allows Fidelity to reinvest in the development of services designed to enhance the value or convenience of the Fidelity funds as investment vehicles. These services include 24-hour access to account information and market information through telephone representatives and over the Internet, investor education materials and asset allocation tools, and the expanded availability of Fidelity Investor Centers.
Investment in a Large Fund Family. The Board considered the benefits to shareholders of investing in a Fidelity fund, including the benefits of investing in a fund that is part of a large family of funds offering a variety of investment disciplines and providing a large variety of mutual fund investor services. The Board noted that Fidelity had taken, or had made recommendations that resulted in the Fidelity funds taking, a number of actions over the previous year that benefited particular funds, including: (i) continuing to dedicate additional resources to investment research and to the support of the senior management team that oversees asset management; (ii) continuing efforts to enhance Fidelity's global research capabilities; (iii) launching new funds and making other enhancements to meet client needs; (iv) broadening eligibility requirements for certain lower-priced share classes of, and streamlining the fee structure for, certain existing equity index funds; (v) lowering expense caps for certain existing funds and classes to reduce expenses paid by shareholders; (vi) eliminating redemption fees for certain variable insurance product funds and classes; (vii) continuing to launch dedicated lower cost underlying funds to meet portfolio construction needs related to expanding underlying fund options for Fidelity funds of funds, specifically for the Freedom Fund product lines; (viii) launching a lower cost share class for use by the Freedom Index Fund product line; (ix) rationalizing product lines and gaining increased efficiencies through fund mergers and share class consolidations; (x) continuing to develop, acquire and implement systems and technology to improve services to the funds and shareholders, strengthen information security, and increase efficiency; (xi) implementing investment enhancements to further strengthen Fidelity's target date product line to increase investors' probability of success in achieving their goals; (xii) accelerating the conversion of all remaining Class B shares to Class A shares, which have a lower expense structure; and (xiii) implementing changes to Fidelity's money market fund product line in response to recent regulatory reforms.
Investment Performance. The Board considered whether each fund has operated in accordance with its investment objective, as well as its record of compliance with its investment restrictions and its performance history.
The Board took into account discussions with representatives of the investment adviser about fund investment performance that occur at Board meetings throughout the year. In this regard the Board noted that as part of regularly scheduled fund reviews and other reports to the Board on fund performance, the Board considers annualized return information for each fund for different time periods, measured against one or more securities market indices, including a customized blended index representative of the fund's asset classes (each a "benchmark index") and a peer group of funds with similar objectives ("peer group"), if any. In its evaluation of fund investment performance at meetings throughout the year, the Board gave particular attention to information indicating underperformance of certain Fidelity funds for specific time periods and discussed with the investment adviser the reasons for such underperformance.
In addition to reviewing absolute and relative fund performance, the Independent Trustees periodically consider the appropriateness of fund performance metrics in evaluating the results achieved. In general, the Independent Trustees believe that fund performance should be evaluated based on gross performance (before fees and expenses, including acquired fund fees and expenses, but after transaction costs, if any) compared to appropriate benchmark indices, over appropriate time periods that may include full market cycles, and on net performance (after fees and expenses, including acquired fund fees and expenses) compared to peer groups, as applicable, over the same periods, taking into account relevant factors including the following: general market conditions; the extent to which particular underlying funds affected performance; and fund cash flows and other factors. Depending on the circumstances, the Independent Trustees may be satisfied with a fund's performance notwithstanding that it lags its benchmark index or peer group for certain periods.
The Independent Trustees recognize that shareholders evaluate performance on a net basis over their own holding periods, for which one-, three-, and five-year periods are often used as a proxy. For this reason, the performance information reviewed by the Board also included net cumulative calendar year total return information for each fund and an appropriate benchmark index for the most recent one-, three-, and five-year periods.
Based on its review, the Board concluded that the nature, extent, and quality of services provided to each fund under the Advisory Contracts should continue to benefit the shareholders of each fund.
Competitiveness of Management Fee and Total Expense Ratio. The Board noted that the funds do not pay FMRC a management fee for investment advisory services, and that each fund bears indirectly the fees and expenses, including the management fees, paid by the underlying Fidelity funds in which it invests. The Board considered each fund's management fee and total expense ratio compared to "mapped groups" of competitive funds and classes created for the purpose of facilitating the Trustees' competitive analysis of management fees and total expenses. Fidelity creates "mapped groups" by combining similar Lipper investment objective categories that have comparable investment mandates. Combining Lipper investment objective categories aids the Board's management fee and total expense ratio comparisons by broadening the competitive group used for comparison.
Management Fee. The Board considered two proprietary management fee comparisons for the 12-month periods shown in basis points (BP) in the charts below. The group of Lipper funds used by the Board for management fee comparisons is referred to below as the "Total Mapped Group." The Total Mapped Group comparison focuses on a fund's standing in terms of gross management fees before expense reimbursements or caps relative to the total universe of funds with comparable investment mandates, regardless of whether their management fee structures also are comparable. Funds with comparable investment mandates offer exposure to similar types of securities. Funds with comparable management fee structures have similar management fee contractual arrangements (
e.g., flat rate charged for advisory services, all-inclusive fee rate,
etc.). "TMG %" represents the percentage of funds in the Total Mapped Group that had management fees that were lower than a fund's. For example, a hypothetical TMG % of 20% would mean that 80% of the funds in the Total Mapped Group had higher, and 20% had lower, management fees than a fund. The funds' actual TMG %s and the number of funds in the Total Mapped Group are in the charts below. The "Asset-Size Peer Group" (ASPG) comparison focuses on a fund's standing relative to a subset of non-Fidelity funds within the Total Mapped Group that are similar in size and management fee structure. For example, if a fund is in the first quartile of the ASPG, the fund's management fee ranks in the least expensive or lowest 25% of funds in the ASPG. The ASPG represents at least 15% of the funds in the Total Mapped Group with comparable asset size and management fee structures, subject to a minimum of 50 funds (or all funds in the Total Mapped Group if fewer than 50). Additional information, such as the ASPG quartile in which a fund's management fee rate ranked, is also included in the charts and considered by the Board.
Income Replacement 2016 Fund
Income Replacement 2018 Fund
Income Replacement 2020 Fund
Income Replacement 2022 Fund
Income Replacement 2024 Fund
Income Replacement 2026 Fund
Income Replacement 2028 Fund
Income Replacement 2030 Fund
Income Replacement 2032 Fund
Income Replacement 2034 Fund
Income Replacement 2036 Fund
Income Replacement 2038 Fund
Income Replacement 2040 Fund
Income Replacement 2042 Fund
The Board noted that each fund's management fee rate of 0.00% ranked below the median of its Total Mapped Group and below the median of its ASPG for 2015. The Board further noted that many peer funds pay fund-level expenses, including management fees, to which the funds are not subject. The Board noted that, beginning with the 2014 competitive results, the comparisons reflect a revised Total Mapped Group that includes only non-target date funds-of-funds that invest in affiliated funds.
The Board noted that, in 2014, the ad hoc Committee on Group Fee was formed by it and the boards of other Fidelity funds to conduct an in-depth review of the "group fee" component of the management fee of funds with such management fee structures, and that while the funds do not pay a management fee, they indirectly bear a portion of the management fees paid by the Fidelity funds in which they invest, some of which are subject to the group fee. The Committee's focus included the mechanics of the group fee, the competitive landscape of group fee structures, Fidelity funds with no group fee component (such as the funds) and investment products not included in group fee assets. The Board also considered that, for funds subject to the group fee, FMR agreed to voluntarily waive fees over a specified period of time in amounts designed to account for assets converted from certain funds to certain collective investment trusts.
Based on its review, the Board concluded that each fund's management fee is fair and reasonable in light of the services that the fund receives and the other factors considered.
Total Expense Ratio. In its review of the total expense ratio of each class of each fund, the Board considered fund-paid 12b-1 fees and noted that each fund invests in a class of shares of the underlying Fidelity fund that does not charge a 12b-1 fee to avoid charging fund-paid 12b-1 fees at both fund levels. The Board considered that the funds do not pay transfer agent fees. Instead, the applicable class of each underlying Fidelity fund bears its pro rata portion of each fund's transfer agent fee according to the percentage of each fund's assets invested in that underlying fund. The Board further noted that FMR pays all other expenses of each fund, with limited exceptions.
The Board noted that the total expense ratio of each of Class A, Class C, Class I, and the retail class of each fund ranked below the competitive median for 2015 and the total expense ratio of Class T of each fund ranked equal to the competitive median for 2015.
In considering the total expense ratio of each class of each fund, the Board also considered an alternative competitive analysis that included both top level (
i.e., direct) fund fees and acquired fund fees and expenses for the class and the other funds and classes to which it is compared. The Board noted that, under this alternative competitive analysis, the total expense ratio of each class of each fund ranked below the competitive median for 2015.
Fees Charged to Other Fidelity Clients. The Board also considered Fidelity fee structures and other information with respect to clients of Fidelity, such as other funds advised or subadvised by Fidelity, pension plan clients, and other institutional clients with similar mandates. The Board noted that an ad hoc joint committee created by it and the boards of other Fidelity funds periodically (most recently in 2013) reviews and compares Fidelity's institutional investment advisory business with its business of providing services to the Fidelity funds, including the differences in services provided, fees charged, and costs incurred, as well as competition in their respective marketplaces.
Based on its review of total expense ratios and fees charged to other Fidelity clients, the Board concluded that the total expense ratio of each class of each fund was reasonable in light of the services that the fund and its shareholders receive and the other factors considered.
Costs of the Services and Profitability. The Board considered the level of Fidelity's profits in respect of all the Fidelity funds, including the Fidelity funds in which the funds invest.
PricewaterhouseCoopers LLP (PwC), independent registered public accounting firm and auditor to Fidelity and certain Fidelity funds, has been engaged annually by the Board as part of the Board's assessment of Fidelity's profitability analysis. PwC's engagement includes the review and assessment of the methodologies used by Fidelity in determining the revenues and expenses attributable to Fidelity's mutual fund business, and completion of agreed-upon procedures in respect of the mathematical accuracy of the fund profitability information and its conformity to established allocation methodologies. After considering PwC's reports issued under the engagement and information provided by Fidelity, the Board concluded that while other allocation methods may also be reasonable, Fidelity's profitability methodologies are reasonable in all material respects.
The Board also reviewed Fidelity's non-fund businesses and fall-out benefits related to the mutual fund business as well as cases where Fidelity's affiliates may benefit from or be related to the funds' business.
The Board concluded that the costs of the services provided by and the profits realized by Fidelity in connection with the operation of each fund were not relevant to the renewal of each fund's Advisory Contract because the funds do not pay management fees and FMR pays all other expenses of each fund, with limited exceptions.
Economies of Scale. The Board concluded that because the funds do not pay management fees and FMR pays all other expenses of each fund, with limited exceptions, economies of scale cannot be realized by the funds, but may be realized by the other Fidelity funds in which each fund invests, many of which may benefit from breakpoints under the group fee arrangement.
Additional Information Requested by the Board. In order to develop fully the factual basis for consideration of the Fidelity funds' advisory contracts, the Board requested and received additional information on certain topics, including: (i) Fidelity's fund profitability methodology, profitability trends for certain funds, and the impact of certain factors on fund profitability results; (ii) portfolio manager changes that have occurred during the past year and the amount of the investment that each portfolio manager has made in the Fidelity fund(s) that he or she manages; (iii) Fidelity's compensation structure for portfolio managers, research analysts, and other key personnel, including its effects on fund profitability, the rationale for the compensation structure, and the extent to which current market conditions have affected retention and recruitment; (iv) the arrangements with and compensation paid to certain fund sub-advisers on behalf of the Fidelity funds; (v) Fidelity's voluntary waiver of its fees to maintain minimum yields for certain money market funds and classes as well as contractual waivers in place for certain funds; (vi) the methodology with respect to competitive fund data and peer group classifications; (vii) Fidelity's transfer agent fee, expense, and service structures for different funds and classes relative to competitive trends, and the impact of the increased use of omnibus accounts; (viii) Fidelity's long-term expectations for its offerings in the workplace investing channel; (ix) new developments in the retail and institutional marketplaces; (x) the approach to considering "fall-out" benefits; and (xi) the impact of money market reform on Fidelity's money market funds, including with respect to costs and profitability. In addition, the Board considered its discussions with Fidelity throughout the year regarding enhanced information security initiatives and the funds' fair valuation policies.
Based on its evaluation of all of the conclusions noted above, and after considering all factors it believed relevant, the Board concluded that the advisory fee structures are fair and reasonable, and that each fund's Advisory Contract should be renewed.
Board Approval of Investment Advisory Contracts and Management Fees
Fidelity Income Replacement 2022 FundFidelity Income Replacement 2024 FundFidelity Income Replacement 2026 FundFidelity Income Replacement 2028 FundFidelity Income Replacement 2030 FundFidelity Income Replacement 2032 FundFidelity Income Replacement 2034 FundFidelity Income Replacement 2036 FundFidelity Income Replacement 2038 FundFidelity Income Replacement 2040 FundFidelity Income Replacement 2042 FundAt its January 2017 meeting, the Board of Trustees, including the Independent Trustees (together, the Board) voted to approve an amended and restated management contract (New Advisory Contract) between FMR Co., Inc. (FMRC) and each fund to add a management fee payable by each fund. The Board considered that each fund's New Advisory Contract will not take effect unless it is approved by the fund's shareholders.
The Board noted that, under each fund's current management contract (Current Advisory Contract), the funds do not pay a management fee to FMRC. Instead, the Board noted that, each fund currently indirectly incurs a portion of the management fee and other expenses of each underlying fund in which each fund invests and that such expenses are currently reflected in each fund's expense ratio as acquired fund fees and expenses. The Board considered that, under each fund's New Advisory Contract, each class or each fund, as applicable, will pay a monthly management fee to FMRC at an annual rate for the class or the fund, as applicable.
The Board considered that the increase in each fund's management fee under the New Advisory Contract will result in the fund's management fee rate ranking above the median of the management fee rates of its competitor funds based on the competitive mapped group data provided to the Board in July 2016 in connection with its consideration of the annual renewal of the Current Advisory Contract. However, the Board considered that the increase in management fees under the New Advisory Contract will be offset by a decrease in each fund's acquired fund fees and expenses as a result of the repositioning of the funds to invest only in a particular subset of the underlying funds (Series Funds) together with fee reductions for the Series Funds under new management contracts, sub-advisory agreements, transfer agent agreements, and pricing and bookkeeping agreements (collectively, the New Series Fund Contracts) that will go into effect if new advisory contracts for certain other Fidelity funds that invest in the Series Funds are approved by shareholders of those other Fidelity funds. The Board noted that, once the New Series Fund Contracts take effect, the Series Funds will no longer pay any operating expenses, except 12b-1 fees, interest and taxes, brokerage commissions, independent trustee expenses, custodian fees, expenses related to proxy solicitations, and extraordinary expenses (such as litigation expenses), and, thus, the funds' acquired fund fees and expenses will be significantly reduced. The Board noted that, as a result, the increased management fee and decreased acquired fund fees and expenses are expected to have the combined effect of reducing the total expenses incurred by shareholders of each fund by at least 0.01%.
After approving the New Advisory Contracts and implementing the New Series Fund Contracts, the total expense ratio of each class of each fund, including acquired fund fees and expenses, is expected to continue to rank below the median, except for Class C and Class T of certain funds which will rank above median, of those funds and classes used by the Board for management fee comparisons that have a similar sales load structure. The Board noted that the total expense ratio of Class T of certain funds will rank above the competitive median primarily because of higher 12b-1 fees on Class T as compared to most competitor funds. Class T has a higher 12b-1 fee, but a lower front-end sales charge, than traditionally priced front-end sales charge classes. The Board considered that Class T is primarily sold load-waived in the retirement plan market where its 0.50% 12b-1 fee is comparable to competing no-load, higher 12b-1 fee classes designed specifically for retirement plans. The Board noted that the total expense ratio of Class C of certain funds will rank above the competitive median primarily because of Class C's 12b-1 fees. The Board also noted that, once the New Series Fund Contracts take effect, the funds' total expense ratios are expected to be more predictable because all the Series Funds will be priced similarly and, thus, the funds' investment decisions will not result in shifting expense levels.
The Board considered that, because the implementation of the New Series Fund Contracts is dependent on approval of new advisory contracts by the shareholders of certain other Fidelity funds, FMRC will adopt an expense contract for each fund. Under each fund's expense contract, the fund will waive its management fee so long as the Series Funds continue to pay management fees.
The Board considered that the approval of the New Advisory Contracts will not result in any changes to (i) the investment process or strategies employed in the management of the funds' assets (although the Board separately approved changes to the funds' investment objectives and strategies); (ii) the nature, extent and quality of services provided to each fund; or (iii) the day-to-day management of each fund and the personnel primarily responsible for such management. The Board noted that, under the Current Advisory Contracts, FMRC or an affiliate undertakes to pay all operating expenses of the funds, except Independent Trustee expenses, interest, taxes, brokerage fees and commissions, redemption fees and other shareholder charges associated with investments in other mutual funds, and extraordinary expenses (such as litigation expenses). The Board considered that the New Advisory Contracts provide that FMRC or an affiliate undertakes to pay all operating expenses of the funds, except 12b-1 fees, Independent Trustee expenses, interest, taxes, brokerage fees and commissions, redemption fees and other shareholder charges associated with investments in other mutual funds, expenses related to proxy solicitations, and extraordinary expenses (such as litigation expenses).
The Board did not consider the costs of the services and profitability to Fidelity or whether there have been economies of scale in respect of the management of the Fidelity funds (including the funds) to be material factors in approving the New Advisory Contracts because the new fee arrangements have not yet been implemented. The Board noted however that it evaluated such information in connection with its consideration of the annual renewal of the Current Advisory Contracts at its September 2016 meeting and that it will consider these factors in connection with future renewals of the New Advisory Contracts, if approved.
Based on its evaluation of all of the conclusions noted above, and after considering all factors it believed relevant, the Board ultimately concluded that the management fee structures under the New Advisory Contracts are fair and reasonable, and that each fund's New Advisory Contract should be approved.
ARW-SANN-0317
1.848195.109
Fidelity Income Replacement Funds℠ 2018, 2020, 2022, 2024, 2026, 2028, 2030, 2032, 2034, 2036, 2038, 2040, 2042
Semi-Annual Report January 31, 2017 |
|
Contents
To view a fund's proxy voting guidelines and proxy voting record for the 12-month period ended June 30, visit http://www.fidelity.com/proxyvotingresults or visit the Securities and Exchange Commission's (SEC) web site at http://www.sec.gov.
You may also call 1-800-544-8544 to request a free copy of the proxy voting guidelines.
Standard & Poor's, S&P and S&P 500 are registered service marks of The McGraw-Hill Companies, Inc. and have been licensed for use by Fidelity Distributors Corporation.
Other third-party marks appearing herein are the property of their respective owners.
All other marks appearing herein are registered or unregistered trademarks or service marks of FMR LLC or an affiliated company. © 2017 FMR LLC. All rights reserved.
This report and the financial statements contained herein are submitted for the general information of the shareholders of the Funds. This report is not authorized for distribution to prospective investors in the Funds unless preceded or accompanied by an effective prospectus.
A fund files its complete schedule of portfolio holdings with the SEC for the first and third quarters of each fiscal year on Form N-Q. Forms N-Q are available on the SEC’s web site at http://www.sec.gov. A fund's Forms N-Q may be reviewed and copied at the SEC’s Public Reference Room in Washington, DC. Information regarding the operation of the SEC's Public Reference Room may be obtained by calling 1-800-SEC-0330.
For a complete list of a fund's portfolio holdings, view the most recent holdings listing, semiannual report, or annual report on Fidelity's web site at http://www.fidelity.com, http://www.institutional.fidelity.com, or http://www.401k.com, as applicable.
NOT FDIC INSURED •MAY LOSE VALUE •NO BANK GUARANTEE
Neither the Funds nor Fidelity Distributors Corporation is a bank.
Fidelity Income Replacement 2018 Fund℠
Investment Summary (Unaudited)
The information in the following tables is based on the direct investments of the Fund.
Top Holdings as of January 31, 2017
| | % of fund's net assets | % of fund's net assets 6 months ago |
| Fidelity Investments Money Market Government Portfolio Institutional Class 0.47% | 62.1 | 53.8 |
| Fidelity Short-Term Bond Fund | 27.5 | 28.1 |
| Fidelity Total Bond Fund | 2.8 | 6.3 |
| Fidelity Series Broad Market Opportunities Fund | 1.3 | 1.8 |
| Fidelity Equity-Income Fund | 1.2 | 1.5 |
| Fidelity Strategic Real Return Fund | 0.9 | 2.1 |
| Fidelity Government Income Fund | 0.9 | 2.1 |
| Fidelity Large Cap Stock Fund | 0.9 | 1.1 |
| Fidelity Advisor Mid Cap II Fund Class I | 0.8 | 1.1 |
| Fidelity Series 100 Index Fund | 0.8 | 1.0 |
| | 99.2 | 98.9 |
Asset Allocation (% of fund's net assets)
| Period end |
| | Domestic Equity Funds | 5.8% |
| | Investment Grade Fixed-Income Funds | 4.6% |
| | Short-Term Funds | 89.6% |
| Six months ago |
| | Domestic Equity Funds | 7.6% |
| | Investment Grade Fixed-Income Funds | 10.5% |
| | Short-Term Funds | 81.9% |
Fidelity Income Replacement 2018 Fund℠
Investments January 31, 2017 (Unaudited)
Showing Percentage of Net Assets
| Equity Funds - 5.8% | | | |
| | | Shares | Value |
| Domestic Equity Funds - 5.8% | | | |
| Fidelity Advisor Mid Cap II Fund Class I (a) | | 2,186 | $43,353 |
| Fidelity Blue Chip Growth Fund (a) | | 568 | 40,141 |
| Fidelity Equity-Income Fund (a) | | 1,075 | 62,085 |
| Fidelity Large Cap Stock Fund (a) | | 1,564 | 46,564 |
| Fidelity Series 100 Index Fund (a) | | 2,723 | 40,141 |
| Fidelity Series Broad Market Opportunities Fund (a) | | 4,394 | 71,184 |
| Fidelity Series Small Cap Opportunities Fund (a) | | 456 | 6,423 |
| TOTAL DOMESTIC EQUITY FUNDS | | | |
| (Cost $218,089) | | | 309,891 |
|
| Fixed-Income Funds - 4.6% | | | |
| Investment Grade Fixed-Income Funds - 4.6% | | | |
| Fidelity Government Income Fund (a) | | 4,837 | 49,240 |
| Fidelity Strategic Real Return Fund (a) | | 5,583 | 49,240 |
| Fidelity Total Bond Fund (a) | | 13,951 | 147,185 |
| TOTAL INVESTMENT GRADE FIXED-INCOME FUNDS | | | |
| (Cost $242,620) | | | 245,665 |
|
| Short-Term Funds - 89.6% | | | |
| Fidelity Investments Money Market Government Portfolio Institutional Class 0.47% (a)(b) | | 3,324,249 | 3,324,249 |
| Fidelity Short-Term Bond Fund (a) | | 171,407 | 1,472,391 |
| TOTAL SHORT-TERM FUNDS | | | |
| (Cost $4,788,570) | | | 4,796,640 |
| TOTAL INVESTMENT PORTFOLIO - 100.0% | | | |
| (Cost $5,249,279) | | | 5,352,196 |
| NET OTHER ASSETS (LIABILITIES) - 0.0% | | | (422) |
| NET ASSETS - 100% | | | $5,351,774 |
Legend
(a) Affiliated Fund
(b) The rate quoted is the annualized seven-day yield of the fund at period end.
Affiliated Underlying Funds
Information regarding the Fund's fiscal year to date purchases and sales of the affiliated Underlying Funds and income earned by the Fund from investments in affiliated Underlying Funds is as follows:
| Affiliate | Value, beginning of period | Purchases | Sales Proceeds | Dividend Income | Value, end of period |
| Fidelity Advisor Mid Cap II Fund Class I | $52,411 | $13,979 | $24,888 | $185 | $43,353 |
| Fidelity Blue Chip Growth Fund | 48,982 | 13,092 | 22,726 | 91 | 40,141 |
| Fidelity Equity-Income Fund | 74,943 | 19,114 | 35,661 | 869 | 62,085 |
| Fidelity Government Income Fund | 102,373 | 17,159 | 66,834 | 571 | 49,240 |
| Fidelity Investments Money Market Government Portfolio Institutional Class 0.47% | 2,633,775 | 1,258,222 | 567,748 | 4,812 | 3,324,249 |
| Fidelity Large Cap Stock Fund | 56,330 | 14,175 | 27,894 | 385 | 46,564 |
| Fidelity Series 100 Index Fund | 48,982 | 12,370 | 22,427 | 849 | 40,141 |
| Fidelity Series Broad Market Opportunities Fund | 86,209 | 20,884 | 40,356 | 319 | 71,184 |
| Fidelity Series Small Cap Opportunities Fund | 7,347 | 1,835 | 3,281 | 32 | 6,423 |
| Fidelity Short-Term Bond Fund | 1,376,889 | 492,627 | 386,455 | 8,073 | 1,472,391 |
| Fidelity Strategic Real Return Fund | 102,373 | 16,904 | 69,834 | 834 | 49,240 |
| Fidelity Total Bond Fund | 307,608 | 51,566 | 206,305 | 3,082 | 147,185 |
| Total | $4,898,222 | $1,931,927 | $1,474,409 | $20,102 | $5,352,196 |
Investment Valuation
All investments are categorized as Level 1 under the Fair Value Hierarchy. The inputs or methodology used for valuing securities may not be an indication of the risk associated with investing in those securities. For more information on valuation inputs please refer to the Investment Valuation section in the accompanying Notes to Financial Statements.
See accompanying notes which are an integral part of the financial statements.
Fidelity Income Replacement 2018 Fund℠
Financial Statements
Statement of Assets and Liabilities
| | | January 31, 2017 (Unaudited) |
| Assets | | |
| Investment in securities, at value (cost $5,249,279) — See accompanying schedule | | $5,352,196 |
| Cash | | 1 |
| Receivable for investments sold | | 143,055 |
| Total assets | | 5,495,252 |
| Liabilities | | |
| Payable for investments purchased | $143,045 | |
| Distribution and service plan fees payable | 433 | |
| Total liabilities | | 143,478 |
| Net Assets | | $5,351,774 |
| Net Assets consist of: | | |
| Paid in capital | | $5,286,350 |
| Undistributed net investment income | | 887 |
| Accumulated undistributed net realized gain (loss) on investments | | (38,380) |
| Net unrealized appreciation (depreciation) on investments | | 102,917 |
| Net Assets | | $5,351,774 |
| Calculation of Maximum Offering Price | | |
| Class A: | | |
| Net Asset Value and redemption price per share ($444,981 ÷ 8,077.88 shares) | | $55.09 |
| Maximum offering price per share (100/94.25 of $55.09) | | $58.45 |
| Class T: | | |
| Net Asset Value and redemption price per share ($212,667 ÷ 3,859.65 shares) | | $55.10 |
| Maximum offering price per share (100/96.50 of $55.10) | | $57.10 |
| Class C: | | |
| Net Asset Value and offering price per share ($293,819 ÷ 5,369.37 shares)(a) | | $54.72 |
| Income Replacement 2018: | | |
| Net Asset Value, offering price and redemption price per share ($4,207,243 ÷ 76,357.25 shares) | | $55.10 |
| Class I: | | |
| Net Asset Value, offering price and redemption price per share ($193,064 ÷ 3,503.56 shares) | | $55.11 |
(a) Redemption price per share is equal to net asset value less any applicable contingent deferred sales charge.
See accompanying notes which are an integral part of the financial statements.
Statement of Operations
| | | Six months ended January 31, 2017 (Unaudited) |
| Investment Income | | |
| Income distributions from underlying funds | | $20,102 |
| Expenses | | |
| Distribution and service plan fees | $2,712 | |
| Independent trustees' fees and expenses | 12 | |
| Total expenses before reductions | 2,724 | |
| Expense reductions | (12) | 2,712 |
| Net investment income (loss) | | 17,390 |
| Realized and Unrealized Gain (Loss) | | |
| Realized gain (loss) on sale of underlying fund shares | 37,439 | |
| Capital gain distributions from underlying funds | 5,077 | |
| Total net realized gain (loss) | | 42,516 |
| Change in net unrealized appreciation (depreciation) on underlying funds | | (40,985) |
| Net gain (loss) | | 1,531 |
| Net increase (decrease) in net assets resulting from operations | | $18,921 |
See accompanying notes which are an integral part of the financial statements.
Statement of Changes in Net Assets
| | Six months ended January 31, 2017 (Unaudited) | Year ended July 31, 2016 |
| Increase (Decrease) in Net Assets | | |
| Operations | | |
| Net investment income (loss) | $17,390 | $45,857 |
| Net realized gain (loss) | 42,516 | 117,792 |
| Change in net unrealized appreciation (depreciation) | (40,985) | (103,534) |
| Net increase (decrease) in net assets resulting from operations | 18,921 | 60,115 |
| Distributions to shareholders from net investment income | (17,293) | (46,006) |
| Distributions to shareholders from net realized gain | – | (2,469) |
| Total distributions | (17,293) | (48,475) |
| Share transactions - net increase (decrease) | 452,418 | (1,174,262) |
| Total increase (decrease) in net assets | 454,046 | (1,162,622) |
| Net Assets | | |
| Beginning of period | 4,897,728 | 6,060,350 |
| End of period | $5,351,774 | $4,897,728 |
| Other Information | | |
| Undistributed net investment income end of period | $887 | $790 |
See accompanying notes which are an integral part of the financial statements.
Financial Highlights — Fidelity Income Replacement 2018 Fund Class A
| | Six months ended (Unaudited) January 31, | Years ended July 31, | | | | |
| | 2017 | 2016 | 2015 | 2014 | 2013 | 2012 |
| Selected Per–Share Data | | | | | | |
| Net asset value, beginning of period | $55.07 | $54.99 | $54.46 | $52.45 | $50.59 | $49.87 |
| Income from Investment Operations | | | | | | |
| Net investment income (loss)A | .162 | .374 | .437 | .588 | .719 | .774 |
| Net realized and unrealized gain (loss) | .008 | .101 | .583 | 2.080 | 2.135 | .909 |
| Total from investment operations | .170 | .475 | 1.020 | 2.668 | 2.854 | 1.683 |
| Distributions from net investment income | (.150) | (.371) | (.432) | (.579) | (.705) | (.765) |
| Distributions from net realized gain | – | (.024) | (.058) | (.079) | (.289) | (.198) |
| Total distributions | (.150) | (.395) | (.490) | (.658) | (.994) | (.963) |
| Net asset value, end of period | $55.09 | $55.07 | $54.99 | $54.46 | $52.45 | $50.59 |
| Total ReturnB,C,D | .31% | .87% | 1.88% | 5.11% | 5.70% | 3.45% |
| Ratios to Average Net AssetsE,F | | | | | | |
| Expenses before reductions | .25%G | .25% | .25% | .25% | .25% | .25% |
| Expenses net of fee waivers, if any | .25%G | .25% | .25% | .25% | .25% | .25% |
| Expenses net of all reductions | .25%G | .25% | .25% | .25% | .25% | .25% |
| Net investment income (loss) | .59%G | .69% | .79% | 1.10% | 1.39% | 1.57% |
| Supplemental Data | | | | | | |
| Net assets, end of period (000 omitted) | $445 | $483 | $567 | $868 | $774 | $762 |
| Portfolio turnover rate E | 61%G | 105% | 56% | 56% | 41% | 44% |
A Calculated based on average shares outstanding during the period.
B Total returns for periods of less than one year are not annualized.
C Total returns would have been lower if certain expenses had not been reduced during the applicable periods shown.
D Total returns do not include the effect of the sales charges.
E Amounts do not include the activity of the Underlying Funds.
F Expense ratios reflect operating expenses of the class. Expenses before reductions do not reflect amounts reimbursed by the investment adviser or reductions from expense offset arrangements and do not represent the amount paid by the class during periods when reimbursements or reductions occur. Expenses net of fee waivers reflect expenses after reimbursement by the investment adviser but prior to reductions from expense offset arrangements. Expenses net of all reductions represent the net expenses paid by the class but do not include expenses of the underlying funds in which the Fund invests.
G Annualized
See accompanying notes which are an integral part of the financial statements.
Financial Highlights — Fidelity Income Replacement 2018 Fund Class T
| | Six months ended (Unaudited) January 31, | Years ended July 31, | | | | |
| | 2017 | 2016 | 2015 | 2014 | 2013 | 2012 |
| Selected Per–Share Data | | | | | | |
| Net asset value, beginning of period | $55.08 | $55.00 | $54.48 | $52.48 | $50.62 | $49.90 |
| Income from Investment Operations | | | | | | |
| Net investment income (loss)A | .093 | .238 | .299 | .454 | .589 | .651 |
| Net realized and unrealized gain (loss) | .008 | .101 | .573 | 2.085 | 2.133 | .909 |
| Total from investment operations | .101 | .339 | .872 | 2.539 | 2.722 | 1.560 |
| Distributions from net investment income | (.081) | (.235) | (.294) | (.460) | (.573) | (.642) |
| Distributions from net realized gain | – | (.024) | (.058) | (.079) | (.289) | (.198) |
| Total distributions | (.081) | (.259) | (.352) | (.539) | (.862) | (.840) |
| Net asset value, end of period | $55.10 | $55.08 | $55.00 | $54.48 | $52.48 | $50.62 |
| Total ReturnB,C,D | .17% | .64% | 1.60% | 4.86% | 5.43% | 3.19% |
| Ratios to Average Net AssetsE,F | | | | | | |
| Expenses before reductions | .50%G | .50% | .50% | .50% | .50% | .50% |
| Expenses net of fee waivers, if any | .50%G | .50% | .50% | .50% | .50% | .50% |
| Expenses net of all reductions | .50%G | .50% | .50% | .50% | .50% | .50% |
| Net investment income (loss) | .34%G | .44% | .54% | .85% | 1.14% | 1.32% |
| Supplemental Data | | | | | | |
| Net assets, end of period (000 omitted) | $213 | $257 | $357 | $444 | $101 | $128 |
| Portfolio turnover rate E | 61%G | 105% | 56% | 56% | 41% | 44% |
A Calculated based on average shares outstanding during the period.
B Total returns for periods of less than one year are not annualized.
C Total returns would have been lower if certain expenses had not been reduced during the applicable periods shown.
D Total returns do not include the effect of the sales charges.
E Amounts do not include the activity of the Underlying Funds.
F Expense ratios reflect operating expenses of the class. Expenses before reductions do not reflect amounts reimbursed by the investment adviser or reductions from expense offset arrangements and do not represent the amount paid by the class during periods when reimbursements or reductions occur. Expenses net of fee waivers reflect expenses after reimbursement by the investment adviser but prior to reductions from expense offset arrangements. Expenses net of all reductions represent the net expenses paid by the class but do not include expenses of the underlying funds in which the Fund invests.
G Annualized
See accompanying notes which are an integral part of the financial statements.
Financial Highlights — Fidelity Income Replacement 2018 Fund Class C
| | Six months ended (Unaudited) January 31, | Years ended July 31, | | | | |
| | 2017 | 2016 | 2015 | 2014 | 2013 | 2012 |
| Selected Per–Share Data | | | | | | |
| Net asset value, beginning of period | $54.78 | $54.80 | $54.36 | $52.38 | $50.56 | $49.85 |
| Income from Investment Operations | | | | | | |
| Net investment income (loss)A | (.044) | (.035) | .024 | .187 | .330 | .403 |
| Net realized and unrealized gain (loss) | (.002)B | .111 | .574 | 2.073 | 2.129 | .912 |
| Total from investment operations | (.046) | .076 | .598 | 2.260 | 2.459 | 1.315 |
| Distributions from net investment income | (.014) | (.072) | (.100) | (.201) | (.350) | (.407) |
| Distributions from net realized gain | – | (.024) | (.058) | (.079) | (.289) | (.198) |
| Total distributions | (.014) | (.096) | (.158) | (.280) | (.639) | (.605) |
| Net asset value, end of period | $54.72 | $54.78 | $54.80 | $54.36 | $52.38 | $50.56 |
| Total ReturnC,D,E | (.08)% | .14% | 1.10% | 4.32% | 4.90% | 2.68% |
| Ratios to Average Net AssetsF,G | | | | | | |
| Expenses before reductions | 1.00%H | 1.00% | 1.00% | 1.00% | 1.00% | 1.00% |
| Expenses net of fee waivers, if any | 1.00%H | 1.00% | 1.00% | 1.00% | 1.00% | 1.00% |
| Expenses net of all reductions | 1.00%H | 1.00% | 1.00% | 1.00% | 1.00% | 1.00% |
| Net investment income (loss) | (.16)%H | (.06)% | .04% | .35% | .64% | .82% |
| Supplemental Data | | | | | | |
| Net assets, end of period (000 omitted) | $294 | $321 | $579 | $787 | $498 | $439 |
| Portfolio turnover rate F | 61%H | 105% | 56% | 56% | 41% | 44% |
A Calculated based on average shares outstanding during the period.
B The amount shown for a share outstanding does not correspond with the aggregate net gain (loss) on investments for the period due to the timing of sales and repurchases of shares in relation to fluctuating marker values of the investments of the Fund.
C Total returns for periods of less than one year are not annualized.
D Total returns would have been lower if certain expenses had not been reduced during the applicable periods shown.
E Total returns do not include the effect of the contingent deferred sales charge.
F Amounts do not include the activity of the Underlying Funds.
G Expense ratios reflect operating expenses of the class. Expenses before reductions do not reflect amounts reimbursed by the investment adviser or reductions from expense offset arrangements and do not represent the amount paid by the class during periods when reimbursements or reductions occur. Expenses net of fee waivers reflect expenses after reimbursement by the investment adviser but prior to reductions from expense offset arrangements. Expenses net of all reductions represent the net expenses paid by the class but do not include expenses of the underlying funds in which the Fund invests.
H Annualized
See accompanying notes which are an integral part of the financial statements.
Financial Highlights — Fidelity Income Replacement 2018 Fund
| | Six months ended (Unaudited) January 31, | Years ended July 31, | | | | |
| | 2017 | 2016 | 2015 | 2014 | 2013 | 2012 |
| Selected Per–Share Data | | | | | | |
| Net asset value, beginning of period | $55.08 | $55.00 | $54.47 | $52.46 | $50.60 | $49.88 |
| Income from Investment Operations | | | | | | |
| Net investment income (loss)A | .230 | .510 | .574 | .722 | .848 | .898 |
| Net realized and unrealized gain (loss) | .008 | .101 | .582 | 2.081 | 2.135 | .908 |
| Total from investment operations | .238 | .611 | 1.156 | 2.803 | 2.983 | 1.806 |
| Distributions from net investment income | (.218) | (.507) | (.568) | (.714) | (.834) | (.888) |
| Distributions from net realized gain | – | (.024) | (.058) | (.079) | (.289) | (.198) |
| Total distributions | (.218) | (.531) | (.626) | (.793) | (1.123) | (1.086) |
| Net asset value, end of period | $55.10 | $55.08 | $55.00 | $54.47 | $52.46 | $50.60 |
| Total ReturnB,C | .43% | 1.13% | 2.13% | 5.38% | 5.96% | 3.71% |
| Ratios to Average Net AssetsD,E | | | | | | |
| Expenses before reductions F | - %G | -% | -% | -% | -% | -% |
| Expenses net of fee waivers, if any | - %G | -% | -% | -% | -% | -% |
| Expenses net of all reductions | - %G | -% | -% | -% | -% | -% |
| Net investment income (loss) | .84%G | .94% | 1.04% | 1.35% | 1.64% | 1.82% |
| Supplemental Data | | | | | | |
| Net assets, end of period (000 omitted) | $4,207 | $3,609 | $4,263 | $4,665 | $3,875 | $3,904 |
| Portfolio turnover rate D | 61%G | 105% | 56% | 56% | 41% | 44% |
A Calculated based on average shares outstanding during the period.
B Total returns for periods of less than one year are not annualized.
C Total returns would have been lower if certain expenses had not been reduced during the applicable periods shown.
D Amounts do not include the activity of the Underlying Funds.
E Expense ratios reflect operating expenses of the class. Expenses before reductions do not reflect amounts reimbursed by the investment adviser or reductions from expense offset arrangements and do not represent the amount paid by the class during periods when reimbursements or reductions occur. Expenses net of fee waivers reflect expenses after reimbursement by the investment adviser but prior to reductions from expense offset arrangements. Expenses net of all reductions represent the net expenses paid by the class but do not include expenses of the underlying funds in which the Fund invests.
F Amount represents less than .005%.
G Annualized
See accompanying notes which are an integral part of the financial statements.
Financial Highlights — Fidelity Income Replacement 2018 Fund Class I
| | Six months ended (Unaudited) January 31, | Years ended July 31, | | | | |
| | 2017 | 2016 | 2015 | 2014 | 2013 | 2012 |
| Selected Per–Share Data | | | | | | |
| Net asset value, beginning of period | $55.09 | $55.00 | $54.48 | $52.46 | $50.61 | $49.89 |
| Income from Investment Operations | | | | | | |
| Net investment income (loss)A | .231 | .510 | .575 | .722 | .849 | .891 |
| Net realized and unrealized gain (loss) | .007 | .111 | .571 | 2.091 | 2.124 | .915 |
| Total from investment operations | .238 | .621 | 1.146 | 2.813 | 2.973 | 1.806 |
| Distributions from net investment income | (.218) | (.507) | (.568) | (.714) | (.834) | (.888) |
| Distributions from net realized gain | – | (.024) | (.058) | (.079) | (.289) | (.198) |
| Total distributions | (.218) | (.531) | (.626) | (.793) | (1.123) | (1.086) |
| Net asset value, end of period | $55.11 | $55.09 | $55.00 | $54.48 | $52.46 | $50.61 |
| Total ReturnB,C | .43% | 1.14% | 2.11% | 5.40% | 5.94% | 3.71% |
| Ratios to Average Net AssetsD,E | | | | | | |
| Expenses before reductions F | - %G | -% | -% | -% | -% | -% |
| Expenses net of fee waivers, if any | - %G | -% | -% | -% | -% | -% |
| Expenses net of all reductions | - %G | -% | -% | -% | -% | -% |
| Net investment income (loss) | .84%G | .94% | 1.04% | 1.35% | 1.64% | 1.82% |
| Supplemental Data | | | | | | |
| Net assets, end of period (000 omitted) | $193 | $227 | $295 | $434 | $491 | $470 |
| Portfolio turnover rate D | 61%G | 105% | 56% | 56% | 41% | 44% |
A Calculated based on average shares outstanding during the period.
B Total returns for periods of less than one year are not annualized.
C Total returns would have been lower if certain expenses had not been reduced during the applicable periods shown.
D Amounts do not include the activity of the Underlying Funds.
E Expense ratios reflect operating expenses of the class. Expenses before reductions do not reflect amounts reimbursed by the investment adviser or reductions from expense offset arrangements and do not represent the amount paid by the class during periods when reimbursements or reductions occur. Expenses net of fee waivers reflect expenses after reimbursement by the investment adviser but prior to reductions from expense offset arrangements. Expenses net of all reductions represent the net expenses paid by the class but do not include expenses of the underlying funds in which the Fund invests.
F Amount represents less than .005%.
G Annualized
See accompanying notes which are an integral part of the financial statements.
Fidelity Income Replacement 2020 Fund℠
Investment Summary (Unaudited)
The information in the following tables is based on the direct investments of the Fund.
Top Holdings as of January 31, 2017
| | % of fund's net assets | % of fund's net assets 6 months ago |
| Fidelity Investments Money Market Government Portfolio Institutional Class 0.47% | 34.0 | 28.1 |
| Fidelity Short-Term Bond Fund | 22.7 | 20.8 |
| Fidelity Total Bond Fund | 17.3 | 20.5 |
| Fidelity Strategic Real Return Fund | 5.8 | 6.8 |
| Fidelity Government Income Fund | 5.8 | 6.8 |
| Fidelity Series Broad Market Opportunities Fund | 3.3 | 3.9 |
| Fidelity Equity-Income Fund | 2.9 | 3.4 |
| Fidelity Large Cap Stock Fund | 2.1 | 2.6 |
| Fidelity Advisor Mid Cap II Fund Class I | 2.0 | 2.4 |
| Fidelity Series 100 Index Fund | 1.9 | 2.2 |
| | 97.8 | 97.5 |
Asset Allocation (% of fund's net assets)
| Period end |
| | Domestic Equity Funds | 14.4% |
| | Investment Grade Fixed-Income Funds | 28.9% |
| | Short-Term Funds | 56.7% |
| Six months ago |
| | Domestic Equity Funds | 17.0% |
| | Investment Grade Fixed-Income Funds | 34.1% |
| | Short-Term Funds | 48.9% |
Fidelity Income Replacement 2020 Fund℠
Investments January 31, 2017 (Unaudited)
Showing Percentage of Net Assets
| Equity Funds - 14.4% | | | |
| | | Shares | Value |
| Domestic Equity Funds - 14.4% | | | |
| Fidelity Advisor Mid Cap II Fund Class I (a) | | 10,280 | $203,853 |
| Fidelity Blue Chip Growth Fund (a) | | 2,672 | 188,715 |
| Fidelity Equity-Income Fund (a) | | 5,032 | 290,641 |
| Fidelity Large Cap Stock Fund (a) | | 7,320 | 217,981 |
| Fidelity Series 100 Index Fund (a) | | 12,803 | 188,715 |
| Fidelity Series Broad Market Opportunities Fund (a) | | 20,619 | 334,036 |
| Fidelity Series Small Cap Opportunities Fund (a) | | 2,077 | 29,266 |
| TOTAL DOMESTIC EQUITY FUNDS | | | |
| (Cost $891,710) | | | 1,453,207 |
|
| Fixed-Income Funds - 28.9% | | | |
| Investment Grade Fixed-Income Funds - 28.9% | | | |
| Fidelity Government Income Fund (a) | | 57,299 | 583,300 |
| Fidelity Strategic Real Return Fund (a) | | 66,134 | 583,301 |
| Fidelity Total Bond Fund (a) | | 165,867 | 1,749,901 |
| TOTAL INVESTMENT GRADE FIXED-INCOME FUNDS | | | |
| (Cost $2,915,610) | | | 2,916,502 |
|
| Short-Term Funds - 56.7% | | | |
| Fidelity Investments Money Market Government Portfolio Institutional Class 0.47% (a)(b) | | 3,434,209 | 3,434,209 |
| Fidelity Short-Term Bond Fund (a) | | 266,332 | 2,287,788 |
| TOTAL SHORT-TERM FUNDS | | | |
| (Cost $5,709,164) | | | 5,721,997 |
| TOTAL INVESTMENT PORTFOLIO - 100.0% | | | |
| (Cost $9,516,484) | | | 10,091,706 |
| NET OTHER ASSETS (LIABILITIES) - 0.0% | | | (925) |
| NET ASSETS - 100% | | | $10,090,781 |
Legend
(a) Affiliated Fund
(b) The rate quoted is the annualized seven-day yield of the fund at period end.
Affiliated Underlying Funds
Information regarding the Fund's fiscal year to date purchases and sales of the affiliated Underlying Funds and income earned by the Fund from investments in affiliated Underlying Funds is as follows:
| Affiliate | Value, beginning of period | Purchases | Sales Proceeds | Dividend Income | Value, end of period |
| Fidelity Advisor Mid Cap II Fund Class I | $233,659 | $33,235 | $72,447 | $951 | $203,853 |
| Fidelity Blue Chip Growth Fund | 216,969 | 31,053 | 62,913 | 435 | 188,715 |
| Fidelity Equity-Income Fund | 332,817 | 42,529 | 103,488 | 4,349 | 290,641 |
| Fidelity Government Income Fund | 670,542 | 85,110 | 141,362 | 5,068 | 583,300 |
| Fidelity Investments Money Market Government Portfolio Institutional Class 0.47% | 2,759,731 | 966,551 | 292,072 | 5,346 | 3,434,209 |
| Fidelity Large Cap Stock Fund | 250,349 | 31,474 | 83,660 | 1,974 | 217,981 |
| Fidelity Series 100 Index Fund | 216,969 | 27,737 | 62,288 | 4,426 | 188,715 |
| Fidelity Series Broad Market Opportunities Fund | 382,887 | 43,566 | 114,304 | 1,634 | 334,036 |
| Fidelity Series Small Cap Opportunities Fund | 33,380 | 3,924 | 10,771 | 153 | 29,266 |
| Fidelity Short-Term Bond Fund | 2,039,119 | 472,607 | 206,734 | 12,468 | 2,287,788 |
| Fidelity Strategic Real Return Fund | 670,543 | 81,666 | 168,879 | 8,344 | 583,301 |
| Fidelity Total Bond Fund | 2,010,644 | 248,957 | 457,709 | 27,646 | 1,749,901 |
| Total | $9,817,609 | $2,068,409 | $1,776,627 | $72,794 | $10,091,706 |
Investment Valuation
All investments are categorized as Level 1 under the Fair Value Hierarchy. The inputs or methodology used for valuing securities may not be an indication of the risk associated with investing in those securities. For more information on valuation inputs please refer to the Investment Valuation section in the accompanying Notes to Financial Statements.
See accompanying notes which are an integral part of the financial statements.
Fidelity Income Replacement 2020 Fund℠
Financial Statements
Statement of Assets and Liabilities
| | | January 31, 2017 (Unaudited) |
| Assets | | |
| Investment in securities, at value (cost $9,516,484) — See accompanying schedule | | $10,091,706 |
| Cash | | 6 |
| Receivable for investments sold | | 169,059 |
| Total assets | | 10,260,771 |
| Liabilities | | |
| Payable for investments purchased | $169,056 | |
| Distribution and service plan fees payable | 934 | |
| Total liabilities | | 169,990 |
| Net Assets | | $10,090,781 |
| Net Assets consist of: | | |
| Paid in capital | | $9,499,991 |
| Undistributed net investment income | | 2,198 |
| Accumulated undistributed net realized gain (loss) on investments | | 13,370 |
| Net unrealized appreciation (depreciation) on investments | | 575,222 |
| Net Assets | | $10,090,781 |
| Calculation of Maximum Offering Price | | |
| Class A: | | |
| Net Asset Value and redemption price per share ($1,088,885 ÷ 19,824.30 shares) | | $54.93 |
| Maximum offering price per share (100/94.25 of $54.93) | | $58.28 |
| Class T: | | |
| Net Asset Value and redemption price per share ($187,499 ÷ 3,412.90 shares) | | $54.94 |
| Maximum offering price per share (100/96.50 of $54.94) | | $56.93 |
| Class C: | | |
| Net Asset Value and offering price per share ($752,023 ÷ 13,728.20 shares)(a) | | $54.78 |
| Income Replacement 2020: | | |
| Net Asset Value, offering price and redemption price per share ($7,997,220 ÷ 145,592.80 shares) | | $54.93 |
| Class I: | | |
| Net Asset Value, offering price and redemption price per share ($65,154 ÷ 1,186.10 shares) | | $54.93 |
(a) Redemption price per share is equal to net asset value less any applicable contingent deferred sales charge.
See accompanying notes which are an integral part of the financial statements.
Statement of Operations
| | | Six months ended January 31, 2017 (Unaudited) |
| Investment Income | | |
| Income distributions from underlying funds | | $72,794 |
| Expenses | | |
| Distribution and service plan fees | $5,783 | |
| Independent trustees' fees and expenses | 22 | |
| Total expenses before reductions | 5,805 | |
| Expense reductions | (22) | 5,783 |
| Net investment income (loss) | | 67,011 |
| Realized and Unrealized Gain (Loss) | | |
| Realized gain (loss) on sale of underlying fund shares | 64,598 | |
| Capital gain distributions from underlying funds | 30,830 | |
| Total net realized gain (loss) | | 95,428 |
| Change in net unrealized appreciation (depreciation) on underlying funds | | (82,288) |
| Net gain (loss) | | 13,140 |
| Net increase (decrease) in net assets resulting from operations | | $80,151 |
See accompanying notes which are an integral part of the financial statements.
Statement of Changes in Net Assets
| | Six months ended January 31, 2017 (Unaudited) | Year ended July 31, 2016 |
| Increase (Decrease) in Net Assets | | |
| Operations | | |
| Net investment income (loss) | $67,011 | $117,846 |
| Net realized gain (loss) | 95,428 | 123,507 |
| Change in net unrealized appreciation (depreciation) | (82,288) | (47,102) |
| Net increase (decrease) in net assets resulting from operations | 80,151 | 194,251 |
| Distributions to shareholders from net investment income | (66,946) | (117,535) |
| Distributions to shareholders from net realized gain | (84,587) | (191,220) |
| Total distributions | (151,533) | (308,755) |
| Share transactions - net increase (decrease) | 345,567 | 1,124,392 |
| Total increase (decrease) in net assets | 274,185 | 1,009,888 |
| Net Assets | | |
| Beginning of period | 9,816,596 | 8,806,708 |
| End of period | $10,090,781 | $9,816,596 |
| Other Information | | |
| Undistributed net investment income end of period | $2,198 | $2,133 |
See accompanying notes which are an integral part of the financial statements.
Financial Highlights — Fidelity Income Replacement 2020 Fund Class A
| | Six months ended (Unaudited) January 31, | Years ended July 31, | | | | |
| | 2017 | 2016 | 2015 | 2014 | 2013 | 2012 |
| Selected Per–Share Data | | | | | | |
| Net asset value, beginning of period | $55.33 | $56.15 | $55.94 | $53.59 | $50.69 | $49.99 |
| Income from Investment Operations | | | | | | |
| Net investment income (loss)A | .336 | .662 | .653 | .674 | .770 | .793 |
| Net realized and unrealized gain (loss) | .063 | .370 | .871 | 2.766 | 3.157 | .884 |
| Total from investment operations | .399 | 1.032 | 1.524 | 3.440 | 3.927 | 1.677 |
| Distributions from net investment income | (.328) | (.654) | (.650) | (.670) | (.774) | (.794) |
| Distributions from net realized gain | (.471) | (1.198) | (.664) | (.420) | (.253) | (.183) |
| Total distributions | (.799) | (1.852) | (1.314) | (1.090) | (1.027) | (.977) |
| Net asset value, end of period | $54.93 | $55.33 | $56.15 | $55.94 | $53.59 | $50.69 |
| Total ReturnB,C,D | .73% | 1.96% | 2.76% | 6.48% | 7.84% | 3.44% |
| Ratios to Average Net AssetsE,F | | | | | | |
| Expenses before reductions | .25%G | .25% | .25% | .25% | .25% | .25% |
| Expenses net of fee waivers, if any | .25%G | .25% | .25% | .25% | .25% | .25% |
| Expenses net of all reductions | .25%G | .25% | .25% | .25% | .25% | .25% |
| Net investment income (loss) | 1.22%G | 1.22% | 1.17% | 1.23% | 1.47% | 1.61% |
| Supplemental Data | | | | | | |
| Net assets, end of period (000 omitted) | $1,089 | $1,187 | $1,099 | $813 | $411 | $408 |
| Portfolio turnover rateE | 36%G | 66% | 41% | 25% | 44% | 35% |
A Calculated based on average shares outstanding during the period.
B Total returns for periods of less than one year are not annualized.
C Total returns would have been lower if certain expenses had not been reduced during the applicable periods shown.
D Total returns do not include the effect of the sales charges.
E Amounts do not include the activity of the Underlying Funds.
F Expense ratios reflect operating expenses of the class. Expenses before reductions do not reflect amounts reimbursed by the investment adviser or reductions from expense offset arrangements and do not represent the amount paid by the class during periods when reimbursements or reductions occur. Expenses net of fee waivers reflect expenses after reimbursement by the investment adviser but prior to reductions from expense offset arrangements. Expenses net of all reductions represent the net expenses paid by the class but do not include expenses of the underlying funds in which the Fund invests.
G Annualized
See accompanying notes which are an integral part of the financial statements.
Financial Highlights — Fidelity Income Replacement 2020 Fund Class T
| | Six months ended (Unaudited) January 31, | Years ended July 31, | | | | |
| | 2017 | 2016 | 2015 | 2014 | 2013 | 2012 |
| Selected Per–Share Data | | | | | | |
| Net asset value, beginning of period | $55.34 | $56.16 | $55.95 | $53.59 | $50.69 | $49.99 |
| Income from Investment Operations | | | | | | |
| Net investment income (loss)A | .267 | .527 | .512 | .537 | .639 | .670 |
| Net realized and unrealized gain (loss) | .062 | .370 | .871 | 2.770 | 3.145 | .885 |
| Total from investment operations | .329 | .897 | 1.383 | 3.307 | 3.784 | 1.555 |
| Distributions from net investment income | (.258) | (.519) | (.509) | (.527) | (.631) | (.672) |
| Distributions from net realized gain | (.471) | (1.198) | (.664) | (.420) | (.253) | (.183) |
| Total distributions | (.729) | (1.717) | (1.173) | (.947) | (.884) | (.855) |
| Net asset value, end of period | $54.94 | $55.34 | $56.16 | $55.95 | $53.59 | $50.69 |
| Total ReturnB,C,D | .60% | 1.71% | 2.50% | 6.22% | 7.54% | 3.18% |
| Ratios to Average Net AssetsE,F | | | | | | |
| Expenses before reductions | .50%G | .50% | .50% | .50% | .50% | .50% |
| Expenses net of fee waivers, if any | .50%G | .50% | .50% | .50% | .50% | .50% |
| Expenses net of all reductions | .50%G | .50% | .50% | .50% | .50% | .50% |
| Net investment income (loss) | .97%G | .97% | .92% | .98% | 1.22% | 1.36% |
| Supplemental Data | | | | | | |
| Net assets, end of period (000 omitted) | $187 | $192 | $204 | $94 | $101 | $189 |
| Portfolio turnover rateE | 36%G | 66% | 41% | 25% | 44% | 35% |
A Calculated based on average shares outstanding during the period.
B Total returns for periods of less than one year are not annualized.
C Total returns would have been lower if certain expenses had not been reduced during the applicable periods shown.
D Total returns do not include the effect of the sales charges.
E Amounts do not include the activity of the Underlying Funds.
F Expense ratios reflect operating expenses of the class. Expenses before reductions do not reflect amounts reimbursed by the investment adviser or reductions from expense offset arrangements and do not represent the amount paid by the class during periods when reimbursements or reductions occur. Expenses net of fee waivers reflect expenses after reimbursement by the investment adviser but prior to reductions from expense offset arrangements. Expenses net of all reductions represent the net expenses paid by the class but do not include expenses of the underlying funds in which the Fund invests.
G Annualized
See accompanying notes which are an integral part of the financial statements.
Financial Highlights — Fidelity Income Replacement 2020 Fund Class C
| | Six months ended (Unaudited) January 31, | Years ended July 31, | | | | |
| | 2017 | 2016 | 2015 | 2014 | 2013 | 2012 |
| Selected Per–Share Data | | | | | | |
| Net asset value, beginning of period | $55.20 | $56.02 | $55.84 | $53.51 | $50.65 | $49.97 |
| Income from Investment Operations | | | | | | |
| Net investment income (loss)A | .129 | .255 | .233 | .262 | .377 | .422 |
| Net realized and unrealized gain (loss) | .055 | .378 | .862 | 2.759 | 3.151 | .876 |
| Total from investment operations | .184 | .633 | 1.095 | 3.021 | 3.528 | 1.298 |
| Distributions from net investment income | (.133) | (.255) | (.251) | (.271) | (.415) | (.435) |
| Distributions from net realized gain | (.471) | (1.198) | (.664) | (.420) | (.253) | (.183) |
| Total distributions | (.604) | (1.453) | (.915) | (.691) | (.668) | (.618) |
| Net asset value, end of period | $54.78 | $55.20 | $56.02 | $55.84 | $53.51 | $50.65 |
| Total ReturnB,C,D | .34% | 1.21% | 1.98% | 5.68% | 7.02% | 2.65% |
| Ratios to Average Net AssetsE,F | | | | | | |
| Expenses before reductions | 1.00%G | 1.00% | 1.00% | 1.00% | 1.00% | 1.00% |
| Expenses net of fee waivers, if any | 1.00%G | 1.00% | 1.00% | 1.00% | 1.00% | 1.00% |
| Expenses net of all reductions | 1.00%G | 1.00% | 1.00% | 1.00% | 1.00% | 1.00% |
| Net investment income (loss) | .47%G | .47% | .42% | .48% | .72% | .86% |
| Supplemental Data | | | | | | |
| Net assets, end of period (000 omitted) | $752 | $832 | $810 | $563 | $322 | $306 |
| Portfolio turnover rateE | 36%G | 66% | 41% | 25% | 44% | 35% |
A Calculated based on average shares outstanding during the period.
B Total returns for periods of less than one year are not annualized.
C Total returns would have been lower if certain expenses had not been reduced during the applicable periods shown.
D Total returns do not include the effect of the contingent deferred sales charge.
E Amounts do not include the activity of the Underlying Funds.
F Expense ratios reflect operating expenses of the class. Expenses before reductions do not reflect amounts reimbursed by the investment adviser or reductions from expense offset arrangements and do not represent the amount paid by the class during periods when reimbursements or reductions occur. Expenses net of fee waivers reflect expenses after reimbursement by the investment adviser but prior to reductions from expense offset arrangements. Expenses net of all reductions represent the net expenses paid by the class but do not include expenses of the underlying funds in which the Fund invests.
G Annualized
See accompanying notes which are an integral part of the financial statements.
Financial Highlights — Fidelity Income Replacement 2020 Fund
| | Six months ended (Unaudited) January 31, | Years ended July 31, | | | | |
| | 2017 | 2016 | 2015 | 2014 | 2013 | 2012 |
| Selected Per–Share Data | | | | | | |
| Net asset value, beginning of period | $55.34 | $56.15 | $55.94 | $53.59 | $50.69 | $50.00 |
| Income from Investment Operations | | | | | | |
| Net investment income (loss)A | .404 | .798 | .795 | .813 | .901 | .917 |
| Net realized and unrealized gain (loss) | .054 | .382 | .866 | 2.762 | 3.160 | .874 |
| Total from investment operations | .458 | 1.180 | 1.661 | 3.575 | 4.061 | 1.791 |
| Distributions from net investment income | (.397) | (.792) | (.787) | (.805) | (.908) | (.918) |
| Distributions from net realized gain | (.471) | (1.198) | (.664) | (.420) | (.253) | (.183) |
| Total distributions | (.868) | (1.990) | (1.451) | (1.225) | (1.161) | (1.101) |
| Net asset value, end of period | $54.93 | $55.34 | $56.15 | $55.94 | $53.59 | $50.69 |
| Total ReturnB,C | .84% | 2.24% | 3.01% | 6.74% | 8.11% | 3.68% |
| Ratios to Average Net AssetsD,E | | | | | | |
| Expenses before reductionsF | - %G | -% | -% | -% | -% | -% |
| Expenses net of fee waivers, if any | - %G | -% | -% | -% | -% | -% |
| Expenses net of all reductions | - %G | -% | -% | -% | -% | -% |
| Net investment income (loss) | 1.47%G | 1.47% | 1.42% | 1.48% | 1.72% | 1.86% |
| Supplemental Data | | | | | | |
| Net assets, end of period (000 omitted) | $7,997 | $7,536 | $6,502 | $7,053 | $5,196 | $3,945 |
| Portfolio turnover rateD | 36%G | 66% | 41% | 25% | 44% | 35% |
A Calculated based on average shares outstanding during the period.
B Total returns for periods of less than one year are not annualized.
C Total returns would have been lower if certain expenses had not been reduced during the applicable periods shown.
D Amounts do not include the activity of the Underlying Funds.
E Expense ratios reflect operating expenses of the class. Expenses before reductions do not reflect amounts reimbursed by the investment adviser or reductions from expense offset arrangements and do not represent the amount paid by the class during periods when reimbursements or reductions occur. Expenses net of fee waivers reflect expenses after reimbursement by the investment adviser but prior to reductions from expense offset arrangements. Expenses net of all reductions represent the net expenses paid by the class but do not include expenses of the underlying funds in which the Fund invests.
F Amount represents less than .005%.
G Annualized
See accompanying notes which are an integral part of the financial statements.
Financial Highlights — Fidelity Income Replacement 2020 Fund Class I
| | Six months ended (Unaudited) January 31, | Years ended July 31, | | | | |
| | 2017 | 2016 | 2015 | 2014 | 2013 | 2012 |
| Selected Per–Share Data | | | | | | |
| Net asset value, beginning of period | $55.34 | $56.15 | $55.94 | $53.59 | $50.69 | $50.00 |
| Income from Investment Operations | | | | | | |
| Net investment income (loss)A | .404 | .800 | .793 | .814 | .901 | .917 |
| Net realized and unrealized gain (loss) | .054 | .380 | .868 | 2.761 | 3.160 | .874 |
| Total from investment operations | .458 | 1.180 | 1.661 | 3.575 | 4.061 | 1.791 |
| Distributions from net investment income | (.397) | (.792) | (.787) | (.805) | (.908) | (.918) |
| Distributions from net realized gain | (.471) | (1.198) | (.664) | (.420) | (.253) | (.183) |
| Total distributions | (.868) | (1.990) | (1.451) | (1.225) | (1.161) | (1.101) |
| Net asset value, end of period | $54.93 | $55.34 | $56.15 | $55.94 | $53.59 | $50.69 |
| Total ReturnB,C | .84% | 2.24% | 3.01% | 6.74% | 8.11% | 3.68% |
| Ratios to Average Net AssetsD,E | | | | | | |
| Expenses before reductionsF | - %G | -% | -% | -% | -% | -% |
| Expenses net of fee waivers, if any | - %G | -% | -% | -% | -% | -% |
| Expenses net of all reductions | - %G | -% | -% | -% | -% | -% |
| Net investment income (loss) | 1.47%G | 1.47% | 1.42% | 1.48% | 1.72% | 1.86% |
| Supplemental Data | | | | | | |
| Net assets, end of period (000 omitted) | $65 | $70 | $191 | $87 | $14 | $13 |
| Portfolio turnover rateD | 36%G | 66% | 41% | 25% | 44% | 35% |
A Calculated based on average shares outstanding during the period.
B Total returns for periods of less than one year are not annualized.
C Total returns would have been lower if certain expenses had not been reduced during the applicable periods shown.
D Amounts do not include the activity of the Underlying Funds.
E Expense ratios reflect operating expenses of the class. Expenses before reductions do not reflect amounts reimbursed by the investment adviser or reductions from expense offset arrangements and do not represent the amount paid by the class during periods when reimbursements or reductions occur. Expenses net of fee waivers reflect expenses after reimbursement by the investment adviser but prior to reductions from expense offset arrangements. Expenses net of all reductions represent the net expenses paid by the class but do not include expenses of the underlying funds in which the Fund invests.
F Amount represents less than .005%.
G Annualized
See accompanying notes which are an integral part of the financial statements.
Fidelity Income Replacement 2022 Fund℠
Investment Summary (Unaudited)
The information in the following tables is based on the direct investments of the Fund.
Top Holdings as of January 31, 2017
| | % of fund's net assets | % of fund's net assets 6 months ago |
| Fidelity Total Bond Fund | 25.4 | 25.0 |
| Fidelity Investments Money Market Government Portfolio Institutional Class 0.47% | 16.7 | 15.9 |
| Fidelity Short-Term Bond Fund | 16.6 | 15.8 |
| Fidelity Strategic Real Return Fund | 8.5 | 8.4 |
| Fidelity Government Income Fund | 8.5 | 8.4 |
| Fidelity Series Broad Market Opportunities Fund | 5.2 | 5.6 |
| Fidelity Equity-Income Fund | 4.5 | 4.9 |
| Fidelity Large Cap Stock Fund | 3.4 | 3.6 |
| Fidelity Advisor Mid Cap II Fund Class I | 3.2 | 3.4 |
| Fidelity Series 100 Index Fund | 2.9 | 3.2 |
| | 94.9 | 94.2 |
Asset Allocation (% of fund's net assets)
| Period end |
| | Domestic Equity Funds | 22.5% |
| | International Equity Funds | 1.8% |
| | Investment Grade Fixed-Income Funds | 42.4% |
| | Short-Term Funds | 33.3% |
| Six months ago |
| | Domestic Equity Funds | 24.3% |
| | International Equity Funds | 2.2% |
| | Investment Grade Fixed-Income Funds | 41.8% |
| | Short-Term Funds | 31.7% |
Fidelity Income Replacement 2022 Fund℠
Investments January 31, 2017 (Unaudited)
Showing Percentage of Net Assets
| Equity Funds - 24.3% | | | |
| | | Shares | Value |
| Domestic Equity Funds - 22.5% | | | |
| Fidelity Advisor Mid Cap II Fund Class I (a) | | 20,651 | $409,518 |
| Fidelity Blue Chip Growth Fund (a) | | 5,394 | 380,916 |
| Fidelity Equity-Income Fund (a) | | 10,129 | 585,025 |
| Fidelity Large Cap Stock Fund (a) | | 14,756 | 439,419 |
| Fidelity Series 100 Index Fund (a) | | 25,842 | 380,916 |
| Fidelity Series Broad Market Opportunities Fund (a) | | 41,570 | 673,429 |
| Fidelity Series Small Cap Opportunities Fund (a) | | 4,152 | 58,503 |
|
| TOTAL DOMESTIC EQUITY FUNDS | | | 2,927,726 |
|
| International Equity Funds - 1.8% | | | |
| Fidelity Advisor International Discovery Fund Class I (a) | | 6,247 | 235,310 |
| TOTAL EQUITY FUNDS | | | |
| (Cost $2,492,900) | | | 3,163,036 |
|
| Fixed-Income Funds - 42.4% | | | |
| Investment Grade Fixed-Income Funds - 42.4% | | | |
| Fidelity Government Income Fund (a) | | 108,295 | 1,102,447 |
| Fidelity Strategic Real Return Fund (a) | | 124,994 | 1,102,448 |
| Fidelity Total Bond Fund (a) | | 313,122 | 3,303,440 |
| TOTAL INVESTMENT GRADE FIXED-INCOME FUNDS | | | |
| (Cost $5,609,979) | | | 5,508,335 |
|
| Short-Term Funds - 33.3% | | | |
| Fidelity Investments Money Market Government Portfolio Institutional Class 0.47% (a)(b) | | 2,164,593 | 2,164,593 |
| Fidelity Short-Term Bond Fund (a) | | 251,990 | 2,164,592 |
| TOTAL SHORT-TERM FUNDS | | | |
| (Cost $4,326,186) | | | 4,329,185 |
| TOTAL INVESTMENT PORTFOLIO - 100.0% | | | |
| (Cost $12,429,065) | | | 13,000,556 |
| NET OTHER ASSETS (LIABILITIES) - 0.0% | | | (144) |
| NET ASSETS - 100% | | | $13,000,412 |
Legend
(a) Affiliated Fund
(b) The rate quoted is the annualized seven-day yield of the fund at period end.
Affiliated Underlying Funds
Information regarding the Fund's fiscal year to date purchases and sales of the affiliated Underlying Funds and income earned by the Fund from investments in affiliated Underlying Funds is as follows:
| Affiliate | Value, beginning of period | Purchases | Sales Proceeds | Dividend Income | Value, end of period |
| Fidelity Advisor International Discovery Fund Class I | $300,747 | $21,379 | $81,761 | $4,361 | $235,310 |
| Fidelity Advisor Mid Cap II Fund Class I | 469,055 | 43,570 | 121,249 | 1,986 | 409,518 |
| Fidelity Blue Chip Growth Fund | 435,945 | 39,832 | 101,241 | 906 | 380,916 |
| Fidelity Equity-Income Fund | 670,473 | 45,633 | 168,680 | 9,116 | 585,025 |
| Fidelity Government Income Fund | 1,154,703 | 141,034 | 136,483 | 9,222 | 1,102,447 |
| Fidelity Investments Money Market Government Portfolio Institutional Class 0.47% | 2,185,245 | 242,903 | 263,555 | 3,794 | 2,164,593 |
| Fidelity Large Cap Stock Fund | 502,165 | 33,195 | 135,905 | 4,111 | 439,419 |
| Fidelity Series 100 Index Fund | 435,945 | 29,160 | 97,156 | 8,675 | 380,916 |
| Fidelity Series Broad Market Opportunities Fund | 771,182 | 45,510 | 186,629 | 3,408 | 673,429 |
| Fidelity Series Small Cap Opportunities Fund | 67,599 | 5,826 | 20,456 | 316 | 58,503 |
| Fidelity Short-Term Bond Fund | 2,185,245 | 260,111 | 263,153 | 12,555 | 2,164,592 |
| Fidelity Strategic Real Return Fund | 1,154,703 | 99,217 | 151,153 | 15,722 | 1,102,448 |
| Fidelity Total Bond Fund | 3,462,729 | 358,855 | 422,771 | 50,307 | 3,303,440 |
| Total | $13,795,736 | $1,366,225 | $2,150,192 | $124,479 | $13,000,556 |
Investment Valuation
All investments are categorized as Level 1 under the Fair Value Hierarchy. The inputs or methodology used for valuing securities may not be an indication of the risk associated with investing in those securities. For more information on valuation inputs please refer to the Investment Valuation section in the accompanying Notes to Financial Statements.
See accompanying notes which are an integral part of the financial statements.
Fidelity Income Replacement 2022 Fund℠
Financial Statements
Statement of Assets and Liabilities
| | | January 31, 2017 (Unaudited) |
| Assets | | |
| Investment in securities, at value (cost $12,429,065) — See accompanying schedule | | $13,000,556 |
| Cash | | 1 |
| Receivable for investments sold | | 111,795 |
| Total assets | | 13,112,352 |
| Liabilities | | |
| Payable for investments purchased | $111,797 | |
| Distribution and service plan fees payable | 143 | |
| Total liabilities | | 111,940 |
| Net Assets | | $13,000,412 |
| Net Assets consist of: | | |
| Paid in capital | | $12,500,214 |
| Undistributed net investment income | | 3,346 |
| Accumulated undistributed net realized gain (loss) on investments | | (74,639) |
| Net unrealized appreciation (depreciation) on investments | | 571,491 |
| Net Assets | | $13,000,412 |
| Calculation of Maximum Offering Price | | |
| Class A: | | |
| Net Asset Value and redemption price per share ($292,837 ÷ 4,947.60 shares) | | $59.19 |
| Maximum offering price per share (100/94.25 of $59.19) | | $62.80 |
| Class T: | | |
| Net Asset Value and redemption price per share ($81,385 ÷ 1,373.80 shares) | | $59.24 |
| Maximum offering price per share (100/96.50 of $59.24) | | $61.39 |
| Class C: | | |
| Net Asset Value and offering price per share ($58,221 ÷ 985.50 shares)(a) | | $59.08 |
| Income Replacement 2022: | | |
| Net Asset Value, offering price and redemption price per share ($12,476,747 ÷ 210,828.00 shares) | | $59.18 |
| Class I: | | |
| Net Asset Value, offering price and redemption price per share ($91,222 ÷ 1,541.90 shares) | | $59.16 |
(a) Redemption price per share is equal to net asset value less any applicable contingent deferred sales charge.
See accompanying notes which are an integral part of the financial statements.
Statement of Operations
| | | Six months ended January 31, 2017 (Unaudited) |
| Investment Income | | |
| Income distributions from underlying funds | | $124,479 |
| Expenses | | |
| Distribution and service plan fees | $868 | |
| Independent trustees' fees and expenses | 31 | |
| Total expenses before reductions | 899 | |
| Expense reductions | (31) | 868 |
| Net investment income (loss) | | 123,611 |
| Realized and Unrealized Gain (Loss) | | |
| Realized gain (loss) on sale of underlying fund shares | 21,766 | |
| Capital gain distributions from underlying funds | 62,396 | |
| Total net realized gain (loss) | | 84,162 |
| Change in net unrealized appreciation (depreciation) on underlying funds | | (32,976) |
| Net gain (loss) | | 51,186 |
| Net increase (decrease) in net assets resulting from operations | | $174,797 |
See accompanying notes which are an integral part of the financial statements.
Statement of Changes in Net Assets
| | Six months ended January 31, 2017 (Unaudited) | Year ended July 31, 2016 |
| Increase (Decrease) in Net Assets | | |
| Operations | | |
| Net investment income (loss) | $123,611 | $222,097 |
| Net realized gain (loss) | 84,162 | 106,833 |
| Change in net unrealized appreciation (depreciation) | (32,976) | (18,250) |
| Net increase (decrease) in net assets resulting from operations | 174,797 | 310,680 |
| Distributions to shareholders from net investment income | (123,933) | (221,870) |
| Distributions to shareholders from net realized gain | (14,929) | (12,857) |
| Total distributions | (138,862) | (234,727) |
| Share transactions - net increase (decrease) | (831,110) | (1,159,698) |
| Total increase (decrease) in net assets | (795,175) | (1,083,745) |
| Net Assets | | |
| Beginning of period | 13,795,587 | 14,879,332 |
| End of period | $13,000,412 | $13,795,587 |
| Other Information | | |
| Undistributed net investment income end of period | $3,346 | $3,668 |
See accompanying notes which are an integral part of the financial statements.
Financial Highlights — Fidelity Income Replacement 2022 Fund Class A
| | Six months ended (Unaudited) January 31, | Years ended July 31, | | | | |
| | 2017 | 2016 | 2015 | 2014 | 2013 | 2012 |
| Selected Per–Share Data | | | | | | |
| Net asset value, beginning of period | $59.02 | $58.61 | $57.41 | $54.16 | $50.46 | $49.79 |
| Income from Investment Operations | | | | | | |
| Net investment income (loss)A | .465 | .758 | .686 | .708 | .825 | .783 |
| Net realized and unrealized gain (loss) | .248 | .457 | 1.311 | 3.351 | 3.933 | .842 |
| Total from investment operations | .713 | 1.215 | 1.997 | 4.059 | 4.758 | 1.625 |
| Distributions from net investment income | (.476) | (.754) | (.658) | (.686) | (.804) | (.784) |
| Distributions from net realized gain | (.067) | (.051) | (.139) | (.123) | (.254) | (.171) |
| Total distributions | (.543) | (.805) | (.797) | (.809) | (1.058) | (.955) |
| Net asset value, end of period | $59.19 | $59.02 | $58.61 | $57.41 | $54.16 | $50.46 |
| Total ReturnB,C,D | 1.22% | 2.12% | 3.50% | 7.54% | 9.54% | 3.35% |
| Ratios to Average Net AssetsE,F | | | | | | |
| Expenses before reductions | .25%G | .25% | .25% | .25% | .25% | .25% |
| Expenses net of fee waivers, if any | .25%G | .25% | .25% | .25% | .25% | .25% |
| Expenses net of all reductions | .25%G | .25% | .25% | .25% | .25% | .25% |
| Net investment income (loss) | 1.58%G | 1.32% | 1.18% | 1.26% | 1.57% | 1.59% |
| Supplemental Data | | | | | | |
| Net assets, end of period (000 omitted) | $293 | $293 | $432 | $419 | $391 | $386 |
| Portfolio turnover rateE | 20%G | 47% | 33% | 26% | 38% | 43% |
A Calculated based on average shares outstanding during the period.
B Total returns for periods of less than one year are not annualized.
C Total returns would have been lower if certain expenses had not been reduced during the applicable periods shown.
D Total returns do not include the effect of the sales charges.
E Amounts do not include the activity of the Underlying Funds.
F Expense ratios reflect operating expenses of the class. Expenses before reductions do not reflect amounts reimbursed by the investment adviser or reductions from expense offset arrangements and do not represent the amount paid by the class during periods when reimbursements or reductions occur. Expenses net of fee waivers reflect expenses after reimbursement by the investment adviser but prior to reductions from expense offset arrangements. Expenses net of all reductions represent the net expenses paid by the class but do not include expenses of the underlying funds in which the Fund invests.
G Annualized
See accompanying notes which are an integral part of the financial statements.
Financial Highlights — Fidelity Income Replacement 2022 Fund Class T
| | Six months ended (Unaudited) January 31, | Years ended July 31, | | | | |
| | 2017 | 2016 | 2015 | 2014 | 2013 | 2012 |
| Selected Per–Share Data | | | | | | |
| Net asset value, beginning of period | $59.07 | $58.67 | $57.46 | $54.24 | $50.53 | $49.82 |
| Income from Investment Operations | | | | | | |
| Net investment income (loss)A | .391 | .615 | .540 | .581 | .686 | .653 |
| Net realized and unrealized gain (loss) | .247 | .450 | 1.318 | 3.339 | 3.958 | .871 |
| Total from investment operations | .638 | 1.065 | 1.858 | 3.920 | 4.644 | 1.524 |
| Distributions from net investment income | (.401) | (.614) | (.509) | (.577) | (.680) | (.643) |
| Distributions from net realized gain | (.067) | (.051) | (.139) | (.123) | (.254) | (.171) |
| Total distributions | (.468) | (.665) | (.648) | (.700) | (.934) | (.814) |
| Net asset value, end of period | $59.24 | $59.07 | $58.67 | $57.46 | $54.24 | $50.53 |
| Total ReturnB,C,D | 1.09% | 1.86% | 3.25% | 7.26% | 9.29% | 3.13% |
| Ratios to Average Net AssetsE,F | | | | | | |
| Expenses before reductions | .50%G | .50% | .50% | .49%H | .49%H | .50% |
| Expenses net of fee waivers, if any | .50%G | .50% | .50% | .49%H | .49%H | .50% |
| Expenses net of all reductions | .50%G | .50% | .50% | .49%H | .49%H | .50% |
| Net investment income (loss) | 1.32%G | 1.07% | .93% | 1.02% | 1.30% | 1.34% |
| Supplemental Data | | | | | | |
| Net assets, end of period (000 omitted) | $81 | $86 | $90 | $26 | $1 | $5 |
| Portfolio turnover rateE | 20%G | 47% | 33% | 26% | 38% | 43% |
A Calculated based on average shares outstanding during the period.
B Total returns for periods of less than one year are not annualized.
C Total returns would have been lower if certain expenses had not been reduced during the applicable periods shown.
D Total returns do not include the effect of the sales charges.
E Amounts do not include the activity of the Underlying Funds.
F Expense ratios reflect operating expenses of the class. Expenses before reductions do not reflect amounts reimbursed by the investment adviser or reductions from expense offset arrangements and do not represent the amount paid by the class during periods when reimbursements or reductions occur. Expenses net of fee waivers reflect expenses after reimbursement by the investment adviser but prior to reductions from expense offset arrangements. Expenses net of all reductions represent the net expenses paid by the class but do not include expenses of the underlying funds in which the Fund invests.
G Annualized
H On certain classes, the size and fluctuation of net assets may cause rounding of expense amounts and ratios to differ from contractual rates.
See accompanying notes which are an integral part of the financial statements.
Financial Highlights — Fidelity Income Replacement 2022 Fund Class C
| | Six months ended (Unaudited) January 31, | Years ended July 31, | | | | |
| | 2017 | 2016 | 2015 | 2014 | 2013 | 2012 |
| Selected Per–Share Data | | | | | | |
| Net asset value, beginning of period | $58.91 | $58.53 | $57.34 | $54.13 | $50.49 | $49.81 |
| Income from Investment Operations | | | | | | |
| Net investment income (loss)A | .244 | .328 | .245 | .293 | .434 | .411 |
| Net realized and unrealized gain (loss) | .250 | .435 | 1.323 | 3.354 | 3.919 | .845 |
| Total from investment operations | .494 | .763 | 1.568 | 3.647 | 4.353 | 1.256 |
| Distributions from net investment income | (.257) | (.332) | (.239) | (.314) | (.459) | (.405) |
| Distributions from net realized gain | (.067) | (.051) | (.139) | (.123) | (.254) | (.171) |
| Total distributions | (.324) | (.383) | (.378) | (.437) | (.713) | (.576) |
| Net asset value, end of period | $59.08 | $58.91 | $58.53 | $57.34 | $54.13 | $50.49 |
| Total ReturnB,C,D | .84% | 1.34% | 2.72% | 6.76% | 8.70% | 2.58% |
| Ratios to Average Net AssetsE,F | | | | | | |
| Expenses before reductions | 1.00%G | 1.00% | 1.01%H | .99%H | 1.00% | 1.00% |
| Expenses net of fee waivers, if any | 1.00%G | 1.00% | 1.01%H | .99%H | 1.00% | 1.00% |
| Expenses net of all reductions | 1.00%G | 1.00% | 1.01%H | .99%H | 1.00% | 1.00% |
| Net investment income (loss) | .83%G | .57% | .42% | .52% | .83% | .84% |
| Supplemental Data | | | | | | |
| Net assets, end of period (000 omitted) | $58 | $58 | $60 | $325 | $54 | $28 |
| Portfolio turnover rateE | 20%G | 47% | 33% | 26% | 38% | 43% |
A Calculated based on average shares outstanding during the period.
B Total returns for periods of less than one year are not annualized.
C Total returns would have been lower if certain expenses had not been reduced during the applicable periods shown.
D Total returns do not include the effect of the contingent deferred sales charge.
E Amounts do not include the activity of the Underlying Funds.
F Expense ratios reflect operating expenses of the class. Expenses before reductions do not reflect amounts reimbursed by the investment adviser or reductions from expense offset arrangements and do not represent the amount paid by the class during periods when reimbursements or reductions occur. Expenses net of fee waivers reflect expenses after reimbursement by the investment adviser but prior to reductions from expense offset arrangements. Expenses net of all reductions represent the net expenses paid by the class but do not include expenses of the underlying funds in which the Fund invests.
G Annualized
H On certain classes, the size and fluctuation of net assets may cause rounding of expense amounts and ratios to differ from contractual rates.
See accompanying notes which are an integral part of the financial statements.
Financial Highlights — Fidelity Income Replacement 2022 Fund
| | Six months ended (Unaudited) January 31, | Years ended July 31, | | | | |
| | 2017 | 2016 | 2015 | 2014 | 2013 | 2012 |
| Selected Per–Share Data | | | | | | |
| Net asset value, beginning of period | $59.01 | $58.61 | $57.41 | $54.15 | $50.46 | $49.78 |
| Income from Investment Operations | | | | | | |
| Net investment income (loss)A | .539 | .901 | .831 | .851 | .956 | .901 |
| Net realized and unrealized gain (loss) | .247 | .452 | 1.313 | 3.358 | 3.922 | .849 |
| Total from investment operations | .786 | 1.353 | 2.144 | 4.209 | 4.878 | 1.750 |
| Distributions from net investment income | (.549) | (.902) | (.805) | (.826) | (.934) | (.899) |
| Distributions from net realized gain | (.067) | (.051) | (.139) | (.123) | (.254) | (.171) |
| Total distributions | (.616) | (.953) | (.944) | (.949) | (1.188) | (1.070) |
| Net asset value, end of period | $59.18 | $59.01 | $58.61 | $57.41 | $54.15 | $50.46 |
| Total ReturnB,C | 1.34% | 2.37% | 3.76% | 7.82% | 9.80% | 3.62% |
| Ratios to Average Net AssetsD,E | | | | | | |
| Expenses before reductionsF | - %G | -% | -% | -% | -% | -% |
| Expenses net of fee waivers, if any | - %G | -% | -% | -% | -% | -% |
| Expenses net of all reductions | - %G | -% | -% | -% | -% | -% |
| Net investment income (loss) | 1.83%G | 1.57% | 1.43% | 1.51% | 1.82% | 1.84% |
| Supplemental Data | | | | | | |
| Net assets, end of period (000 omitted) | $12,477 | $13,227 | $14,208 | $9,774 | $4,474 | $3,892 |
| Portfolio turnover rateD | 20%G | 47% | 33% | 26% | 38% | 43% |
A Calculated based on average shares outstanding during the period.
B Total returns for periods of less than one year are not annualized.
C Total returns would have been lower if certain expenses had not been reduced during the applicable periods shown.
D Amounts do not include the activity of the Underlying Funds.
E Expense ratios reflect operating expenses of the class. Expenses before reductions do not reflect amounts reimbursed by the investment adviser or reductions from expense offset arrangements and do not represent the amount paid by the class during periods when reimbursements or reductions occur. Expenses net of fee waivers reflect expenses after reimbursement by the investment adviser but prior to reductions from expense offset arrangements. Expenses net of all reductions represent the net expenses paid by the class but do not include expenses of the underlying funds in which the Fund invests.
F Amount represents less than .005%.
G Annualized
See accompanying notes which are an integral part of the financial statements.
Financial Highlights — Fidelity Income Replacement 2022 Fund Class I
| | Six months ended (Unaudited) January 31, | Years ended July 31, | | | | |
| | 2017 | 2016 | 2015 | 2014 | 2013 | 2012 |
| Selected Per–Share Data | | | | | | |
| Net asset value, beginning of period | $58.99 | $58.59 | $57.39 | $54.14 | $50.45 | $49.77 |
| Income from Investment Operations | | | | | | |
| Net investment income (loss)A | .540 | .899 | .830 | .856 | .957 | .900 |
| Net realized and unrealized gain (loss) | .246 | .454 | 1.314 | 3.343 | 3.921 | .850 |
| Total from investment operations | .786 | 1.353 | 2.144 | 4.199 | 4.878 | 1.750 |
| Distributions from net investment income | (.549) | (.902) | (.805) | (.826) | (.934) | (.899) |
| Distributions from net realized gain | (.067) | (.051) | (.139) | (.123) | (.254) | (.171) |
| Total distributions | (.616) | (.953) | (.944) | (.949) | (1.188) | (1.070) |
| Net asset value, end of period | $59.16 | $58.99 | $58.59 | $57.39 | $54.14 | $50.45 |
| Total ReturnB,C | 1.34% | 2.37% | 3.76% | 7.81% | 9.80% | 3.62% |
| Ratios to Average Net AssetsD,E | | | | | | |
| Expenses before reductionsF | - %G | -% | -% | -% | -% | -% |
| Expenses net of fee waivers, if any | - %G | -% | -% | -% | -% | -% |
| Expenses net of all reductions | - %G | -% | -% | -% | -% | -% |
| Net investment income (loss) | 1.83%G | 1.57% | 1.43% | 1.51% | 1.82% | 1.84% |
| Supplemental Data | | | | | | |
| Net assets, end of period (000 omitted) | $91 | $131 | $90 | $61 | $4 | $3 |
| Portfolio turnover rateD | 20%G | 47% | 33% | 26% | 38% | 43% |
A Calculated based on average shares outstanding during the period.
B Total returns for periods of less than one year are not annualized.
C Total return would have been lower if certain expenses had not been reduced during the applicable periods shown.
D Amounts do not include the activity of the Underlying Funds.
E Expense ratios reflect operating expenses of the class. Expenses before reductions do not reflect amounts reimbursed by the investment adviser or reductions from expense offset arrangements and do not represent the amount paid by the class during periods when reimbursements or reductions occur. Expenses net of fee waivers reflect expenses after reimbursement by the investment adviser but prior to reductions from expense offset arrangements. Expenses net of all reductions represent the net expenses paid by the class but do not include expenses of the underlying funds in which the Fund invests.
F Amount represents less than .005%.
G Annualized
See accompanying notes which are an integral part of the financial statements.
Fidelity Income Replacement 2024 Fund℠
Investment Summary (Unaudited)
The information in the following tables is based on the direct investments of the Fund.
Top Holdings as of January 31, 2017
| | % of fund's net assets | % of fund's net assets 6 months ago |
| Fidelity Total Bond Fund | 23.3 | 22.9 |
| Fidelity Investments Money Market Government Portfolio Institutional Class 0.47% | 13.5 | 12.9 |
| Fidelity Short-Term Bond Fund | 13.5 | 12.9 |
| Fidelity Strategic Real Return Fund | 7.8 | 7.6 |
| Fidelity Government Income Fund | 7.8 | 7.6 |
| Fidelity Series Broad Market Opportunities Fund | 6.8 | 7.1 |
| Fidelity Equity-Income Fund | 5.9 | 6.2 |
| Fidelity Large Cap Stock Fund | 4.4 | 4.7 |
| Fidelity Advisor Mid Cap II Fund Class I | 4.1 | 4.3 |
| Fidelity Series 100 Index Fund | 3.8 | 4.0 |
| | 90.9 | 90.2 |
Asset Allocation (% of fund's net assets)
| Period end |
| | Domestic Equity Funds | 29.5% |
| | International Equity Funds | 2.9% |
| | High Yield Fixed-Income Funds | 1.7% |
| | Investment Grade Fixed-Income Funds | 38.9% |
| | Short-Term Funds | 27.0% |
| Six months ago |
| | Domestic Equity Funds | 30.9% |
| | International Equity Funds | 3.1% |
| | High Yield Fixed-Income Funds | 2.1% |
| | Investment Grade Fixed-Income Funds | 38.1% |
| | Short-Term Funds | 25.8% |
Fidelity Income Replacement 2024 Fund℠
Investments January 31, 2017 (Unaudited)
Showing Percentage of Net Assets
| Equity Funds - 32.4% | | | |
| | | Shares | Value |
| Domestic Equity Funds - 29.5% | | | |
| Fidelity Advisor Mid Cap II Fund Class I (a) | | 21,225 | $420,892 |
| Fidelity Blue Chip Growth Fund (a) | | 5,540 | 391,266 |
| Fidelity Equity-Income Fund (a) | | 10,417 | 601,712 |
| Fidelity Large Cap Stock Fund (a) | | 15,163 | 451,540 |
| Fidelity Series 100 Index Fund (a) | | 26,545 | 391,266 |
| Fidelity Series Broad Market Opportunities Fund (a) | | 42,692 | 691,611 |
| Fidelity Series Small Cap Opportunities Fund (a) | | 4,278 | 60,273 |
|
| TOTAL DOMESTIC EQUITY FUNDS | | | 3,008,560 |
|
| International Equity Funds - 2.9% | | | |
| Fidelity Advisor International Discovery Fund Class I (a) | | 7,865 | 296,259 |
| TOTAL EQUITY FUNDS | | | |
| (Cost $2,769,127) | | | 3,304,819 |
|
| Fixed-Income Funds - 40.6% | | | |
| High Yield Fixed-Income Funds - 1.7% | | | |
| Fidelity Capital & Income Fund (a) | | 8,968 | 88,877 |
| Fidelity Strategic Income Fund (a) | | 8,252 | 88,877 |
|
| TOTAL HIGH YIELD FIXED-INCOME FUNDS | | | 177,754 |
|
| Investment Grade Fixed-Income Funds - 38.9% | | | |
| Fidelity Government Income Fund (a) | | 77,973 | 793,769 |
| Fidelity Strategic Real Return Fund (a) | | 89,997 | 793,770 |
| Fidelity Total Bond Fund (a) | | 225,910 | 2,383,348 |
|
| TOTAL INVESTMENT GRADE FIXED-INCOME FUNDS | | | 3,970,887 |
|
| TOTAL FIXED-INCOME FUNDS | | | |
| (Cost $4,204,952) | | | 4,148,641 |
|
| Short-Term Funds - 27.0% | | | |
| Fidelity Investments Money Market Government Portfolio Institutional Class 0.47% (a)(b) | | 1,381,179 | 1,381,179 |
| Fidelity Short-Term Bond Fund (a) | | 160,789 | 1,381,178 |
| TOTAL SHORT-TERM FUNDS | | | |
| (Cost $2,761,438) | | | 2,762,357 |
| TOTAL INVESTMENT PORTFOLIO - 100.0% | | | |
| (Cost $9,735,517) | | | 10,215,817 |
| NET OTHER ASSETS (LIABILITIES) - 0.0% | | | (246) |
| NET ASSETS - 100% | | | $10,215,571 |
Legend
(a) Affiliated Fund
(b) The rate quoted is the annualized seven-day yield of the fund at period end.
Affiliated Underlying Funds
Information regarding the Fund's fiscal year to date purchases and sales of the affiliated Underlying Funds and income earned by the Fund from investments in affiliated Underlying Funds is as follows:
| Affiliate | Value, beginning of period | Purchases | Sales Proceeds | Dividend Income | Value, end of period |
| Fidelity Advisor International Discovery Fund Class I | $292,353 | $76,922 | $68,156 | $5,002 | $296,259 |
| Fidelity Advisor Mid Cap II Fund Class I | 403,149 | 112,793 | 112,915 | 2,007 | 420,892 |
| Fidelity Blue Chip Growth Fund | 374,286 | 105,632 | 95,934 | 888 | 391,266 |
| Fidelity Capital & Income Fund | 98,692 | 23,932 | 37,856 | 2,231 | 88,877 |
| Fidelity Equity-Income Fund | 575,395 | 144,124 | 153,743 | 8,948 | 601,712 |
| Fidelity Government Income Fund | 708,536 | 219,436 | 95,999 | 6,295 | 793,769 |
| Fidelity Investments Money Market Government Portfolio Institutional Class 0.47% | 1,200,136 | 342,770 | 161,726 | 2,339 | 1,381,179 |
| Fidelity Large Cap Stock Fund | 432,012 | 107,154 | 126,166 | 4,051 | 451,540 |
| Fidelity Series 100 Index Fund | 374,286 | 93,583 | 89,463 | 8,973 | 391,266 |
| Fidelity Series Broad Market Opportunities Fund | 661,983 | 159,547 | 173,386 | 3,443 | 691,611 |
| Fidelity Series Small Cap Opportunities Fund | 57,726 | 14,159 | 16,972 | 310 | 60,273 |
| Fidelity Short-Term Bond Fund | 1,200,136 | 356,612 | 164,836 | 7,770 | 1,381,178 |
| Fidelity Strategic Income Fund | 98,692 | 23,469 | 33,182 | 1,768 | 88,877 |
| Fidelity Strategic Real Return Fund | 708,536 | 193,783 | 109,510 | 10,858 | 793,770 |
| Fidelity Total Bond Fund | 2,124,676 | 628,328 | 305,057 | 34,427 | 2,383,348 |
| Total | $9,310,594 | $2,602,244 | $1,744,901 | $99,310 | $10,215,817 |
Investment Valuation
All investments are categorized as Level 1 under the Fair Value Hierarchy. The inputs or methodology used for valuing securities may not be an indication of the risk associated with investing in those securities. For more information on valuation inputs please refer to the Investment Valuation section in the accompanying Notes to Financial Statements.
See accompanying notes which are an integral part of the financial statements.
Fidelity Income Replacement 2024 Fund℠
Financial Statements
Statement of Assets and Liabilities
| | | January 31, 2017 (Unaudited) |
| Assets | | |
| Investment in securities, at value (cost $9,735,517) — See accompanying schedule | | $10,215,817 |
| Cash | | 3 |
| Receivable for investments sold | | 161,938 |
| Total assets | | 10,377,758 |
| Liabilities | | |
| Payable for investments purchased | $18,068 | |
| Payable for fund shares redeemed | 143,891 | |
| Distribution and service plan fees payable | 228 | |
| Total liabilities | | 162,187 |
| Net Assets | | $10,215,571 |
| Net Assets consist of: | | |
| Paid in capital | | $9,737,623 |
| Undistributed net investment income | | 2,611 |
| Accumulated undistributed net realized gain (loss) on investments | | (4,963) |
| Net unrealized appreciation (depreciation) on investments | | 480,300 |
| Net Assets | | $10,215,571 |
| Calculation of Maximum Offering Price | | |
| Class A: | | |
| Net Asset Value and redemption price per share ($189,429 ÷ 3,207.92 shares) | | $59.05 |
| Maximum offering price per share (100/94.25 of $59.05) | | $62.65 |
| Class T: | | |
| Net Asset Value and redemption price per share ($146,253 ÷ 2,477.36 shares) | | $59.04 |
| Maximum offering price per share (100/96.50 of $59.04) | | $61.18 |
| Class C: | | |
| Net Asset Value and offering price per share ($151,406 ÷ 2,573.88 shares)(a) | | $58.82 |
| Income Replacement 2024: | | |
| Net Asset Value, offering price and redemption price per share ($9,674,650 ÷ 163,858.25 shares) | | $59.04 |
| Class I: | | |
| Net Asset Value, offering price and redemption price per share ($53,833 ÷ 911.84 shares) | | $59.04 |
(a) Redemption price per share is equal to net asset value less any applicable contingent deferred sales charge.
See accompanying notes which are an integral part of the financial statements.
Statement of Operations
| | | Six months ended January 31, 2017 (Unaudited) |
| Investment Income | | |
| Income distributions from underlying funds | | $99,310 |
| Expenses | | |
| Distribution and service plan fees | $1,374 | |
| Independent trustees' fees and expenses | 23 | |
| Total expenses before reductions | 1,397 | |
| Expense reductions | (23) | 1,374 |
| Net investment income (loss) | | 97,936 |
| Realized and Unrealized Gain (Loss) | | |
| Realized gain (loss) on sale of underlying fund shares | (198) | |
| Capital gain distributions from underlying funds | 56,232 | |
| Total net realized gain (loss) | | 56,034 |
| Change in net unrealized appreciation (depreciation) on underlying funds | | 48,074 |
| Net gain (loss) | | 104,108 |
| Net increase (decrease) in net assets resulting from operations | | $202,044 |
See accompanying notes which are an integral part of the financial statements.
Statement of Changes in Net Assets
| | Six months ended January 31, 2017 (Unaudited) | Year ended July 31, 2016 |
| Increase (Decrease) in Net Assets | | |
| Operations | | |
| Net investment income (loss) | $97,936 | $151,030 |
| Net realized gain (loss) | 56,034 | 63,128 |
| Change in net unrealized appreciation (depreciation) | 48,074 | (57,966) |
| Net increase (decrease) in net assets resulting from operations | 202,044 | 156,192 |
| Distributions to shareholders from net investment income | (97,662) | (150,769) |
| Distributions to shareholders from net realized gain | (31,846) | (167,848) |
| Total distributions | (129,508) | (318,617) |
| Share transactions - net increase (decrease) | 832,663 | (703,127) |
| Total increase (decrease) in net assets | 905,199 | (865,552) |
| Net Assets | | |
| Beginning of period | 9,310,372 | 10,175,924 |
| End of period | $10,215,571 | $9,310,372 |
| Other Information | | |
| Undistributed net investment income end of period | $2,611 | $2,337 |
See accompanying notes which are an integral part of the financial statements.
Financial Highlights — Fidelity Income Replacement 2024 Fund Class A
| | Six months ended (Unaudited) January 31, | Years ended July 31, | | | | |
| | 2017 | 2016 | 2015 | 2014 | 2013 | 2012 |
| Selected Per–Share Data | | | | | | |
| Net asset value, beginning of period | $58.63 | $59.28 | $58.28 | $54.77 | $50.48 | $49.85 |
| Income from Investment Operations | | | | | | |
| Net investment income (loss)A | .500 | .779 | .718 | .718 | .840 | .821 |
| Net realized and unrealized gain (loss) | .585 | .322 | 1.623 | 3.808 | 4.571 | .771 |
| Total from investment operations | 1.085 | 1.101 | 2.341 | 4.526 | 5.411 | 1.592 |
| Distributions from net investment income | (.486) | (.768) | (.704) | (.677) | (.900) | (.794) |
| Distributions from net realized gain | (.179) | (.983) | (.637) | (.339) | (.221) | (.168) |
| Total distributions | (.665) | (1.751) | (1.341) | (1.016) | (1.121) | (.962) |
| Net asset value, end of period | $59.05 | $58.63 | $59.28 | $58.28 | $54.77 | $50.48 |
| Total ReturnB,C,D | 1.87% | 1.99% | 4.06% | 8.32% | 10.86% | 3.29% |
| Ratios to Average Net AssetsE,F | | | | | | |
| Expenses before reductions | .25%G | .25% | .25% | .25% | .25% | .25% |
| Expenses net of fee waivers, if any | .25%G | .25% | .25% | .25% | .25% | .25% |
| Expenses net of all reductions | .25%G | .25% | .25% | .25% | .25% | .25% |
| Net investment income (loss) | 1.70%G | 1.37% | 1.22% | 1.27% | 1.59% | 1.68% |
| Supplemental Data | | | | | | |
| Net assets, end of period (000 omitted) | $189 | $190 | $467 | $220 | $424 | $213 |
| Portfolio turnover rate E | 35%G | 49% | 29% | 30% | 49% | 65% |
A Calculated based on average shares outstanding during the period.
B Total returns for periods of less than one year are not annualized.
C Total returns would have been lower if certain expenses had not been reduced during the applicable periods shown.
D Total returns do not include the effect of the sales charges.
E Amounts do not include the activity of the Underlying Funds.
F Expense ratios reflect operating expenses of the class. Expenses before reductions do not reflect amounts reimbursed by the investment adviser or reductions from expense offset arrangements and do not represent the amount paid by the class during periods when reimbursements or reductions occur. Expenses net of fee waivers reflect expenses after reimbursement by the investment adviser but prior to reductions from expense offset arrangements. Expenses net of all reductions represent the net expenses paid by the class but do not include expenses of the underlying funds in which the Fund invests.
G Annualized
See accompanying notes which are an integral part of the financial statements.
Financial Highlights — Fidelity Income Replacement 2024 Fund Class T
| | Six months ended (Unaudited) January 31, | Years ended July 31, | | | | |
| | 2017 | 2016 | 2015 | 2014 | 2013 | 2012 |
| Selected Per–Share Data | | | | | | |
| Net asset value, beginning of period | $58.61 | $59.27 | $58.27 | $54.78 | $50.49 | $49.87 |
| Income from Investment Operations | | | | | | |
| Net investment income (loss)A | .426 | .640 | .572 | .579 | .706 | .699 |
| Net realized and unrealized gain (loss) | .595 | .310 | 1.631 | 3.796 | 4.576 | .769 |
| Total from investment operations | 1.021 | .950 | 2.203 | 4.375 | 5.282 | 1.468 |
| Distributions from net investment income | (.412) | (.627) | (.566) | (.546) | (.771) | (.680) |
| Distributions from net realized gain | (.179) | (.983) | (.637) | (.339) | (.221) | (.168) |
| Total distributions | (.591) | (1.610) | (1.203) | (.885) | (.992) | (.848) |
| Net asset value, end of period | $59.04 | $58.61 | $59.27 | $58.27 | $54.78 | $50.49 |
| Total ReturnB,C,D | 1.76% | 1.72% | 3.82% | 8.04% | 10.59% | 3.03% |
| Ratios to Average Net AssetsE,F | | | | | | |
| Expenses before reductions | .50%G | .50% | .50% | .50% | .50% | .50% |
| Expenses net of fee waivers, if any | .50%G | .50% | .50% | .50% | .50% | .50% |
| Expenses net of all reductions | .50%G | .50% | .50% | .50% | .50% | .50% |
| Net investment income (loss) | 1.45%G | 1.12% | .97% | 1.02% | 1.34% | 1.43% |
| Supplemental Data | | | | | | |
| Net assets, end of period (000 omitted) | $146 | $153 | $334 | $190 | $190 | $175 |
| Portfolio turnover rate E | 35%G | 49% | 29% | 30% | 49% | 65% |
A Calculated based on average shares outstanding during the period.
B Total returns for periods of less than one year are not annualized.
C Total returns would have been lower if certain expenses had not been reduced during the applicable periods shown.
D Total returns do not include the effect of the sales charges.
E Amounts do not include the activity of the Underlying Funds.
F Expense ratios reflect operating expenses of the class. Expenses before reductions do not reflect amounts reimbursed by the investment adviser or reductions from expense offset arrangements and do not represent the amount paid by the class during periods when reimbursements or reductions occur. Expenses net of fee waivers reflect expenses after reimbursement by the investment adviser but prior to reductions from expense offset arrangements. Expenses net of all reductions represent the net expenses paid by the class but do not include expenses of the underlying funds in which the Fund invests.
G Annualized
See accompanying notes which are an integral part of the financial statements.
Financial Highlights — Fidelity Income Replacement 2024 Fund Class C
| | Six months ended (Unaudited) January 31, | Years ended July 31, | | | | |
| | 2017 | 2016 | 2015 | 2014 | 2013 | 2012 |
| Selected Per–Share Data | | | | | | |
| Net asset value, beginning of period | $58.41 | $59.07 | $58.11 | $54.66 | $50.43 | $49.82 |
| Income from Investment Operations | | | | | | |
| Net investment income (loss)A | .278 | .351 | .276 | .295 | .444 | .454 |
| Net realized and unrealized gain (loss) | .583 | .321 | 1.618 | 3.791 | 4.564 | .761 |
| Total from investment operations | .861 | .672 | 1.894 | 4.086 | 5.008 | 1.215 |
| Distributions from net investment income | (.272) | (.349) | (.297) | (.297) | (.557) | (.437) |
| Distributions from net realized gain | (.179) | (.983) | (.637) | (.339) | (.221) | (.168) |
| Total distributions | (.451) | (1.332) | (.934) | (.636) | (.778) | (.605) |
| Net asset value, end of period | $58.82 | $58.41 | $59.07 | $58.11 | $54.66 | $50.43 |
| Total ReturnB,C,D | 1.48% | 1.23% | 3.29% | 7.51% | 10.03% | 2.50% |
| Ratios to Average Net AssetsE,F | | | | | | |
| Expenses before reductions | 1.00%G | 1.00% | 1.00% | 1.00% | 1.00% | 1.00% |
| Expenses net of fee waivers, if any | 1.00%G | 1.00% | 1.00% | 1.00% | 1.00% | 1.00% |
| Expenses net of all reductions | 1.00%G | 1.00% | 1.00% | 1.00% | 1.00% | 1.00% |
| Net investment income (loss) | .95%G | .62% | .47% | .52% | .84% | .93% |
| Supplemental Data | | | | | | |
| Net assets, end of period (000 omitted) | $151 | $159 | $168 | $156 | $113 | $170 |
| Portfolio turnover rate E | 35%G | 49% | 29% | 30% | 49% | 65% |
A Calculated based on average shares outstanding during the period.
B Total returns for periods of less than one year are not annualized.
C Total returns would have been lower if certain expenses had not been reduced during the applicable periods shown.
D Total returns do not include the effect of the contingent deferred sales charge.
E Amounts do not include the activity of the Underlying Funds.
F Expense ratios reflect operating expenses of the class. Expenses before reductions do not reflect amounts reimbursed by the investment adviser or reductions from expense offset arrangements and do not represent the amount paid by the class during periods when reimbursements or reductions occur. Expenses net of fee waivers reflect expenses after reimbursement by the investment adviser but prior to reductions from expense offset arrangements. Expenses net of all reductions represent the net expenses paid by the class but do not include expenses of the underlying funds in which the Fund invests.
G Annualized
See accompanying notes which are an integral part of the financial statements.
Financial Highlights — Fidelity Income Replacement 2024 Fund
| | Six months ended (Unaudited) January 31, | Years ended July 31, | | | | |
| | 2017 | 2016 | 2015 | 2014 | 2013 | 2012 |
| Selected Per–Share Data | | | | | | |
| Net asset value, beginning of period | $58.62 | $59.28 | $58.27 | $54.77 | $50.49 | $49.86 |
| Income from Investment Operations | | | | | | |
| Net investment income (loss)A | .573 | .920 | .866 | .866 | .969 | .942 |
| Net realized and unrealized gain (loss) | .585 | .317 | 1.628 | 3.805 | 4.563 | .775 |
| Total from investment operations | 1.158 | 1.237 | 2.494 | 4.671 | 5.532 | 1.717 |
| Distributions from net investment income | (.559) | (.914) | (.847) | (.832) | (1.031) | (.919) |
| Distributions from net realized gain | (.179) | (.983) | (.637) | (.339) | (.221) | (.168) |
| Total distributions | (.738) | (1.897) | (1.484) | (1.171) | (1.252) | (1.087) |
| Net asset value, end of period | $59.04 | $58.62 | $59.28 | $58.27 | $54.77 | $50.49 |
| Total ReturnB,C | 1.99% | 2.24% | 4.33% | 8.60% | 11.12% | 3.55% |
| Ratios to Average Net AssetsD,E | | | | | | |
| Expenses before reductions F | - %G | -% | -% | -% | -% | -% |
| Expenses net of fee waivers, if any | - %G | -% | -% | -% | -% | -% |
| Expenses net of all reductions | - %G | -% | -% | -% | -% | -% |
| Net investment income (loss) | 1.95%G | 1.62% | 1.47% | 1.52% | 1.84% | 1.93% |
| Supplemental Data | | | | | | |
| Net assets, end of period (000 omitted) | $9,675 | $8,756 | $9,139 | $6,818 | $2,108 | $1,521 |
| Portfolio turnover rate D | 35%G | 49% | 29% | 30% | 49% | 65% |
A Calculated based on average shares outstanding during the period.
B Total returns for periods of less than one year are not annualized.
C Total returns would have been lower if certain expenses had not been reduced during the applicable periods shown.
D Amounts do not include the activity of the Underlying Funds.
E Expense ratios reflect operating expenses of the class. Expenses before reductions do not reflect amounts reimbursed by the investment adviser or reductions from expense offset arrangements and do not represent the amount paid by the class during periods when reimbursements or reductions occur. Expenses net of fee waivers reflect expenses after reimbursement by the investment adviser but prior to reductions from expense offset arrangements. Expenses net of all reductions represent the net expenses paid by the class but do not include expenses of the underlying funds in which the Fund invests.
F Amount represents less than .005%.
G Annualized
See accompanying notes which are an integral part of the financial statements.
Financial Highlights — Fidelity Income Replacement 2024 Fund Class I
| | Six months ended (Unaudited) January 31, | Years ended July 31, | | | | |
| | 2017 | 2016 | 2015 | 2014 | 2013 | 2012 |
| Selected Per–Share Data | | | | | | |
| Net asset value, beginning of period | $58.62 | $59.27 | $58.26 | $54.77 | $50.48 | $49.86 |
| Income from Investment Operations | | | | | | |
| Net investment income (loss)A | .573 | .921 | .864 | .863 | .969 | .944 |
| Net realized and unrealized gain (loss) | .585 | .326 | 1.630 | 3.798 | 4.573 | .763 |
| Total from investment operations | 1.158 | 1.247 | 2.494 | 4.661 | 5.542 | 1.707 |
| Distributions from net investment income | (.559) | (.914) | (.847) | (.832) | (1.031) | (.919) |
| Distributions from net realized gain | (.179) | (.983) | (.637) | (.339) | (.221) | (.168) |
| Total distributions | (.738) | (1.897) | (1.484) | (1.171) | (1.252) | (1.087) |
| Net asset value, end of period | $59.04 | $58.62 | $59.27 | $58.26 | $54.77 | $50.48 |
| Total ReturnB,C | 1.99% | 2.26% | 4.33% | 8.58% | 11.14% | 3.53% |
| Ratios to Average Net AssetsD,E | | | | | | |
| Expenses before reductions F | - %G | -% | -% | -% | -% | -% |
| Expenses net of fee waivers, if any | - %G | -% | -% | -% | -% | -% |
| Expenses net of all reductions | - %G | -% | -% | -% | -% | -% |
| Net investment income (loss) | 1.95%G | 1.62% | 1.47% | 1.52% | 1.84% | 1.93% |
| Supplemental Data | | | | | | |
| Net assets, end of period (000 omitted) | $54 | $53 | $68 | $30 | $27 | $25 |
| Portfolio turnover rate D | 35%G | 49% | 29% | 30% | 49% | 65% |
A Calculated based on average shares outstanding during the period.
B Total returns for periods of less than one year are not annualized.
C Total returns would have been lower if certain expenses had not been reduced during the applicable periods shown.
D Amounts do not include the activity of the Underlying Funds.
E Expense ratios reflect operating expenses of the class. Expenses before reductions do not reflect amounts reimbursed by the investment adviser or reductions from expense offset arrangements and do not represent the amount paid by the class during periods when reimbursements or reductions occur. Expenses net of fee waivers reflect expenses after reimbursement by the investment adviser but prior to reductions from expense offset arrangements. Expenses net of all reductions represent the net expenses paid by the class but do not include expenses of the underlying funds in which the Fund invests.
F Amount represents less than .005%.
G Annualized
See accompanying notes which are an integral part of the financial statements.
Fidelity Income Replacement 2026 Fund℠
Investment Summary (Unaudited)
The information in the following tables is based on the direct investments of the Fund.
Top Holdings as of January 31, 2017
| | % of fund's net assets | % of fund's net assets 6 months ago |
| Fidelity Total Bond Fund | 21.6 | 21.2 |
| Fidelity Short-Term Bond Fund | 11.3 | 10.8 |
| Fidelity Investments Money Market Government Portfolio Institutional Class 0.47% | 11.2 | 10.8 |
| Fidelity Series Broad Market Opportunities Fund | 8.0 | 8.2 |
| Fidelity Strategic Real Return Fund | 7.2 | 7.1 |
| Fidelity Government Income Fund | 7.2 | 7.1 |
| Fidelity Equity-Income Fund | 7.0 | 7.2 |
| Fidelity Large Cap Stock Fund | 5.2 | 5.4 |
| Fidelity Advisor Mid Cap II Fund Class I | 4.9 | 5.0 |
| Fidelity Series 100 Index Fund | 4.5 | 4.7 |
| | 88.1 | 87.5 |
Asset Allocation (% of fund's net assets)
| Period end |
| | Domestic Equity Funds | 34.8% |
| | International Equity Funds | 3.9% |
| | High Yield Fixed-Income Funds | 2.8% |
| | Investment Grade Fixed-Income Funds | 36.0% |
| | Short-Term Funds | 22.5% |
| Six months ago |
| | Domestic Equity Funds | 35.9% |
| | International Equity Funds | 4.1% |
| | High Yield Fixed-Income Funds | 3.0% |
| | Investment Grade Fixed-Income Funds | 35.4% |
| | Short-Term Funds | 21.6% |
Fidelity Income Replacement 2026 Fund℠
Investments January 31, 2017 (Unaudited)
Showing Percentage of Net Assets
| Equity Funds - 38.7% | | | |
| | | Shares | Value |
| Domestic Equity Funds - 34.8% | | | |
| Fidelity Advisor Mid Cap II Fund Class I (a) | | 27,549 | $546,290 |
| Fidelity Blue Chip Growth Fund (a) | | 7,196 | 508,150 |
| Fidelity Equity-Income Fund (a) | | 13,517 | 780,734 |
| Fidelity Large Cap Stock Fund (a) | | 19,663 | 585,551 |
| Fidelity Series 100 Index Fund (a) | | 34,474 | 508,150 |
| Fidelity Series Broad Market Opportunities Fund (a) | | 55,464 | 898,517 |
| Fidelity Series Small Cap Opportunities Fund (a) | | 5,573 | 78,522 |
|
| TOTAL DOMESTIC EQUITY FUNDS | | | 3,905,914 |
|
| International Equity Funds - 3.9% | | | |
| Fidelity Advisor International Discovery Fund Class I (a) | | 11,465 | 431,872 |
| TOTAL EQUITY FUNDS | | | |
| (Cost $3,800,661) | | | 4,337,786 |
|
| Fixed-Income Funds - 38.8% | | | |
| High Yield Fixed-Income Funds - 2.8% | | | |
| Fidelity Capital & Income Fund (a) | | 15,847 | 157,044 |
| Fidelity Strategic Income Fund (a) | | 14,582 | 157,044 |
|
| TOTAL HIGH YIELD FIXED-INCOME FUNDS | | | 314,088 |
|
| Investment Grade Fixed-Income Funds - 36.0% | | | |
| Fidelity Government Income Fund (a) | | 79,338 | 807,656 |
| Fidelity Strategic Real Return Fund (a) | | 91,571 | 807,656 |
| Fidelity Total Bond Fund (a) | | 229,772 | 2,424,092 |
|
| TOTAL INVESTMENT GRADE FIXED-INCOME FUNDS | | | 4,039,404 |
|
| TOTAL FIXED-INCOME FUNDS | | | |
| (Cost $4,387,922) | | | 4,353,492 |
|
| Short-Term Funds - 22.5% | | | |
| Fidelity Investments Money Market Government Portfolio Institutional Class 0.47% (a)(b) | | 1,262,825 | 1,262,825 |
| Fidelity Short-Term Bond Fund (a) | | 147,041 | 1,263,085 |
| TOTAL SHORT-TERM FUNDS | | | |
| (Cost $2,525,804) | | | 2,525,910 |
| TOTAL INVESTMENT PORTFOLIO - 100.0% | | | |
| (Cost $10,714,387) | | | 11,217,188 |
| NET OTHER ASSETS (LIABILITIES) - 0.0% | | | (433) |
| NET ASSETS - 100% | | | $11,216,755 |
Legend
(a) Affiliated Fund
(b) The rate quoted is the annualized seven-day yield of the fund at period end.
Affiliated Underlying Funds
Information regarding the Fund's fiscal year to date purchases and sales of the affiliated Underlying Funds and income earned by the Fund from investments in affiliated Underlying Funds is as follows:
| Affiliate | Value, beginning of period | Purchases | Sales Proceeds | Dividend Income | Value, end of period |
| Fidelity Advisor International Discovery Fund Class I | $341,529 | $152,504 | $57,822 | $6,351 | $431,872 |
| Fidelity Advisor Mid Cap II Fund Class I | 420,215 | 190,429 | 86,429 | 2,269 | 546,290 |
| Fidelity Blue Chip Growth Fund | 390,917 | 177,169 | 70,341 | 909 | 508,150 |
| Fidelity Capital & Income Fund | 125,562 | 50,901 | 25,405 | 2,971 | 157,044 |
| Fidelity Equity-Income Fund | 601,025 | 249,986 | 111,756 | 9,506 | 780,734 |
| Fidelity Government Income Fund | 593,491 | 304,151 | 57,828 | 5,348 | 807,656 |
| Fidelity Investments Money Market Government Portfolio Institutional Class 0.47% | 903,211 | 448,830 | 89,216 | 1,793 | 1,262,825 |
| Fidelity Large Cap Stock Fund | 450,350 | 186,990 | 94,566 | 4,700 | 585,551 |
| Fidelity Series 100 Index Fund | 390,917 | 163,505 | 61,996 | 10,091 | 508,150 |
| Fidelity Series Broad Market Opportunities Fund | 690,592 | 284,971 | 129,226 | 3,888 | 898,517 |
| Fidelity Series Small Cap Opportunities Fund | 60,270 | 26,292 | 14,382 | 322 | 78,522 |
| Fidelity Short-Term Bond Fund | 903,211 | 457,249 | 89,043 | 5,978 | 1,263,085 |
| Fidelity Strategic Income Fund | 125,562 | 51,232 | 19,859 | 2,348 | 157,044 |
| Fidelity Strategic Real Return Fund | 593,491 | 274,383 | 62,039 | 9,058 | 807,656 |
| Fidelity Total Bond Fund | 1,780,471 | 871,462 | 174,573 | 29,266 | 2,424,092 |
| Total | $8,370,814 | $3,890,054 | $1,144,481 | $94,798 | $11,217,188 |
Investment Valuation
All investments are categorized as Level 1 under the Fair Value Hierarchy. The inputs or methodology used for valuing securities may not be an indication of the risk associated with investing in those securities. For more information on valuation inputs please refer to the Investment Valuation section in the accompanying Notes to Financial Statements.
See accompanying notes which are an integral part of the financial statements.
Fidelity Income Replacement 2026 Fund℠
Financial Statements
Statement of Assets and Liabilities
| | | January 31, 2017 (Unaudited) |
| Assets | | |
| Investment in securities, at value (cost $10,714,387) — See accompanying schedule | | $11,217,188 |
| Cash | | 2 |
| Receivable for investments sold | | 80,404 |
| Total assets | | 11,297,594 |
| Liabilities | | |
| Payable for investments purchased | $77,076 | |
| Payable for fund shares redeemed | 3,308 | |
| Distribution and service plan fees payable | 455 | |
| Total liabilities | | 80,839 |
| Net Assets | | $11,216,755 |
| Net Assets consist of: | | |
| Paid in capital | | $10,765,610 |
| Undistributed net investment income | | 2,559 |
| Accumulated undistributed net realized gain (loss) on investments | | (54,215) |
| Net unrealized appreciation (depreciation) on investments | | 502,801 |
| Net Assets | | $11,216,755 |
| Calculation of Maximum Offering Price | | |
| Class A: | | |
| Net Asset Value and redemption price per share ($560,176 ÷ 9,211.30 shares) | | $60.81 |
| Maximum offering price per share (100/94.25 of $60.81) | | $64.52 |
| Class T: | | |
| Net Asset Value and redemption price per share ($299,287 ÷ 4,918.28 shares) | | $60.85 |
| Maximum offering price per share (100/96.50 of $60.85) | | $63.06 |
| Class C: | | |
| Net Asset Value and offering price per share ($255,222 ÷ 4,214.34 shares)(a) | | $60.56 |
| Income Replacement 2026: | | |
| Net Asset Value, offering price and redemption price per share ($10,071,055 ÷ 165,577.26 shares) | | $60.82 |
| Class I: | | |
| Net Asset Value, offering price and redemption price per share ($31,015 ÷ 509.92 shares) | | $60.82 |
(a) Redemption price per share is equal to net asset value less any applicable contingent deferred sales charge.
See accompanying notes which are an integral part of the financial statements.
Statement of Operations
| | | Six months ended January 31, 2017 (Unaudited) |
| Investment Income | | |
| Income distributions from underlying funds | | $94,798 |
| Expenses | | |
| Distribution and service plan fees | $2,722 | |
| Independent trustees' fees and expenses | 21 | |
| Total expenses before reductions | 2,743 | |
| Expense reductions | (21) | 2,722 |
| Net investment income (loss) | | 92,076 |
| Realized and Unrealized Gain (Loss) | | |
| Realized gain (loss) on sale of underlying fund shares | (1,182) | |
| Capital gain distributions from underlying funds | 58,878 | |
| Total net realized gain (loss) | | 57,696 |
| Change in net unrealized appreciation (depreciation) on underlying funds | | 101,978 |
| Net gain (loss) | | 159,674 |
| Net increase (decrease) in net assets resulting from operations | | $251,750 |
See accompanying notes which are an integral part of the financial statements.
Statement of Changes in Net Assets
| | Six months ended January 31, 2017 (Unaudited) | Year ended July 31, 2016 |
| Increase (Decrease) in Net Assets | | |
| Operations | | |
| Net investment income (loss) | $92,076 | $126,792 |
| Net realized gain (loss) | 57,696 | 71,839 |
| Change in net unrealized appreciation (depreciation) | 101,978 | 18,448 |
| Net increase (decrease) in net assets resulting from operations | 251,750 | 217,079 |
| Distributions to shareholders from net investment income | (91,535) | (126,167) |
| Distributions to shareholders from net realized gain | (48,306) | (79,217) |
| Total distributions | (139,841) | (205,384) |
| Share transactions - net increase (decrease) | 2,734,503 | 1,027,483 |
| Total increase (decrease) in net assets | 2,846,412 | 1,039,178 |
| Net Assets | | |
| Beginning of period | 8,370,343 | 7,331,165 |
| End of period | $11,216,755 | $8,370,343 |
| Other Information | | |
| Undistributed net investment income end of period | $2,559 | $2,018 |
See accompanying notes which are an integral part of the financial statements.
Financial Highlights — Fidelity Income Replacement 2026 Fund Class A
| | Six months ended (Unaudited) January 31, | Years ended July 31, | | | | |
| | 2017 | 2016 | 2015 | 2014 | 2013 | 2012 |
| Selected Per–Share Data | | | | | | |
| Net asset value, beginning of period | $60.26 | $60.57 | $58.78 | $54.81 | $50.09 | $49.53 |
| Income from Investment Operations | | | | | | |
| Net investment income (loss)A | .543 | .801 | .724 | .735 | .906 | .793 |
| Net realized and unrealized gain (loss) | .851 | .274 | 1.910 | 4.084 | 4.920 | .712 |
| Total from investment operations | 1.394 | 1.075 | 2.634 | 4.819 | 5.826 | 1.505 |
| Distributions from net investment income | (.517) | (.785) | (.698) | (.708) | (.879) | (.789) |
| Distributions from net realized gain | (.327) | (.600) | (.146) | (.141) | (.227) | (.156) |
| Total distributions | (.844) | (1.385) | (.844) | (.849) | (1.106) | (.945) |
| Net asset value, end of period | $60.81 | $60.26 | $60.57 | $58.78 | $54.81 | $50.09 |
| Total ReturnB,C,D | 2.34% | 1.88% | 4.50% | 8.84% | 11.79% | 3.13% |
| Ratios to Average Net AssetsE,F | | | | | | |
| Expenses before reductions | .25%G | .25% | .25% | .25% | .25% | .25% |
| Expenses net of fee waivers, if any | .25%G | .25% | .25% | .25% | .25% | .25% |
| Expenses net of all reductions | .25%G | .25% | .25% | .25% | .25% | .25% |
| Net investment income (loss) | 1.80%G | 1.38% | 1.21% | 1.28% | 1.73% | 1.64% |
| Supplemental Data | | | | | | |
| Net assets, end of period (000 omitted) | $560 | $577 | $727 | $526 | $304 | $139 |
| Portfolio turnover rateE | 25%G | 45% | 35% | 27% | 45% | 60% |
A Calculated based on average shares outstanding during the period.
B Total returns for periods of less than one year are not annualized.
C Total returns would have been lower if certain expenses had not been reduced during the applicable periods shown.
D Total returns do not include the effect of the sales charges.
E Amounts do not include the activity of the Underlying Funds.
F Expense ratios reflect operating expenses of the class. Expenses before reductions do not reflect amounts reimbursed by the investment adviser or reductions from expense offset arrangements and do not represent the amount paid by the class during periods when reimbursements or reductions occur. Expenses net of fee waivers reflect expenses after reimbursement by the investment adviser but prior to reductions from expense offset arrangements. Expenses net of all reductions represent the net expenses paid by the class but do not include expenses of the underlying funds in which the Fund invests.
G Annualized
See accompanying notes which are an integral part of the financial statements.
Financial Highlights — Fidelity Income Replacement 2026 Fund Class T
| | Six months ended (Unaudited) January 31, | Years ended July 31, | | | | |
| | 2017 | 2016 | 2015 | 2014 | 2013 | 2012 |
| Selected Per–Share Data | | | | | | |
| Net asset value, beginning of period | $60.30 | $60.61 | $58.83 | $54.82 | $50.08 | $49.53 |
| Income from Investment Operations | | | | | | |
| Net investment income (loss)A | .468 | .655 | .574 | .587 | .781 | .668 |
| Net realized and unrealized gain (loss) | .851 | .276 | 1.910 | 4.098 | 4.911 | .713 |
| Total from investment operations | 1.319 | .931 | 2.484 | 4.685 | 5.692 | 1.381 |
| Distributions from net investment income | (.442) | (.641) | (.558) | (.534) | (.725) | (.675) |
| Distributions from net realized gain | (.327) | (.600) | (.146) | (.141) | (.227) | (.156) |
| Total distributions | (.769) | (1.241) | (.704) | (.675) | (.952) | (.831) |
| Net asset value, end of period | $60.85 | $60.30 | $60.61 | $58.83 | $54.82 | $50.08 |
| Total ReturnB,C,D | 2.21% | 1.63% | 4.24% | 8.58% | 11.50% | 2.87% |
| Ratios to Average Net AssetsE,F | | | | | | |
| Expenses before reductions | .50%G | .50% | .50% | .50% | .50% | .50% |
| Expenses net of fee waivers, if any | .50%G | .50% | .50% | .50% | .50% | .50% |
| Expenses net of all reductions | .50%G | .50% | .50% | .50% | .50% | .50% |
| Net investment income (loss) | 1.55%G | 1.13% | .96% | 1.03% | 1.48% | 1.39% |
| Supplemental Data | | | | | | |
| Net assets, end of period (000 omitted) | $299 | $308 | $328 | $39 | $85 | $298 |
| Portfolio turnover rateE | 25%G | 45% | 35% | 27% | 45% | 60% |
A Calculated based on average shares outstanding during the period.
B Total returns for periods of less than one year are not annualized.
C Total returns would have been lower if certain expenses had not been reduced during the applicable periods shown.
D Total returns do not include the effect of the sales charges.
E Amounts do not include the activity of the Underlying Funds.
F Expense ratios reflect operating expenses of the class. Expenses before reductions do not reflect amounts reimbursed by the investment adviser or reductions from expense offset arrangements and do not represent the amount paid by the class during periods when reimbursements or reductions occur. Expenses net of fee waivers reflect expenses after reimbursement by the investment adviser but prior to reductions from expense offset arrangements. Expenses net of all reductions represent the net expenses paid by the class but do not include expenses of the underlying funds in which the Fund invests.
G Annualized
See accompanying notes which are an integral part of the financial statements.
Financial Highlights — Fidelity Income Replacement 2026 Fund Class C
| | Six months ended (Unaudited) January 31, | Years ended July 31, | | | | |
| | 2017 | 2016 | 2015 | 2014 | 2013 | 2012 |
| Selected Per–Share Data | | | | | | |
| Net asset value, beginning of period | $60.03 | $60.40 | $58.69 | $54.76 | $50.12 | $49.49 |
| Income from Investment Operations | | | | | | |
| Net investment income (loss)A | .316 | .360 | .278 | .303 | .508 | .430 |
| Net realized and unrealized gain (loss) | .849 | .276 | 1.899 | 4.086 | 4.915 | .730 |
| Total from investment operations | 1.165 | .636 | 2.177 | 4.389 | 5.423 | 1.160 |
| Distributions from net investment income | (.308) | (.406) | (.321) | (.318) | (.556) | (.374) |
| Distributions from net realized gain | (.327) | (.600) | (.146) | (.141) | (.227) | (.156) |
| Total distributions | (.635) | (1.006) | (.467) | (.459) | (.783) | (.530) |
| Net asset value, end of period | $60.56 | $60.03 | $60.40 | $58.69 | $54.76 | $50.12 |
| Total ReturnB,C,D | 1.96% | 1.12% | 3.72% | 8.04% | 10.93% | 2.40% |
| Ratios to Average Net AssetsE,F | | | | | | |
| Expenses before reductions | 1.00%G | 1.00% | .99%H | 1.00% | 1.00% | 1.00% |
| Expenses net of fee waivers, if any | 1.00%G | 1.00% | .99%H | 1.00% | 1.00% | 1.00% |
| Expenses net of all reductions | 1.00%G | 1.00% | .99%H | 1.00% | 1.00% | 1.00% |
| Net investment income (loss) | 1.05%G | .62% | .47% | .53% | .97% | .89% |
| Supplemental Data | | | | | | |
| Net assets, end of period (000 omitted) | $255 | $250 | $86 | $33 | $31 | $9 |
| Portfolio turnover rateE | 25%G | 45% | 35% | 27% | 45% | 60% |
A Calculated based on average shares outstanding during the period.
B Total returns for periods of less than one year are not annualized.
C Total returns would have been lower if certain expenses had not been reduced during the applicable periods shown.
D Total returns do not include the effect of the contingent deferred sales charge.
E Amounts do not include the activity of the Underlying Funds.
F Expense ratios reflect operating expenses of the class. Expenses before reductions do not reflect amounts reimbursed by the investment adviser or reductions from expense offset arrangements and do not represent the amount paid by the class during periods when reimbursements or reductions occur. Expenses net of fee waivers reflect expenses after reimbursement by the investment adviser but prior to reductions from expense offset arrangements. Expenses net of all reductions represent the net expenses paid by the class but do not include expenses of the underlying funds in which the Fund invests.
G Annualized
H On certain classes, the size and fluctuations of net assets may cause rounding of expense amounts and ratios to differ from contractual rates.
See accompanying notes which are an integral part of the financial statements.
Financial Highlights — Fidelity Income Replacement 2026 Fund
| | Six months ended (Unaudited) January 31, | Years ended July 31, | | | | |
| | 2017 | 2016 | 2015 | 2014 | 2013 | 2012 |
| Selected Per–Share Data | | | | | | |
| Net asset value, beginning of period | $60.27 | $60.58 | $58.79 | $54.81 | $50.09 | $49.53 |
| Income from Investment Operations | | | | | | |
| Net investment income (loss)A | .617 | .945 | .874 | .878 | 1.040 | .913 |
| Net realized and unrealized gain (loss) | .852 | .277 | 1.909 | 4.094 | 4.914 | .711 |
| Total from investment operations | 1.469 | 1.222 | 2.783 | 4.972 | 5.954 | 1.624 |
| Distributions from net investment income | (.592) | (.932) | (.847) | (.851) | (1.007) | (.908) |
| Distributions from net realized gain | (.327) | (.600) | (.146) | (.141) | (.227) | (.156) |
| Total distributions | (.919) | (1.532) | (.993) | (.992) | (1.234) | (1.064) |
| Net asset value, end of period | $60.82 | $60.27 | $60.58 | $58.79 | $54.81 | $50.09 |
| Total ReturnB,C | 2.47% | 2.14% | 4.76% | 9.13% | 12.06% | 3.39% |
| Ratios to Average Net AssetsD,E | | | | | | |
| Expenses before reductionsF | - %G | -% | -% | -% | -% | -% |
| Expenses net of fee waivers, if any | - %G | -% | -% | -% | -% | -% |
| Expenses net of all reductions | - %G | -% | -% | -% | -% | -% |
| Net investment income (loss) | 2.05%G | 1.63% | 1.46% | 1.53% | 1.98% | 1.88% |
| Supplemental Data | | | | | | |
| Net assets, end of period (000 omitted) | $10,071 | $7,205 | $6,160 | $3,677 | $1,702 | $1,309 |
| Portfolio turnover rateD | 25%G | 45% | 35% | 27% | 45% | 60% |
A Calculated based on average shares outstanding during the period.
B Total returns for periods of less than one year are not annualized.
C Total returns would have been lower if certain expenses had not been reduced during the applicable periods shown.
D Amounts do not include the activity of the Underlying Funds.
E Expense ratios reflect operating expenses of the class. Expenses before reductions do not reflect amounts reimbursed by the investment adviser or reductions from expense offset arrangements and do not represent the amount paid by the class during periods when reimbursements or reductions occur. Expenses net of fee waivers reflect expenses after reimbursement by the investment adviser but prior to reductions from expense offset arrangements. Expenses net of all reductions represent the net expenses paid by the class but do not include expenses of the underlying funds in which the Fund invests.
F Amount represents less than .005%.
G Annualized
See accompanying notes which are an integral part of the financial statements.
Financial Highlights — Fidelity Income Replacement 2026 Fund Class I
| | Six months ended (Unaudited) January 31, | Years ended July 31, | | | | |
| | 2017 | 2016 | 2015 | 2014 | 2013 | 2012 |
| Selected Per–Share Data | | | | | | |
| Net asset value, beginning of period | $60.27 | $60.58 | $58.79 | $54.81 | $50.09 | $49.53 |
| Income from Investment Operations | | | | | | |
| Net investment income (loss)A | .617 | .945 | .875 | .877 | 1.039 | .912 |
| Net realized and unrealized gain (loss) | .852 | .277 | 1.908 | 4.095 | 4.915 | .712 |
| Total from investment operations | 1.469 | 1.222 | 2.783 | 4.972 | 5.954 | 1.624 |
| Distributions from net investment income | (.592) | (.932) | (.847) | (.851) | (1.007) | (.908) |
| Distributions from net realized gain | (.327) | (.600) | (.146) | (.141) | (.227) | (.156) |
| Total distributions | (.919) | (1.532) | (.993) | (.992) | (1.234) | (1.064) |
| Net asset value, end of period | $60.82 | $60.27 | $60.58 | $58.79 | $54.81 | $50.09 |
| Total ReturnB,C | 2.47% | 2.14% | 4.76% | 9.13% | 12.06% | 3.39% |
| Ratios to Average Net AssetsD,E | | | | | | |
| Expenses before reductionsF | - %G | -% | -% | -% | -% | -% |
| Expenses net of fee waivers, if any | - %G | -% | -% | -% | -% | -% |
| Expenses net of all reductions | - %G | -% | -% | -% | -% | -% |
| Net investment income (loss) | 2.05%G | 1.63% | 1.46% | 1.53% | 1.98% | 1.88% |
| Supplemental Data | | | | | | |
| Net assets, end of period (000 omitted) | $31 | $30 | $31 | $30 | $27 | $24 |
| Portfolio turnover rateD | 25%G | 45% | 35% | 27% | 45% | 60% |
A Calculated based on average shares outstanding during the period.
B Total returns for periods of less than one year are not annualized.
C Total returns would have been lower if certain expenses had not been reduced during the applicable periods shown.
D Amounts do not include the activity of the Underlying Funds.
E Expense ratios reflect operating expenses of the class. Expenses before reductions do not reflect amounts reimbursed by the investment adviser or reductions from expense offset arrangements and do not represent the amount paid by the class during periods when reimbursements or reductions occur. Expenses net of fee waivers reflect expenses after reimbursement by the investment adviser but prior to reductions from expense offset arrangements. Expenses net of all reductions represent the net expenses paid by the class but do not include expenses of the underlying funds in which the Fund invests.
F Amount represents less than .005%.
G Annualized
See accompanying notes which are an integral part of the financial statements.
Fidelity Income Replacement 2028 Fund℠
Investment Summary (Unaudited)
The information in the following tables is based on the direct investments of the Fund.
Top Holdings as of January 31, 2017
| | % of fund's net assets | % of fund's net assets 6 months ago |
| Fidelity Total Bond Fund | 20.3 | 19.9 |
| Fidelity Investments Money Market Government Portfolio Institutional Class 0.47% | 9.6 | 9.3 |
| Fidelity Short-Term Bond Fund | 9.6 | 9.3 |
| Fidelity Series Broad Market Opportunities Fund | 8.9 | 9.1 |
| Fidelity Equity-Income Fund | 7.8 | 7.9 |
| Fidelity Strategic Real Return Fund | 6.8 | 6.7 |
| Fidelity Government Income Fund | 6.7 | 6.7 |
| Fidelity Large Cap Stock Fund | 5.8 | 5.9 |
| Fidelity Advisor Mid Cap II Fund Class I | 5.4 | 5.5 |
| Fidelity Series 100 Index Fund | 5.0 | 5.1 |
| | 85.9 | 85.4 |
Asset Allocation (% of fund's net assets)
| Period end |
| | Domestic Equity Funds | 38.8% |
| | International Equity Funds | 4.7% |
| | High Yield Fixed-Income Funds | 3.5% |
| | Investment Grade Fixed-Income Funds | 33.8% |
| | Short-Term Funds | 19.2% |
| Six months ago |
| | Domestic Equity Funds | 39.4% |
| | International Equity Funds | 5.0% |
| | High Yield Fixed-Income Funds | 3.7% |
| | Investment Grade Fixed-Income Funds | 33.3% |
| | Short-Term Funds | 18.6% |
Fidelity Income Replacement 2028 Fund℠
Investments January 31, 2017 (Unaudited)
Showing Percentage of Net Assets
| Equity Funds - 43.5% | | | |
| | | Shares | Value |
| Domestic Equity Funds - 38.8% | | | |
| Fidelity Advisor Mid Cap II Fund Class I (a) | | 67,434 | $1,337,213 |
| Fidelity Blue Chip Growth Fund (a) | | 17,575 | 1,241,170 |
| Fidelity Equity-Income Fund (a) | | 33,043 | 1,908,545 |
| Fidelity Large Cap Stock Fund (a) | | 48,128 | 1,433,256 |
| Fidelity Series 100 Index Fund (a) | | 84,204 | 1,241,170 |
| Fidelity Series Broad Market Opportunities Fund (a) | | 135,597 | 2,196,674 |
| Fidelity Series Small Cap Opportunities Fund (a) | | 13,633 | 192,086 |
|
| TOTAL DOMESTIC EQUITY FUNDS | | | 9,550,114 |
|
| International Equity Funds - 4.7% | | | |
| Fidelity Advisor International Discovery Fund Class I (a) | | 31,183 | 1,174,679 |
| TOTAL EQUITY FUNDS | | | |
| (Cost $9,003,721) | | | 10,724,793 |
|
| Fixed-Income Funds - 37.3% | | | |
| High Yield Fixed-Income Funds - 3.5% | | | |
| Fidelity Capital & Income Fund (a) | | 43,984 | 435,884 |
| Fidelity Strategic Income Fund (a) | | 40,472 | 435,885 |
|
| TOTAL HIGH YIELD FIXED-INCOME FUNDS | | | 871,769 |
|
| Investment Grade Fixed-Income Funds - 33.8% | | | |
| Fidelity Government Income Fund (a) | | 163,288 | 1,662,276 |
| Fidelity Strategic Real Return Fund (a) | | 188,467 | 1,662,281 |
| Fidelity Total Bond Fund (a) | | 472,684 | 4,986,820 |
|
| TOTAL INVESTMENT GRADE FIXED-INCOME FUNDS | | | 8,311,377 |
|
| TOTAL FIXED-INCOME FUNDS | | | |
| (Cost $9,261,542) | | | 9,183,146 |
|
| Short-Term Funds - 19.2% | | | |
| Fidelity Investments Money Market Government Portfolio Institutional Class 0.47% (a)(b) | | 2,359,206 | 2,359,206 |
| Fidelity Short-Term Bond Fund (a) | | 274,645 | 2,359,203 |
| TOTAL SHORT-TERM FUNDS | | | |
| (Cost $4,711,021) | | | 4,718,409 |
| TOTAL INVESTMENT PORTFOLIO - 100.0% | | | |
| (Cost $22,976,284) | | | 24,626,348 |
| NET OTHER ASSETS (LIABILITIES) - 0.0% | | | (437) |
| NET ASSETS - 100% | | | $24,625,911 |
Legend
(a) Affiliated Fund
(b) The rate quoted is the annualized seven-day yield of the fund at period end.
Affiliated Underlying Funds
Information regarding the Fund's fiscal year to date purchases and sales of the affiliated Underlying Funds and income earned by the Fund from investments in affiliated Underlying Funds is as follows:
| Affiliate | Value, beginning of period | Purchases | Sales Proceeds | Dividend Income | Value, end of period |
| Fidelity Advisor International Discovery Fund Class I | $1,470,389 | $102,288 | $373,905 | $21,033 | $1,174,679 |
| Fidelity Advisor Mid Cap II Fund Class I | 1,629,829 | 106,787 | 458,117 | 6,758 | 1,337,213 |
| Fidelity Blue Chip Growth Fund | 1,514,678 | 101,885 | 396,991 | 3,042 | 1,241,170 |
| Fidelity Capital & Income Fund | 543,276 | 17,139 | 144,560 | 10,870 | 435,884 |
| Fidelity Equity-Income Fund | 2,329,592 | 79,800 | 625,399 | 30,925 | 1,908,545 |
| Fidelity Government Income Fund | 1,966,423 | 182,249 | 395,277 | 14,762 | 1,662,276 |
| Fidelity Investments Money Market Government Portfolio Institutional Class 0.47% | 2,742,954 | 182,459 | 566,207 | 4,469 | 2,359,206 |
| Fidelity Large Cap Stock Fund | 1,747,932 | 52,887 | 500,723 | 13,982 | 1,433,256 |
| Fidelity Series 100 Index Fund | 1,514,678 | 57,290 | 373,709 | 29,963 | 1,241,170 |
| Fidelity Series Broad Market Opportunities Fund | 2,680,950 | 84,681 | 713,898 | 11,579 | 2,196,674 |
| Fidelity Series Small Cap Opportunities Fund | 233,254 | 9,412 | 68,678 | 1,069 | 192,086 |
| Fidelity Short-Term Bond Fund | 2,742,954 | 201,201 | 564,265 | 14,789 | 2,359,203 |
| Fidelity Strategic Income Fund | 543,276 | 21,066 | 127,977 | 8,631 | 435,885 |
| Fidelity Strategic Real Return Fund | 1,966,424 | 105,045 | 407,015 | 25,137 | 1,662,281 |
| Fidelity Total Bond Fund | 5,899,267 | 448,837 | 1,208,444 | 80,493 | 4,986,820 |
| Total | $29,525,876 | $1,753,026 | $6,925,165 | $277,502 | $24,626,348 |
Investment Valuation
All investments are categorized as Level 1 under the Fair Value Hierarchy. The inputs or methodology used for valuing securities may not be an indication of the risk associated with investing in those securities. For more information on valuation inputs please refer to the Investment Valuation section in the accompanying Notes to Financial Statements.
See accompanying notes which are an integral part of the financial statements.
Fidelity Income Replacement 2028 Fund℠
Financial Statements
Statement of Assets and Liabilities
| | | January 31, 2017 (Unaudited) |
| Assets | | |
| Investment in securities, at value (cost $22,976,284) — See accompanying schedule | | $24,626,348 |
| Cash | | 2 |
| Receivable for investments sold | | 215,807 |
| Receivable for fund shares sold | | 802 |
| Total assets | | 24,842,959 |
| Liabilities | | |
| Payable for investments purchased | $158,719 | |
| Payable for fund shares redeemed | 57,927 | |
| Distribution and service plan fees payable | 402 | |
| Total liabilities | | 217,048 |
| Net Assets | | $24,625,911 |
| Net Assets consist of: | | |
| Paid in capital | | $22,985,104 |
| Undistributed net investment income | | 5,561 |
| Accumulated undistributed net realized gain (loss) on investments | | (14,818) |
| Net unrealized appreciation (depreciation) on investments | | 1,650,064 |
| Net Assets | | $24,625,911 |
| Calculation of Maximum Offering Price | | |
| Class A: | | |
| Net Asset Value and redemption price per share ($378,542 ÷ 6,139.10 shares) | | $61.66 |
| Maximum offering price per share (100/94.25 of $61.66) | | $65.42 |
| Class T: | | |
| Net Asset Value and redemption price per share ($367,195 ÷ 5,955.70 shares) | | $61.65 |
| Maximum offering price per share (100/96.50 of $61.65) | | $63.89 |
| Class C: | | |
| Net Asset Value and offering price per share ($204,643 ÷ 3,332.30 shares)(a) | | $61.41 |
| Income Replacement 2028: | | |
| Net Asset Value, offering price and redemption price per share ($23,620,056 ÷ 383,127.50 shares) | | $61.65 |
| Class I: | | |
| Net Asset Value, offering price and redemption price per share ($55,475 ÷ 899.80 shares) | | $61.65 |
(a) Redemption price per share is equal to net asset value less any applicable contingent deferred sales charge.
See accompanying notes which are an integral part of the financial statements.
Statement of Operations
| | | Six months ended January 31, 2017 (Unaudited) |
| Investment Income | | |
| Income distributions from underlying funds | | $277,502 |
| Expenses | | |
| Distribution and service plan fees | $2,604 | |
| Independent trustees' fees and expenses | 62 | |
| Total expenses before reductions | 2,666 | |
| Expense reductions | (62) | 2,604 |
| Net investment income (loss) | | 274,898 |
| Realized and Unrealized Gain (Loss) | | |
| Realized gain (loss) on sale of underlying fund shares | (42,281) | |
| Capital gain distributions from underlying funds | 176,825 | |
| Total net realized gain (loss) | | 134,544 |
| Change in net unrealized appreciation (depreciation) on underlying funds | | 314,891 |
| Net gain (loss) | | 449,435 |
| Net increase (decrease) in net assets resulting from operations | | $724,333 |
See accompanying notes which are an integral part of the financial statements.
Statement of Changes in Net Assets
| | Six months ended January 31, 2017 (Unaudited) | Year ended July 31, 2016 |
| Increase (Decrease) in Net Assets | | |
| Operations | | |
| Net investment income (loss) | $274,898 | $478,240 |
| Net realized gain (loss) | 134,544 | 330,471 |
| Change in net unrealized appreciation (depreciation) | 314,891 | (163,247) |
| Net increase (decrease) in net assets resulting from operations | 724,333 | 645,464 |
| Distributions to shareholders from net investment income | (276,567) | (476,597) |
| Distributions to shareholders from net realized gain | (164,913) | (478,870) |
| Total distributions | (441,480) | (955,467) |
| Share transactions - net increase (decrease) | (5,182,337) | 2,040,175 |
| Total increase (decrease) in net assets | (4,899,484) | 1,730,172 |
| Net Assets | | |
| Beginning of period | 29,525,395 | 27,795,223 |
| End of period | $24,625,911 | $29,525,395 |
| Other Information | | |
| Undistributed net investment income end of period | $5,561 | $7,230 |
See accompanying notes which are an integral part of the financial statements.
Financial Highlights — Fidelity Income Replacement 2028 Fund Class A
| | Six months ended (Unaudited) January 31, | Years ended July 31, | | | | |
| | 2017 | 2016 | 2015 | 2014 | 2013 | 2012 |
| Selected Per–Share Data | | | | | | |
| Net asset value, beginning of period | $60.95 | $61.71 | $59.76 | $55.54 | $50.43 | $49.92 |
| Income from Investment Operations | | | | | | |
| Net investment income (loss)A | .538 | .815 | .758 | .733 | .868 | .792 |
| Net realized and unrealized gain (loss) | 1.084 | .196 | 2.089 | 4.363 | 5.348 | .666 |
| Total from investment operations | 1.622 | 1.011 | 2.847 | 5.096 | 6.216 | 1.458 |
| Distributions from net investment income | (.553) | (.798) | (.749) | (.713) | (.879) | (.794) |
| Distributions from net realized gain | (.359) | (.973) | (.148) | (.163) | (.227) | (.154) |
| Total distributions | (.912) | (1.771) | (.897) | (.876) | (1.106) | (.948) |
| Net asset value, end of period | $61.66 | $60.95 | $61.71 | $59.76 | $55.54 | $50.43 |
| Total ReturnB,C,D | 2.69% | 1.78% | 4.79% | 9.23% | 12.49% | 3.02% |
| Ratios to Average Net AssetsE,F | | | | | | |
| Expenses before reductions | .25%G | .25% | .25% | .25% | .25% | .25% |
| Expenses net of fee waivers, if any | .25%G | .25% | .25% | .25% | .25% | .25% |
| Expenses net of all reductions | .25%G | .25% | .25% | .25% | .25% | .25% |
| Net investment income (loss) | 1.76%G | 1.38% | 1.24% | 1.25% | 1.64% | 1.63% |
| Supplemental Data | | | | | | |
| Net assets, end of period (000 omitted) | $379 | $494 | $832 | $699 | $122 | $133 |
| Portfolio turnover rateE | 13%G | 47% | 28% | 18% | 34% | 46% |
A Calculated based on average shares outstanding during the period.
B Total returns for periods of less than one year are not annualized.
C Total returns would have been lower if certain expenses had not been reduced during the applicable periods shown.
D Total returns do not include the effect of the sales charges.
E Amounts do not include the activity of the Underlying Funds.
F Expense ratios reflect operating expenses of the class. Expenses before reductions do not reflect amounts reimbursed by the investment adviser or reductions from expense offset arrangements and do not represent the amount paid by the class during periods when reimbursements or reductions occur. Expenses net of fee waivers reflect expenses after reimbursement by the investment adviser but prior to reductions from expense offset arrangements. Expenses net of all reductions represent the net expenses paid by the class but do not include expenses of the underlying funds in which the Fund invests.
G Annualized
See accompanying notes which are an integral part of the financial statements.
Financial Highlights — Fidelity Income Replacement 2028 Fund Class T
| | Six months ended (Unaudited) January 31, | Years ended July 31, | | | | |
| | 2017 | 2016 | 2015 | 2014 | 2013 | 2012 |
| Selected Per–Share Data | | | | | | |
| Net asset value, beginning of period | $60.94 | $61.71 | $59.77 | $55.55 | $50.46 | $49.94 |
| Income from Investment Operations | | | | | | |
| Net investment income (loss)A | .462 | .667 | .604 | .580 | .738 | .672 |
| Net realized and unrealized gain (loss) | 1.082 | .189 | 2.087 | 4.379 | 5.346 | .678 |
| Total from investment operations | 1.544 | .856 | 2.691 | 4.959 | 6.084 | 1.350 |
| Distributions from net investment income | (.475) | (.653) | (.603) | (.576) | (.767) | (.676) |
| Distributions from net realized gain | (.359) | (.973) | (.148) | (.163) | (.227) | (.154) |
| Total distributions | (.834) | (1.626) | (.751) | (.739) | (.994) | (.830) |
| Net asset value, end of period | $61.65 | $60.94 | $61.71 | $59.77 | $55.55 | $50.46 |
| Total ReturnB,C,D | 2.56% | 1.51% | 4.52% | 8.97% | 12.21% | 2.79% |
| Ratios to Average Net AssetsE,F | | | | | | |
| Expenses before reductions | .50%G | .50% | .50% | .50% | .50% | .50% |
| Expenses net of fee waivers, if any | .50%G | .50% | .50% | .50% | .50% | .50% |
| Expenses net of all reductions | .50%G | .50% | .50% | .50% | .50% | .50% |
| Net investment income (loss) | 1.51%G | 1.13% | .99% | 1.00% | 1.39% | 1.38% |
| Supplemental Data | | | | | | |
| Net assets, end of period (000 omitted) | $367 | $419 | $466 | $338 | $326 | $128 |
| Portfolio turnover rateE | 13%G | 47% | 28% | 18% | 34% | 46% |
A Calculated based on average shares outstanding during the period.
B Total returns for periods of less than one year are not annualized.
C Total returns would have been lower if certain expenses had not been reduced during the applicable periods shown.
D Total returns do not include the effect of the sales charges.
E Amounts do not include the activity of the Underlying Funds.
F Expense ratios reflect operating expenses of the class. Expenses before reductions do not reflect amounts reimbursed by the investment adviser or reductions from expense offset arrangements and do not represent the amount paid by the class during periods when reimbursements or reductions occur. Expenses net of fee waivers reflect expenses after reimbursement by the investment adviser but prior to reductions from expense offset arrangements. Expenses net of all reductions represent the net expenses paid by the class but do not include expenses of the underlying funds in which the Fund invests.
G Annualized
See accompanying notes which are an integral part of the financial statements.
Financial Highlights — Fidelity Income Replacement 2028 Fund Class C
| | Six months ended (Unaudited) January 31, | Years ended July 31, | | | | |
| | 2017 | 2016 | 2015 | 2014 | 2013 | 2012 |
| Selected Per–Share Data | | | | | | |
| Net asset value, beginning of period | $60.72 | $61.52 | $59.65 | $55.49 | $50.44 | $49.94 |
| Income from Investment Operations | | | | | | |
| Net investment income (loss)A | .308 | .370 | .296 | .293 | .471 | .427 |
| Net realized and unrealized gain (loss) | 1.077 | .197 | 2.081 | 4.369 | 5.346 | .662 |
| Total from investment operations | 1.385 | .567 | 2.377 | 4.662 | 5.817 | 1.089 |
| Distributions from net investment income | (.336) | (.394) | (.359) | (.339) | (.540) | (.435) |
| Distributions from net realized gain | (.359) | (.973) | (.148) | (.163) | (.227) | (.154) |
| Total distributions | (.695) | (1.367) | (.507) | (.502) | (.767) | (.589) |
| Net asset value, end of period | $61.41 | $60.72 | $61.52 | $59.65 | $55.49 | $50.44 |
| Total ReturnB,C,D | 2.30% | 1.02% | 4.00% | 8.43% | 11.65% | 2.24% |
| Ratios to Average Net AssetsE,F | | | | | | |
| Expenses before reductions | 1.00%G | 1.00% | 1.00% | 1.00% | 1.00% | 1.00% |
| Expenses net of fee waivers, if any | 1.00%G | 1.00% | 1.00% | 1.00% | 1.00% | 1.00% |
| Expenses net of all reductions | 1.00%G | 1.00% | 1.00% | 1.00% | 1.00% | 1.00% |
| Net investment income (loss) | 1.01%G | .63% | .49% | .50% | .89% | .88% |
| Supplemental Data | | | | | | |
| Net assets, end of period (000 omitted) | $205 | $213 | $177 | $37 | $18 | $33 |
| Portfolio turnover rateE | 13%G | 47% | 28% | 18% | 34% | 46% |
A Calculated based on average shares outstanding during the period.
B Total returns for periods of less than one year are not annualized.
C Total returns would have been lower if certain expenses had not been reduced during the applicable periods shown.
D Total returns do not include the effect of the contingent deferred sales charge.
E Amounts do not include the activity of the Underlying Funds.
F Expense ratios reflect operating expenses of the class. Expenses before reductions do not reflect amounts reimbursed by the investment adviser or reductions from expense offset arrangements and do not represent the amount paid by the class during periods when reimbursements or reductions occur. Expenses net of fee waivers reflect expenses after reimbursement by the investment adviser but prior to reductions from expense offset arrangements. Expenses net of all reductions represent the net expenses paid by the class but do not include expenses of the underlying funds in which the Fund invests.
G Annualized
See accompanying notes which are an integral part of the financial statements.
Financial Highlights — Fidelity Income Replacement 2028 Fund
| | Six months ended (Unaudited) January 31, | Years ended July 31, | | | | |
| | 2017 | 2016 | 2015 | 2014 | 2013 | 2012 |
| Selected Per–Share Data | | | | | | |
| Net asset value, beginning of period | $60.94 | $61.71 | $59.76 | $55.54 | $50.44 | $49.92 |
| Income from Investment Operations | | | | | | |
| Net investment income (loss)A | .614 | .959 | .910 | .874 | 1.003 | .914 |
| Net realized and unrealized gain (loss) | 1.086 | .194 | 2.088 | 4.376 | 5.340 | .680 |
| Total from investment operations | 1.700 | 1.153 | 2.998 | 5.250 | 6.343 | 1.594 |
| Distributions from net investment income | (.631) | (.950) | (.900) | (.867) | (1.016) | (.920) |
| Distributions from net realized gain | (.359) | (.973) | (.148) | (.163) | (.227) | (.154) |
| Total distributions | (.990) | (1.923) | (1.048) | (1.030) | (1.243) | (1.074) |
| Net asset value, end of period | $61.65 | $60.94 | $61.71 | $59.76 | $55.54 | $50.44 |
| Total ReturnB,C | 2.82% | 2.03% | 5.05% | 9.52% | 12.76% | 3.30% |
| Ratios to Average Net AssetsD,E | | | | | | |
| Expenses before reductionsF | - %G | -% | -% | -% | -% | -% |
| Expenses net of fee waivers, if any | - %G | -% | -% | -% | -% | -% |
| Expenses net of all reductions | - %G | -% | -% | -% | -% | -% |
| Net investment income (loss) | 2.01%G | 1.63% | 1.49% | 1.50% | 1.89% | 1.88% |
| Supplemental Data | | | | | | |
| Net assets, end of period (000 omitted) | $23,620 | $28,337 | $26,020 | $21,766 | $7,494 | $5,405 |
| Portfolio turnover rateD | 13%G | 47% | 28% | 18% | 34% | 46% |
A Calculated based on average shares outstanding during the period.
B Total returns for periods of less than one year are not annualized.
C Total returns would have been lower if certain expenses had not been reduced during the applicable periods shown.
D Amounts do not include the activity of the Underlying Funds.
E Expense ratios reflect operating expenses of the class. Expenses before reductions do not reflect amounts reimbursed by the investment adviser or reductions from expense offset arrangements and do not represent the amount paid by the class during periods when reimbursements or reductions occur. Expenses net of fee waivers reflect expenses after reimbursement by the investment adviser but prior to reductions from expense offset arrangements. Expenses net of all reductions represent the net expenses paid by the class but do not include expenses of the underlying funds in which the Fund invests.
F Amount represents less than .005%.
G Annualized
See accompanying notes which are an integral part of the financial statements.
Financial Highlights — Fidelity Income Replacement 2028 Fund Class I
| | Six months ended (Unaudited) January 31, | Years ended July 31, | | | | |
| | 2017 | 2016 | 2015 | 2014 | 2013 | 2012 |
| Selected Per–Share Data | | | | | | |
| Net asset value, beginning of period | $60.94 | $61.71 | $59.76 | $55.54 | $50.44 | $49.92 |
| Income from Investment Operations | | | | | | |
| Net investment income (loss)A | .614 | .978 | .906 | .871 | 1.011 | .916 |
| Net realized and unrealized gain (loss) | 1.086 | .175 | 2.092 | 4.379 | 5.332 | .678 |
| Total from investment operations | 1.700 | 1.153 | 2.998 | 5.250 | 6.343 | 1.594 |
| Distributions from net investment income | (.631) | (.950) | (.900) | (.867) | (1.016) | (.920) |
| Distributions from net realized gain | (.359) | (.973) | (.148) | (.163) | (.227) | (.154) |
| Total distributions | (.990) | (1.923) | (1.048) | (1.030) | (1.243) | (1.074) |
| Net asset value, end of period | $61.65 | $60.94 | $61.71 | $59.76 | $55.54 | $50.44 |
| Total ReturnB,C | 2.82% | 2.03% | 5.05% | 9.52% | 12.76% | 3.30% |
| Ratios to Average Net AssetsD,E | | | | | | |
| Expenses before reductionsF | - %G | -% | -% | -% | -% | -% |
| Expenses net of fee waivers, if any | - %G | -% | -% | -% | -% | -% |
| Expenses net of all reductions | - %G | -% | -% | -% | -% | -% |
| Net investment income (loss) | 2.01%G | 1.63% | 1.49% | 1.50% | 1.89% | 1.88% |
| Supplemental Data | | | | | | |
| Net assets, end of period (000 omitted) | $55 | $62 | $300 | $91 | $83 | $24 |
| Portfolio turnover rateD | 13%G | 47% | 28% | 18% | 34% | 46% |
A Calculated based on average shares outstanding during the period.
B Total returns for periods of less than one year are not annualized.
C Total returns would have been lower if certain expenses had not been reduced during the applicable periods shown.
D Amounts do not include the activity of the Underlying Funds.
E Expense ratios reflect operating expenses of the class. Expenses before reductions do not reflect amounts reimbursed by the investment adviser or reductions from expense offset arrangements and do not represent the amount paid by the class during periods when reimbursements or reductions occur. Expenses net of fee waivers reflect expenses after reimbursement by the investment adviser but prior to reductions from expense offset arrangements. Expenses net of all reductions represent the net expenses paid by the class but do not include expenses of the underlying funds in which the Fund invests.
F Amount represents less than .005%.
G Annualized
See accompanying notes which are an integral part of the financial statements.
Fidelity Income Replacement 2030 Fund℠
Investment Summary (Unaudited)
The information in the following tables is based on the direct investments of the Fund.
Top Holdings as of January 31, 2017
| | % of fund's net assets | % of fund's net assets 6 months ago |
| Fidelity Total Bond Fund | 19.4 | 19.0 |
| Fidelity Series Broad Market Opportunities Fund | 9.5 | 9.6 |
| Fidelity Investments Money Market Government Portfolio Institutional Class 0.47% | 8.5 | 8.3 |
| Fidelity Short-Term Bond Fund | 8.4 | 8.3 |
| Fidelity Equity-Income Fund | 8.2 | 8.4 |
| Fidelity Strategic Real Return Fund | 6.5 | 6.4 |
| Fidelity Government Income Fund | 6.4 | 6.4 |
| Fidelity Large Cap Stock Fund | 6.2 | 6.3 |
| Fidelity Advisor Mid Cap II Fund Class I | 5.8 | 5.8 |
| Fidelity Advisor International Discovery Fund Class I | 5.6 | 5.8 |
| | 84.5 | 84.3 |
Asset Allocation (% of fund's net assets)
| Period end |
| | Domestic Equity Funds | 41.2% |
| | International Equity Funds | 5.6% |
| | High Yield Fixed-Income Funds | 4.0% |
| | Investment Grade Fixed-Income Funds | 32.3% |
| | Short-Term Funds | 16.9% |
| Six months ago |
| | Domestic Equity Funds | 41.7% |
| | International Equity Funds | 5.8% |
| | High Yield Fixed-Income Funds | 4.1% |
| | Investment Grade Fixed-Income Funds | 31.8% |
| | Short-Term Funds | 16.6% |
Fidelity Income Replacement 2030 Fund℠
Investments January 31, 2017 (Unaudited)
Showing Percentage of Net Assets
| Equity Funds - 46.8% | | | |
| | | Shares | Value |
| Domestic Equity Funds - 41.2% | | | |
| Fidelity Advisor Mid Cap II Fund Class I (a) | | 39,229 | $777,910 |
| Fidelity Blue Chip Growth Fund (a) | | 10,233 | 722,634 |
| Fidelity Equity-Income Fund (a) | | 19,257 | 1,112,263 |
| Fidelity Large Cap Stock Fund (a) | | 27,978 | 833,186 |
| Fidelity Series 100 Index Fund (a) | | 49,025 | 722,634 |
| Fidelity Series Broad Market Opportunities Fund (a) | | 78,895 | 1,278,092 |
| Fidelity Series Small Cap Opportunities Fund (a) | | 7,846 | 110,552 |
|
| TOTAL DOMESTIC EQUITY FUNDS | | | 5,557,271 |
|
| International Equity Funds - 5.6% | | | |
| Fidelity Advisor International Discovery Fund Class I (a) | | 20,042 | 754,991 |
| TOTAL EQUITY FUNDS | | | |
| (Cost $5,068,115) | | | 6,312,262 |
|
| Fixed-Income Funds - 36.3% | | | |
| High Yield Fixed-Income Funds - 4.0% | | | |
| Fidelity Capital & Income Fund (a) | | 27,345 | 270,988 |
| Fidelity Strategic Income Fund (a) | | 25,161 | 270,988 |
|
| TOTAL HIGH YIELD FIXED-INCOME FUNDS | | | 541,976 |
|
| Investment Grade Fixed-Income Funds - 32.3% | | | |
| Fidelity Government Income Fund (a) | | 85,289 | 868,239 |
| Fidelity Strategic Real Return Fund (a) | | 98,440 | 868,239 |
| Fidelity Total Bond Fund (a) | | 247,148 | 2,607,414 |
|
| TOTAL INVESTMENT GRADE FIXED-INCOME FUNDS | | | 4,343,892 |
|
| TOTAL FIXED-INCOME FUNDS | | | |
| (Cost $4,919,286) | | | 4,885,868 |
|
| Short-Term Funds - 16.9% | | | |
| Fidelity Investments Money Market Government Portfolio Institutional Class 0.47% (a)(b) | | 1,141,924 | 1,141,924 |
| Fidelity Short-Term Bond Fund (a) | | 132,936 | 1,141,923 |
| TOTAL SHORT-TERM FUNDS | | | |
| (Cost $2,278,115) | | | 2,283,847 |
| TOTAL INVESTMENT PORTFOLIO - 100.0% | | | |
| (Cost $12,265,516) | | | 13,481,977 |
| NET OTHER ASSETS (LIABILITIES) - 0.0% | | | (190) |
| NET ASSETS - 100% | | | $13,481,787 |
Legend
(a) Affiliated Fund
(b) The rate quoted is the annualized seven-day yield of the fund at period end.
Affiliated Underlying Funds
Information regarding the Fund's fiscal year to date purchases and sales of the affiliated Underlying Funds and income earned by the Fund from investments in affiliated Underlying Funds is as follows:
| Affiliate | Value, beginning of period | Purchases | Sales Proceeds | Dividend Income | Value, end of period |
| Fidelity Advisor International Discovery Fund Class I | $824,854 | $73,804 | $131,528 | $12,160 | $754,991 |
| Fidelity Advisor Mid Cap II Fund Class I | 830,543 | 68,275 | 151,727 | 3,540 | 777,910 |
| Fidelity Blue Chip Growth Fund | 770,812 | 65,577 | 125,933 | 1,581 | 722,634 |
| Fidelity Capital & Income Fund | 294,387 | 14,432 | 49,102 | 6,040 | 270,988 |
| Fidelity Equity-Income Fund | 1,186,083 | 71,779 | 209,999 | 16,081 | 1,112,263 |
| Fidelity Government Income Fund | 903,073 | 110,500 | 103,276 | 6,925 | 868,239 |
| Fidelity Investments Money Market Government Portfolio Institutional Class 0.47% | 1,181,817 | 105,160 | 145,053 | 1,958 | 1,141,924 |
| Fidelity Large Cap Stock Fund | 888,851 | 42,744 | 167,100 | 7,349 | 833,186 |
| Fidelity Series 100 Index Fund | 770,812 | 42,986 | 113,462 | 15,740 | 722,634 |
| Fidelity Series Broad Market Opportunities Fund | 1,363,854 | 66,933 | 229,445 | 6,071 | 1,278,092 |
| Fidelity Series Small Cap Opportunities Fund | 118,039 | 7,502 | 24,479 | 554 | 110,552 |
| Fidelity Short-Term Bond Fund | 1,181,817 | 113,289 | 144,197 | 6,479 | 1,141,923 |
| Fidelity Strategic Income Fund | 294,387 | 17,321 | 40,631 | 4,795 | 270,988 |
| Fidelity Strategic Real Return Fund | 903,073 | 74,348 | 108,593 | 11,753 | 868,239 |
| Fidelity Total Bond Fund | 2,709,220 | 287,541 | 319,073 | 37,794 | 2,607,414 |
| Total | $14,221,622 | $1,162,191 | $2,063,598 | $138,820 | $13,481,977 |
Investment Valuation
All investments are categorized as Level 1 under the Fair Value Hierarchy. The inputs or methodology used for valuing securities may not be an indication of the risk associated with investing in those securities. For more information on valuation inputs please refer to the Investment Valuation section in the accompanying Notes to Financial Statements.
See accompanying notes which are an integral part of the financial statements.
Fidelity Income Replacement 2030 Fund℠
Financial Statements
Statement of Assets and Liabilities
| | | January 31, 2017 (Unaudited) |
| Assets | | |
| Investment in securities, at value (cost $12,265,516) — See accompanying schedule | | $13,481,977 |
| Cash | | 2 |
| Receivable for investments sold | | 77,752 |
| Receivable for fund shares sold | | 59,849 |
| Total assets | | 13,619,580 |
| Liabilities | | |
| Payable for investments purchased | $112,445 | |
| Payable for fund shares redeemed | 25,146 | |
| Distribution and service plan fees payable | 202 | |
| Total liabilities | | 137,793 |
| Net Assets | | $13,481,787 |
| Net Assets consist of: | | |
| Paid in capital | | $12,234,895 |
| Undistributed net investment income | | 2,998 |
| Accumulated undistributed net realized gain (loss) on investments | | 27,433 |
| Net unrealized appreciation (depreciation) on investments | | 1,216,461 |
| Net Assets | | $13,481,787 |
| Calculation of Maximum Offering Price | | |
| Class A: | | |
| Net Asset Value and redemption price per share ($129,451 ÷ 2,130.09 shares) | | $60.77 |
| Maximum offering price per share (100/94.25 of $60.77) | | $64.48 |
| Class T: | | |
| Net Asset Value and redemption price per share ($16,336 ÷ 268.33 shares) | | $60.88 |
| Maximum offering price per share (100/96.50 of $60.88) | | $63.09 |
| Class C: | | |
| Net Asset Value and offering price per share ($199,903 ÷ 3,307.95 shares)(a) | | $60.43 |
| Income Replacement 2030: | | |
| Net Asset Value, offering price and redemption price per share ($13,104,467 ÷ 215,650.47 shares) | | $60.77 |
| Class I: | | |
| Net Asset Value, offering price and redemption price per share ($31,630 ÷ 520.47 shares) | | $60.77 |
(a) Redemption price per share is equal to net asset value less any applicable contingent deferred sales charge.
See accompanying notes which are an integral part of the financial statements.
Statement of Operations
| | | Six months ended January 31, 2017 (Unaudited) |
| Investment Income | | |
| Income distributions from underlying funds | | $138,820 |
| Expenses | | |
| Distribution and service plan fees | $1,206 | |
| Independent trustees' fees and expenses | 31 | |
| Total expenses before reductions | 1,237 | |
| Expense reductions | (31) | 1,206 |
| Net investment income (loss) | | 137,614 |
| Realized and Unrealized Gain (Loss) | | |
| Realized gain (loss) on sale of underlying fund shares | 12,345 | |
| Capital gain distributions from underlying funds | 90,637 | |
| Total net realized gain (loss) | | 102,982 |
| Change in net unrealized appreciation (depreciation) on underlying funds | | 149,416 |
| Net gain (loss) | | 252,398 |
| Net increase (decrease) in net assets resulting from operations | | $390,012 |
See accompanying notes which are an integral part of the financial statements.
Statement of Changes in Net Assets
| | Six months ended January 31, 2017 (Unaudited) | Year ended July 31, 2016 |
| Increase (Decrease) in Net Assets | | |
| Operations | | |
| Net investment income (loss) | $137,614 | $248,184 |
| Net realized gain (loss) | 102,982 | 184,594 |
| Change in net unrealized appreciation (depreciation) | 149,416 | (282,030) |
| Net increase (decrease) in net assets resulting from operations | 390,012 | 150,748 |
| Distributions to shareholders from net investment income | (137,952) | (248,283) |
| Distributions to shareholders from net realized gain | (107,778) | (388,383) |
| Total distributions | (245,730) | (636,666) |
| Share transactions - net increase (decrease) | (883,930) | (3,054,764) |
| Total increase (decrease) in net assets | (739,648) | (3,540,682) |
| Net Assets | | |
| Beginning of period | 14,221,435 | 17,762,117 |
| End of period | $13,481,787 | $14,221,435 |
| Other Information | | |
| Undistributed net investment income end of period | $2,998 | $3,336 |
See accompanying notes which are an integral part of the financial statements.
Financial Highlights — Fidelity Income Replacement 2030 Fund Class A
| | Six months ended (Unaudited) January 31, | Years ended July 31, | | | | |
| | 2017 | 2016 | 2015 | 2014 | 2013 | 2012 |
| Selected Per–Share Data | | | | | | |
| Net asset value, beginning of period | $60.07 | $61.33 | $59.84 | $55.45 | $50.12 | $49.65 |
| Income from Investment Operations | | | | | | |
| Net investment income (loss)A | .542 | .799 | .747 | .740 | .886 | .815 |
| Net realized and unrealized gain (loss) | 1.185 | .112B | 2.210 | 4.505 | 5.568 | .598 |
| Total from investment operations | 1.727 | .911 | 2.957 | 5.245 | 6.454 | 1.413 |
| Distributions from net investment income | (.552) | (.794) | (.746) | (.700) | (.896) | (.796) |
| Distributions from net realized gain | (.475) | (1.377) | (.721) | (.155) | (.228) | (.147) |
| Total distributions | (1.027) | (2.171) | (1.467) | (.855) | (1.124) | (.943) |
| Net asset value, end of period | $60.77 | $60.07 | $61.33 | $59.84 | $55.45 | $50.12 |
| Total ReturnC,D,E | 2.91% | 1.67% | 5.00% | 9.51% | 13.06% | 2.94% |
| Ratios to Average Net AssetsF,G | | | | | | |
| Expenses before reductions | .25%H | .25% | .25% | .25% | .25% | .25% |
| Expenses net of fee waivers, if any | .25%H | .25% | .25% | .25% | .25% | .25% |
| Expenses net of all reductions | .25%H | .25% | .25% | .25% | .25% | .25% |
| Net investment income (loss) | 1.80%H | 1.38% | 1.23% | 1.27% | 1.67% | 1.68% |
| Supplemental Data | | | | | | |
| Net assets, end of period (000 omitted) | $129 | $156 | $285 | $257 | $145 | $86 |
| Portfolio turnover rate F | 17%H | 26% | 26% | 27% | 32% | 50% |
A Calculated based on average shares outstanding during the period.
B The amount shown for a share outstanding does not correspond with the aggregate net gain (loss) on investments for the period due to the timing of sales and repurchases of shares in relation to fluctuating market values of the investments of the Fund.
C Total returns for periods of less than one year are not annualized.
D Total returns would have been lower if certain expenses had not been reduced during the applicable periods shown.
E Total returns do not include the effect of the sales charges.
F Amounts do not include the activity of the Underlying Funds.
G Expense ratios reflect operating expenses of the class. Expenses before reductions do not reflect amounts reimbursed by the investment adviser or reductions from expense offset arrangements and do not represent the amount paid by the class during periods when reimbursements or reductions occur. Expenses net of fee waivers reflect expenses after reimbursement by the investment adviser but prior to reductions from expense offset arrangements. Expenses net of all reductions represent the net expenses paid by the class but do not include expenses of the underlying funds in which the Fund invests.
H Annualized
See accompanying notes which are an integral part of the financial statements.
Financial Highlights — Fidelity Income Replacement 2030 Fund Class T
| | Six months ended (Unaudited) January 31, | Years ended July 31, | | | | |
| | 2017 | 2016 | 2015 | 2014 | 2013 | 2012 |
| Selected Per–Share Data | | | | | | |
| Net asset value, beginning of period | $60.19 | $61.44 | $59.95 | $55.55 | $50.20 | $49.67 |
| Income from Investment Operations | | | | | | |
| Net investment income (loss)A | .467 | .658 | .600 | .597 | .745 | .715 |
| Net realized and unrealized gain (loss) | 1.182 | .118B | 2.211 | 4.507 | 5.590 | .598 |
| Total from investment operations | 1.649 | .776 | 2.811 | 5.104 | 6.335 | 1.313 |
| Distributions from net investment income | (.484) | (.649) | (.600) | (.549) | (.757) | (.636) |
| Distributions from net realized gain | (.475) | (1.377) | (.721) | (.155) | (.228) | (.147) |
| Total distributions | (.959) | (2.026) | (1.321) | (.704) | (.985) | (.783) |
| Net asset value, end of period | $60.88 | $60.19 | $61.44 | $59.95 | $55.55 | $50.20 |
| Total ReturnC,D,E | 2.77% | 1.43% | 4.74% | 9.23% | 12.78% | 2.72% |
| Ratios to Average Net AssetsF,G | | | | | | |
| Expenses before reductions | .50%H | .50% | .50% | .50% | .51%I | .50% |
| Expenses net of fee waivers, if any | .50%H | .50% | .50% | .50% | .51%I | .46% |
| Expenses net of all reductions | .50%H | .50% | .50% | .50% | .51%I | .46% |
| Net investment income (loss) | 1.55%H | 1.13% | .99% | 1.03% | 1.41% | 1.48% |
| Supplemental Data | | | | | | |
| Net assets, end of period (000 omitted) | $16 | $16 | $21 | $17 | $15 | $13 |
| Portfolio turnover rate F | 17%H | 26% | 26% | 27% | 32% | 50% |
A Calculated based on average shares outstanding during the period.
B The amount shown for a share outstanding does not correspond with the aggregate net gain (loss) on investments for the period due to the timing of sales and repurchases of shares in relation to fluctuating market values of the investments of the Fund.
C Total returns for periods of less than one year are not annualized.
D Total returns would have been lower if certain expenses had not been reduced during the applicable periods shown.
E Total returns do not include the effect of the sales charges.
F Amounts do not include the activity of the Underlying Funds.
G Expense ratios reflect operating expenses of the class. Expenses before reductions do not reflect amounts reimbursed by the investment adviser or reductions from expense offset arrangements and do not represent the amount paid by the class during periods when reimbursements or reductions occur. Expenses net of fee waivers reflect expenses after reimbursement by the investment adviser but prior to reductions from expense offset arrangements. Expenses net of all reductions represent the net expenses paid by the class but do not include expenses of the underlying funds in which the Fund invests.
H Annualized
I On certain classes, the size and fluctuation of net assets may cause rounding of expense amounts and ratios to differ from contractual rates.
See accompanying notes which are an integral part of the financial statements.
Financial Highlights — Fidelity Income Replacement 2030 Fund Class C
| | Six months ended (Unaudited) January 31, | Years ended July 31, | | | | |
| | 2017 | 2016 | 2015 | 2014 | 2013 | 2012 |
| Selected Per–Share Data | | | | | | |
| Net asset value, beginning of period | $59.76 | $61.06 | $59.64 | $55.33 | $50.07 | $49.61 |
| Income from Investment Operations | | | | | | |
| Net investment income (loss)A | .314 | .361 | .291 | .303 | .486 | .451 |
| Net realized and unrealized gain (loss) | 1.174 | .115B | 2.202 | 4.486 | 5.561 | .604 |
| Total from investment operations | 1.488 | .476 | 2.493 | 4.789 | 6.047 | 1.055 |
| Distributions from net investment income | (.343) | (.399) | (.352) | (.324) | (.559) | (.448) |
| Distributions from net realized gain | (.475) | (1.377) | (.721) | (.155) | (.228) | (.147) |
| Total distributions | (.818) | (1.776) | (1.073) | (.479) | (.787) | (.595) |
| Net asset value, end of period | $60.43 | $59.76 | $61.06 | $59.64 | $55.33 | $50.07 |
| Total ReturnC,D,E | 2.52% | .92% | 4.22% | 8.68% | 12.21% | 2.19% |
| Ratios to Average Net AssetsF,G | | | | | | |
| Expenses before reductions | 1.00%H | 1.00% | 1.00% | 1.00% | 1.00% | 1.00% |
| Expenses net of fee waivers, if any | 1.00%H | 1.00% | 1.00% | 1.00% | 1.00% | 1.00% |
| Expenses net of all reductions | 1.00%H | 1.00% | 1.00% | 1.00% | 1.00% | 1.00% |
| Net investment income (loss) | 1.05%H | .63% | .48% | .52% | .92% | .93% |
| Supplemental Data | | | | | | |
| Net assets, end of period (000 omitted) | $200 | $200 | $345 | $353 | $315 | $312 |
| Portfolio turnover rate F | 17%H | 26% | 26% | 27% | 32% | 50% |
A Calculated based on average shares outstanding during the period.
B The amount shown for a share outstanding does not correspond with the aggregate net gain (loss) on investments for the period due to the timing of sales and repurchases of shares in relation to fluctuating market values of the investments of the Fund.
C Total returns for periods of less than one year are not annualized.
D Total returns would have been lower if certain expenses had not been reduced during the applicable periods shown.
E Total returns do not include the effect of the contingent deferred sales charge.
F Amounts do not include the activity of the Underlying Funds.
G Expense ratios reflect operating expenses of the class. Expenses before reductions do not reflect amounts reimbursed by the investment adviser or reductions from expense offset arrangements and do not represent the amount paid by the class during periods when reimbursements or reductions occur. Expenses net of fee waivers reflect expenses after reimbursement by the investment adviser but prior to reductions from expense offset arrangements. Expenses net of all reductions represent the net expenses paid by the class but do not include expenses of the underlying funds in which the Fund invests.
H Annualized
See accompanying notes which are an integral part of the financial statements.
Financial Highlights — Fidelity Income Replacement 2030 Fund
| | Six months ended (Unaudited) January 31, | Years ended July 31, | | | | |
| | 2017 | 2016 | 2015 | 2014 | 2013 | 2012 |
| Selected Per–Share Data | | | | | | |
| Net asset value, beginning of period | $60.07 | $61.33 | $59.84 | $55.45 | $50.12 | $49.64 |
| Income from Investment Operations | | | | | | |
| Net investment income (loss)A | .617 | .944 | .900 | .888 | 1.015 | .935 |
| Net realized and unrealized gain (loss) | 1.186 | .116B | 2.209 | 4.502 | 5.567 | .608 |
| Total from investment operations | 1.803 | 1.060 | 3.109 | 5.390 | 6.582 | 1.543 |
| Distributions from net investment income | (.628) | (.943) | (.898) | (.845) | (1.024) | (.916) |
| Distributions from net realized gain | (.475) | (1.377) | (.721) | (.155) | (.228) | (.147) |
| Total distributions | (1.103) | (2.320) | (1.619) | (1.000) | (1.252) | (1.063) |
| Net asset value, end of period | $60.77 | $60.07 | $61.33 | $59.84 | $55.45 | $50.12 |
| Total ReturnC,D | 3.04% | 1.93% | 5.27% | 9.78% | 13.33% | 3.22% |
| Ratios to Average Net AssetsE,F | | | | | | |
| Expenses before reductions G | - %H | -% | -% | -% | -% | -% |
| Expenses net of fee waivers, if any | - %H | -% | -% | -% | -% | -% |
| Expenses net of all reductions | - %H | -% | -% | -% | -% | -% |
| Net investment income (loss) | 2.05%H | 1.63% | 1.48% | 1.52% | 1.92% | 1.93% |
| Supplemental Data | | | | | | |
| Net assets, end of period (000 omitted) | $13,104 | $13,819 | $17,079 | $15,175 | $5,367 | $3,558 |
| Portfolio turnover rate E | 17%H | 26% | 26% | 27% | 32% | 50% |
A Calculated based on average shares outstanding during the period.
B The amount shown for a share outstanding does not correspond with the aggregate net gain (loss) on investments for the period due to the timing of sales and repurchases of shares in relation to fluctuating market values of the investments of the Fund.
C Total returns for periods of less than one year are not annualized.
D Total returns would have been lower if certain expenses had not been reduced during the applicable periods shown.
E Amounts do not include the activity of the Underlying Funds.
F Expense ratios reflect operating expenses of the class. Expenses before reductions do not reflect amounts reimbursed by the investment adviser or reductions from expense offset arrangements and do not represent the amount paid by the class during periods when reimbursements or reductions occur. Expenses net of fee waivers reflect expenses after reimbursement by the investment adviser but prior to reductions from expense offset arrangements. Expenses net of all reductions represent the net expenses paid by the class but do not include expenses of the underlying funds in which the Fund invests.
G Amount represents less than .005%.
H Annualized
See accompanying notes which are an integral part of the financial statements.
Financial Highlights — Fidelity Income Replacement 2030 Fund Class I
| | Six months ended (Unaudited) January 31, | Years ended July 31, | | | | |
| | 2017 | 2016 | 2015 | 2014 | 2013 | 2012 |
| Selected Per–Share Data | | | | | | |
| Net asset value, beginning of period | $60.07 | $61.33 | $59.84 | $55.45 | $50.12 | $49.64 |
| Income from Investment Operations | | | | | | |
| Net investment income (loss)A | .616 | .942 | .902 | .885 | 1.020 | .936 |
| Net realized and unrealized gain (loss) | 1.187 | .118B | 2.207 | 4.505 | 5.562 | .607 |
| Total from investment operations | 1.803 | 1.060 | 3.109 | 5.390 | 6.582 | 1.543 |
| Distributions from net investment income | (.628) | (.943) | (.898) | (.845) | (1.024) | (.916) |
| Distributions from net realized gain | (.475) | (1.377) | (.721) | (.155) | (.228) | (.147) |
| Total distributions | (1.103) | (2.320) | (1.619) | (1.000) | (1.252) | (1.063) |
| Net asset value, end of period | $60.77 | $60.07 | $61.33 | $59.84 | $55.45 | $50.12 |
| Total ReturnC,D | 3.04% | 1.93% | 5.26% | 9.78% | 13.33% | 3.22% |
| Ratios to Average Net AssetsE,F | | | | | | |
| Expenses before reductions G | - %H | -% | -% | -% | -% | -% |
| Expenses net of fee waivers, if any | - %H | -% | -% | -% | -% | -% |
| Expenses net of all reductions | - %H | -% | -% | -% | -% | -% |
| Net investment income (loss) | 2.05%H | 1.63% | 1.48% | 1.52% | 1.92% | 1.93% |
| Supplemental Data | | | | | | |
| Net assets, end of period (000 omitted) | $32 | $31 | $32 | $63 | $57 | $24 |
| Portfolio turnover rate E | 17%H | 26% | 26% | 27% | 32% | 50% |
A Calculated based on average shares outstanding during the period.
B The amount shown for a share outstanding does not correspond with the aggregate net gain (loss) on investments for the period due to the timing of sales and repurchases of shares in relation to fluctuating market values of the investments of the Fund.
C Total returns for periods of less than one year are not annualized.
D Total returns would have been lower if certain expenses had not been reduced during the applicable periods shown.
E Amounts do not include the activity of the Underlying Funds.
F Expense ratios reflect operating expenses of the class. Expenses before reductions do not reflect amounts reimbursed by the investment adviser or reductions from expense offset arrangements and do not represent the amount paid by the class during periods when reimbursements or reductions occur. Expenses net of fee waivers reflect expenses after reimbursement by the investment adviser but prior to reductions from expense offset arrangements. Expenses net of all reductions represent the net expenses paid by the class but do not include expenses of the underlying funds in which the Fund invests.
G Amount represents less than .005%.
H Annualized
See accompanying notes which are an integral part of the financial statements.
Fidelity Income Replacement 2032 Fund℠
Investment Summary (Unaudited)
The information in the following tables is based on the direct investments of the Fund.
Top Holdings as of January 31, 2017
| | % of fund's net assets | % of fund's net assets 6 months ago |
| Fidelity Total Bond Fund | 18.4 | 18.1 |
| Fidelity Series Broad Market Opportunities Fund | 9.9 | 10.0 |
| Fidelity Equity-Income Fund | 8.6 | 8.7 |
| Fidelity Investments Money Market Government Portfolio Institutional Class 0.47% | 7.8 | 7.7 |
| Fidelity Short-Term Bond Fund | 7.8 | 7.6 |
| Fidelity Large Cap Stock Fund | 6.4 | 6.5 |
| Fidelity Advisor International Discovery Fund Class I | 6.4 | 6.6 |
| Fidelity Strategic Real Return Fund | 6.1 | 6.1 |
| Fidelity Government Income Fund | 6.1 | 6.1 |
| Fidelity Advisor Mid Cap II Fund Class I | 6.0 | 6.0 |
| | 83.5 | 83.4 |
Asset Allocation (% of fund's net assets)
| Period end |
| | Domestic Equity Funds | 43.0% |
| | International Equity Funds | 6.4% |
| | High Yield Fixed-Income Funds | 4.4% |
| | Investment Grade Fixed-Income Funds | 30.6% |
| | Short-Term Funds | 15.6% |
| Six months ago |
| | Domestic Equity Funds | 43.3% |
| | International Equity Funds | 6.6% |
| | High Yield Fixed-Income Funds | 4.5% |
| | Investment Grade Fixed-Income Funds | 30.3% |
| | Short-Term Funds | 15.3% |
Fidelity Income Replacement 2032 Fund℠
Investments January 31, 2017 (Unaudited)
Showing Percentage of Net Assets
| Equity Funds - 49.4% | | | |
| | | Shares | Value |
| Domestic Equity Funds - 43.0% | | | |
| Fidelity Advisor Mid Cap II Fund Class I (a) | | 22,202 | $440,257 |
| Fidelity Blue Chip Growth Fund (a) | | 5,788 | 408,758 |
| Fidelity Equity-Income Fund (a) | | 10,894 | 629,253 |
| Fidelity Large Cap Stock Fund (a) | | 15,841 | 471,756 |
| Fidelity Series 100 Index Fund (a) | | 27,731 | 408,758 |
| Fidelity Series Broad Market Opportunities Fund (a) | | 44,676 | 723,750 |
| Fidelity Series Small Cap Opportunities Fund (a) | | 4,471 | 62,999 |
|
| TOTAL DOMESTIC EQUITY FUNDS | | | 3,145,531 |
|
| International Equity Funds - 6.4% | | | |
| Fidelity Advisor International Discovery Fund Class I (a) | | 12,446 | 468,826 |
| TOTAL EQUITY FUNDS | | | |
| (Cost $2,755,618) | | | 3,614,357 |
|
| Fixed-Income Funds - 35.0% | | | |
| High Yield Fixed-Income Funds - 4.4% | | | |
| Fidelity Capital & Income Fund (a) | | 16,262 | 161,159 |
| Fidelity Strategic Income Fund (a) | | 14,964 | 161,159 |
|
| TOTAL HIGH YIELD FIXED-INCOME FUNDS | | | 322,318 |
|
| Investment Grade Fixed-Income Funds - 30.6% | | | |
| Fidelity Government Income Fund (a) | | 44,039 | 448,315 |
| Fidelity Strategic Real Return Fund (a) | | 50,829 | 448,315 |
| Fidelity Total Bond Fund (a) | | 127,622 | 1,346,410 |
|
| TOTAL INVESTMENT GRADE FIXED-INCOME FUNDS | | | 2,243,040 |
|
| TOTAL FIXED-INCOME FUNDS | | | |
| (Cost $2,607,868) | | | 2,565,358 |
|
| Short-Term Funds - 15.6% | | | |
| Fidelity Investments Money Market Government Portfolio Institutional Class 0.47% (a)(b) | | 572,847 | 572,847 |
| Fidelity Short-Term Bond Fund (a) | | 66,688 | 572,847 |
| TOTAL SHORT-TERM FUNDS | | | |
| (Cost $1,143,672) | | | 1,145,694 |
| TOTAL INVESTMENT PORTFOLIO - 100.0% | | | |
| (Cost $6,507,158) | | | 7,325,409 |
| NET OTHER ASSETS (LIABILITIES) - 0.0% | | | (189) |
| NET ASSETS - 100% | | | $7,325,220 |
Legend
(a) Affiliated Fund
(b) The rate quoted is the annualized seven-day yield of the fund at period end.
Affiliated Underlying Funds
Information regarding the Fund's fiscal year to date purchases and sales of the affiliated Underlying Funds and income earned by the Fund from investments in affiliated Underlying Funds is as follows:
| Affiliate | Value, beginning of period | Purchases | Sales Proceeds | Dividend Income | Value, end of period |
| Fidelity Advisor International Discovery Fund Class I | $486,247 | $50,028 | $59,860 | $7,793 | $468,826 |
| Fidelity Advisor Mid Cap II Fund Class I | 447,141 | 43,493 | 69,401 | 2,070 | 440,257 |
| Fidelity Blue Chip Growth Fund | 415,413 | 40,251 | 54,407 | 893 | 408,758 |
| Fidelity Capital & Income Fund | 166,018 | 9,922 | 21,580 | 3,588 | 161,159 |
| Fidelity Equity-Income Fund | 638,983 | 44,435 | 92,671 | 9,130 | 629,253 |
| Fidelity Government Income Fund | 447,879 | 58,850 | 36,312 | 3,586 | 448,315 |
| Fidelity Investments Money Market Government Portfolio Institutional Class 0.47% | 564,460 | 58,677 | 50,290 | 983 | 572,847 |
| Fidelity Large Cap Stock Fund | 478,869 | 28,478 | 75,755 | 4,348 | 471,756 |
| Fidelity Series 100 Index Fund | 415,413 | 27,806 | 48,190 | 9,180 | 408,758 |
| Fidelity Series Broad Market Opportunities Fund | 734,905 | 42,006 | 98,904 | 3,551 | 723,750 |
| Fidelity Series Small Cap Opportunities Fund | 64,193 | 5,086 | 12,003 | 314 | 62,999 |
| Fidelity Short-Term Bond Fund | 564,460 | 62,864 | 49,880 | 3,263 | 572,847 |
| Fidelity Strategic Income Fund | 166,018 | 11,949 | 16,701 | 2,842 | 161,159 |
| Fidelity Strategic Real Return Fund | 447,879 | 39,687 | 39,439 | 6,082 | 448,315 |
| Fidelity Total Bond Fund | 1,340,683 | 157,464 | 114,489 | 19,598 | 1,346,410 |
| Total | $7,378,561 | $680,996 | $839,882 | $77,221 | $7,325,409 |
Investment Valuation
All investments are categorized as Level 1 under the Fair Value Hierarchy. The inputs or methodology used for valuing securities may not be an indication of the risk associated with investing in those securities. For more information on valuation inputs please refer to the Investment Valuation section in the accompanying Notes to Financial Statements.
See accompanying notes which are an integral part of the financial statements.
Fidelity Income Replacement 2032 Fund℠
Financial Statements
Statement of Assets and Liabilities
| | | January 31, 2017 (Unaudited) |
| Assets | | |
| Investment in securities, at value (cost $6,507,158) — See accompanying schedule | | $7,325,409 |
| Receivable for investments sold | | 50,375 |
| Total assets | | 7,375,784 |
| Liabilities | | |
| Payable for investments purchased | $50,371 | |
| Distribution and service plan fees payable | 193 | |
| Total liabilities | | 50,564 |
| Net Assets | | $7,325,220 |
| Net Assets consist of: | | |
| Paid in capital | | $6,476,969 |
| Undistributed net investment income | | 1,488 |
| Accumulated undistributed net realized gain (loss) on investments | | 28,512 |
| Net unrealized appreciation (depreciation) on investments | | 818,251 |
| Net Assets | | $7,325,220 |
| Calculation of Maximum Offering Price | | |
| Class A: | | |
| Net Asset Value and redemption price per share ($380,514 ÷ 6,595.35 shares) | | $57.69 |
| Maximum offering price per share (100/94.25 of $57.69) | | $61.21 |
| Class T: | | |
| Net Asset Value and redemption price per share ($21,778 ÷ 377.14 shares) | | $57.75 |
| Maximum offering price per share (100/96.50 of $57.75) | | $59.84 |
| Class C: | | |
| Net Asset Value and offering price per share ($125,820 ÷ 2,189.73 shares)(a) | | $57.46 |
| Income Replacement 2032: | | |
| Net Asset Value, offering price and redemption price per share ($6,739,063 ÷ 116,767.89 shares) | | $57.71 |
| Class I: | | |
| Net Asset Value, offering price and redemption price per share ($58,045 ÷ 1,005.73 shares) | | $57.71 |
(a) Redemption price per share is equal to net asset value less any applicable contingent deferred sales charge.
See accompanying notes which are an integral part of the financial statements.
Statement of Operations
| | | Six months ended January 31, 2017 (Unaudited) |
| Investment Income | | |
| Income distributions from underlying funds | | $77,221 |
| Expenses | | |
| Distribution and service plan fees | $1,206 | |
| Independent trustees' fees and expenses | 17 | |
| Total expenses before reductions | 1,223 | |
| Expense reductions | (17) | 1,206 |
| Net investment income (loss) | | 76,015 |
| Realized and Unrealized Gain (Loss) | | |
| Realized gain (loss) on sale of underlying fund shares | 15,589 | |
| Capital gain distributions from underlying funds | 51,916 | |
| Total net realized gain (loss) | | 67,505 |
| Change in net unrealized appreciation (depreciation) on underlying funds | | 90,145 |
| Net gain (loss) | | 157,650 |
| Net increase (decrease) in net assets resulting from operations | | $233,665 |
See accompanying notes which are an integral part of the financial statements.
Statement of Changes in Net Assets
| | Six months ended January 31, 2017 (Unaudited) | Year ended July 31, 2016 |
| Increase (Decrease) in Net Assets | | |
| Operations | | |
| Net investment income (loss) | $76,015 | $121,337 |
| Net realized gain (loss) | 67,505 | 114,028 |
| Change in net unrealized appreciation (depreciation) | 90,145 | (155,017) |
| Net increase (decrease) in net assets resulting from operations | 233,665 | 80,348 |
| Distributions to shareholders from net investment income | (76,236) | (121,233) |
| Distributions to shareholders from net realized gain | (87,566) | (198,372) |
| Total distributions | (163,802) | (319,605) |
| Share transactions - net increase (decrease) | (123,006) | (929,485) |
| Total increase (decrease) in net assets | (53,143) | (1,168,742) |
| Net Assets | | |
| Beginning of period | 7,378,363 | 8,547,105 |
| End of period | $7,325,220 | $7,378,363 |
| Other Information | | |
| Undistributed net investment income end of period | $1,488 | $1,709 |
See accompanying notes which are an integral part of the financial statements.
Financial Highlights — Fidelity Income Replacement 2032 Fund Class A
| | Six months ended (Unaudited) January 31, | Years ended July 31, | | | | |
| | 2017 | 2016 | 2015 | 2014 | 2013 | 2012 |
| Selected Per–Share Data | | | | | | |
| Net asset value, beginning of period | $57.18 | $58.52 | $56.72 | $53.04 | $47.91 | $49.07 |
| Income from Investment Operations | | | | | | |
| Net investment income (loss)A | .528 | .758 | .738 | .718 | .906 | .717 |
| Net realized and unrealized gain (loss) | 1.197 | .040B | 2.196 | 4.379 | 5.480 | .618 |
| Total from investment operations | 1.725 | .798 | 2.934 | 5.097 | 6.386 | 1.335 |
| Distributions from net investment income | (.535) | (.756) | (.740) | (.704) | (.852) | (.770) |
| Distributions from net realized gain | (.680) | (1.382) | (.394) | (.713) | (.404) | (1.725) |
| Total distributions | (1.215) | (2.138) | (1.134) | (1.417) | (1.256) | (2.495) |
| Net asset value, end of period | $57.69 | $57.18 | $58.52 | $56.72 | $53.04 | $47.91 |
| Total ReturnC,D,E | 3.07% | 1.55% | 5.22% | 9.76% | 13.55% | 2.85% |
| Ratios to Average Net AssetsF,G | | | | | | |
| Expenses before reductions | .25%H | .25% | .25% | .25% | .25% | .37% |
| Expenses net of fee waivers, if any | .25%H | .25% | .25% | .25% | .25% | .25% |
| Expenses net of all reductions | .25%H | .25% | .25% | .25% | .25% | .25% |
| Net investment income (loss) | 1.85%H | 1.37% | 1.28% | 1.30% | 1.80% | 1.51% |
| Supplemental Data | | | | | | |
| Net assets, end of period (000 omitted) | $381 | $395 | $427 | $267 | $229 | $217 |
| Portfolio turnover rateF | 19%H | 24% | 33% | 29% | 30% | 37% |
A Calculated based on average shares outstanding during the period.
B The amount shown for a share outstanding does not correspond with the aggregate net gain (loss) on investments for the period due to the timing of sales and repurchases of shares in relation to fluctuating market values of the investments of the Fund.
C Total returns for periods of less than one year are not annualized.
D Total returns would have been lower if certain expenses had not been reduced during the applicable periods shown.
E Total returns do not include the effect of the sales charges.
F Amounts do not include the activity of the Underlying Funds.
G Expense ratios reflect operating expenses of the class. Expenses before reductions do not reflect amounts reimbursed by the investment adviser or reductions from expense offset arrangements and do not represent the amount paid by the class during periods when reimbursements or reductions occur. Expenses net of fee waivers reflect expenses after reimbursement by the investment adviser but prior to reductions from expense offset arrangements. Expenses net of all reductions represent the net expenses paid by the class but do not include expenses of the underlying funds in which the Fund invests.
H Annualized
See accompanying notes which are an integral part of the financial statements.
Financial Highlights — Fidelity Income Replacement 2032 Fund Class T
| | Six months ended (Unaudited) January 31, | Years ended July 31, | | | | |
| | 2017 | 2016 | 2015 | 2014 | 2013 | 2012 |
| Selected Per–Share Data | | | | | | |
| Net asset value, beginning of period | $57.22 | $58.55 | $56.76 | $53.08 | $47.94 | $49.10 |
| Income from Investment Operations | | | | | | |
| Net investment income (loss)A | .460 | .620 | .592 | .581 | .781 | .599 |
| Net realized and unrealized gain (loss) | 1.203 | .047B | 2.190 | 4.386 | 5.484 | .599 |
| Total from investment operations | 1.663 | .667 | 2.782 | 4.967 | 6.265 | 1.198 |
| Distributions from net investment income | (.453) | (.615) | (.598) | (.574) | (.721) | (.633) |
| Distributions from net realized gain | (.680) | (1.382) | (.394) | (.713) | (.404) | (1.725) |
| Total distributions | (1.133) | (1.997) | (.992) | (1.287) | (1.125) | (2.358) |
| Net asset value, end of period | $57.75 | $57.22 | $58.55 | $56.76 | $53.08 | $47.94 |
| Total ReturnC,D,E | 2.95% | 1.31% | 4.94% | 9.50% | 13.27% | 2.55% |
| Ratios to Average Net AssetsF,G | | | | | | |
| Expenses before reductions | .50%H | .50% | .50% | .50% | .50% | .62% |
| Expenses net of fee waivers, if any | .50%H | .50% | .50% | .50% | .50% | .50% |
| Expenses net of all reductions | .50%H | .50% | .50% | .50% | .50% | .50% |
| Net investment income (loss) | 1.60%H | 1.12% | 1.03% | 1.05% | 1.55% | 1.26% |
| Supplemental Data | | | | | | |
| Net assets, end of period (000 omitted) | $22 | $58 | $67 | $36 | $27 | $24 |
| Portfolio turnover rateF | 19%H | 24% | 33% | 29% | 30% | 37% |
A Calculated based on average shares outstanding during the period.
B The amount shown for a share outstanding does not correspond with the aggregate net gain (loss) on investments for the period due to the timing of sales and repurchases of shares in relation to fluctuating market values of the investments of the Fund.
C Total returns for periods of less than one year are not annualized.
D Total returns would have been lower if certain expenses had not been reduced during the applicable periods shown.
E Total returns do not include the effect of the sales charges.
F Amounts do not include the activity of the Underlying Funds.
G Expense ratios reflect operating expenses of the class. Expenses before reductions do not reflect amounts reimbursed by the investment adviser or reductions from expense offset arrangements and do not represent the amount paid by the class during periods when reimbursements or reductions occur. Expenses net of fee waivers reflect expenses after reimbursement by the investment adviser but prior to reductions from expense offset arrangements. Expenses net of all reductions represent the net expenses paid by the class but do not include expenses of the underlying funds in which the Fund invests.
H Annualized
See accompanying notes which are an integral part of the financial statements.
Financial Highlights — Fidelity Income Replacement 2032 Fund Class C
| | Six months ended (Unaudited) January 31, | Years ended July 31, | | | | |
| | 2017 | 2016 | 2015 | 2014 | 2013 | 2012 |
| Selected Per–Share Data | | | | | | |
| Net asset value, beginning of period | $56.97 | $58.35 | $56.62 | $52.99 | $47.93 | $49.12 |
| Income from Investment Operations | | | | | | |
| Net investment income (loss)A | .312 | .344 | .303 | .305 | .529 | .358 |
| Net realized and unrealized gain (loss) | 1.198 | .043B | 2.182 | 4.382 | 5.469 | .615 |
| Total from investment operations | 1.510 | .387 | 2.485 | 4.687 | 5.998 | .973 |
| Distributions from net investment income | (.340) | (.385) | (.361) | (.344) | (.534) | (.438) |
| Distributions from net realized gain | (.680) | (1.382) | (.394) | (.713) | (.404) | (1.725) |
| Total distributions | (1.020) | (1.767) | (.755) | (1.057) | (.938) | (2.163) |
| Net asset value, end of period | $57.46 | $56.97 | $58.35 | $56.62 | $52.99 | $47.93 |
| Total ReturnC,D,E | 2.69% | .81% | 4.42% | 8.96% | 12.68% | 2.07% |
| Ratios to Average Net AssetsF,G | | | | | | |
| Expenses before reductions | 1.00%H | 1.00% | 1.00% | 1.00% | 1.00% | 1.12% |
| Expenses net of fee waivers, if any | 1.00%H | 1.00% | 1.00% | 1.00% | 1.00% | 1.00% |
| Expenses net of all reductions | 1.00%H | 1.00% | 1.00% | 1.00% | 1.00% | 1.00% |
| Net investment income (loss) | 1.10%H | .63% | .53% | .55% | 1.05% | .76% |
| Supplemental Data | | | | | | |
| Net assets, end of period (000 omitted) | $126 | $124 | $137 | $122 | $69 | $52 |
| Portfolio turnover rateF | 19%H | 24% | 33% | 29% | 30% | 37% |
A Calculated based on average shares outstanding during the period.
B The amount shown for a share outstanding does not correspond with the aggregate net gain (loss) on investments for the period due to the timing of sales and repurchases of shares in relation to fluctuating market values of the investments of the Fund.
C Total returns for periods of less than one year are not annualized.
D Total returns would have been lower if certain expenses had not been reduced during the applicable periods shown.
E Total returns do not include the effect of the contingent deferred sales charge.
F Amounts do not include the activity of the Underlying Funds.
G Expense ratios reflect operating expenses of the class. Expenses before reductions do not reflect amounts reimbursed by the investment adviser or reductions from expense offset arrangements and do not represent the amount paid by the class during periods when reimbursements or reductions occur. Expenses net of fee waivers reflect expenses after reimbursement by the investment adviser but prior to reductions from expense offset arrangements. Expenses net of all reductions represent the net expenses paid by the class but do not include expenses of the underlying funds in which the Fund invests.
H Annualized
See accompanying notes which are an integral part of the financial statements.
Financial Highlights — Fidelity Income Replacement 2032 Fund
| | Six months ended (Unaudited) January 31, | Years ended July 31, | | | | |
| | 2017 | 2016 | 2015 | 2014 | 2013 | 2012 |
| Selected Per–Share Data | | | | | | |
| Net asset value, beginning of period | $57.20 | $58.53 | $56.73 | $53.05 | $47.92 | $49.08 |
| Income from Investment Operations | | | | | | |
| Net investment income (loss)A | .600 | .897 | .882 | .856 | 1.033 | .836 |
| Net realized and unrealized gain (loss) | 1.196 | .048B | 2.192 | 4.380 | 5.479 | .618 |
| Total from investment operations | 1.796 | .945 | 3.074 | 5.236 | 6.512 | 1.454 |
| Distributions from net investment income | (.606) | (.893) | (.880) | (.843) | (.978) | (.889) |
| Distributions from net realized gain | (.680) | (1.382) | (.394) | (.713) | (.404) | (1.725) |
| Total distributions | (1.286) | (2.275) | (1.274) | (1.556) | (1.382) | (2.614) |
| Net asset value, end of period | $57.71 | $57.20 | $58.53 | $56.73 | $53.05 | $47.92 |
| Total ReturnC,D | 3.20% | 1.82% | 5.48% | 10.04% | 13.83% | 3.10% |
| Ratios to Average Net AssetsE,F | | | | | | |
| Expenses before reductions | - %G,H | - %H | - %H | - %H | - %H | .12% |
| Expenses net of fee waivers, if any | - %G | -% | -% | -% | -% | -% |
| Expenses net of all reductions | - %G | -% | -% | -% | -% | -% |
| Net investment income (loss) | 2.10%G | 1.62% | 1.53% | 1.55% | 2.05% | 1.76% |
| Supplemental Data | | | | | | |
| Net assets, end of period (000 omitted) | $6,739 | $6,745 | $7,858 | $7,608 | $4,418 | $2,991 |
| Portfolio turnover rateE | 19%G | 24% | 33% | 29% | 30% | 37% |
A Calculated based on average shares outstanding during the period.
B The amount shown for a share outstanding does not correspond with the aggregate net gain (loss) on investments for the period due to the timing of sales and repurchases of shares in relation to fluctuating market values of the investments of the Fund.
C Total returns for periods of less than one year are not annualized.
D Total returns would have been lower if certain expenses had not been reduced during the applicable periods shown.
E Amounts do not include the activity of the Underlying Funds.
F Expense ratios reflect operating expenses of the class. Expenses before reductions do not reflect amounts reimbursed by the investment adviser or reductions from expense offset arrangements and do not represent the amount paid by the class during periods when reimbursements or reductions occur. Expenses net of fee waivers reflect expenses after reimbursement by the investment adviser but prior to reductions from expense offset arrangements. Expenses net of all reductions represent the net expenses paid by the class but do not include expenses of the underlying funds in which the Fund invests.
G Annualized
H Amount represents less than .005%.
See accompanying notes which are an integral part of the financial statements.
Financial Highlights — Fidelity Income Replacement 2032 Fund Class I
| | Six months ended (Unaudited) January 31, | Years ended July 31, | | | | |
| | 2017 | 2016 | 2015 | 2014 | 2013 | 2012 |
| Selected Per–Share Data | | | | | | |
| Net asset value, beginning of period | $57.20 | $58.53 | $56.73 | $53.05 | $47.92 | $49.08 |
| Income from Investment Operations | | | | | | |
| Net investment income (loss)A | .600 | .896 | .880 | .856 | 1.032 | .835 |
| Net realized and unrealized gain (loss) | 1.196 | .049B | 2.194 | 4.380 | 5.480 | .619 |
| Total from investment operations | 1.796 | .945 | 3.074 | 5.236 | 6.512 | 1.454 |
| Distributions from net investment income | (.606) | (.893) | (.880) | (.843) | (.978) | (.889) |
| Distributions from net realized gain | (.680) | (1.382) | (.394) | (.713) | (.404) | (1.725) |
| Total distributions | (1.286) | (2.275) | (1.274) | (1.556) | (1.382) | (2.614) |
| Net asset value, end of period | $57.71 | $57.20 | $58.53 | $56.73 | $53.05 | $47.92 |
| Total ReturnC,D | 3.20% | 1.82% | 5.48% | 10.04% | 13.83% | 3.10% |
| Ratios to Average Net AssetsE,F | | | | | | |
| Expenses before reductions | - %G,H | - %H | - %H | - %H | - %H | .12% |
| Expenses net of fee waivers, if any | - %G | -% | -% | -% | -% | -% |
| Expenses net of all reductions | - %G | -% | -% | -% | -% | -% |
| Net investment income (loss) | 2.10%G | 1.62% | 1.53% | 1.55% | 2.05% | 1.76% |
| Supplemental Data | | | | | | |
| Net assets, end of period (000 omitted) | $58 | $56 | $58 | $21 | $19 | $17 |
| Portfolio turnover rateE | 19%G | 24% | 33% | 29% | 30% | 37% |
A Calculated based on average shares outstanding during the period.
B The amount shown for a share outstanding does not correspond with the aggregate net gain (loss) on investments for the period due to the timing of sales and repurchases of shares in relation to fluctuating market values of the investments of the Fund.
C Total returns for periods of less than one year are not annualized.
D Total returns would have been lower if certain expenses had not been reduced during the applicable periods shown.
E Amounts do not include the activity of the Underlying Funds.
F Expense ratios reflect operating expenses of the class. Expenses before reductions do not reflect amounts reimbursed by the investment adviser or reductions from expense offset arrangements and do not represent the amount paid by the class during periods when reimbursements or reductions occur. Expenses net of fee waivers reflect expenses after reimbursement by the investment adviser but prior to reductions from expense offset arrangements. Expenses net of all reductions represent the net expenses paid by the class but do not include expenses of the underlying funds in which the Fund invests.
G Annualized
H Amount represents less than .005%.
See accompanying notes which are an integral part of the financial statements.
Fidelity Income Replacement 2034 Fund℠
Investment Summary (Unaudited)
The information in the following tables is based on the direct investments of the Fund.
Top Holdings as of January 31, 2017
| | % of fund's net assets | % of fund's net assets 6 months ago |
| Fidelity Total Bond Fund | 17.8 | 17.7 |
| Fidelity Series Broad Market Opportunities Fund | 10.2 | 10.2 |
| Fidelity Equity-Income Fund | 8.8 | 8.9 |
| Fidelity Advisor International Discovery Fund Class I | 7.2 | 7.3 |
| Fidelity Investments Money Market Government Portfolio Institutional Class 0.47% | 7.1 | 7.0 |
| Fidelity Short-Term Bond Fund | 7.1 | 6.9 |
| Fidelity Large Cap Stock Fund | 6.6 | 6.7 |
| Fidelity Advisor Mid Cap II Fund Class I | 6.2 | 6.2 |
| Fidelity Strategic Real Return Fund | 6.0 | 5.9 |
| Fidelity Government Income Fund | 5.9 | 5.9 |
| | 82.9 | 82.7 |
Asset Allocation (% of fund's net assets)
| Period end |
| | Domestic Equity Funds | 44.2% |
| | International Equity Funds | 7.2% |
| | High Yield Fixed-Income Funds | 4.7% |
| | Investment Grade Fixed-Income Funds | 29.7% |
| | Short-Term Funds | 14.2% |
| Six months ago |
| | Domestic Equity Funds | 44.5% |
| | International Equity Funds | 7.3% |
| | High Yield Fixed-Income Funds | 4.8% |
| | Investment Grade Fixed-Income Funds | 29.5% |
| | Short-Term Funds | 13.9% |
Fidelity Income Replacement 2034 Fund℠
Investments January 31, 2017 (Unaudited)
Showing Percentage of Net Assets
| Equity Funds - 51.4% | | | |
| | | Shares | Value |
| Domestic Equity Funds - 44.2% | | | |
| Fidelity Advisor Mid Cap II Fund Class I (a) | | 20,988 | $416,197 |
| Fidelity Blue Chip Growth Fund (a) | | 5,475 | 386,612 |
| Fidelity Equity-Income Fund (a) | | 10,290 | 594,374 |
| Fidelity Large Cap Stock Fund (a) | | 14,969 | 445,781 |
| Fidelity Series 100 Index Fund (a) | | 26,229 | 386,612 |
| Fidelity Series Broad Market Opportunities Fund (a) | | 42,210 | 683,800 |
| Fidelity Series Small Cap Opportunities Fund (a) | | 4,199 | 59,169 |
|
| TOTAL DOMESTIC EQUITY FUNDS | | | 2,972,545 |
|
| International Equity Funds - 7.2% | | | |
| Fidelity Advisor International Discovery Fund Class I (a) | | 12,816 | 482,761 |
| TOTAL EQUITY FUNDS | | | |
| (Cost $2,580,042) | | | 3,455,306 |
|
| Fixed-Income Funds - 34.4% | | | |
| High Yield Fixed-Income Funds - 4.7% | | | |
| Fidelity Capital & Income Fund (a) | | 16,012 | 158,679 |
| Fidelity Strategic Income Fund (a) | | 14,733 | 158,679 |
|
| TOTAL HIGH YIELD FIXED-INCOME FUNDS | | | 317,358 |
|
| Investment Grade Fixed-Income Funds - 29.7% | | | |
| Fidelity Government Income Fund (a) | | 39,166 | 398,715 |
| Fidelity Strategic Real Return Fund (a) | | 45,206 | 398,715 |
| Fidelity Total Bond Fund (a) | | 113,379 | 1,196,145 |
|
| TOTAL INVESTMENT GRADE FIXED-INCOME FUNDS | | | 1,993,575 |
|
| TOTAL FIXED-INCOME FUNDS | | | |
| (Cost $2,285,271) | | | 2,310,933 |
|
| Short-Term Funds - 14.2% | | | |
| Fidelity Investments Money Market Government Portfolio Institutional Class 0.47% (a)(b) | | 478,727 | 478,727 |
| Fidelity Short-Term Bond Fund (a) | | 55,731 | 478,727 |
| TOTAL SHORT-TERM FUNDS | | | |
| (Cost $952,846) | | | 957,454 |
| TOTAL INVESTMENT PORTFOLIO - 100.0% | | | |
| (Cost $5,818,159) | | | 6,723,693 |
| NET OTHER ASSETS (LIABILITIES) - 0.0% | | | (179) |
| NET ASSETS - 100% | | | $6,723,514 |
Legend
(a) Affiliated Fund
(b) The rate quoted is the annualized seven-day yield of the fund at period end.
Affiliated Underlying Funds
Information regarding the Fund's fiscal year to date purchases and sales of the affiliated Underlying Funds and income earned by the Fund from investments in affiliated Underlying Funds is as follows:
| Affiliate | Value, beginning of period | Purchases | Sales Proceeds | Dividend Income | Value, end of period |
| Fidelity Advisor International Discovery Fund Class I | $570,895 | $42,953 | $122,504 | $8,142 | $482,761 |
| Fidelity Advisor Mid Cap II Fund Class I | 482,589 | 32,427 | 115,765 | 1,985 | 416,197 |
| Fidelity Blue Chip Growth Fund | 447,731 | 31,648 | 99,205 | 917 | 386,612 |
| Fidelity Capital & Income Fund | 185,134 | 6,348 | 39,719 | 3,743 | 158,679 |
| Fidelity Equity-Income Fund | 689,412 | 28,274 | 159,294 | 9,228 | 594,374 |
| Fidelity Government Income Fund | 457,026 | 43,185 | 80,789 | 3,409 | 398,715 |
| Fidelity Investments Money Market Government Portfolio Institutional Class 0.47% | 537,587 | 39,518 | 98,378 | 872 | 478,727 |
| Fidelity Large Cap Stock Fund | 516,672 | 16,812 | 126,662 | 4,090 | 445,781 |
| Fidelity Series 100 Index Fund | 447,731 | 18,638 | 92,120 | 8,736 | 386,612 |
| Fidelity Series Broad Market Opportunities Fund | 792,437 | 24,868 | 175,901 | 3,401 | 683,800 |
| Fidelity Series Small Cap Opportunities Fund | 68,941 | 3,174 | 18,247 | 321 | 59,169 |
| Fidelity Short-Term Bond Fund | 537,587 | 43,129 | 97,976 | 2,884 | 478,727 |
| Fidelity Strategic Income Fund | 185,134 | 8,422 | 34,815 | 2,975 | 158,679 |
| Fidelity Strategic Real Return Fund | 457,026 | 26,047 | 83,682 | 5,828 | 398,715 |
| Fidelity Total Bond Fund | 1,370,302 | 106,834 | 246,545 | 18,590 | 1,196,145 |
| Total | $7,746,204 | $472,277 | $1,591,602 | $75,121 | $6,723,693 |
Investment Valuation
All investments are categorized as Level 1 under the Fair Value Hierarchy. The inputs or methodology used for valuing securities may not be an indication of the risk associated with investing in those securities. For more information on valuation inputs please refer to the Investment Valuation section in the accompanying Notes to Financial Statements.
See accompanying notes which are an integral part of the financial statements.
Fidelity Income Replacement 2034 Fund℠
Financial Statements
Statement of Assets and Liabilities
| | | January 31, 2017 (Unaudited) |
| Assets | | |
| Investment in securities, at value (cost $5,818,159) — See accompanying schedule | | $6,723,693 |
| Receivable for investments sold | | 57,383 |
| Total assets | | 6,781,076 |
| Liabilities | | |
| Payable for investments purchased | $32,086 | |
| Payable for fund shares redeemed | 25,287 | |
| Distribution and service plan fees payable | 189 | |
| Total liabilities | | 57,562 |
| Net Assets | | $6,723,514 |
| Net Assets consist of: | | |
| Paid in capital | | $5,812,221 |
| Undistributed net investment income | | 1,342 |
| Accumulated undistributed net realized gain (loss) on investments | | 4,417 |
| Net unrealized appreciation (depreciation) on investments | | 905,534 |
| Net Assets | | $6,723,514 |
| Calculation of Maximum Offering Price | | |
| Class A: | | |
| Net Asset Value and redemption price per share ($272,749 ÷ 4,477.70 shares) | | $60.91 |
| Maximum offering price per share (100/94.25 of $60.91) | | $64.63 |
| Class T: | | |
| Net Asset Value and redemption price per share ($23,325 ÷ 382.50 shares) | | $60.98 |
| Maximum offering price per share (100/96.50 of $60.98) | | $63.19 |
| Class C: | | |
| Net Asset Value and offering price per share ($147,668 ÷ 2,435.30 shares)(a) | | $60.64 |
| Income Replacement 2034: | | |
| Net Asset Value, offering price and redemption price per share ($6,041,955 ÷ 99,218.70 shares) | | $60.90 |
| Class I: | | |
| Net Asset Value, offering price and redemption price per share ($237,817 ÷ 3,905.00 shares) | | $60.90 |
(a) Redemption price per share is equal to net asset value less any applicable contingent deferred sales charge.
See accompanying notes which are an integral part of the financial statements.
Statement of Operations
| | | Six months ended January 31, 2017 (Unaudited) |
| Investment Income | | |
| Income distributions from underlying funds | | $75,121 |
| Expenses | | |
| Distribution and service plan fees | $1,260 | |
| Independent trustees' fees and expenses | 18 | |
| Total expenses before reductions | 1,278 | |
| Expense reductions | (18) | 1,260 |
| Net investment income (loss) | | 73,861 |
| Realized and Unrealized Gain (Loss) | | |
| Realized gain (loss) on sale of underlying fund shares | 20,403 | |
| Capital gain distributions from underlying funds | 50,169 | |
| Total net realized gain (loss) | | 70,572 |
| Change in net unrealized appreciation (depreciation) on underlying funds | | 76,410 |
| Net gain (loss) | | 146,982 |
| Net increase (decrease) in net assets resulting from operations | | $220,843 |
See accompanying notes which are an integral part of the financial statements.
Statement of Changes in Net Assets
| | Six months ended January 31, 2017 (Unaudited) | Year ended July 31, 2016 |
| Increase (Decrease) in Net Assets | | |
| Operations | | |
| Net investment income (loss) | $73,861 | $142,550 |
| Net realized gain (loss) | 70,572 | 77,443 |
| Change in net unrealized appreciation (depreciation) | 76,410 | (131,537) |
| Net increase (decrease) in net assets resulting from operations | 220,843 | 88,456 |
| Distributions to shareholders from net investment income | (74,230) | (142,540) |
| Distributions to shareholders from net realized gain | (26,704) | (259,010) |
| Total distributions | (100,934) | (401,550) |
| Share transactions - net increase (decrease) | (1,142,400) | (1,324,530) |
| Total increase (decrease) in net assets | (1,022,491) | (1,637,624) |
| Net Assets | | |
| Beginning of period | 7,746,005 | 9,383,629 |
| End of period | $6,723,514 | $7,746,005 |
| Other Information | | |
| Undistributed net investment income end of period | $1,342 | $1,711 |
See accompanying notes which are an integral part of the financial statements.
Financial Highlights — Fidelity Income Replacement 2034 Fund Class A
| | Six months ended (Unaudited) January 31, | Years ended July 31, | | | | |
| | 2017 | 2016 | 2015 | 2014 | 2013 | 2012 |
| Selected Per–Share Data | | | | | | |
| Net asset value, beginning of period | $59.82 | $61.43 | $59.85 | $55.44 | $49.70 | $49.33 |
| Income from Investment Operations | | | | | | |
| Net investment income (loss)A | .549 | .797 | .753 | .741 | .840 | .782 |
| Net realized and unrealized gain (loss) | 1.341 | (.018) | 2.384 | 4.748 | 6.014 | .504 |
| Total from investment operations | 1.890 | .779 | 3.137 | 5.489 | 6.854 | 1.286 |
| Distributions from net investment income | (.571) | (.795) | (.751) | (.723) | (.903) | (.775) |
| Distributions from net realized gain | (.229) | (1.594) | (.806) | (.356) | (.211) | (.141) |
| Total distributions | (.800) | (2.389) | (1.557) | (1.079) | (1.114) | (.916) |
| Net asset value, end of period | $60.91 | $59.82 | $61.43 | $59.85 | $55.44 | $49.70 |
| Total ReturnB,C,D | 3.19% | 1.47% | 5.31% | 9.97% | 13.98% | 2.71% |
| Ratios to Average Net AssetsE,F | | | | | | |
| Expenses before reductions | .25%G | .25% | .25% | .25% | .25% | .25% |
| Expenses net of fee waivers, if any | .25%G | .25% | .25% | .25% | .25% | .25% |
| Expenses net of all reductions | .25%G | .25% | .25% | .25% | .25% | .25% |
| Net investment income (loss) | 1.83%G | 1.38% | 1.24% | 1.27% | 1.60% | 1.63% |
| Supplemental Data | | | | | | |
| Net assets, end of period (000 omitted) | $273 | $280 | $300 | $126 | $20 | $18 |
| Portfolio turnover rate E | 13%G | 33% | 24% | 19% | 35% | 34% |
A Calculated based on average shares outstanding during the period.
B Total returns for periods of less than one year are not annualized.
C Total returns would have been lower if certain expenses had not been reduced during the applicable periods shown.
D Total returns do not include the effect of the sales charges.
E Amounts do not include the activity of the Underlying Funds.
F Expense ratios reflect operating expenses of the class. Expenses before reductions do not reflect amounts reimbursed by the investment adviser or reductions from expense offset arrangements and do not represent the amount paid by the class during periods when reimbursements or reductions occur. Expenses net of fee waivers reflect expenses after reimbursement by the investment adviser but prior to reductions from expense offset arrangements. Expenses net of all reductions represent the net expenses paid by the class but do not include expenses of the underlying funds in which the Fund invests.
G Annualized
See accompanying notes which are an integral part of the financial statements.
Financial Highlights — Fidelity Income Replacement 2034 Fund Class T
| | Six months ended (Unaudited) January 31, | Years ended July 31, | | | | |
| | 2017 | 2016 | 2015 | 2014 | 2013 | 2012 |
| Selected Per–Share Data | | | | | | |
| Net asset value, beginning of period | $59.85 | $61.44 | $59.85 | $55.44 | $49.70 | $49.34 |
| Income from Investment Operations | | | | | | |
| Net investment income (loss)A | .477 | .647 | .602 | .592 | .719 | .662 |
| Net realized and unrealized gain (loss) | 1.319 | (.008) | 2.387 | 4.742 | 6.008 | .490 |
| Total from investment operations | 1.796 | .639 | 2.989 | 5.334 | 6.727 | 1.152 |
| Distributions from net investment income | (.437) | (.635) | (.593) | (.568) | (.776) | (.651) |
| Distributions from net realized gain | (.229) | (1.594) | (.806) | (.356) | (.211) | (.141) |
| Total distributions | (.666) | (2.229) | (1.399) | (.924) | (.987) | (.792) |
| Net asset value, end of period | $60.98 | $59.85 | $61.44 | $59.85 | $55.44 | $49.70 |
| Total ReturnB,C,D | 3.02% | 1.23% | 5.06% | 9.68% | 13.71% | 2.42% |
| Ratios to Average Net AssetsE,F | | | | | | |
| Expenses before reductions | .50%G | .50% | .50% | .50% | .50% | .50% |
| Expenses net of fee waivers, if any | .50%G | .50% | .50% | .50% | .50% | .50% |
| Expenses net of all reductions | .50%G | .50% | .50% | .50% | .50% | .50% |
| Net investment income (loss) | 1.58%G | 1.13% | .99% | 1.02% | 1.35% | 1.38% |
| Supplemental Data | | | | | | |
| Net assets, end of period (000 omitted) | $23 | $94 | $101 | $96 | $88 | $23 |
| Portfolio turnover rate E | 13%G | 33% | 24% | 19% | 35% | 34% |
A Calculated based on average shares outstanding during the period.
B Total returns for periods of less than one year are not annualized.
C Total returns do not include the effect of the sales charges.
D Total returns would have been lower if certain expenses had not been reduced during the applicable periods shown.
E Amounts do not include the activity of the Underlying Funds.
F Expense ratios reflect operating expenses of the class. Expenses before reductions do not reflect amounts reimbursed by the investment adviser or reductions from expense offset arrangements and do not represent the amount paid by the class during periods when reimbursements or reductions occur. Expenses net of fee waivers reflect expenses after reimbursement by the investment adviser but prior to reductions from expense offset arrangements. Expenses net of all reductions represent the net expenses paid by the class but do not include expenses of the underlying funds in which the Fund invests.
G Annualized
See accompanying notes which are an integral part of the financial statements.
Financial Highlights — Fidelity Income Replacement 2034 Fund Class C
| | Six months ended (Unaudited) January 31, | Years ended July 31, | | | | |
| | 2017 | 2016 | 2015 | 2014 | 2013 | 2012 |
| Selected Per–Share Data | | | | | | |
| Net asset value, beginning of period | $59.58 | $61.23 | $59.74 | $55.39 | $49.70 | $49.37 |
| Income from Investment Operations | | | | | | |
| Net investment income (loss)A | .322 | .363 | .298 | .300 | .448 | .424 |
| Net realized and unrealized gain (loss) | 1.337 | (.014) | 2.370 | 4.746 | 6.020 | .490 |
| Total from investment operations | 1.659 | .349 | 2.668 | 5.046 | 6.468 | .914 |
| Distributions from net investment income | (.370) | (.405) | (.372) | (.340) | (.567) | (.443) |
| Distributions from net realized gain | (.229) | (1.594) | (.806) | (.356) | (.211) | (.141) |
| Total distributions | (.599) | (1.999) | (1.178) | (.696) | (.778) | (.584) |
| Net asset value, end of period | $60.64 | $59.58 | $61.23 | $59.74 | $55.39 | $49.70 |
| Total ReturnB,C,D | 2.80% | .73% | 4.52% | 9.15% | 13.15% | 1.92% |
| Ratios to Average Net AssetsE,F | | | | | | |
| Expenses before reductions | 1.00%G | 1.00% | 1.00% | 1.00% | 1.00% | 1.00% |
| Expenses net of fee waivers, if any | 1.00%G | 1.00% | 1.00% | 1.00% | 1.00% | 1.00% |
| Expenses net of all reductions | 1.00%G | 1.00% | 1.00% | 1.00% | 1.00% | 1.00% |
| Net investment income (loss) | 1.08%G | .63% | .49% | .52% | .86% | .89% |
| Supplemental Data | | | | | | |
| Net assets, end of period (000 omitted) | $148 | $144 | $132 | $54 | $49 | $43 |
| Portfolio turnover rate E | 13%G | 33% | 24% | 19% | 35% | 34% |
A Calculated based on average shares outstanding during the period.
B Total returns for periods of less than one year are not annualized.
C Total returns would have been lower if certain expenses had not been reduced during the applicable periods shown.
D Total returns do not include the effect of the contingent deferred sales charge.
E Amounts do not include the activity of the Underlying Funds.
F Expense ratios reflect operating expenses of the class. Expenses before reductions do not reflect amounts reimbursed by the investment adviser or reductions from expense offset arrangements and do not represent the amount paid by the class during periods when reimbursements or reductions occur. Expenses net of fee waivers reflect expenses after reimbursement by the investment adviser but prior to reductions from expense offset arrangements. Expenses net of all reductions represent the net expenses paid by the class but do not include expenses of the underlying funds in which the Fund invests.
G Annualized
See accompanying notes which are an integral part of the financial statements.
Financial Highlights — Fidelity Income Replacement 2034 Fund
| | Six months ended (Unaudited) January 31, | Years ended July 31, | | | | |
| | 2017 | 2016 | 2015 | 2014 | 2013 | 2012 |
| Selected Per–Share Data | | | | | | |
| Net asset value, beginning of period | $59.81 | $61.42 | $59.82 | $55.41 | $49.67 | $49.31 |
| Income from Investment Operations | | | | | | |
| Net investment income (loss)A | .625 | .940 | .905 | .885 | .975 | .903 |
| Net realized and unrealized gain (loss) | 1.343 | (.017) | 2.396 | 4.738 | 6.009 | .505 |
| Total from investment operations | 1.968 | .923 | 3.301 | 5.623 | 6.984 | 1.408 |
| Distributions from net investment income | (.649) | (.939) | (.895) | (.857) | (1.033) | (.907) |
| Distributions from net realized gain | (.229) | (1.594) | (.806) | (.356) | (.211) | (.141) |
| Total distributions | (.878) | (2.533) | (1.701) | (1.213) | (1.244) | (1.048) |
| Net asset value, end of period | $60.90 | $59.81 | $61.42 | $59.82 | $55.41 | $49.67 |
| Total ReturnB,C | 3.32% | 1.73% | 5.60% | 10.23% | 14.27% | 2.97% |
| Ratios to Average Net AssetsD,E | | | | | | |
| Expenses before reductions F | - %G | -% | -% | -% | -% | -% |
| Expenses net of fee waivers, if any | - %G | -% | -% | -% | -% | -% |
| Expenses net of all reductions | - %G | -% | -% | -% | -% | -% |
| Net investment income (loss) | 2.08%G | 1.63% | 1.49% | 1.52% | 1.85% | 1.89% |
| Supplemental Data | | | | | | |
| Net assets, end of period (000 omitted) | $6,042 | $6,996 | $8,622 | $8,313 | $3,894 | $2,123 |
| Portfolio turnover rate D | 13%G | 33% | 24% | 19% | 35% | 34% |
A Calculated based on average shares outstanding during the period.
B Total returns for periods of less than one year are not annualized.
C Total returns would have been lower if certain expenses had not been reduced during the applicable periods shown.
D Amounts do not include the activity of the Underlying Funds.
E Expense ratios reflect operating expenses of the class. Expenses before reductions do not reflect amounts reimbursed by the investment adviser or reductions from expense offset arrangements and do not represent the amount paid by the class during periods when reimbursements or reductions occur. Expenses net of fee waivers reflect expenses after reimbursement by the investment adviser but prior to reductions from expense offset arrangements. Expenses net of all reductions represent the net expenses paid by the class but do not include expenses of the underlying funds in which the Fund invests.
F Amount represents less than .005%.
G Annualized
See accompanying notes which are an integral part of the financial statements.
Financial Highlights — Fidelity Income Replacement 2034 Fund Class I
| | Six months ended (Unaudited) January 31, | Years ended July 31, | | | | |
| | 2017 | 2016 | 2015 | 2014 | 2013 | 2012 |
| Selected Per–Share Data | | | | | | |
| Net asset value, beginning of period | $59.81 | $61.42 | $59.83 | $55.42 | $49.67 | $49.31 |
| Income from Investment Operations | | | | | | |
| Net investment income (loss)A | .624 | .940 | .906 | .884 | .972 | .904 |
| Net realized and unrealized gain (loss) | 1.344 | (.017) | 2.385 | 4.739 | 6.022 | .504 |
| Total from investment operations | 1.968 | .923 | 3.291 | 5.623 | 6.994 | 1.408 |
| Distributions from net investment income | (.649) | (.939) | (.895) | (.857) | (1.033) | (.907) |
| Distributions from net realized gain | (.229) | (1.594) | (.806) | (.356) | (.211) | (.141) |
| Total distributions | (.878) | (2.533) | (1.701) | (1.213) | (1.244) | (1.048) |
| Net asset value, end of period | $60.90 | $59.81 | $61.42 | $59.83 | $55.42 | $49.67 |
| Total ReturnB,C | 3.32% | 1.73% | 5.58% | 10.23% | 14.29% | 2.97% |
| Ratios to Average Net AssetsD,E | | | | | | |
| Expenses before reductions F | - %G | -% | -% | -% | -% | -% |
| Expenses net of fee waivers, if any | - %G | -% | -% | -% | -% | -% |
| Expenses net of all reductions | - %G | -% | -% | -% | -% | -% |
| Net investment income (loss) | 2.08%G | 1.63% | 1.49% | 1.52% | 1.85% | 1.89% |
| Supplemental Data | | | | | | |
| Net assets, end of period (000 omitted) | $238 | $232 | $228 | $217 | $139 | $122 |
| Portfolio turnover rate D | 13%G | 33% | 24% | 19% | 35% | 34% |
A Calculated based on average shares outstanding during the period.
B Total returns for periods of less than one year are not annualized.
C Total returns would have been lower if certain expenses had not been reduced during the applicable periods shown.
D Amounts do not include the activity of the Underlying Funds.
E Expense ratios reflect operating expenses of the class. Expenses before reductions do not reflect amounts reimbursed by the investment adviser or reductions from expense offset arrangements and do not represent the amount paid by the class during periods when reimbursements or reductions occur. Expenses net of fee waivers reflect expenses after reimbursement by the investment adviser but prior to reductions from expense offset arrangements. Expenses net of all reductions represent the net expenses paid by the class but do not include expenses of the underlying funds in which the Fund invests.
F Amount represents less than .005%.
G Annualized
See accompanying notes which are an integral part of the financial statements.
Fidelity Income Replacement 2036 Fund℠
Investment Summary (Unaudited)
The information in the following tables is based on the direct investments of the Fund.
Top Holdings as of January 31, 2017
| | % of fund's net assets | % of fund's net assets 6 months ago |
| Fidelity Total Bond Fund | 17.1 | 17.0 |
| Fidelity Series Broad Market Opportunities Fund | 10.4 | 10.4 |
| Fidelity Equity-Income Fund | 9.0 | 9.1 |
| Fidelity Advisor International Discovery Fund Class I | 8.0 | 8.1 |
| Fidelity Large Cap Stock Fund | 6.8 | 6.8 |
| Fidelity Investments Money Market Government Portfolio Institutional Class 0.47% | 6.7 | 6.6 |
| Fidelity Short-Term Bond Fund | 6.6 | 6.5 |
| Fidelity Advisor Mid Cap II Fund Class I | 6.3 | 6.4 |
| Fidelity Series 100 Index Fund | 5.9 | 5.9 |
| Fidelity Blue Chip Growth Fund | 5.9 | 5.9 |
| | 82.7 | 82.7 |
Asset Allocation (% of fund's net assets)
| Period end |
| | Domestic Equity Funds | 45.2% |
| | International Equity Funds | 8.0% |
| | High Yield Fixed-Income Funds | 5.0% |
| | Investment Grade Fixed-Income Funds | 28.5% |
| | Short-Term Funds | 13.3% |
| Six months ago |
| | Domestic Equity Funds | 45.4% |
| | International Equity Funds | 8.1% |
| | High Yield Fixed-Income Funds | 5.1% |
| | Investment Grade Fixed-Income Funds | 28.3% |
| | Short-Term Funds | 13.1% |
Fidelity Income Replacement 2036 Fund℠
Investments January 31, 2017 (Unaudited)
Showing Percentage of Net Assets
| Equity Funds - 53.2% | | | |
| | | Shares | Value |
| Domestic Equity Funds - 45.2% | | | |
| Fidelity Advisor Mid Cap II Fund Class I (a) | | 31,413 | $622,919 |
| Fidelity Blue Chip Growth Fund (a) | | 8,194 | 578,636 |
| Fidelity Equity-Income Fund (a) | | 15,402 | 889,604 |
| Fidelity Large Cap Stock Fund (a) | | 22,404 | 667,203 |
| Fidelity Series 100 Index Fund (a) | | 39,256 | 578,636 |
| Fidelity Series Broad Market Opportunities Fund (a) | | 63,175 | 1,023,438 |
| Fidelity Series Small Cap Opportunities Fund (a) | | 6,286 | 88,567 |
|
| TOTAL DOMESTIC EQUITY FUNDS | | | 4,449,003 |
|
| International Equity Funds - 8.0% | | | |
| Fidelity Advisor International Discovery Fund Class I (a) | | 20,768 | 782,339 |
| TOTAL EQUITY FUNDS | | | |
| (Cost $4,367,359) | | | 5,231,342 |
|
| Fixed-Income Funds - 33.5% | | | |
| High Yield Fixed-Income Funds - 5.0% | | | |
| Fidelity Capital & Income Fund (a) | | 24,726 | 245,035 |
| Fidelity Strategic Income Fund (a) | | 22,752 | 245,035 |
|
| TOTAL HIGH YIELD FIXED-INCOME FUNDS | | | 490,070 |
|
| Investment Grade Fixed-Income Funds - 28.5% | | | |
| Fidelity Government Income Fund (a) | | 55,197 | 561,907 |
| Fidelity Strategic Real Return Fund (a) | | 63,708 | 561,907 |
| Fidelity Total Bond Fund (a) | | 159,691 | 1,684,733 |
|
| TOTAL INVESTMENT GRADE FIXED-INCOME FUNDS | | | 2,808,547 |
|
| TOTAL FIXED-INCOME FUNDS | | | |
| (Cost $3,347,192) | | | 3,298,617 |
|
| Short-Term Funds - 13.3% | | | |
| Fidelity Investments Money Market Government Portfolio Institutional Class 0.47% (a)(b) | | 655,394 | 655,394 |
| Fidelity Short-Term Bond Fund (a) | | 76,297 | 655,394 |
| TOTAL SHORT-TERM FUNDS | | | |
| (Cost $1,310,038) | | | 1,310,788 |
| TOTAL INVESTMENT PORTFOLIO - 100.0% | | | |
| (Cost $9,024,589) | | | 9,840,747 |
| NET OTHER ASSETS (LIABILITIES) - 0.0% | | | (643) |
| NET ASSETS - 100% | | | $9,840,104 |
Legend
(a) Affiliated Fund
(b) The rate quoted is the annualized seven-day yield of the fund at period end.
Affiliated Underlying Funds
Information regarding the Fund's fiscal year to date purchases and sales of the affiliated Underlying Funds and income earned by the Fund from investments in affiliated Underlying Funds is as follows:
| Affiliate | Value, beginning of period | Purchases | Sales Proceeds | Dividend Income | Value, end of period |
| Fidelity Advisor International Discovery Fund Class I | $894,729 | $77,058 | $176,497 | $13,191 | $782,339 |
| Fidelity Advisor Mid Cap II Fund Class I | 698,218 | 53,741 | 155,069 | 2,973 | 622,919 |
| Fidelity Blue Chip Growth Fund | 647,718 | 50,658 | 130,117 | 1,285 | 578,636 |
| Fidelity Capital & Income Fund | 276,652 | 12,918 | 55,033 | 5,530 | 245,035 |
| Fidelity Equity-Income Fund | 996,826 | 54,099 | 216,351 | 13,193 | 889,604 |
| Fidelity Government Income Fund | 622,467 | 68,686 | 100,844 | 4,600 | 561,907 |
| Fidelity Investments Money Market Government Portfolio Institutional Class 0.47% | 717,978 | 58,091 | 120,676 | 1,152 | 655,394 |
| Fidelity Large Cap Stock Fund | 747,620 | 31,932 | 170,281 | 6,147 | 667,203 |
| Fidelity Series 100 Index Fund | 647,718 | 34,938 | 123,221 | 13,218 | 578,636 |
| Fidelity Series Broad Market Opportunities Fund | 1,146,131 | 46,224 | 233,771 | 5,091 | 1,023,438 |
| Fidelity Series Small Cap Opportunities Fund | 99,902 | 5,476 | 24,856 | 455 | 88,567 |
| Fidelity Short-Term Bond Fund | 717,978 | 62,978 | 120,188 | 3,814 | 655,394 |
| Fidelity Strategic Income Fund | 276,652 | 17,176 | 48,736 | 4,389 | 245,035 |
| Fidelity Strategic Real Return Fund | 622,468 | 43,926 | 104,373 | 7,788 | 561,907 |
| Fidelity Total Bond Fund | 1,865,206 | 176,502 | 309,643 | 25,071 | 1,684,733 |
| Total | $10,978,263 | $794,403 | $2,089,656 | $107,897 | $9,840,747 |
Investment Valuation
All investments are categorized as Level 1 under the Fair Value Hierarchy. The inputs or methodology used for valuing securities may not be an indication of the risk associated with investing in those securities. For more information on valuation inputs please refer to the Investment Valuation section in the accompanying Notes to Financial Statements.
See accompanying notes which are an integral part of the financial statements.
Fidelity Income Replacement 2036 Fund℠
Financial Statements
Statement of Assets and Liabilities
| | | January 31, 2017 (Unaudited) |
| Assets | | |
| Investment in securities, at value (cost $9,024,589) — See accompanying schedule | | $9,840,747 |
| Receivable for investments sold | | 64,758 |
| Total assets | | 9,905,505 |
| Liabilities | | |
| Payable for investments purchased | $64,753 | |
| Distribution and service plan fees payable | 648 | |
| Total liabilities | | 65,401 |
| Net Assets | | $9,840,104 |
| Net Assets consist of: | | |
| Paid in capital | | $9,046,438 |
| Undistributed net investment income | | 1,862 |
| Accumulated undistributed net realized gain (loss) on investments | | (24,354) |
| Net unrealized appreciation (depreciation) on investments | | 816,158 |
| Net Assets | | $9,840,104 |
| Calculation of Maximum Offering Price | | |
| Class A: | | |
| Net Asset Value and redemption price per share ($499,120.74 ÷ 8,145.949 shares) | | $61.27 |
| Maximum offering price per share (100/94.25 of $61.27) | | $65.01 |
| Class T: | | |
| Net Asset Value and redemption price per share ($546,279.40 ÷ 8,918.179 shares) | | $61.25 |
| Maximum offering price per share (100/96.50 of $61.25) | | $63.47 |
| Class C: | | |
| Net Asset Value and offering price per share ($377,687.95 ÷ 6,203.897 shares)(a) | | $60.88 |
| Income Replacement 2036: | | |
| Net Asset Value, offering price and redemption price per share ($8,416,208.55 ÷ 137,331.323 shares) | | $61.28 |
| Class I: | | |
| Net Asset Value, offering price and redemption price per share ($807.08 ÷ 13.147 shares) | | $61.39 |
(a) Redemption price per share is equal to net asset value less any applicable contingent deferred sales charge.
See accompanying notes which are an integral part of the financial statements.
Statement of Operations
| | | Six months ended January 31, 2017 (Unaudited) |
| Investment Income | | |
| Income distributions from underlying funds | | $107,897 |
| Expenses | | |
| Distribution and service plan fees | $4,787 | |
| Independent trustees' fees and expenses | 24 | |
| Total expenses before reductions | 4,811 | |
| Expense reductions | (24) | 4,787 |
| Net investment income (loss) | | 103,110 |
| Realized and Unrealized Gain (Loss) | | |
| Realized gain (loss) on sale of underlying fund shares | (22,160) | |
| Capital gain distributions from underlying funds | 73,456 | |
| Total net realized gain (loss) | | 51,296 |
| Change in net unrealized appreciation (depreciation) on underlying funds | | 179,895 |
| Net gain (loss) | | 231,191 |
| Net increase (decrease) in net assets resulting from operations | | $334,301 |
See accompanying notes which are an integral part of the financial statements.
Statement of Changes in Net Assets
| | Six months ended January 31, 2017 (Unaudited) | Year ended July 31, 2016 |
| Increase (Decrease) in Net Assets | | |
| Operations | | |
| Net investment income (loss) | $103,110 | $160,587 |
| Net realized gain (loss) | 51,296 | 129,588 |
| Change in net unrealized appreciation (depreciation) | 179,895 | (133,017) |
| Net increase (decrease) in net assets resulting from operations | 334,301 | 157,158 |
| Distributions to shareholders from net investment income | (103,414) | (160,249) |
| Distributions to shareholders from net realized gain | (118,111) | (238,984) |
| Total distributions | (221,525) | (399,233) |
| Share transactions - net increase (decrease) | (1,250,096) | (63,577) |
| Total increase (decrease) in net assets | (1,137,320) | (305,652) |
| Net Assets | | |
| Beginning of period | 10,977,424 | 11,283,076 |
| End of period | $9,840,104 | $10,977,424 |
| Other Information | | |
| Undistributed net investment income end of period | $1,862 | $2,166 |
See accompanying notes which are an integral part of the financial statements.
Financial Highlights — Fidelity Income Replacement 2036 Fund Class A
| | Six months ended (Unaudited) January 31, | Years ended July 31, | | | | |
| | 2017 | 2016 | 2015 | 2014 | 2013 | 2012 |
| Selected Per–Share Data | | | | | | |
| Net asset value, beginning of period | $60.61 | $62.00 | $59.79 | $55.12 | $49.20 | $48.92 |
| Income from Investment Operations | | | | | | |
| Net investment income (loss)A | .569 | .790 | .753 | .751 | .939 | .760 |
| Net realized and unrealized gain (loss) | 1.385 | (.055) | 2.474 | 4.831 | 6.075 | .441 |
| Total from investment operations | 1.954 | .735 | 3.227 | 5.582 | 7.014 | 1.201 |
| Distributions from net investment income | (.587) | (.788) | (.743) | (.734) | (.913) | (.784) |
| Distributions from net realized gain | (.707) | (1.337) | (.274) | (.178) | (.181) | (.137) |
| Total distributions | (1.294) | (2.125) | (1.017) | (.912) | (1.094) | (.921) |
| Net asset value, end of period | $61.27 | $60.61 | $62.00 | $59.79 | $55.12 | $49.20 |
| Total ReturnB,C,D | 3.28% | 1.37% | 5.44% | 10.18% | 14.45% | 2.56% |
| Ratios to Average Net AssetsE,F | | | | | | |
| Expenses before reductions | .25%G | .25% | .25% | .25% | .25% | .25% |
| Expenses net of fee waivers, if any | .25%G | .25% | .25% | .25% | .25% | .25% |
| Expenses net of all reductions | .25%G | .25% | .25% | .25% | .25% | .25% |
| Net investment income (loss) | 1.88%G | 1.36% | 1.23% | 1.29% | 1.80% | 1.60% |
| Supplemental Data | | | | | | |
| Net assets, end of period (000 omitted) | $499 | $501 | $452 | $181 | $25 | $27 |
| Portfolio turnover rateE | 16%G | 27% | 20% | 25% | 25% | 62% |
A Calculated based on average shares outstanding during the period.
B Total returns for periods of less than one year are not annualized.
C Total returns would have been lower if certain expenses had not been reduced during the applicable periods shown.
D Total returns do not include the effect of the sales charges.
E Amounts do not include the activity of the Underlying Funds.
F Expense ratios reflect operating expenses of the class. Expenses before reductions do not reflect amounts reimbursed by the investment adviser or reductions from expense offset arrangements and do not represent the amount paid by the class during periods when reimbursements or reductions occur. Expenses net of fee waivers reflect expenses after reimbursement by the investment adviser but prior to reductions from expense offset arrangements. Expenses net of all reductions represent the net expenses paid by the class but do not include expenses of the underlying funds in which the Fund invests.
G Annualized
See accompanying notes which are an integral part of the financial statements.
Financial Highlights — Fidelity Income Replacement 2036 Fund Class T
| | Six months ended (Unaudited) January 31, | Years ended July 31, | | | | |
| | 2017 | 2016 | 2015 | 2014 | 2013 | 2012 |
| Selected Per–Share Data | | | | | | |
| Net asset value, beginning of period | $60.57 | $61.96 | $59.75 | $55.09 | $49.17 | $48.89 |
| Income from Investment Operations | | | �� | | | |
| Net investment income (loss)A | .495 | .645 | .600 | .601 | .809 | .641 |
| Net realized and unrealized gain (loss) | 1.383 | (.056) | 2.475 | 4.822 | 6.077 | .448 |
| Total from investment operations | 1.878 | .589 | 3.075 | 5.423 | 6.886 | 1.089 |
| Distributions from net investment income | (.491) | (.642) | (.591) | (.585) | (.785) | (.672) |
| Distributions from net realized gain | (.707) | (1.337) | (.274) | (.178) | (.181) | (.137) |
| Total distributions | (1.198) | (1.979) | (.865) | (.763) | (.966) | (.809) |
| Net asset value, end of period | $61.25 | $60.57 | $61.96 | $59.75 | $55.09 | $49.17 |
| Total ReturnB,C,D | 3.15% | 1.11% | 5.18% | 9.89% | 14.18% | 2.32% |
| Ratios to Average Net AssetsE,F | | | | | | |
| Expenses before reductions | .50%G | .50% | .50% | .50% | .50% | .50% |
| Expenses net of fee waivers, if any | .50%G | .50% | .50% | .50% | .50% | .50% |
| Expenses net of all reductions | .50%G | .50% | .50% | .50% | .50% | .50% |
| Net investment income (loss) | 1.63%G | 1.11% | .98% | 1.04% | 1.55% | 1.35% |
| Supplemental Data | | | | | | |
| Net assets, end of period (000 omitted) | $546 | $1,030 | $1,088 | $420 | $295 | $278 |
| Portfolio turnover rateE | 16%G | 27% | 20% | 25% | 25% | 62% |
A Calculated based on average shares outstanding during the period.
B Total returns for periods of less than one year are not annualized.
C Total returns would have been lower if certain expenses had not been reduced during the applicable periods shown.
D Total returns do not include the effect of the sales charges.
E Amounts do not include the activity of the Underlying Funds.
F Expense ratios reflect operating expenses of the class. Expenses before reductions do not reflect amounts reimbursed by the investment adviser or reductions from expense offset arrangements and do not represent the amount paid by the class during periods when reimbursements or reductions occur. Expenses net of fee waivers reflect expenses after reimbursement by the investment adviser but prior to reductions from expense offset arrangements. Expenses net of all reductions represent the net expenses paid by the class but do not include expenses of the underlying funds in which the Fund invests.
G Annualized
See accompanying notes which are an integral part of the financial statements.
Financial Highlights — Fidelity Income Replacement 2036 Fund Class C
| | Six months ended (Unaudited) January 31, | Years ended July 31, | | | | |
| | 2017 | 2016 | 2015 | 2014 | 2013 | 2012 |
| Selected Per–Share Data | | | | | | |
| Net asset value, beginning of period | $60.25 | $61.71 | $59.58 | $54.98 | $49.14 | $48.88 |
| Income from Investment Operations | | | | | | |
| Net investment income (loss)A | .340 | .352 | .294 | .310 | .553 | .404 |
| Net realized and unrealized gain (loss) | 1.380 | (.066) | 2.471 | 4.816 | 6.061 | .445 |
| Total from investment operations | 1.720 | .286 | 2.765 | 5.126 | 6.614 | .849 |
| Distributions from net investment income | (.383) | (.409) | (.361) | (.348) | (.593) | (.452) |
| Distributions from net realized gain | (.707) | (1.337) | (.274) | (.178) | (.181) | (.137) |
| Total distributions | (1.090) | (1.746) | (.635) | (.526) | (.774) | (.589) |
| Net asset value, end of period | $60.88 | $60.25 | $61.71 | $59.58 | $54.98 | $49.14 |
| Total ReturnB,C,D | 2.90% | .60% | 4.66% | 9.35% | 13.60% | 1.80% |
| Ratios to Average Net AssetsE,F | | | | | | |
| Expenses before reductions | 1.00%G | 1.00% | 1.00% | 1.00% | 1.00% | 1.00% |
| Expenses net of fee waivers, if any | 1.00%G | 1.00% | 1.00% | 1.00% | 1.00% | 1.00% |
| Expenses net of all reductions | 1.00%G | 1.00% | 1.00% | 1.00% | 1.00% | 1.00% |
| Net investment income (loss) | 1.13%G | .61% | .48% | .54% | 1.06% | .85% |
| Supplemental Data | | | | | | |
| Net assets, end of period (000 omitted) | $378 | $384 | $444 | $358 | $357 | $174 |
| Portfolio turnover rateE | 16%G | 27% | 20% | 25% | 25% | 62% |
A Calculated based on average shares outstanding during the period.
B Total returns for periods of less than one year are not annualized.
C Total returns would have been lower if certain expenses had not been reduced during the applicable periods shown.
D Total returns do not include the effect of the contingent deferred sales charge.
E Amounts do not include the activity of the Underlying Funds.
F Expense ratios reflect operating expenses of the class. Expenses before reductions do not reflect amounts reimbursed by the investment adviser or reductions from expense offset arrangements and do not represent the amount paid by the class during periods when reimbursements or reductions occur. Expenses net of fee waivers reflect expenses after reimbursement by the investment adviser but prior to reductions from expense offset arrangements. Expenses net of all reductions represent the net expenses paid by the class but do not include expenses of the underlying funds in which the Fund invests.
G Annualized
See accompanying notes which are an integral part of the financial statements.
Financial Highlights — Fidelity Income Replacement 2036 Fund
| | Six months ended (Unaudited) January 31, | Years ended July 31, | | | | |
| | 2017 | 2016 | 2015 | 2014 | 2013 | 2012 |
| Selected Per–Share Data | | | | | | |
| Net asset value, beginning of period | $60.62 | $62.01 | $59.79 | $55.11 | $49.19 | $48.91 |
| Income from Investment Operations | | | | | | |
| Net investment income (loss)A | .645 | .938 | .907 | .893 | 1.073 | .880 |
| Net realized and unrealized gain (loss) | 1.385 | (.057) | 2.472 | 4.833 | 6.070 | .445 |
| Total from investment operations | 2.030 | .881 | 3.379 | 5.726 | 7.143 | 1.325 |
| Distributions from net investment income | (.663) | (.934) | (.885) | (.868) | (1.042) | (.908) |
| Distributions from net realized gain | (.707) | (1.337) | (.274) | (.178) | (.181) | (.137) |
| Total distributions | (1.370) | (2.271) | (1.159) | (1.046) | (1.223) | (1.045) |
| Net asset value, end of period | $61.28 | $60.62 | $62.01 | $59.79 | $55.11 | $49.19 |
| Total ReturnB,C | 3.41% | 1.62% | 5.70% | 10.46% | 14.74% | 2.82% |
| Ratios to Average Net AssetsD,E | | | | | | |
| Expenses before reductionsF | - %G | -% | -% | -% | -% | -% |
| Expenses net of fee waivers, if any | - %G | -% | -% | -% | -% | -% |
| Expenses net of all reductions | - %G | -% | -% | -% | -% | -% |
| Net investment income (loss) | 2.13%G | 1.61% | 1.48% | 1.54% | 2.05% | 1.85% |
| Supplemental Data | | | | | | |
| Net assets, end of period (000 omitted) | $8,416 | $9,061 | $9,298 | $6,327 | $3,904 | $2,363 |
| Portfolio turnover rateD | 16%G | 27% | 20% | 25% | 25% | 62% |
A Calculated based on average shares outstanding during the period.
B Total returns for periods of less than one year are not annualized.
C Total returns would have been lower if certain expenses had not been reduced during the applicable periods shown.
D Amounts do not include the activity of the Underlying Funds.
E Expense ratios reflect operating expenses of the class. Expenses before reductions do not reflect amounts reimbursed by the investment adviser or reductions from expense offset arrangements and do not represent the amount paid by the class during periods when reimbursements or reductions occur. Expenses net of fee waivers reflect expenses after reimbursement by the investment adviser but prior to reductions from expense offset arrangements. Expenses net of all reductions represent the net expenses paid by the class but do not include expenses of the underlying funds in which the Fund invests.
F Amount represents less than .005%.
G Annualized
See accompanying notes which are an integral part of the financial statements.
Financial Highlights — Fidelity Income Replacement 2036 Fund Class I
| | Six months ended (Unaudited) January 31, | Years ended July 31, | | | | |
| | 2017 | 2016 | 2015 | 2014 | 2013 | 2012 |
| Selected Per–Share Data | | | | | | |
| Net asset value, beginning of period | $60.71 | $62.07 | $59.83 | $55.13 | $49.18 | $48.90 |
| Income from Investment Operations | | | | | | |
| Net investment income (loss)A | .646 | .940 | .901 | .869 | 1.108 | .873 |
| Net realized and unrealized gain (loss) | 1.404 | (.029) | 2.498 | 4.877 | 6.065 | .452 |
| Total from investment operations | 2.050 | .911 | 3.399 | 5.746 | 7.173 | 1.325 |
| Distributions from net investment income | (.663) | (.934) | (.885) | (.868) | (1.042) | (.908) |
| Distributions from net realized gain | (.707) | (1.337) | (.274) | (.178) | (.181) | (.137) |
| Total distributions | (1.370) | (2.271) | (1.159) | (1.046) | (1.223) | (1.045) |
| Net asset value, end of period | $61.39 | $60.71 | $62.07 | $59.83 | $55.13 | $49.18 |
| Total ReturnB | 3.44% | 1.67% | 5.73% | 10.49% | 14.80% | 2.82% |
| Ratios to Average Net AssetsC,D | | | | | | |
| Expenses before reductionsE | - %F | -% | -% | -% | -% | -% |
| Expenses net of fee waivers, if any | - %F | -% | -% | -% | -% | -% |
| Expenses net of all reductions | - %F | -% | -% | -% | -% | -% |
| Net investment income (loss) | 2.13%F | 1.61% | 1.48% | 1.54% | 2.05% | 1.85% |
| Supplemental Data | | | | | | |
| Net assets, end of period (000 omitted) | $1 | $1 | $1 | $1 | $1 | $1 |
| Portfolio turnover rateC | 16%F | 27% | 20% | 25% | 25% | 62% |
A Calculated based on average shares outstanding during the period.
B Total returns for periods of less than one year are not annualized.
C Amounts do not include the activity of the Underlying Funds.
D Expense ratios reflect operating expenses of the class. Expenses before reductions do not reflect amounts reimbursed by the investment adviser or reductions from expense offset arrangements and do not represent the amount paid by the class during periods when reimbursements or reductions occur. Expenses net of fee waivers reflect expenses after reimbursement by the investment adviser but prior to reductions from expense offset arrangements. Expenses net of all reductions represent the net expenses paid by the class but do not include expenses of the underlying funds in which the Fund invests.
E Amount represents less than .005%.
F Annualized
See accompanying notes which are an integral part of the financial statements.
Fidelity Income Replacement 2038 Fund℠
Investment Summary (Unaudited)
The information in the following tables is based on the direct investments of the Fund.
Top Holdings as of January 31, 2017
| | % of fund's net assets | % of fund's net assets 6 months ago |
| Fidelity Total Bond Fund | 16.7 | 16.7 |
| Fidelity Series Broad Market Opportunities Fund | 10.6 | 10.6 |
| Fidelity Equity-Income Fund | 9.2 | 9.3 |
| Fidelity Advisor International Discovery Fund Class I | 8.7 | 9.0 |
| Fidelity Large Cap Stock Fund | 6.9 | 6.9 |
| Fidelity Advisor Mid Cap II Fund Class I | 6.4 | 6.5 |
| Fidelity Investments Money Market Government Portfolio Institutional Class 0.47% | 6.1 | 5.9 |
| Fidelity Short-Term Bond Fund | 6.1 | 5.9 |
| Fidelity Series 100 Index Fund | 6.0 | 6.0 |
| Fidelity Blue Chip Growth Fund | 6.0 | 6.0 |
| | 82.7 | 82.8 |
Asset Allocation (% of fund's net assets)
| Period end |
| | Domestic Equity Funds | 46.0% |
| | International Equity Funds | 8.7% |
| | High Yield Fixed-Income Funds | 5.2% |
| | Investment Grade Fixed-Income Funds | 27.9% |
| | Short-Term Funds | 12.2% |
| Six months ago |
| | Domestic Equity Funds | 46.2% |
| | International Equity Funds | 9.0% |
| | High Yield Fixed-Income Funds | 5.3% |
| | Investment Grade Fixed-Income Funds | 27.7% |
| | Short-Term Funds | 11.8% |
Fidelity Income Replacement 2038 Fund℠
Investments January 31, 2017 (Unaudited)
Showing Percentage of Net Assets
| Equity Funds - 54.7% | | | |
| | | Shares | Value |
| Domestic Equity Funds - 46.0% | | | |
| Fidelity Advisor Mid Cap II Fund Class I (a) | | 15,128 | $299,980 |
| Fidelity Blue Chip Growth Fund (a) | | 3,944 | 278,553 |
| Fidelity Equity-Income Fund (a) | | 7,419 | 428,543 |
| Fidelity Large Cap Stock Fund (a) | | 10,793 | 321,407 |
| Fidelity Series 100 Index Fund (a) | | 18,898 | 278,553 |
| Fidelity Series Broad Market Opportunities Fund (a) | | 30,421 | 492,825 |
| Fidelity Series Small Cap Opportunities Fund (a) | | 3,041 | 42,854 |
|
| TOTAL DOMESTIC EQUITY FUNDS | | | 2,142,715 |
|
| International Equity Funds - 8.7% | | | |
| Fidelity Advisor International Discovery Fund Class I (a) | | 10,807 | 407,116 |
| TOTAL EQUITY FUNDS | | | |
| (Cost $1,944,635) | | | 2,549,831 |
|
| Fixed-Income Funds - 33.1% | | | |
| High Yield Fixed-Income Funds - 5.2% | | | |
| Fidelity Capital & Income Fund (a) | | 12,268 | 121,576 |
| Fidelity Strategic Income Fund (a) | | 11,288 | 121,576 |
|
| TOTAL HIGH YIELD FIXED-INCOME FUNDS | | | 243,152 |
|
| Investment Grade Fixed-Income Funds - 27.9% | | | |
| Fidelity Government Income Fund (a) | | 25,532 | 259,921 |
| Fidelity Strategic Real Return Fund (a) | | 29,469 | 259,921 |
| Fidelity Total Bond Fund (a) | | 73,823 | 778,832 |
|
| TOTAL INVESTMENT GRADE FIXED-INCOME FUNDS | | | 1,298,674 |
|
| TOTAL FIXED-INCOME FUNDS | | | |
| (Cost $1,525,614) | | | 1,541,826 |
|
| Short-Term Funds - 12.2% | | | |
| Fidelity Investments Money Market Government Portfolio Institutional Class 0.47% (a)(b) | | 283,211 | 283,211 |
| Fidelity Short-Term Bond Fund (a) | | 32,970 | 283,211 |
| TOTAL SHORT-TERM FUNDS | | | |
| (Cost $563,681) | | | 566,422 |
| TOTAL INVESTMENT PORTFOLIO - 100.0% | | | |
| (Cost $4,033,930) | | | 4,658,079 |
| NET OTHER ASSETS (LIABILITIES) - 0.0% | | | (154) |
| NET ASSETS - 100% | | | $4,657,925 |
Legend
(a) Affiliated Fund
(b) The rate quoted is the annualized seven-day yield of the fund at period end.
Affiliated Underlying Funds
Information regarding the Fund's fiscal year to date purchases and sales of the affiliated Underlying Funds and income earned by the Fund from investments in affiliated Underlying Funds is as follows:
| Affiliate | Value, beginning of period | Purchases | Sales Proceeds | Dividend Income | Value, end of period |
| Fidelity Advisor International Discovery Fund Class I | $444,172 | $36,543 | $66,791 | $6,904 | $407,116 |
| Fidelity Advisor Mid Cap II Fund Class I | 321,454 | 22,738 | 57,031 | 1,440 | 299,980 |
| Fidelity Blue Chip Growth Fund | 298,599 | 22,152 | 47,417 | 618 | 278,553 |
| Fidelity Capital & Income Fund | 131,164 | 5,265 | 20,092 | 2,763 | 121,576 |
| Fidelity Equity-Income Fund | 459,077 | 22,001 | 78,963 | 6,403 | 428,543 |
| Fidelity Government Income Fund | 275,744 | 29,553 | 32,236 | 2,141 | 259,921 |
| Fidelity Investments Money Market Government Portfolio Institutional Class 0.47% | 293,134 | 25,808 | 35,730 | 498 | 283,211 |
| Fidelity Large Cap Stock Fund | 344,308 | 12,205 | 63,070 | 2,965 | 321,407 |
| Fidelity Series 100 Index Fund | 298,599 | 13,249 | 42,632 | 6,417 | 278,553 |
| Fidelity Series Broad Market Opportunities Fund | 528,138 | 17,584 | 84,314 | 2,467 | 492,825 |
| Fidelity Series Small Cap Opportunities Fund | 45,709 | 2,597 | 9,327 | 217 | 42,854 |
| Fidelity Short-Term Bond Fund | 293,133 | 27,910 | 35,520 | 1,651 | 283,211 |
| Fidelity Strategic Income Fund | 131,164 | 7,465 | 17,014 | 2,189 | 121,576 |
| Fidelity Strategic Real Return Fund | 275,745 | 18,568 | 34,366 | 3,648 | 259,921 |
| Fidelity Total Bond Fund | 828,221 | 72,291 | 99,740 | 11,708 | 778,832 |
| Total | $4,968,361 | $335,929 | $724,243 | $52,029 | $4,658,079 |
Investment Valuation
All investments are categorized as Level 1 under the Fair Value Hierarchy. The inputs or methodology used for valuing securities may not be an indication of the risk associated with investing in those securities. For more information on valuation inputs please refer to the Investment Valuation section in the accompanying Notes to Financial Statements.
See accompanying notes which are an integral part of the financial statements.
Fidelity Income Replacement 2038 Fund℠
Financial Statements
Statement of Assets and Liabilities
| | | January 31, 2017 (Unaudited) |
| Assets | | |
| Investment in securities, at value (cost $4,033,930) — See accompanying schedule | | $4,658,079 |
| Cash | | 2 |
| Receivable for investments sold | | 32,249 |
| Total assets | | 4,690,330 |
| Liabilities | | |
| Payable for investments purchased | $32,250 | |
| Distribution and service plan fees payable | 155 | |
| Total liabilities | | 32,405 |
| Net Assets | | $4,657,925 |
| Net Assets consist of: | | |
| Paid in capital | | $4,015,172 |
| Undistributed net investment income | | 909 |
| Accumulated undistributed net realized gain (loss) on investments | | 17,695 |
| Net unrealized appreciation (depreciation) on investments | | 624,149 |
| Net Assets | | $4,657,925 |
| Calculation of Maximum Offering Price | | |
| Class A: | | |
| Net Asset Value and redemption price per share ($6,474 ÷ 109.81 shares) | | $58.96 |
| Maximum offering price per share (100/94.25 of $58.96) | | $62.56 |
| Class T: | | |
| Net Asset Value and redemption price per share ($184,530 ÷ 3,132.57 shares) | | $58.91 |
| Maximum offering price per share (100/96.50 of $58.91) | | $61.05 |
| Class C: | | |
| Net Asset Value and offering price per share ($92,123 ÷ 1,573.27 shares)(a) | | $58.56 |
| Income Replacement 2038: | | |
| Net Asset Value, offering price and redemption price per share ($4,340,540 ÷ 73,655.45 shares) | | $58.93 |
| Class I: | | |
| Net Asset Value, offering price and redemption price per share ($34,258 ÷ 581.37 shares) | | $58.93 |
(a) Redemption price per share is equal to net asset value less any applicable contingent deferred sales charge.
See accompanying notes which are an integral part of the financial statements.
Statement of Operations
| | | Six months ended January 31, 2017 (Unaudited) |
| Investment Income | | |
| Income distributions from underlying funds | | $52,029 |
| Expenses | | |
| Distribution and service plan fees | $934 | |
| Independent trustees' fees and expenses | 12 | |
| Total expenses before reductions | 946 | |
| Expense reductions | (12) | 934 |
| Net investment income (loss) | | 51,095 |
| Realized and Unrealized Gain (Loss) | | |
| Realized gain (loss) on sale of underlying fund shares | 15,339 | |
| Capital gain distributions from underlying funds | 35,401 | |
| Total net realized gain (loss) | | 50,740 |
| Change in net unrealized appreciation (depreciation) on underlying funds | | 62,692 |
| Net gain (loss) | | 113,432 |
| Net increase (decrease) in net assets resulting from operations | | $164,527 |
See accompanying notes which are an integral part of the financial statements.
Statement of Changes in Net Assets
| | Six months ended January 31, 2017 (Unaudited) | Year ended July 31, 2016 |
| Increase (Decrease) in Net Assets | | |
| Operations | | |
| Net investment income (loss) | $51,095 | $93,261 |
| Net realized gain (loss) | 50,740 | 62,002 |
| Change in net unrealized appreciation (depreciation) | 62,692 | (142,555) |
| Net increase (decrease) in net assets resulting from operations | 164,527 | 12,708 |
| Distributions to shareholders from net investment income | (51,267) | (93,349) |
| Distributions to shareholders from net realized gain | (29,677) | (167,598) |
| Total distributions | (80,944) | (260,947) |
| Share transactions - net increase (decrease) | (393,856) | (1,464,806) |
| Total increase (decrease) in net assets | (310,273) | (1,713,045) |
| Net Assets | | |
| Beginning of period | 4,968,198 | 6,681,243 |
| End of period | $4,657,925 | $4,968,198 |
| Other Information | | |
| Undistributed net investment income end of period | $909 | $1,081 |
See accompanying notes which are an integral part of the financial statements.
Financial Highlights — Fidelity Income Replacement 2038 Fund Class A
| | Six months ended (Unaudited) January 31, | Years ended July 31, | | | | |
| | 2017 | 2016 | 2015 | 2014 | 2013 | 2012 |
| Selected Per–Share Data | | | | | | |
| Net asset value, beginning of period | $57.92 | $59.57 | $57.74 | $54.44 | $48.41 | $48.19 |
| Income from Investment Operations | | | | | | |
| Net investment income (loss)A | .574 | .774 | .718 | .738 | .953 | .739 |
| Net realized and unrealized gain (loss) | 1.354 | (.138) | 2.463 | 4.763 | 6.186 | .384 |
| Total from investment operations | 1.928 | .636 | 3.181 | 5.501 | 7.139 | 1.123 |
| Distributions from net investment income | (.527) | (.766) | (.712) | (.688) | (.909) | (.769) |
| Distributions from net realized gain | (.361) | (1.520) | (.639) | (1.513) | (.200) | (.134) |
| Total distributions | (.888) | (2.286) | (1.351) | (2.201) | (1.109) | (.903) |
| Net asset value, end of period | $58.96 | $57.92 | $59.57 | $57.74 | $54.44 | $48.41 |
| Total ReturnB,C,D | 3.36% | 1.27% | 5.58% | 10.39% | 14.95% | 2.44% |
| Ratios to Average Net AssetsE,F | | | | | | |
| Expenses before reductions | .24%G,H | .25% | .25% | .25% | .25% | .25% |
| Expenses net of fee waivers, if any | .24%G,H | .25% | .25% | .25% | .25% | .25% |
| Expenses net of all reductions | .24%G,H | .25% | .25% | .25% | .25% | .25% |
| Net investment income (loss) | 1.92%G | 1.39% | 1.22% | 1.31% | 1.85% | 1.59% |
| Supplemental Data | | | | | | |
| Net assets, end of period (000 omitted) | $6 | $62 | $172 | $178 | $121 | $76 |
| Portfolio turnover rate E | 14%G | 23% | 41% | 39% | 49% | 57% |
A Calculated based on average shares outstanding during the period.
B Total returns for periods of less than one year are not annualized.
C Total returns would have been lower if certain expenses had not been reduced during the applicable periods shown.
D Total returns do not include the effect of the sales charges.
E Amounts do not include the activity of the Underlying Funds.
F Expense ratios reflect operating expenses of the class. Expenses before reductions do not reflect amounts reimbursed by the investment adviser or reductions from expense offset arrangements and do not represent the amount paid by the class during periods when reimbursements or reductions occur. Expenses net of fee waivers reflect expenses after reimbursement by the investment adviser but prior to reductions from expense offset arrangements. Expenses net of all reductions represent the net expenses paid by the class but do not include expenses of the underlying funds in which the Fund invests.
G Annualized
H On certain classes, the size and fluctuation of net assets may cause rounding of expense amounts and ratios to differ from contractual rates.
See accompanying notes which are an integral part of the financial statements.
Financial Highlights — Fidelity Income Replacement 2038 Fund Class T
| | Six months ended (Unaudited) January 31, | Years ended July 31, | | | | |
| | 2017 | 2016 | 2015 | 2014 | 2013 | 2012 |
| Selected Per–Share Data | | | | | | |
| Net asset value, beginning of period | $57.90 | $59.56 | $57.74 | $54.44 | $48.40 | $48.19 |
| Income from Investment Operations | | | | | | |
| Net investment income (loss)A | .483 | .635 | .571 | .599 | .820 | .624 |
| Net realized and unrealized gain (loss) | 1.376 | (.140) | 2.456 | 4.761 | 6.201 | .367 |
| Total from investment operations | 1.859 | .495 | 3.027 | 5.360 | 7.021 | .991 |
| Distributions from net investment income | (.488) | (.635) | (.568) | (.547) | (.781) | (.647) |
| Distributions from net realized gain | (.361) | (1.520) | (.639) | (1.513) | (.200) | (.134) |
| Total distributions | (.849) | (2.155) | (1.207) | (2.060) | (.981) | (.781) |
| Net asset value, end of period | $58.91 | $57.90 | $59.56 | $57.74 | $54.44 | $48.40 |
| Total ReturnB,C,D | 3.24% | 1.02% | 5.30% | 10.11% | 14.69% | 2.15% |
| Ratios to Average Net AssetsE,F | | | | | | |
| Expenses before reductions | .50%G | .50% | .50% | .50% | .50% | .50% |
| Expenses net of fee waivers, if any | .50%G | .50% | .50% | .50% | .50% | .50% |
| Expenses net of all reductions | .50%G | .50% | .50% | .50% | .50% | .50% |
| Net investment income (loss) | 1.66%G | 1.14% | .97% | 1.07% | 1.59% | 1.34% |
| Supplemental Data | | | | | | |
| Net assets, end of period (000 omitted) | $185 | $183 | $191 | $190 | $135 | $105 |
| Portfolio turnover rate E | 14%G | 23% | 41% | 39% | 49% | 57% |
A Calculated based on average shares outstanding during the period.
B Total returns for periods of less than one year are not annualized.
C Total returns would have been lower if certain expenses had not been reduced during the applicable periods shown.
D Total returns do not include the effect of the sales charges.
E Amounts do not include the activity of the Underlying Funds.
F Expense ratios reflect operating expenses of the class. Expenses before reductions do not reflect amounts reimbursed by the investment adviser or reductions from expense offset arrangements and do not represent the amount paid by the class during periods when reimbursements or reductions occur. Expenses net of fee waivers reflect expenses after reimbursement by the investment adviser but prior to reductions from expense offset arrangements. Expenses net of all reductions represent the net expenses paid by the class but do not include expenses of the underlying funds in which the Fund invests.
G Annualized
See accompanying notes which are an integral part of the financial statements.
Financial Highlights — Fidelity Income Replacement 2038 Fund Class C
| | Six months ended (Unaudited) January 31, | Years ended July 31, | | | | |
| | 2017 | 2016 | 2015 | 2014 | 2013 | 2012 |
| Selected Per–Share Data | | | | | | |
| Net asset value, beginning of period | $57.58 | $59.30 | $57.56 | $54.33 | $48.37 | $48.17 |
| Income from Investment Operations | | | | | | |
| Net investment income (loss)A | .336 | .355 | .276 | .315 | .561 | .390 |
| Net realized and unrealized gain (loss) | 1.375 | (.151) | 2.444 | 4.755 | 6.186 | .379 |
| Total from investment operations | 1.711 | .204 | 2.720 | 5.070 | 6.747 | .769 |
| Distributions from net investment income | (.370) | (.404) | (.341) | (.327) | (.587) | (.435) |
| Distributions from net realized gain | (.361) | (1.520) | (.639) | (1.513) | (.200) | (.134) |
| Total distributions | (.731) | (1.924) | (.980) | (1.840) | (.787) | (.569) |
| Net asset value, end of period | $58.56 | $57.58 | $59.30 | $57.56 | $54.33 | $48.37 |
| Total ReturnB,C,D | 3.00% | .50% | 4.77% | 9.57% | 14.10% | 1.67% |
| Ratios to Average Net AssetsE,F | | | | | | |
| Expenses before reductions | 1.00%G | 1.00% | 1.00% | 1.00% | 1.00% | 1.00% |
| Expenses net of fee waivers, if any | 1.00%G | 1.00% | 1.00% | 1.00% | 1.00% | 1.00% |
| Expenses net of all reductions | 1.00%G | 1.00% | 1.00% | 1.00% | 1.00% | 1.00% |
| Net investment income (loss) | 1.16%G | .64% | .47% | .56% | 1.09% | .84% |
| Supplemental Data | | | | | | |
| Net assets, end of period (000 omitted) | $92 | $93 | $104 | $110 | $84 | $74 |
| Portfolio turnover rate E | 14%G | 23% | 41% | 39% | 49% | 57% |
A Calculated based on average shares outstanding during the period.
B Total returns for periods of less than one year are not annualized.
C Total returns do not include the effect of the contingent deferred sales charge.
D Total returns would have been lower if certain expenses had not been reduced during the applicable periods shown.
E Amounts do not include the activity of the Underlying Funds.
F Expense ratios reflect operating expenses of the class. Expenses before reductions do not reflect amounts reimbursed by the investment adviser or reductions from expense offset arrangements and do not represent the amount paid by the class during periods when reimbursements or reductions occur. Expenses net of fee waivers reflect expenses after reimbursement by the investment adviser but prior to reductions from expense offset arrangements. Expenses net of all reductions represent the net expenses paid by the class but do not include expenses of the underlying funds in which the Fund invests.
G Annualized
See accompanying notes which are an integral part of the financial statements.
Financial Highlights — Fidelity Income Replacement 2038 Fund
| | Six months ended (Unaudited) January 31, | Years ended July 31, | | | | |
| | 2017 | 2016 | 2015 | 2014 | 2013 | 2012 |
| Selected Per–Share Data | | | | | | |
| Net asset value, beginning of period | $57.92 | $59.58 | $57.75 | $54.45 | $48.41 | $48.19 |
| Income from Investment Operations | | | | | | |
| Net investment income (loss)A | .629 | .915 | .865 | .881 | 1.076 | .857 |
| Net realized and unrealized gain (loss) | 1.375 | (.145) | 2.464 | 4.759 | 6.200 | .377 |
| Total from investment operations | 2.004 | .770 | 3.329 | 5.640 | 7.276 | 1.234 |
| Distributions from net investment income | (.633) | (.910) | (.860) | (.827) | (1.036) | (.880) |
| Distributions from net realized gain | (.361) | (1.520) | (.639) | (1.513) | (.200) | (.134) |
| Total distributions | (.994) | (2.430) | (1.499) | (2.340) | (1.236) | (1.014) |
| Net asset value, end of period | $58.93 | $57.92 | $59.58 | $57.75 | $54.45 | $48.41 |
| Total ReturnB,C | 3.50% | 1.52% | 5.84% | 10.66% | 15.26% | 2.68% |
| Ratios to Average Net AssetsD,E | | | | | | |
| Expenses before reductionsF | - %G | -% | -% | -% | -% | -% |
| Expenses net of fee waivers, if any | - %G | -% | -% | -% | -% | -% |
| Expenses net of all reductions | - %G | -% | -% | -% | -% | -% |
| Net investment income (loss) | 2.16%G | 1.64% | 1.47% | 1.56% | 2.10% | 1.84% |
| Supplemental Data | | | | | | |
| Net assets, end of period (000 omitted) | $4,341 | $4,597 | $6,181 | $6,017 | $1,942 | $1,811 |
| Portfolio turnover rate D | 14%G | 23% | 41% | 39% | 49% | 57% |
A Calculated based on average shares outstanding during the period.
B Total returns for periods of less than one year are not annualized.
C Total returns would have been lower if certain expenses had not been reduced during the applicable periods shown.
D Amounts do not include the activity of the Underlying Funds.
E Expense ratios reflect operating expenses of the class. Expenses before reductions do not reflect amounts reimbursed by the investment adviser or reductions from expense offset arrangements and do not represent the amount paid by the class during periods when reimbursements or reductions occur. Expenses net of fee waivers reflect expenses after reimbursement by the investment adviser but prior to reductions from expense offset arrangements. Expenses net of all reductions represent the net expenses paid by the class but do not include expenses of the underlying funds in which the Fund invests.
F Amount represents less than .005%.
G Annualized
See accompanying notes which are an integral part of the financial statements.
Financial Highlights — Fidelity Income Replacement 2038 Fund Class I
| | Six months ended (Unaudited) January 31, | Years ended July 31, | | | | |
| | 2017 | 2016 | 2015 | 2014 | 2013 | 2012 |
| Selected Per–Share Data | | | | | | |
| Net asset value, beginning of period | $57.92 | $59.58 | $57.75 | $54.45 | $48.41 | $48.19 |
| Income from Investment Operations | | | | | | |
| Net investment income (loss)A | .628 | .913 | .865 | .879 | 1.078 | .857 |
| Net realized and unrealized gain (loss) | 1.376 | (.143) | 2.464 | 4.761 | 6.198 | .377 |
| Total from investment operations | 2.004 | .770 | 3.329 | 5.640 | 7.276 | 1.234 |
| Distributions from net investment income | (.633) | (.910) | (.860) | (.827) | (1.036) | (.880) |
| Distributions from net realized gain | (.361) | (1.520) | (.639) | (1.513) | (.200) | (.134) |
| Total distributions | (.994) | (2.430) | (1.499) | (2.340) | (1.236) | (1.014) |
| Net asset value, end of period | $58.93 | $57.92 | $59.58 | $57.75 | $54.45 | $48.41 |
| Total ReturnB,C | 3.50% | 1.52% | 5.84% | 10.66% | 15.26% | 2.68% |
| Ratios to Average Net AssetsD,E | | | | | | |
| Expenses before reductions F | - %G | -% | -% | -% | -% | -% |
| Expenses net of fee waivers, if any | - %G | -% | -% | -% | -% | -% |
| Expenses net of all reductions | - %G | -% | -% | -% | -% | -% |
| Net investment income (loss) | 2.16%G | 1.64% | 1.47% | 1.56% | 2.10% | 1.84% |
| Supplemental Data | | | | | | |
| Net assets, end of period (000 omitted) | $34 | $33 | $34 | $32 | $29 | $25 |
| Portfolio turnover rate D | 14%G | 23% | 41% | 39% | 49% | 57% |
A Calculated based on average shares outstanding during the period.
B Total returns for periods of less than one year are not annualized.
C Total returns would have been lower if certain expenses had not been reduced during the applicable periods shown.
D Amounts do not include the activity of the Underlying Funds.
E Expense ratios reflect operating expenses of the class. Expenses before reductions do not reflect amounts reimbursed by the investment adviser or reductions from expense offset arrangements and do not represent the amount paid by the class during periods when reimbursements or reductions occur. Expenses net of fee waivers reflect expenses after reimbursement by the investment adviser but prior to reductions from expense offset arrangements. Expenses net of all reductions represent the net expenses paid by the class but do not include expenses of the underlying funds in which the Fund invests.
F Amount represents less than .005%.
G Annualized
See accompanying notes which are an integral part of the financial statements.
Fidelity Income Replacement 2040 Fund℠
Investment Summary (Unaudited)
The information in the following tables is based on the direct investments of the Fund.
Top Holdings as of January 31, 2017
| | % of fund's net assets | % of fund's net assets 6 months ago |
| Fidelity Total Bond Fund | 16.6 | 16.3 |
| Fidelity Series Broad Market Opportunities Fund | 10.8 | 10.8 |
| Fidelity Advisor International Discovery Fund Class I | 9.6 | 9.8 |
| Fidelity Equity-Income Fund | 9.4 | 9.4 |
| Fidelity Large Cap Stock Fund | 7.0 | 7.1 |
| Fidelity Advisor Mid Cap II Fund Class I | 6.5 | 6.6 |
| Fidelity Series 100 Index Fund | 6.1 | 6.1 |
| Fidelity Blue Chip Growth Fund | 6.1 | 6.1 |
| Fidelity Strategic Real Return Fund | 5.5 | 5.5 |
| Fidelity Government Income Fund | 5.5 | 5.5 |
| | 83.1 | 83.2 |
Asset Allocation (% of fund's net assets)
| Period end |
| | Domestic Equity Funds | 46.8% |
| | International Equity Funds | 9.6% |
| | High Yield Fixed-Income Funds | 5.4% |
| | Investment Grade Fixed-Income Funds | 27.6% |
| | Short-Term Funds | 10.6% |
| Six months ago |
| | Domestic Equity Funds | 47.0% |
| | International Equity Funds | 9.8% |
| | High Yield Fixed-Income Funds | 5.5% |
| | Investment Grade Fixed-Income Funds | 27.3% |
| | Short-Term Funds | 10.4% |
Fidelity Income Replacement 2040 Fund℠
Investments January 31, 2017 (Unaudited)
Showing Percentage of Net Assets
| Equity Funds - 56.4% | | | |
| | | Shares | Value |
| Domestic Equity Funds - 46.8% | | | |
| Fidelity Advisor Mid Cap II Fund Class I (a) | | 30,356 | $601,952 |
| Fidelity Blue Chip Growth Fund (a) | | 7,925 | 559,678 |
| Fidelity Equity-Income Fund (a) | | 14,893 | 860,195 |
| Fidelity Large Cap Stock Fund (a) | | 21,664 | 645,146 |
| Fidelity Series 100 Index Fund (a) | | 37,970 | 559,678 |
| Fidelity Series Broad Market Opportunities Fund (a) | | 61,097 | 989,775 |
| Fidelity Series Small Cap Opportunities Fund (a) | | 6,131 | 86,387 |
|
| TOTAL DOMESTIC EQUITY FUNDS | | | 4,302,811 |
|
| International Equity Funds - 9.6% | | | |
| Fidelity Advisor International Discovery Fund Class I (a) | | 23,323 | 878,575 |
| TOTAL EQUITY FUNDS | | | |
| (Cost $4,329,899) | | | 5,181,386 |
|
| Fixed-Income Funds - 33.0% | | | |
| High Yield Fixed-Income Funds - 5.4% | | | |
| Fidelity Capital & Income Fund (a) | | 25,317 | 250,890 |
| Fidelity Strategic Income Fund (a) | | 23,295 | 250,890 |
|
| TOTAL HIGH YIELD FIXED-INCOME FUNDS | | | 501,780 |
|
| Investment Grade Fixed-Income Funds - 27.6% | | | |
| Fidelity Government Income Fund (a) | | 49,742 | 506,375 |
| Fidelity Strategic Real Return Fund (a) | | 57,412 | 506,375 |
| Fidelity Total Bond Fund (a) | | 144,080 | 1,520,043 |
|
| TOTAL INVESTMENT GRADE FIXED-INCOME FUNDS | | | 2,532,793 |
|
| TOTAL FIXED-INCOME FUNDS | | | |
| (Cost $3,067,766) | | | 3,034,573 |
|
| Short-Term Funds - 10.6% | | | |
| Fidelity Investments Money Market Government Portfolio Institutional Class 0.47% (a)(b) | | 487,076 | 487,076 |
| Fidelity Short-Term Bond Fund (a) | | 56,703 | 487,076 |
| TOTAL SHORT-TERM FUNDS | | | |
| (Cost $973,517) | | | 974,152 |
| TOTAL INVESTMENT PORTFOLIO - 100.0% | | | |
| (Cost $8,371,182) | | | 9,190,111 |
| NET OTHER ASSETS (LIABILITIES) - 0.0% | | | (481) |
| NET ASSETS - 100% | | | $9,189,630 |
Legend
(a) Affiliated Fund
(b) The rate quoted is the annualized seven-day yield of the fund at period end.
Affiliated Underlying Funds
Information regarding the Fund's fiscal year to date purchases and sales of the affiliated Underlying Funds and income earned by the Fund from investments in affiliated Underlying Funds is as follows:
| Affiliate | Value, beginning of period | Purchases | Sales Proceeds | Dividend Income | Value, end of period |
| Fidelity Advisor International Discovery Fund Class I | $955,013 | $86,053 | $147,934 | $14,427 | $878,575 |
| Fidelity Advisor Mid Cap II Fund Class I | 643,511 | 51,062 | 116,952 | 2,796 | 601,952 |
| Fidelity Blue Chip Growth Fund | 597,616 | 48,084 | 95,952 | 1,248 | 559,678 |
| Fidelity Capital & Income Fund | 269,513 | 13,366 | 42,650 | 5,636 | 250,890 |
| Fidelity Equity-Income Fund | 918,883 | 53,463 | 162,484 | 12,779 | 860,195 |
| Fidelity Government Income Fund | 533,167 | 61,815 | 63,497 | 4,115 | 506,375 |
| Fidelity Investments Money Market Government Portfolio Institutional Class 0.47% | 506,801 | 44,053 | 63,779 | 847 | 487,076 |
| Fidelity Large Cap Stock Fund | 689,406 | 31,146 | 129,531 | 5,780 | 645,146 |
| Fidelity Series 100 Index Fund | 597,615 | 32,487 | 88,101 | 12,449 | 559,678 |
| Fidelity Series Broad Market Opportunities Fund | 1,056,569 | 44,263 | 171,476 | 4,789 | 989,775 |
| Fidelity Series Small Cap Opportunities Fund | 91,791 | 6,058 | 18,979 | 438 | 86,387 |
| Fidelity Short-Term Bond Fund | 506,801 | 47,721 | 63,530 | 2,807 | 487,076 |
| Fidelity Strategic Income Fund | 269,513 | 16,939 | 35,500 | 4,470 | 250,890 |
| Fidelity Strategic Real Return Fund | 533,167 | 41,120 | 67,589 | 7,082 | 506,375 |
| Fidelity Total Bond Fund | 1,595,591 | 165,374 | 199,197 | 22,448 | 1,520,043 |
| Total | $9,764,957 | $743,004 | $1,467,151 | $102,111 | $9,190,111 |
Investment Valuation
All investments are categorized as Level 1 under the Fair Value Hierarchy. The inputs or methodology used for valuing securities may not be an indication of the risk associated with investing in those securities. For more information on valuation inputs please refer to the Investment Valuation section in the accompanying Notes to Financial Statements.
See accompanying notes which are an integral part of the financial statements.
Fidelity Income Replacement 2040 Fund℠
Financial Statements
Statement of Assets and Liabilities
| | | January 31, 2017 (Unaudited) |
| Assets | | |
| Investment in securities, at value (cost $8,371,182) — See accompanying schedule | | $9,190,111 |
| Receivable for investments sold | | 62,675 |
| Total assets | | 9,252,786 |
| Liabilities | | |
| Payable for investments purchased | $62,675 | |
| Distribution and service plan fees payable | 481 | |
| Total liabilities | | 63,156 |
| Net Assets | | $9,189,630 |
| Net Assets consist of: | | |
| Paid in capital | | $8,353,148 |
| Undistributed net investment income | | 1,754 |
| Accumulated undistributed net realized gain (loss) on investments | | 15,799 |
| Net unrealized appreciation (depreciation) on investments | | 818,929 |
| Net Assets | | $9,189,630 |
| Calculation of Maximum Offering Price | | |
| Class A: | | |
| Net Asset Value and redemption price per share ($95,183 ÷ 1,583.23 shares) | | $60.12 |
| Maximum offering price per share (100/94.25 of $60.12) | | $63.79 |
| Class T: | | |
| Net Asset Value and redemption price per share ($747,618 ÷ 12,421.55 shares) | | $60.19 |
| Maximum offering price per share (100/96.50 of $60.19) | | $62.37 |
| Class C: | | |
| Net Asset Value and offering price per share ($178,738 ÷ 2,995.50 shares)(a) | | $59.67 |
| Income Replacement 2040: | | |
| Net Asset Value, offering price and redemption price per share ($8,166,214 ÷ 135,928.64 shares) | | $60.08 |
| Class I: | | |
| Net Asset Value, offering price and redemption price per share ($1,877 ÷ 31.24 shares) | | $60.08 |
(a) Redemption price per share is equal to net asset value less any applicable contingent deferred sales charge.
See accompanying notes which are an integral part of the financial statements.
Statement of Operations
| | | Six months ended January 31, 2017 (Unaudited) |
| Investment Income | | |
| Income distributions from underlying funds | | $102,111 |
| Expenses | | |
| Distribution and service plan fees | $2,857 | |
| Independent trustees' fees and expenses | 22 | |
| Total expenses before reductions | 2,879 | |
| Expense reductions | (22) | 2,857 |
| Net investment income (loss) | | 99,254 |
| Realized and Unrealized Gain (Loss) | | |
| Realized gain (loss) on sale of underlying fund shares | (1,449) | |
| Capital gain distributions from underlying funds | 69,123 | |
| Total net realized gain (loss) | | 67,674 |
| Change in net unrealized appreciation (depreciation) on underlying funds | | 150,751 |
| Net gain (loss) | | 218,425 |
| Net increase (decrease) in net assets resulting from operations | | $317,679 |
See accompanying notes which are an integral part of the financial statements.
Statement of Changes in Net Assets
| | Six months ended January 31, 2017 (Unaudited) | Year ended July 31, 2016 |
| Increase (Decrease) in Net Assets | | |
| Operations | | |
| Net investment income (loss) | $99,254 | $153,024 |
| Net realized gain (loss) | 67,674 | 137,577 |
| Change in net unrealized appreciation (depreciation) | 150,751 | (166,274) |
| Net increase (decrease) in net assets resulting from operations | 317,679 | 124,327 |
| Distributions to shareholders from net investment income | (99,473) | (152,794) |
| Distributions to shareholders from net realized gain | (89,994) | (242,649) |
| Total distributions | (189,467) | (395,443) |
| Share transactions - net increase (decrease) | (703,070) | 169,969 |
| Total increase (decrease) in net assets | (574,858) | (101,147) |
| Net Assets | | |
| Beginning of period | 9,764,488 | 9,865,635 |
| End of period | $9,189,630 | $9,764,488 |
| Other Information | | |
| Undistributed net investment income end of period | $1,754 | $1,973 |
See accompanying notes which are an integral part of the financial statements.
Financial Highlights — Fidelity Income Replacement 2040 Fund Class A
| | Six months ended (Unaudited) January 31, | Years ended July 31, | | | | |
| | 2017 | 2016 | 2015 | 2014 | 2013 | 2012 |
| Selected Per–Share Data | | | | | | |
| Net asset value, beginning of period | $59.25 | $60.93 | $59.08 | $54.91 | $48.63 | $48.44 |
| Income from Investment Operations | | | | | | |
| Net investment income (loss)A | .571 | .786 | .748 | .742 | .927 | .762 |
| Net realized and unrealized gain (loss) | 1.439 | (.202) | 2.585 | 5.022 | 6.538 | .331 |
| Total from investment operations | 2.010 | .584 | 3.333 | 5.764 | 7.465 | 1.093 |
| Distributions from net investment income | (.585) | (.773) | (.742) | (.712) | (.933) | (.771) |
| Distributions from net realized gain | (.555) | (1.491) | (.741) | (.882) | (.252) | (.132) |
| Total distributions | (1.140) | (2.264) | (1.483) | (1.594) | (1.185) | (.903) |
| Net asset value, end of period | $60.12 | $59.25 | $60.93 | $59.08 | $54.91 | $48.63 |
| Total ReturnB,C | 3.44% | 1.16% | 5.72% | 10.68% | 15.58% | 2.36% |
| Ratios to Average Net AssetsD,E | | | | | | |
| Expenses before reductions | .25%F | .25% | .25% | .25% | .24%G | .25% |
| Expenses net of fee waivers, if any | .25%F | .25% | .25% | .25% | .24%G | .25% |
| Expenses net of all reductions | .25%F | .25% | .25% | .25% | .24%G | .25% |
| Net investment income (loss) | 1.93%F | 1.38% | 1.25% | 1.28% | 1.79% | 1.64% |
| Supplemental Data | | | | | | |
| Net assets, end of period (000 omitted) | $95 | $92 | $109 | $109 | $10 | $7 |
| Portfolio turnover rateD | 16%F | 29% | 31% | 34% | 30% | 63% |
A Calculated based on average shares outstanding during the period.
B Total returns for periods of less than one year are not annualized.
C Total returns do not include the effect of the sales charges.
D Amounts do not include the activity of the Underlying Funds.
E Expense ratios reflect operating expenses of the class. Expenses before reductions do not reflect amounts reimbursed by the investment adviser or reductions from expense offset arrangements and do not represent the amount paid by the class during periods when reimbursements or reductions occur. Expenses net of fee waivers reflect expenses after reimbursement by the investment adviser but prior to reductions from expense offset arrangements. Expenses net of all reductions represent the net expenses paid by the class but do not include expenses of the underlying funds in which the Fund invests.
F Annualized
G On certain classes, the size and fluctuation of net assets may cause rounding of expense amounts and ratios to differ from contractual rates.
See accompanying notes which are an integral part of the financial statements.
Financial Highlights — Fidelity Income Replacement 2040 Fund Class T
| | Six months ended (Unaudited) January 31, | Years ended July 31, | | | | |
| | 2017 | 2016 | 2015 | 2014 | 2013 | 2012 |
| Selected Per–Share Data | | | | | | |
| Net asset value, beginning of period | $59.31 | $61.00 | $59.15 | $55.00 | $48.61 | $48.43 |
| Income from Investment Operations | | | | | | |
| Net investment income (loss)A | .497 | .642 | .599 | .605 | .781 | .649 |
| Net realized and unrealized gain (loss) | 1.447 | (.205) | 2.586 | 5.021 | 6.563 | .312 |
| Total from investment operations | 1.944 | .437 | 3.185 | 5.626 | 7.344 | .961 |
| Distributions from net investment income | (.509) | (.636) | (.594) | (.594) | (.702) | (.649) |
| Distributions from net realized gain | (.555) | (1.491) | (.741) | (.882) | (.252) | (.132) |
| Total distributions | (1.064) | (2.127) | (1.335) | (1.476) | (.954) | (.781) |
| Net asset value, end of period | $60.19 | $59.31 | $61.00 | $59.15 | $55.00 | $48.61 |
| Total ReturnB,C,D | 3.33% | .90% | 5.45% | 10.40% | 15.30% | 2.08% |
| Ratios to Average Net AssetsE,F | | | | | | |
| Expenses before reductions | .50%G | .50% | .50% | .49%H | .50% | .50% |
| Expenses net of fee waivers, if any | .50%G | .50% | .50% | .49%H | .50% | .50% |
| Expenses net of all reductions | .50%G | .50% | .50% | .49%H | .50% | .50% |
| Net investment income (loss) | 1.68%G | 1.13% | 1.00% | 1.04% | 1.53% | 1.39% |
| Supplemental Data | | | | | | |
| Net assets, end of period (000 omitted) | $748 | $752 | $544 | $451 | $10 | $51 |
| Portfolio turnover rateE | 16%G | 29% | 31% | 34% | 30% | 63% |
A Calculated based on average shares outstanding during the period.
B Total returns for periods of less than one year are not annualized.
C Total returns would have been lower if certain expenses had not been reduced during the applicable periods shown.
D Total returns do not include the effect of the sales charges.
E Amounts do not include the activity of the Underlying Funds.
F Expense ratios reflect operating expenses of the class. Expenses before reductions do not reflect amounts reimbursed by the investment adviser or reductions from expense offset arrangements and do not represent the amount paid by the class during periods when reimbursements or reductions occur. Expenses net of fee waivers reflect expenses after reimbursement by the investment adviser but prior to reductions from expense offset arrangements. Expenses net of all reductions represent the net expenses paid by the class but do not include expenses of the underlying funds in which the Fund invests.
G Annualized
H On certain classes, the size and fluctuation of net assets may cause rounding of expense amounts and ratios to differ from contractual rates.
See accompanying notes which are an integral part of the financial statements.
Financial Highlights — Fidelity Income Replacement 2040 Fund Class C
| | Six months ended (Unaudited) January 31, | Years ended July 31, | | | | |
| | 2017 | 2016 | 2015 | 2014 | 2013 | 2012 |
| Selected Per–Share Data | | | | | | |
| Net asset value, beginning of period | $58.84 | $60.60 | $58.82 | $54.75 | $48.55 | $48.42 |
| Income from Investment Operations | | | | | | |
| Net investment income (loss)A | .346 | .357 | .296 | .304 | .532 | .415 |
| Net realized and unrealized gain (loss) | 1.433 | (.216) | 2.580 | 5.003 | 6.524 | .310 |
| Total from investment operations | 1.779 | .141 | 2.876 | 5.307 | 7.056 | .725 |
| Distributions from net investment income | (.394) | (.410) | (.355) | (.355) | (.604) | (.463) |
| Distributions from net realized gain | (.555) | (1.491) | (.741) | (.882) | (.252) | (.132) |
| Total distributions | (.949) | (1.901) | (1.096) | (1.237) | (.856) | (.595) |
| Net asset value, end of period | $59.67 | $58.84 | $60.60 | $58.82 | $54.75 | $48.55 |
| Total ReturnB,C,D | 3.07% | .39% | 4.94% | 9.84% | 14.71% | 1.57% |
| Ratios to Average Net AssetsE,F | | | | | | |
| Expenses before reductions | 1.00%G | 1.00% | 1.00% | 1.00% | 1.00% | 1.00% |
| Expenses net of fee waivers, if any | 1.00%G | 1.00% | 1.00% | 1.00% | 1.00% | 1.00% |
| Expenses net of all reductions | 1.00%G | 1.00% | 1.00% | 1.00% | 1.00% | 1.00% |
| Net investment income (loss) | 1.18%G | .63% | .49% | .53% | 1.03% | .89% |
| Supplemental Data | | | | | | |
| Net assets, end of period (000 omitted) | $179 | $175 | $177 | $205 | $154 | $107 |
| Portfolio turnover rateE | 16%G | 29% | 31% | 34% | 30% | 63% |
A Calculated based on average shares outstanding during the period.
B Total returns for periods of less than one year are not annualized.
C Total returns would have been lower if certain expenses had not been reduced during the applicable periods shown.
D Total returns do not include the effect of the contingent deferred sales charge.
E Amounts do not include the activity of the Underlying Funds.
F Expense ratios reflect operating expenses of the class. Expenses before reductions do not reflect amounts reimbursed by the investment adviser or reductions from expense offset arrangements and do not represent the amount paid by the class during periods when reimbursements or reductions occur. Expenses net of fee waivers reflect expenses after reimbursement by the investment adviser but prior to reductions from expense offset arrangements. Expenses net of all reductions represent the net expenses paid by the class but do not include expenses of the underlying funds in which the Fund invests.
G Annualized
See accompanying notes which are an integral part of the financial statements.
Financial Highlights — Fidelity Income Replacement 2040 Fund
| | Six months ended (Unaudited) January 31, | Years ended July 31, | | | | |
| | 2017 | 2016 | 2015 | 2014 | 2013 | 2012 |
| Selected Per–Share Data | | | | | | |
| Net asset value, beginning of period | $59.21 | $60.89 | $59.04 | $54.87 | $48.59 | $48.42 |
| Income from Investment Operations | | | | | | |
| Net investment income (loss)A | .645 | .928 | .898 | .880 | 1.051 | .885 |
| Net realized and unrealized gain (loss) | 1.438 | (.202) | 2.584 | 5.027 | 6.531 | .317 |
| Total from investment operations | 2.083 | .726 | 3.482 | 5.907 | 7.582 | 1.202 |
| Distributions from net investment income | (.658) | (.915) | (.891) | (.855) | (1.050) | (.900) |
| Distributions from net realized gain | (.555) | (1.491) | (.741) | (.882) | (.252) | (.132) |
| Total distributions | (1.213) | (2.406) | (1.632) | (1.737) | (1.302) | (1.032) |
| Net asset value, end of period | $60.08 | $59.21 | $60.89 | $59.04 | $54.87 | $48.59 |
| Total ReturnB,C | 3.57% | 1.41% | 5.98% | 10.97% | 15.86% | 2.60% |
| Ratios to Average Net AssetsD,E | | | | | | |
| Expenses before reductionsF | - %G | -% | -% | -% | -% | -% |
| Expenses net of fee waivers, if any | - %G | -% | -% | -% | -% | -% |
| Expenses net of all reductions | - %G | -% | -% | -% | -% | -% |
| Net investment income (loss) | 2.18%G | 1.63% | 1.50% | 1.53% | 2.03% | 1.89% |
| Supplemental Data | | | | | | |
| Net assets, end of period (000 omitted) | $8,166 | $8,744 | $9,019 | $7,882 | $3,925 | $2,462 |
| Portfolio turnover rateD | 16%G | 29% | 31% | 34% | 30% | 63% |
A Calculated based on average shares outstanding during the period.
B Total returns for periods of less than one year are not annualized.
C Total returns would have been lower if certain expenses had not been reduced during the applicable periods shown.
D Amounts do not include the activity of the Underlying Funds.
E Expense ratios reflect operating expenses of the class. Expenses before reductions do not reflect amounts reimbursed by the investment adviser or reductions from expense offset arrangements and do not represent the amount paid by the class during periods when reimbursements or reductions occur. Expenses net of fee waivers reflect expenses after reimbursement by the investment adviser but prior to reductions from expense offset arrangements. Expenses net of all reductions represent the net expenses paid by the class but do not include expenses of the underlying funds in which the Fund invests.
F Amount represents less than .005%.
G Annualized
See accompanying notes which are an integral part of the financial statements.
Financial Highlights — Fidelity Income Replacement 2040 Fund Class I
| | Six months ended (Unaudited) January 31, | Years ended July 31, | | | | |
| | 2017 | 2016 | 2015 | 2014 | 2013 | 2012 |
| Selected Per–Share Data | | | | | | |
| Net asset value, beginning of period | $59.21 | $60.89 | $59.04 | $54.88 | $48.59 | $48.43 |
| Income from Investment Operations | | | | | | |
| Net investment income (loss)A | .642 | .929 | .897 | .887 | 1.040 | .865 |
| Net realized and unrealized gain (loss) | 1.441 | (.203) | 2.585 | 5.010 | 6.552 | .327 |
| Total from investment operations | 2.083 | .726 | 3.482 | 5.897 | 7.592 | 1.192 |
| Distributions from net investment income | (.658) | (.915) | (.891) | (.855) | (1.050) | (.900) |
| Distributions from net realized gain | (.555) | (1.491) | (.741) | (.882) | (.252) | (.132) |
| Total distributions | (1.213) | (2.406) | (1.632) | (1.737) | (1.302) | (1.032) |
| Net asset value, end of period | $60.08 | $59.21 | $60.89 | $59.04 | $54.88 | $48.59 |
| Total ReturnB | 3.57% | 1.41% | 5.98% | 10.95% | 15.88% | 2.58% |
| Ratios to Average Net AssetsC,D | | | | | | |
| Expenses before reductionsE | - %F | -% | -% | -% | -% | -% |
| Expenses net of fee waivers, if any | - %F | -% | -% | -% | -% | -% |
| Expenses net of all reductions | - %F | -% | -% | -% | -% | -% |
| Net investment income (loss) | 2.18%F | 1.63% | 1.50% | 1.53% | 2.03% | 1.89% |
| Supplemental Data | | | | | | |
| Net assets, end of period (000 omitted) | $2 | $2 | $18 | $17 | $2 | $2 |
| Portfolio turnover rateC | 16%F | 29% | 31% | 34% | 30% | 63% |
A Calculated based on average shares outstanding during the period.
B Total returns for periods of less than one year are not annualized.
C Amounts do not include the activity of the Underlying Funds.
D Expense ratios reflect operating expenses of the class. Expenses before reductions do not reflect amounts reimbursed by the investment adviser or reductions from expense offset arrangements and do not represent the amount paid by the class during periods when reimbursements or reductions occur. Expenses net of fee waivers reflect expenses after reimbursement by the investment adviser but prior to reductions from expense offset arrangements. Expenses net of all reductions represent the net expenses paid by the class but do not include expenses of the underlying funds in which the Fund invests.
E Amount represents less than .005%.
F Annualized
See accompanying notes which are an integral part of the financial statements.
Fidelity Income Replacement 2042 Fund℠
Investment Summary (Unaudited)
The information in the following tables is based on the direct investments of the Fund.
Top Holdings as of January 31, 2017
| | % of fund's net assets | % of fund's net assets 6 months ago |
| Fidelity Total Bond Fund | 16.0 | 16.0 |
| Fidelity Series Broad Market Opportunities Fund | 11.0 | 11.1 |
| Fidelity Advisor International Discovery Fund Class I | 10.5 | 10.7 |
| Fidelity Equity-Income Fund | 9.5 | 9.6 |
| Fidelity Large Cap Stock Fund | 7.2 | 7.2 |
| Fidelity Advisor Mid Cap II Fund Class I | 6.7 | 6.7 |
| Fidelity Series 100 Index Fund | 6.2 | 6.2 |
| Fidelity Blue Chip Growth Fund | 6.2 | 6.2 |
| Fidelity Strategic Real Return Fund | 5.4 | 5.3 |
| Fidelity Government Income Fund | 5.3 | 5.3 |
| | 84.0 | 84.3 |
Asset Allocation (% of fund's net assets)
| Period end |
| | Domestic Equity Funds | 47.7% |
| | International Equity Funds | 10.5% |
| | High Yield Fixed-Income Funds | 5.7% |
| | Investment Grade Fixed-Income Funds | 26.7% |
| | Short-Term Funds | 9.4% |
| Six months ago |
| | Domestic Equity Funds | 48.0% |
| | International Equity Funds | 10.7% |
| | High Yield Fixed-Income Funds | 5.8% |
| | Investment Grade Fixed-Income Funds | 26.6% |
| | Short-Term Funds | 8.9% |
Fidelity Income Replacement 2042 Fund℠
Investments January 31, 2017 (Unaudited)
Showing Percentage of Net Assets
| Equity Funds - 58.2% | | | |
| | | Shares | Value |
| Domestic Equity Funds - 47.7% | | | |
| Fidelity Advisor Mid Cap II Fund Class I (a) | | 93,001 | $1,844,206 |
| Fidelity Blue Chip Growth Fund (a) | | 24,238 | 1,711,688 |
| Fidelity Equity-Income Fund (a) | | 45,599 | 2,633,791 |
| Fidelity Large Cap Stock Fund (a) | | 66,378 | 1,976,724 |
| Fidelity Series 100 Index Fund (a) | | 116,125 | 1,711,688 |
| Fidelity Series Broad Market Opportunities Fund (a) | | 187,120 | 3,031,344 |
| Fidelity Series Small Cap Opportunities Fund (a) | | 18,614 | 262,275 |
|
| TOTAL DOMESTIC EQUITY FUNDS | | | 13,171,716 |
|
| International Equity Funds - 10.5% | | | |
| Fidelity Advisor International Discovery Fund Class I (a) | | 76,587 | 2,885,023 |
| TOTAL EQUITY FUNDS | | | |
| (Cost $12,804,482) | | | 16,056,739 |
|
| Fixed-Income Funds - 32.4% | | | |
| High Yield Fixed-Income Funds - 5.7% | | | |
| Fidelity Capital & Income Fund (a) | | 79,954 | 792,343 |
| Fidelity Strategic Income Fund (a) | | 73,570 | 792,344 |
|
| TOTAL HIGH YIELD FIXED-INCOME FUNDS | | | 1,584,687 |
|
| Investment Grade Fixed-Income Funds - 26.7% | | | |
| Fidelity Government Income Fund (a) | | 144,819 | 1,474,258 |
| Fidelity Strategic Real Return Fund (a) | | 167,150 | 1,474,260 |
| Fidelity Total Bond Fund (a) | | 418,697 | 4,417,250 |
|
| TOTAL INVESTMENT GRADE FIXED-INCOME FUNDS | | | 7,365,768 |
|
| TOTAL FIXED-INCOME FUNDS | | | |
| (Cost $8,959,937) | | | 8,950,455 |
|
| Short-Term Funds - 9.4% | | | |
| Fidelity Investments Money Market Government Portfolio Institutional Class 0.47% (a)(b) | | 1,300,330 | 1,300,330 |
| Fidelity Short-Term Bond Fund (a) | | 151,377 | 1,300,329 |
| TOTAL SHORT-TERM FUNDS | | | |
| (Cost $2,598,150) | | | 2,600,659 |
| TOTAL INVESTMENT PORTFOLIO - 100.0% | | | |
| (Cost $24,362,569) | | | 27,607,853 |
| NET OTHER ASSETS (LIABILITIES) - 0.0% | | | (707) |
| NET ASSETS - 100% | | | $27,607,146 |
Legend
(a) Affiliated Fund
(b) The rate quoted is the annualized seven-day yield of the fund at period end.
Affiliated Underlying Funds
Information regarding the Fund's fiscal year to date purchases and sales of the affiliated Underlying Funds and income earned by the Fund from investments in affiliated Underlying Funds is as follows:
| Affiliate | Value, beginning of period | Purchases | Sales Proceeds | Dividend Income | Value, end of period |
| Fidelity Advisor International Discovery Fund Class I | $3,139,114 | $290,616 | $495,304 | $49,044 | $2,885,023 |
| Fidelity Advisor Mid Cap II Fund Class I | 1,973,325 | 159,490 | 367,902 | 8,870 | 1,844,206 |
| Fidelity Blue Chip Growth Fund | 1,832,373 | 152,339 | 304,829 | 3,859 | 1,711,688 |
| Fidelity Capital & Income Fund | 851,585 | 43,014 | 136,483 | 18,187 | 792,343 |
| Fidelity Equity-Income Fund | 2,819,036 | 176,718 | 524,570 | 39,744 | 2,633,791 |
| Fidelity Government Income Fund | 1,562,216 | 186,217 | 199,038 | 12,267 | 1,474,258 |
| Fidelity Investments Money Market Government Portfolio Institutional Class 0.47% | 1,309,677 | 162,266 | 171,613 | 2,279 | 1,300,330 |
| Fidelity Large Cap Stock Fund | 2,114,277 | 104,285 | 414,179 | 18,394 | 1,976,724 |
| Fidelity Series 100 Index Fund | 1,832,373 | 106,827 | 285,032 | 39,431 | 1,711,688 |
| Fidelity Series Broad Market Opportunities Fund | 3,241,891 | 136,229 | 540,390 | 15,202 | 3,031,344 |
| Fidelity Series Small Cap Opportunities Fund | 281,904 | 15,927 | 59,746 | 1,362 | 262,275 |
| Fidelity Short-Term Bond Fund | 1,309,677 | 171,851 | 170,647 | 7,562 | 1,300,329 |
| Fidelity Strategic Income Fund | 851,585 | 58,677 | 117,413 | 14,409 | 792,344 |
| Fidelity Strategic Real Return Fund | 1,562,216 | 122,076 | 209,847 | 20,919 | 1,474,260 |
| Fidelity Total Bond Fund | 4,683,712 | 487,475 | 628,413 | 67,013 | 4,417,250 |
| Total | $29,364,961 | $2,374,007 | $4,625,406 | $318,542 | $27,607,853 |
Investment Valuation
All investments are categorized as Level 1 under the Fair Value Hierarchy. The inputs or methodology used for valuing securities may not be an indication of the risk associated with investing in those securities. For more information on valuation inputs please refer to the Investment Valuation section in the accompanying Notes to Financial Statements.
See accompanying notes which are an integral part of the financial statements.
Fidelity Income Replacement 2042 Fund℠
Financial Statements
Statement of Assets and Liabilities
| | | January 31, 2017 (Unaudited) |
| Assets | | |
| Investment in securities, at value (cost $24,362,569) — See accompanying schedule | | $27,607,853 |
| Receivable for investments sold | | 200,575 |
| Receivable for fund shares sold | | 387 |
| Total assets | | 27,808,815 |
| Liabilities | | |
| Payable for investments purchased | $197,971 | |
| Payable for fund shares redeemed | 3,010 | |
| Distribution and service plan fees payable | 688 | |
| Total liabilities | | 201,669 |
| Net Assets | | $27,607,146 |
| Net Assets consist of: | | |
| Paid in capital | | $24,276,985 |
| Undistributed net investment income | | 5,156 |
| Accumulated undistributed net realized gain (loss) on investments | | 79,721 |
| Net unrealized appreciation (depreciation) on investments | | 3,245,284 |
| Net Assets | | $27,607,146 |
| Calculation of Maximum Offering Price | | |
| Class A: | | |
| Net Asset Value and redemption price per share ($554,402 ÷ 9,207.50 shares) | | $60.21 |
| Maximum offering price per share (100/94.25 of $60.21) | | $63.88 |
| Class T: | | |
| Net Asset Value and redemption price per share ($481,296 ÷ 7,990.70 shares) | | $60.23 |
| Maximum offering price per share (100/96.50 of $60.23) | | $62.41 |
| Class C: | | |
| Net Asset Value and offering price per share ($444,866 ÷ 7,434.10 shares)(a) | | $59.84 |
| Income Replacement 2042: | | |
| Net Asset Value, offering price and redemption price per share ($26,053,134 ÷ 432,531.20 shares) | | $60.23 |
| Class I: | | |
| Net Asset Value, offering price and redemption price per share ($73,448 ÷ 1,219.40 shares) | | $60.23 |
(a) Redemption price per share is equal to net asset value less any applicable contingent deferred sales charge.
See accompanying notes which are an integral part of the financial statements.
Statement of Operations
| | | Six months ended January 31, 2017 (Unaudited) |
| Investment Income | | |
| Income distributions from underlying funds | | $318,542 |
| Expenses | | |
| Distribution and service plan fees | $4,197 | |
| Independent trustees' fees and expenses | 63 | |
| Total expenses before reductions | 4,260 | |
| Expense reductions | (63) | 4,197 |
| Net investment income (loss) | | 314,345 |
| Realized and Unrealized Gain (Loss) | | |
| Realized gain (loss) on sale of underlying fund shares | 76,641 | |
| Capital gain distributions from underlying funds | 217,266 | |
| Total net realized gain (loss) | | 293,907 |
| Change in net unrealized appreciation (depreciation) on underlying funds | | 417,648 |
| Net gain (loss) | | 711,555 |
| Net increase (decrease) in net assets resulting from operations | | $1,025,900 |
See accompanying notes which are an integral part of the financial statements.
Statement of Changes in Net Assets
| | Six months ended January 31, 2017 (Unaudited) | Year ended July 31, 2016 |
| Increase (Decrease) in Net Assets | | |
| Operations | | |
| Net investment income (loss) | $314,345 | $485,731 |
| Net realized gain (loss) | 293,907 | 286,914 |
| Change in net unrealized appreciation (depreciation) | 417,648 | (732,245) |
| Net increase (decrease) in net assets resulting from operations | 1,025,900 | 40,400 |
| Distributions to shareholders from net investment income | (315,208) | (486,226) |
| Distributions to shareholders from net realized gain | (227,253) | (866,030) |
| Total distributions | (542,461) | (1,352,256) |
| Share transactions - net increase (decrease) | (2,240,545) | (5,332,017) |
| Total increase (decrease) in net assets | (1,757,106) | (6,643,873) |
| Net Assets | | |
| Beginning of period | 29,364,252 | 36,008,125 |
| End of period | $27,607,146 | $29,364,252 |
| Other Information | | |
| Undistributed net investment income end of period | $5,156 | $6,019 |
See accompanying notes which are an integral part of the financial statements.
Financial Highlights — Fidelity Income Replacement 2042 Fund Class A
| | Six months ended (Unaudited) January 31, | Years ended July 31, | | | | |
| | 2017 | 2016 | 2015 | 2014 | 2013 | 2012 |
| Selected Per–Share Data | | | | | | |
| Net asset value, beginning of period | $59.20 | $61.04 | $59.16 | $55.32 | $48.66 | $48.52 |
| Income from Investment Operations | | | | | | |
| Net investment income (loss)A | .582 | .798 | .756 | .755 | .977 | .782 |
| Net realized and unrealized gain (loss) | 1.480 | (.292) | 2.687 | 5.194 | 6.833 | .281 |
| Total from investment operations | 2.062 | .506 | 3.443 | 5.949 | 7.810 | 1.063 |
| Distributions from net investment income | (.584) | (.802) | (.750) | (.747) | (.973) | (.791) |
| Distributions from net realized gain | (.468) | (1.544) | (.813) | (1.362) | (.177) | (.132) |
| Total distributions | (1.052) | (2.346) | (1.563) | (2.109) | (1.150) | (.923) |
| Net asset value, end of period | $60.21 | $59.20 | $61.04 | $59.16 | $55.32 | $48.66 |
| Total ReturnB,C,D | 3.53% | 1.03% | 5.90% | 11.01% | 16.28% | 2.30% |
| Ratios to Average Net AssetsE,F | | | | | | |
| Expenses before reductions | .25%G | .25% | .25% | .25% | .25% | .25% |
| Expenses net of fee waivers, if any | .25%G | .25% | .25% | .25% | .25% | .25% |
| Expenses net of all reductions | .25%G | .25% | .25% | .25% | .25% | .25% |
| Net investment income (loss) | 1.96%G | 1.40% | 1.26% | 1.30% | 1.86% | 1.66% |
| Supplemental Data | | | | | | |
| Net assets, end of period (000 omitted) | $554 | $536 | $636 | $565 | $70 | $20 |
| Portfolio turnover rateE | 17%G | 29% | 39% | 16% | 34% | 40% |
A Calculated based on average shares outstanding during the period.
B Total returns for periods of less than one year are not annualized.
C Total returns would have been lower if certain expenses had not been reduced during the applicable periods shown.
D Total returns do not include the effect of the sales charges.
E Amounts do not include the activity of the Underlying Funds.
F Expense ratios reflect operating expenses of the class. Expenses before reductions do not reflect amounts reimbursed by the investment adviser or reductions from expense offset arrangements and do not represent the amount paid by the class during periods when reimbursements or reductions occur. Expenses net of fee waivers reflect expenses after reimbursement by the investment adviser but prior to reductions from expense offset arrangements. Expenses net of all reductions represent the net expenses paid by the class but do not include expenses of the underlying funds in which the Fund invests.
G Annualized
See accompanying notes which are an integral part of the financial statements.
Financial Highlights — Fidelity Income Replacement 2042 Fund Class T
| | Six months ended (Unaudited) January 31, | Years ended July 31, | | | | |
| | 2017 | 2016 | 2015 | 2014 | 2013 | 2012 |
| Selected Per–Share Data | | | | | | |
| Net asset value, beginning of period | $59.21 | $61.05 | $59.18 | $55.33 | $48.67 | $48.53 |
| Income from Investment Operations | | | | | | |
| Net investment income (loss)A | .508 | .655 | .605 | .605 | .836 | .660 |
| Net realized and unrealized gain (loss) | 1.488 | (.294) | 2.677 | 5.216 | 6.839 | .287 |
| Total from investment operations | 1.996 | .361 | 3.282 | 5.821 | 7.675 | .947 |
| Distributions from net investment income | (.508) | (.657) | (.599) | (.609) | (.838) | (.675) |
| Distributions from net realized gain | (.468) | (1.544) | (.813) | (1.362) | (.177) | (.132) |
| Total distributions | (.976) | (2.201) | (1.412) | (1.971) | (1.015) | (.807) |
| Net asset value, end of period | $60.23 | $59.21 | $61.05 | $59.18 | $55.33 | $48.67 |
| Total ReturnB,C,D | 3.41% | .78% | 5.62% | 10.77% | 15.98% | 2.05% |
| Ratios to Average Net AssetsE,F | | | | | | |
| Expenses before reductions | .50%G | .50% | .50% | .50% | .50% | .50% |
| Expenses net of fee waivers, if any | .50%G | .50% | .50% | .50% | .50% | .50% |
| Expenses net of all reductions | .50%G | .50% | .50% | .50% | .50% | .50% |
| Net investment income (loss) | 1.71%G | 1.15% | 1.01% | 1.05% | 1.61% | 1.42% |
| Supplemental Data | | | | | | |
| Net assets, end of period (000 omitted) | $481 | $479 | $543 | $482 | $153 | $132 |
| Portfolio turnover rateE | 17%G | 29% | 39% | 16% | 34% | 40% |
A Calculated based on average shares outstanding during the period.
B Total returns for periods of less than one year are not annualized.
C Total returns would have been lower if certain expenses had not been reduced during the applicable periods shown.
D Total returns do not include the effect of the sales charges.
E Amounts do not include the activity of the Underlying Funds.
F Expense ratios reflect operating expenses of the class. Expenses before reductions do not reflect amounts reimbursed by the investment adviser or reductions from expense offset arrangements and do not represent the amount paid by the class during periods when reimbursements or reductions occur. Expenses net of fee waivers reflect expenses after reimbursement by the investment adviser but prior to reductions from expense offset arrangements. Expenses net of all reductions represent the net expenses paid by the class but do not include expenses of the underlying funds in which the Fund invests.
G Annualized
See accompanying notes which are an integral part of the financial statements.
Financial Highlights — Fidelity Income Replacement 2042 Fund Class C
| | Six months ended (Unaudited) January 31, | Years ended July 31, | | | | |
| | 2017 | 2016 | 2015 | 2014 | 2013 | 2012 |
| Selected Per–Share Data | | | | | | |
| Net asset value, beginning of period | $58.87 | $60.79 | $59.00 | $55.21 | $48.64 | $48.52 |
| Income from Investment Operations | | | | | | |
| Net investment income (loss)A | .358 | .368 | .306 | .317 | .582 | .427 |
| Net realized and unrealized gain (loss) | 1.471 | (.293) | 2.673 | 5.194 | 6.821 | .290 |
| Total from investment operations | 1.829 | .075 | 2.979 | 5.511 | 7.403 | .717 |
| Distributions from net investment income | (.391) | (.451) | (.376) | (.359) | (.656) | (.465) |
| Distributions from net realized gain | (.468) | (1.544) | (.813) | (1.362) | (.177) | (.132) |
| Total distributions | (.859) | (1.995) | (1.189) | (1.721) | (.833) | (.597) |
| Net asset value, end of period | $59.84 | $58.87 | $60.79 | $59.00 | $55.21 | $48.64 |
| Total ReturnB,C,D | 3.14% | .28% | 5.11% | 10.19% | 15.40% | 1.55% |
| Ratios to Average Net AssetsE,F | | | | | | |
| Expenses before reductions | 1.00%G | 1.00% | 1.00% | 1.00% | .99%H | 1.00% |
| Expenses net of fee waivers, if any | 1.00%G | 1.00% | 1.00% | 1.00% | .99%H | 1.00% |
| Expenses net of all reductions | 1.00%G | 1.00% | 1.00% | 1.00% | .99%H | 1.00% |
| Net investment income (loss) | 1.21%G | .65% | .51% | .55% | 1.12% | .91% |
| Supplemental Data | | | | | | |
| Net assets, end of period (000 omitted) | $445 | $498 | $594 | $366 | $97 | $24 |
| Portfolio turnover rateE | 17%G | 29% | 39% | 16% | 34% | 40% |
A Calculated based on average shares outstanding during the period.
B Total returns for periods of less than one year are not annualized.
C Total returns would have been lower if certain expenses had not been reduced during the applicable periods shown.
D Total returns do not include the effect of the contingent deferred sales charge.
E Amounts do not include the activity of the Underlying Funds.
F Expense ratios reflect operating expenses of the class. Expenses before reductions do not reflect amounts reimbursed by the investment adviser or reductions from expense offset arrangements and do not represent the amount paid by the class during periods when reimbursements or reductions occur. Expenses net of fee waivers reflect expenses after reimbursement by the investment adviser but prior to reductions from expense offset arrangements. Expenses net of all reductions represent the net expenses paid by the class but do not include expenses of the underlying funds in which the Fund invests.
G Annualized
H On certain classes, the size and fluctuations of net assets may cause rounding of expense amounts and ratios to differ from contractual rates.
See accompanying notes which are an integral part of the financial statements.
Financial Highlights — Fidelity Income Replacement 2042 Fund
| | Six months ended (Unaudited) January 31, | Years ended July 31, | | | | |
| | 2017 | 2016 | 2015 | 2014 | 2013 | 2012 |
| Selected Per–Share Data | | | | | | |
| Net asset value, beginning of period | $59.22 | $61.06 | $59.18 | $55.32 | $48.65 | $48.51 |
| Income from Investment Operations | | | | | | |
| Net investment income (loss)A | .657 | .941 | .906 | .896 | 1.099 | .897 |
| Net realized and unrealized gain (loss) | 1.480 | (.293) | 2.687 | 5.202 | 6.837 | .284 |
| Total from investment operations | 2.137 | .648 | 3.593 | 6.098 | 7.936 | 1.181 |
| Distributions from net investment income | (.659) | (.944) | (.900) | (.876) | (1.089) | (.909) |
| Distributions from net realized gain | (.468) | (1.544) | (.813) | (1.362) | (.177) | (.132) |
| Total distributions | (1.127) | (2.488) | (1.713) | (2.238) | (1.266) | (1.041) |
| Net asset value, end of period | $60.23 | $59.22 | $61.06 | $59.18 | $55.32 | $48.65 |
| Total ReturnB,C | 3.66% | 1.29% | 6.17% | 11.30% | 16.57% | 2.56% |
| Ratios to Average Net AssetsD,E | | | | | | |
| Expenses before reductionsF | - %G | -% | -% | -% | -% | -% |
| Expenses net of fee waivers, if any | - %G | -% | -% | -% | -% | -% |
| Expenses net of all reductions | - %G | -% | -% | -% | -% | -% |
| Net investment income (loss) | 2.21%G | 1.65% | 1.51% | 1.55% | 2.11% | 1.91% |
| Supplemental Data | | | | | | |
| Net assets, end of period (000 omitted) | $26,053 | $27,774 | $34,087 | $32,313 | $13,862 | $7,139 |
| Portfolio turnover rateD | 17%G | 29% | 39% | 16% | 34% | 40% |
A Calculated based on average shares outstanding during the period.
B Total returns for periods of less than one year are not annualized.
C Total returns would have been lower if certain expenses had not been reduced during the applicable periods shown.
D Amounts do not include the activity of the Underlying Funds.
E Expense ratios reflect operating expenses of the class. Expenses before reductions do not reflect amounts reimbursed by the investment adviser or reductions from expense offset arrangements and do not represent the amount paid by the class during periods when reimbursements or reductions occur. Expenses net of fee waivers reflect expenses after reimbursement by the investment adviser but prior to reductions from expense offset arrangements. Expenses net of all reductions represent the net expenses paid by the class but do not include expenses of the underlying funds in which the Fund invests.
F Amount represents less than .005%.
G Annualized
See accompanying notes which are an integral part of the financial statements.
Financial Highlights — Fidelity Income Replacement 2042 Fund Class I
| | Six months ended (Unaudited) January 31, | Years ended July 31, | | | | |
| | 2017 | 2016 | 2015 | 2014 | 2013 | 2012 |
| Selected Per–Share Data | | | | | | |
| Net asset value, beginning of period | $59.21 | $61.06 | $59.18 | $55.31 | $48.64 | $48.51 |
| Income from Investment Operations | | | | | | |
| Net investment income (loss)A | .657 | .943 | .906 | .897 | 1.095 | .896 |
| Net realized and unrealized gain (loss) | 1.490 | (.305) | 2.687 | 5.211 | 6.841 | .275 |
| Total from investment operations | 2.147 | .638 | 3.593 | 6.108 | 7.936 | 1.171 |
| Distributions from net investment income | (.659) | (.944) | (.900) | (.876) | (1.089) | (.909) |
| Distributions from net realized gain | (.468) | (1.544) | (.813) | (1.362) | (.177) | (.132) |
| Total distributions | (1.127) | (2.488) | (1.713) | (2.238) | (1.266) | (1.041) |
| Net asset value, end of period | $60.23 | $59.21 | $61.06 | $59.18 | $55.31 | $48.64 |
| Total ReturnB,C | 3.68% | 1.27% | 6.17% | 11.32% | 16.57% | 2.54% |
| Ratios to Average Net AssetsD,E | | | | | | |
| Expenses before reductionsF | - %G | -% | -% | -% | -% | -% |
| Expenses net of fee waivers, if any | - %G | -% | -% | -% | -% | -% |
| Expenses net of all reductions | - %G | -% | -% | -% | -% | -% |
| Net investment income (loss) | 2.21%G | 1.65% | 1.51% | 1.55% | 2.11% | 1.91% |
| Supplemental Data | | | | | | |
| Net assets, end of period (000 omitted) | $73 | $78 | $148 | $109 | $30 | $26 |
| Portfolio turnover rateD | 17%G | 29% | 39% | 16% | 34% | 40% |
A Calculated based on average shares outstanding during the period.
B Total returns for periods of less than one year are not annualized.
C Total returns would have been lower if certain expenses had not been reduced during the applicable periods shown.
D Amounts do not include the activity of the Underlying Funds.
E Expense ratios reflect operating expenses of the class. Expenses before reductions do not reflect amounts reimbursed by the investment adviser or reductions from expense offset arrangements and do not represent the amount paid by the class during periods when reimbursements or reductions occur. Expenses net of fee waivers reflect expenses after reimbursement by the investment adviser but prior to reductions from expense offset arrangements. Expenses net of all reductions represent the net expenses paid by the class but do not include expenses of the underlying funds in which the Fund invests.
F Amount represents less than .005%.
G Annualized
See accompanying notes which are an integral part of the financial statements.
Notes to Financial Statements (Unaudited)
For the period ended January 31, 2017
1. Organization.
Fidelity Income Replacement 2018 Fund, Fidelity Income Replacement 2020 Fund, Fidelity Income Replacement 2022 Fund, Fidelity Income Replacement 2024 Fund, Fidelity Income Replacement 2026 Fund, Fidelity Income Replacement 2028 Fund, Fidelity Income Replacement 2030 Fund, Fidelity Income Replacement 2032 Fund, Fidelity Income Replacement 2034 Fund, Fidelity Income Replacement 2036 Fund, Fidelity Income Replacement 2038 Fund, Fidelity Income Replacement 2040 Fund and Fidelity Income Replacement 2042 Fund (the Funds) are funds of Fidelity Income Fund (the Trust). The Trust is registered under the Investment Company Act of 1940, as amended (the 1940 Act), as an open-end management investment company organized as a Massachusetts business trust. Each Fund is authorized to issue an unlimited number of shares. The Funds invest primarily in a combination of other Fidelity equity, bond, and short-term funds (the Underlying Funds) managed by Fidelity Management & Research Company (FMR).
The Funds are designed for investors who seek to convert accumulated assets into regular payments over a defined period of time. The payment strategy for each Fund is designed to be implemented through a shareholder's voluntary participation in the Smart Payment Program. Participation in the Smart Payment Program will result in the gradual liquidation of the shareholder's entire investment in the Fund by its horizon date. Each Fund's name refers to the year of its horizon date.
Each Fund is closed to new accounts and additional purchases, except for reinvestments, effective after the close of business on the dates listed below. Each class has equal rights as to assets and voting privileges, except for matters affecting a single class.
| Class A, Class T, Class C and Class I Shares | Date Closed |
| Income Replacement 2018 Fund | May 30, 2014 |
| All Other Funds | January 29, 2016 |
| Income Replacement Shares | Date Closed |
| All Funds | January 31, 2017 |
In March 2017 the Board of Trustees approved a change in the name of Class T to Class M effective after the close of business on March 24, 2017.
2. Significant Accounting Policies.
The financial statements have been prepared in conformity with accounting principles generally accepted in the United States of America (GAAP), which require management to make certain estimates and assumptions at the date of the financial statements. Actual results could differ from those estimates. Subsequent events, if any, through the date that the financial statements were issued have been evaluated in the preparation of the financial statements. The Fund's Schedule of Investments lists each of the Underlying Funds as an investment of the Fund but does not include the underlying holdings of each Underlying Fund. The following summarizes the significant accounting policies of the Funds:
Investment Valuation. Investments are valued as of 4:00 p.m. Eastern time on the last calendar day of the period. Each Fund categorizes the inputs to valuation techniques used to value its investments into a disclosure hierarchy consisting of three levels as shown below:
Level 1 – quoted prices in active markets for identical investments
Level 2 – other significant observable inputs (including quoted prices for similar investments, interest rates, prepayment speeds, etc.)
Level 3 – unobservable inputs (including the Fund's own assumptions based on the best information available)
Valuation techniques used to value each Fund's investments by major category are as follows. Investments in the Underlying Funds are valued at their closing net asset value (NAV) each business day and are categorized as Level 1 in the hierarchy.
Investment Transactions and Income. For financial reporting purposes, the Funds' investment holdings and NAV include trades executed through the end of the last business day of the period. The NAV per share for processing shareholder transactions is calculated as of the close of business of the New York Stock Exchange (NYSE), normally 4:00 p.m. Eastern time and includes trades executed through the end of the prior business day. Gains and losses on securities sold are determined on the basis of identified cost. Income and capital gain distributions from the Underlying Funds, if any, are recorded on the ex-dividend date. Distributions from the Underlying Funds that are deemed to be return of capital are recorded as a reduction of cost of investments.
Class Allocations and Expenses. Investment income, realized and unrealized capital gains and losses, common expenses of each Fund, and certain fund-level expense reductions, if any, are allocated daily on a pro-rata basis to each class based on the relative net assets of each class to the total net assets of each Fund. Each class differs with respect to distribution and service plan fees incurred. Certain expense reductions may also differ by class. For the reporting period, the allocated portion of income and expenses to each class as a percent of its average net assets may vary due to the timing of recording these transactions in relation to fluctuating net assets of the classes. Expenses directly attributable to a fund are charged to that fund. Expenses attributable to more than one fund are allocated among the respective funds on the basis of relative net assets or other appropriate methods. Expenses included in the accompanying financial statements reflect the expenses of each Fund and do not include any expenses associated with the Underlying Funds. Although not included in each Fund's expenses, each Fund indirectly bears its proportionate share of the Underlying Funds' expenses through the impact of these expenses on each Underlying Fund's NAV. Expense estimates are accrued in the period to which they relate and adjustments are made when actual amounts are known.
Income Tax Information and Distributions to Shareholders. Each year, each Fund intends to qualify as a regulated investment company under Subchapter M of the Internal Revenue Code, including distributing substantially all of its taxable income and realized gains. As a result, no provision for U.S. Federal income taxes is required. Each Fund files a U.S. federal tax return, in addition to state and local tax returns as required. Each Fund's federal income tax returns are subject to examination by the Internal Revenue Service (IRS) for a period of three fiscal years after they are filed. State and local tax returns may be subject to examination for an additional fiscal year depending on the jurisdiction.
Distributions are declared and recorded on the ex-dividend date. Income dividends and capital gain distributions are declared separately for each class. Income and capital gain distributions are determined in accordance with income tax regulations, which may differ from GAAP.
Capital accounts within the financial statements are adjusted for permanent book-tax differences. These adjustments have no impact on net assets or the results of operations. Capital accounts are not adjusted for temporary book-tax differences which will reverse in a subsequent period.
Book-tax differences are primarily due to the short-term gain distributions from the Underlying Funds, capital loss carryforwards and losses deferred due to wash sales.
The federal tax cost of investment securities and unrealized appreciation (depreciation) as of period end were as follows for each Fund:
| | Tax cost | Gross unrealized appreciation | Gross unrealized depreciation | Net unrealized appreciation (depreciation) on securities |
| Fidelity Income Replacement 2018 Fund | $5,254,498 | $100,472 | $(2,774) | $97,698 |
| Fidelity Income Replacement 2020 Fund | 9,557,464 | 592,182 | (57,940) | 534,242 |
| Fidelity Income Replacement 2022 Fund | 12,470,908 | 663,884 | (134,236) | 529,648 |
| Fidelity Income Replacement 2024 Fund | 9,763,253 | 551,701 | (99,137) | 452,564 |
| Fidelity Income Replacement 2026 Fund | 10,763,870 | 537,042 | (83,724) | 453,318 |
| Fidelity Income Replacement 2028 Fund | 23,042,813 | 1,784,538 | (201,003) | 1,583,535 |
| Fidelity Income Replacement 2030 Fund | 12,304,109 | 1,262,350 | (84,482) | 1,177,868 |
| Fidelity Income Replacement 2032 Fund | 6,525,604 | 868,666 | (68,861) | 799,805 |
| Fidelity Income Replacement 2034 Fund | 5,857,806 | 898,432 | (32,545) | 865,887 |
| Fidelity Income Replacement 2036 Fund | 9,074,037 | 869,946 | (103,236) | 766,710 |
| Fidelity Income Replacement 2038 Fund | 4,049,333 | 629,482 | (20,736) | 608,746 |
| Fidelity Income Replacement 2040 Fund | 8,402,018 | 865,787 | (77,694) | 788,093 |
| Fidelity Income Replacement 2042 Fund | 24,485,179 | 3,280,018 | (157,344) | 3,122,674 |
Capital loss carryforwards are only available to offset future capital gains of the Funds to the extent provided by regulations and may be limited. Under the Regulated Investment Company Modernization Act of 2010 (the Act), the Funds are permitted to carry forward capital losses incurred in taxable years beginning after December 22, 2010 for an unlimited period and such capital losses are required to be used prior to any losses that expire. The capital loss carryforward information presented below, including any applicable limitation, is estimated as of prior fiscal period end and is subject to adjustment.
| | Fiscal year of expiration | |
| | 2018 | 2019 | Total with expiration |
| Fidelity Income Replacement 2018 Fund | $(32,634) | $(37,212) | $(69,846) |
| Fidelity Income Replacement 2022 Fund | (8,036) | (74,118) | (82,154) |
| Fidelity Income Replacement 2026 Fund | (47,905) | – | (47,905) |
Due to large redemptions or subscriptions in a prior period, $47,905 of capital losses that will be available to offset future capital gains of Fidelity Income Replacement 2026 will be limited to approximately $28,019 per year.
3. Purchases and Redemptions of Underlying Fund Shares.
Purchases and redemptions of the Underlying Fund shares, are noted in the table below.
| | Purchases ($) | Redemptions ($) |
| Fidelity Income Replacement 2018 Fund | 1,931,927 | 1,474,409 |
| Fidelity Income Replacement 2020 Fund | 2,068,409 | 1,776,627 |
| Fidelity Income Replacement 2022 Fund | 1,366,225 | 2,150,192 |
| Fidelity Income Replacement 2024 Fund | 2,602,244 | 1,744,901 |
| Fidelity Income Replacement 2026 Fund | 3,890,054 | 1,144,481 |
| Fidelity Income Replacement 2028 Fund | 1,753,026 | 6,925,165 |
| Fidelity Income Replacement 2030 Fund | 1,162,191 | 2,063,598 |
| Fidelity Income Replacement 2032 Fund | 680,996 | 839,882 |
| Fidelity Income Replacement 2034 Fund | 472,277 | 1,591,602 |
| Fidelity Income Replacement 2036 Fund | 794,403 | 2,089,656 |
| Fidelity Income Replacement 2038 Fund | 335,929 | 724,243 |
| Fidelity Income Replacement 2040 Fund | 743,004 | 1,467,151 |
| Fidelity Income Replacement 2042 Fund | 2,374,007 | 4,625,406 |
4. Fees and Other Transactions with Affiliates.
Management Fee. FMR Co., Inc. (the investment adviser), an affiliate of Fidelity Management & Research Company (FMR), provides the Funds with investment management related services. The Funds do not pay any fees for these services. Under the management contract, the investment adviser pays all other fund-level expenses, except the compensation of the independent Trustees and certain other expenses such as interest expense.
Distribution and Service Plan Fees. In accordance with Rule 12b-1 of the 1940 Act, each Fund has adopted separate Distribution and Service Plans for each class of shares. Certain classes pay Fidelity Distributors Corporation (FDC), an affiliate of the investment adviser, separate Distribution and Service Fees, each of which is based on an annual percentage of each class' average net assets. In addition, FDC may pay financial intermediaries for selling shares of each Fund and providing shareholder support services. For the period, the Distribution and Service Fee rates, total fees and amounts retained by FDC were as follows:
| | Distribution
Fee | Service
Fee | Total Fees | Retained
by FDC |
| Fidelity Income Replacement 2018 Fund | | | | |
| Class A | -% | .25% | $583 | $– |
| Class T | .25% | .25% | 584 | – |
| Class C | .75% | .25% | 1,545 | – |
| | | | $2,712 | $– |
| Fidelity Income Replacement 2020 Fund | | | | |
| Class A | -% | .25% | $1,414 | $125 |
| Class T | .25% | .25% | 474 | – |
| Class C | .75% | .25% | 3,895 | 48 |
| | | | $5,783 | $173 |
| Fidelity Income Replacement 2022 Fund | | | | |
| Class A | -% | .25% | $365 | $– |
| Class T | .25% | .25% | 214 | 2 |
| Class C | .75% | .25% | 289 | – |
| | | | $868 | $2 |
| Fidelity Income Replacement 2024 Fund | | | | |
| Class A | -% | .25% | $236 | $– |
| Class T | .25% | .25% | 374 | 18 |
| Class C | .75% | .25% | 764 | – |
| | | | $1,374 | $18 |
| Fidelity Income Replacement 2026 Fund | | | | |
| Class A | -% | .25% | $711 | $– |
| Class T | .25% | .25% | 754 | 16 |
| Class C | .75% | .25% | 1,257 | 402 |
| | | | $2,722 | $418 |
| Fidelity Income Replacement 2028 Fund | | | | |
| Class A | -% | .25% | $568 | $– |
| Class T | .25% | .25% | 1,020 | – |
| Class C | .75% | .25% | 1,016 | 19 |
| | | | $2,604 | $19 |
| Fidelity Income Replacement 2030 Fund | | | | |
| Class A | -% | .25% | $171 | $– |
| Class T | .25% | .25% | 40 | 18 |
| Class C | .75% | .25% | 995 | 190 |
| | | | $1,206 | $208 |
| Fidelity Income Replacement 2032 Fund | | | | |
| Class A | -% | .25% | $467 | $– |
| Class T | .25% | .25% | 115 | 52 |
| Class C | .75% | .25% | 624 | 55 |
| | | | $1,206 | $107 |
| Fidelity Income Replacement 2034 Fund | | | | |
| Class A | -% | .25% | $344 | $10 |
| Class T | .25% | .25% | 192 | 60 |
| Class C | .75% | .25% | 724 | 65 |
| | | | $1,260 | $135 |
| Fidelity Income Replacement 2036 Fund | | | | |
| Class A | -% | .25% | $621 | $– |
| Class T | .25% | .25% | 2,270 | – |
| Class C | .75% | .25% | 1,896 | – |
| | | | $4,787 | $– |
| Fidelity Income Replacement 2038 Fund | | | | |
| Class A | -% | .25% | $18 | $1 |
| Class T | .25% | .25% | 456 | 14 |
| Class C | .75% | .25% | 460 | 5 |
| | | | $934 | $20 |
| Fidelity Income Replacement 2040 Fund | | | | |
| Class A | -% | .25% | $116 | $4 |
| Class T | .25% | .25% | 1,864 | 10 |
| Class C | .75% | .25% | 877 | – |
| | | | $2,857 | $14 |
| Fidelity Income Replacement 2042 Fund | | | | |
| Class A | -% | .25% | $676 | $– |
| Class T | .25% | .25% | 1,201 | 10 |
| Class C | .75% | .25% | 2,320 | 96 |
| | | | $4,197 | $106 |
Sales Load. FDC may receive a front-end sales charge of up to 5.75% for selling Class A shares and 3.50% for selling Class T shares, some of which is paid to financial intermediaries for selling shares of each Fund. Depending on the holding period, FDC may receive contingent deferred sales charges levied on Class A, Class T, and Class C redemptions. The deferred sales charges are 1.00% for Class C shares, 1.00% for certain purchases of Class A shares and .25% for certain purchases of Class T shares. For the period, there were no sales charge amounts retained by FDC.
5. Expense Reductions.
FMR voluntarily agreed to reimburse the Funds to the extent annual operating expenses exceeded distribution and service plan fees applicable to each class. Some expenses, for example interest expense, are excluded from this reimbursement.
The following Funds were in reimbursement during the period:
| | Reimbursement(a) |
| Fidelity Income Replacement 2018 Fund | $12 |
| Fidelity Income Replacement 2020 Fund | 22 |
| Fidelity Income Replacement 2022 Fund | 31 |
| Fidelity Income Replacement 2024 Fund | 23 |
| Fidelity Income Replacement 2026 Fund | 21 |
| Fidelity Income Replacement 2028 Fund | 62 |
| Fidelity Income Replacement 2030 Fund | 31 |
| Fidelity Income Replacement 2032 Fund | 17 |
| Fidelity Income Replacement 2034 Fund | 18 |
| Fidelity Income Replacement 2036 Fund | 24 |
| Fidelity Income Replacement 2038 Fund | 12 |
| Fidelity Income Replacement 2040 Fund | 22 |
| Fidelity Income Replacement 2042 Fund | 63 |
(a) Represents total amount reimbursed to the Fund. Each class has received a pro-rata allocation of reimbursement.
6. Distributions to Shareholders.
Distributions to shareholders of each class were as follows:
| | Six months ended
January 31, 2017 | Year ended July 31, 2016 |
| Fidelity Income Replacement 2018 Fund | | |
| From net investment income | | |
| Class A | $1,264 | $3,571 |
| Class T | 335 | 1,333 |
| Class C | 77 | 653 |
| Income Replacement 2018 | 14,804 | 38,034 |
| Class I | 813 | 2,415 |
| Total | $17,293 | $46,006 |
| From net realized gain | | |
| Class A | $– | $235 |
| Class T | – | 140 |
| Class C | – | 217 |
| Income Replacement 2018 | – | 1,759 |
| Class I | – | 118 |
| Total | $– | $2,469 |
| Fidelity Income Replacement 2020 Fund | | |
| From net investment income | | |
| Class A | $6,709 | $13,988 |
| Class T | 888 | 1,870 |
| Class C | 1,831 | 4,242 |
| Income Replacement 2020 | 57,036 | 95,316 |
| Class I | 482 | 2,119 |
| Total | $66,946 | $117,535 |
| From net realized gain | | |
| Class A | $9,654 | $23,499 |
| Class T | 1,623 | 4,347 |
| Class C | 6,756 | 18,056 |
| Income Replacement 2020 | 65,972 | 141,250 |
| Class I | 582 | 4,068 |
| Total | $84,587 | $191,220 |
| Fidelity Income Replacement 2022 Fund | | |
| From net investment income | | |
| Class A | $2,356 | $4,847 |
| Class T | 563 | 938 |
| Class C | $253 | $337 |
| Income Replacement 2022 | 119,845 | 214,082 |
| Class I | 916 | 1,666 |
| Total | $123,933 | $221,870 |
| From net realized gain | | |
| Class A | $331 | $375 |
| Class T | 97 | 78 |
| Class C | 66 | 52 |
| Income Replacement 2022 | 14,332 | 12,274 |
| Class I | 103 | 78 |
| Total | $14,929 | $12,857 |
| Fidelity Income Replacement 2024 Fund | | |
| From net investment income | | |
| Class A | $1,564 | $4,661 |
| Class T | 1,040 | 2,666 |
| Class C | 710 | 949 |
| Income Replacement 2024 | 93,840 | 141,578 |
| Class I | 508 | 915 |
| Total | $97,662 | $150,769 |
| From net realized gain | | |
| Class A | $575 | $7,591 |
| Class T | 454 | 5,214 |
| Class C | 467 | 2,769 |
| Income Replacement 2024 | 30,188 | 151,262 |
| Class I | 162 | 1,012 |
| Total | $31,846 | $167,848 |
| Fidelity Income Replacement 2026 Fund | | |
| From net investment income | | |
| Class A | $4,828 | $8,571 |
| Class T | 2,192 | 3,397 |
| Class C | 1,292 | 1,628 |
| Income Replacement 2026 | 82,923 | 112,093 |
| Class I | 300 | 478 |
| Total | $91,535 | $126,167 |
| From net realized gain | | |
| Class A | $3,090 | $7,102 |
| Class T | 1,636 | 3,213 |
| Class C | 1,365 | 1,456 |
| Income Replacement 2026 | 42,050 | 67,136 |
| Class I | 165 | 310 |
| Total | $48,306 | $79,217 |
| Fidelity Income Replacement 2028 Fund | | |
| From net investment income | | |
| Class A | $3,751 | $10,860 |
| Class T | 2,967 | 4,711 |
| Class C | 1,114 | 1,570 |
| Income Replacement 2028 | 268,137 | 458,398 |
| Class I | 598 | 1,058 |
| Total | $276,567 | $476,597 |
| From net realized gain | | |
| Class A | $2,747 | $14,148 |
| Class T | 2,461 | 7,542 |
| Class C | 1,197 | 3,748 |
| Income Replacement 2028 | 158,149 | 449,213 |
| Class I | 359 | 4,219 |
| Total | $164,913 | $478,870 |
| Fidelity Income Replacement 2030 Fund | | |
| From net investment income | | |
| Class A | $1,254 | $3,026 |
| Class T | 129 | 213 |
| Class C | 1,138 | 2,244 |
| Income Replacement 2030 | 135,107 | 242,309 |
| Class I | 324 | 491 |
| Total | $137,952 | $248,283 |
| From net realized gain | | |
| Class A | $1,079 | $6,194 |
| Class T | 126 | 482 |
| Class C | 1,579 | 7,690 |
| Income Replacement 2030 | 104,750 | 373,301 |
| Class I | 244 | 716 |
| Total | $107,778 | $388,383 |
| Fidelity Income Replacement 2032 Fund | | |
| From net investment income | | |
| Class A | $3,504 | $5,451 |
| Class T | 248 | 931 |
| Class C | 742 | 878 |
| Income Replacement 2032 | 71,138 | 113,077 |
| Class I | 604 | 896 |
| Total | $76,236 | $121,233 |
| From net realized gain | | |
| Class A | $4,415 | $10,055 |
| Class T | 583 | 1,736 |
| Class C | 1,484 | 3,229 |
| Income Replacement 2032 | 80,413 | 181,970 |
| Class I | 671 | 1,382 |
| Total | $87,566 | $198,372 |
| Fidelity Income Replacement 2034 Fund | | |
| From net investment income | | |
| Class A | $2,587 | $3,762 |
| Class T | 324 | 1,059 |
| Class C | 896 | 1,019 |
| Income Replacement 2034 | 67,901 | 133,102 |
| Class I | 2,522 | 3,598 |
| Total | $74,230 | $142,540 |
| From net realized gain | | |
| Class A | $1,036 | $7,727 |
| Class T | 157 | 2,643 |
| Class C | 553 | 3,553 |
| Income Replacement 2034 | 24,070 | 239,145 |
| Class I | 888 | 5,942 |
| Total | $26,704 | $259,010 |
| Fidelity Income Replacement 2036 Fund | | |
| From net investment income | | |
| Class A | $4,797 | $5,910 |
| Class T | 5,382 | 11,291 |
| Class C | 2,393 | 2,752 |
| Income Replacement 2036 | 90,833 | 140,284 |
| Class I | 9 | 12 |
| Total | $103,414 | $160,249 |
| From net realized gain | | |
| Class A | $5,776 | $9,270 |
| Class T | 11,903 | 23,460 |
| Class C | $4,463 | $9,451 |
| Income Replacement 2036 | 95,960 | 196,785 |
| Class I | 9 | 18 |
| Total | $118,111 | $238,984 |
| Fidelity Income Replacement 2038 Fund | | |
| From net investment income | | |
| Class A | $58 | $2,058 |
| Class T | 1,532 | 2,046 |
| Class C | 581 | 658 |
| Income Replacement 2038 | 48,731 | 88,056 |
| Class I | 365 | 531 |
| Total | $51,267 | $93,349 |
| From net realized gain | | |
| Class A | $39 | $4,456 |
| Class T | 1,133 | 4,851 |
| Class C | 573 | 2,624 |
| Income Replacement 2038 | 27,725 | 154,785 |
| Class I | 207 | 882 |
| Total | $29,677 | $167,598 |
| Fidelity Income Replacement 2040 Fund | | |
| From net investment income | | |
| Class A | $919 | $1,339 |
| Class T | 6,359 | 7,925 |
| Class C | 1,176 | 1,221 |
| Income Replacement 2040 | 90,999 | 142,075 |
| Class I | 20 | 234 |
| Total | $99,473 | $152,794 |
| From net realized gain | | |
| Class A | $864 | $2,644 |
| Class T | 6,984 | 14,410 |
| Class C | 1,647 | 4,357 |
| Income Replacement 2040 | 80,482 | 220,792 |
| Class I | 17 | 446 |
| Total | $89,994 | $242,649 |
| Fidelity Income Replacement 2042 Fund | | |
| From net investment income | | |
| Class A | $5,333 | $7,358 |
| Class T | 4,112 | 5,372 |
| Class C | 2,903 | 3,593 |
| Income Replacement 2042 | 302,064 | 468,262 |
| Class I | 796 | 1,641 |
| Total | $315,208 | $486,226 |
| From net realized gain | | |
| Class A | $4,246 | $15,912 |
| Class T | 3,780 | 12,399 |
| Class C | 3,773 | 10,559 |
| Income Replacement 2042 | 214,892 | 824,194 |
| Class I | 562 | 2,966 |
| Total | $227,253 | $866,030 |
7. Share Transactions.
Share transactions for each class were as follows and may contain automatic conversions between classes or exchanges between affiliated funds:
| | Shares | Shares | Dollars | Dollars |
| | Six months ended January 31, 2017 | Year ended July 31, 2016 | Six months ended January 31, 2017 | Year ended July 31, 2016 |
| Fidelity Income Replacement 2018 Fund | | | | |
| Class A | | | | |
| Reinvestment of distributions | 18 | 52 | $1,007 | $2,825 |
| Shares redeemed | (711) | (1,596) | (39,132) | (86,858) |
| Net increase (decrease) | (693) | (1,544) | $(38,125) | $(84,033) |
| Class T | | | | |
| Reinvestment of distributions | 5 | 24 | $299 | $1,289 |
| Shares redeemed | (820) | (1,843) | (45,102) | (100,365) |
| Net increase (decrease) | (815) | (1,819) | $(44,803) | $(99,076) |
| Class C | | | | |
| Reinvestment of distributions | 1 | 15 | $73 | $834 |
| Shares redeemed | (485) | (4,723) | (26,526) | (256,297) |
| Net increase (decrease) | (484) | (4,708) | $(26,453) | $(255,463) |
| Income Replacement 2018 | | | | |
| Shares sold | 27,090 | 39,457 | $1,491,288 | $2,136,458 |
| Reinvestment of distributions | 165 | 364 | 9,105 | 19,788 |
| Shares redeemed | (16,425) | (51,798) | (904,316) | (2,824,986) |
| Net increase (decrease) | 10,830 | (11,977) | $596,077 | $(668,740) |
| Class I | | | | |
| Reinvestment of distributions | 15 | 47 | $813 | $2,532 |
| Shares redeemed | (637) | (1,275) | (35,091) | (69,482) |
| Net increase (decrease) | (622) | (1,228) | $(34,278) | $(66,950) |
| Fidelity Income Replacement 2020 Fund | | | | |
| Class A | | | | |
| Shares sold | – | 5,720 | $– | $309,005 |
| Reinvestment of distributions | 259 | 582 | 14,216 | 31,434 |
| Shares redeemed | (1,893) | (4,418) | (104,299) | (239,085) |
| Net increase (decrease) | (1,634) | 1,884 | $(90,083) | $101,354 |
| Class T | | | | |
| Reinvestment of distributions | 44 | 110 | $2,406 | $5,956 |
| Shares redeemed | (98) | (281) | (5,337) | (15,161) |
| Net increase (decrease) | (54) | (171) | $(2,931) | $(9,205) |
| Class C | | | | |
| Shares sold | – | 2,368 | $– | $127,731 |
| Reinvestment of distributions | 152 | 403 | 8,327 | 21,674 |
| Shares redeemed | (1,488) | (2,159) | (81,738) | (116,978) |
| Net increase (decrease) | (1,336) | 612 | $(73,411) | $32,427 |
| Income Replacement 2020 | | | | |
| Shares sold | 24,046 | 69,087 | $1,320,474 | $3,758,117 |
| Reinvestment of distributions | 1,625 | 3,337 | 89,083 | 180,346 |
| Shares redeemed | (16,265) | (52,032) | (893,230) | (2,823,179) |
| Net increase (decrease) | 9,406 | 20,392 | $516,327 | $1,115,284 |
| Class I | | | | |
| Reinvestment of distributions | 19 | 115 | $1,064 | $6,187 |
| Shares redeemed | (98) | (2,256) | (5,399) | (121,655) |
| Net increase (decrease) | (79) | (2,141) | $(4,335) | $(115,468) |
| Fidelity Income Replacement 2022 Fund | | | | |
| Class A | | | | |
| Reinvestment of distributions | 39 | 78 | $2,322 | $4,469 |
| Shares redeemed | (51) | (2,485) | (3,020) | (138,398) |
| Net increase (decrease) | (12) | (2,407) | $(698) | $(133,929) |
| Class T | | | | |
| Reinvestment of distributions | 11 | 18 | $660 | $1,017 |
| Shares redeemed | (99) | (90) | (5,861) | (5,200) |
| Net increase (decrease) | (88) | (72) | $(5,201) | $(4,183) |
| Class C | | | | |
| Reinvestment of distributions | 3 | 4 | $163 | $206 |
| Shares redeemed | – | (46) | – | (2,674) |
| Net increase (decrease) | 3 | (42) | $163 | $(2,468) |
| Income Replacement 2022 | | | | |
| Shares sold | 13,088 | 51,218 | $771,337 | $2,896,526 |
| Reinvestment of distributions | 1,501 | 2,543 | 88,273 | 145,507 |
| Shares redeemed | (27,916) | (72,020) | (1,644,447) | (4,099,618) |
| Net increase (decrease) | (13,327) | (18,259) | $(784,837) | $(1,057,585) |
| Class I | | | | |
| Shares sold | – | 685 | $– | $37,829 |
| Reinvestment of distributions | 17 | 30 | 1,019 | 1,744 |
| Shares redeemed | (703) | (19) | (41,556) | (1,106) |
| Net increase (decrease) | (686) | 696 | $(40,537) | $38,467 |
| Fidelity Income Replacement 2024 Fund | | | | |
| Class A | | | | |
| Reinvestment of distributions | 26 | 194 | $1,500 | $10,972 |
| Shares redeemed | (52) | (4,831) | (3,027) | (271,160) |
| Net increase (decrease) | (26) | (4,637) | $(1,527) | $(260,188) |
| Class T | | | | |
| Reinvestment of distributions | 12 | 116 | $712 | $6,575 |
| Shares redeemed | (144) | (3,141) | (8,441) | (175,892) |
| Net increase (decrease) | (132) | (3,025) | $(7,729) | $(169,317) |
| Class C | | | | |
| Reinvestment of distributions | 20 | 66 | $1,177 | $3,718 |
| Shares redeemed | (172) | (191) | (10,096) | (10,917) |
| Net increase (decrease) | (152) | (125) | $(8,919) | $(7,199) |
| Income Replacement 2024 | | | | |
| Shares sold | 38,794 | 49,373 | $2,278,635 | $2,825,155 |
| Reinvestment of distributions | 1,467 | 4,112 | 85,864 | 233,011 |
| Shares redeemed | (25,763) | (58,308) | (1,514,021) | (3,311,153) |
| Net increase (decrease) | 14,498 | (4,823) | $850,478 | $(252,987) |
| Class I | | | | |
| Reinvestment of distributions | 6 | 20 | $360 | $1,130 |
| Shares redeemed | – | (254) | – | (14,566) |
| Net increase (decrease) | 6 | (234) | $360 | $(13,436) |
| Fidelity Income Replacement 2026 Fund | | | | |
| Class A | | | | |
| Reinvestment of distributions | 123 | 254 | $7,356 | $14,755 |
| Shares redeemed | (485) | (2,683) | (29,141) | (151,495) |
| Net increase (decrease) | (362) | (2,429) | $(21,785) | $(136,740) |
| Class T | | | | |
| Shares sold | – | 100 | $– | $5,894 |
| Reinvestment of distributions | 64 | 114 | 3,828 | 6,610 |
| Shares redeemed | (249) | (516) | (15,000) | (30,000) |
| Net increase (decrease) | (185) | (302) | $(11,172) | $(17,496) |
| Class C | | | | |
| Shares sold | – | 2,995 | $– | $174,801 |
| Reinvestment of distributions | 45 | 53 | $2,657 | $3,084 |
| Shares redeemed | (1) | (296) | (35) | (17,012) |
| Net increase (decrease) | 44 | 2,752 | $2,622 | $160,873 |
| Income Replacement 2026 | | | | |
| Shares sold | 60,758 | 55,773 | $3,652,284 | $3,236,571 |
| Reinvestment of distributions | 1,457 | 2,321 | 87,524 | 134,899 |
| Shares redeemed | (16,179) | (40,225) | (975,435) | (2,349,933) |
| Net increase (decrease) | 46,036 | 17,869 | $2,764,373 | $1,021,537 |
| Class I | | | | |
| Reinvestment of distributions | 7 | 14 | $465 | $787 |
| Shares redeemed | – | (27) | – | (1,478) |
| Net increase (decrease) | 7 | (13) | $465 | $(691) |
| Fidelity Income Replacement 2028 Fund | | | | |
| Class A | | | | |
| Shares sold | – | 5,853 | $– | $346,051 |
| Reinvestment of distributions | 107 | 426 | 6,498 | 25,007 |
| Shares redeemed | (2,079) | (11,648) | (127,135) | (660,057) |
| Net increase (decrease) | (1,972) | (5,369) | $(120,637) | $(288,999) |
| Class T | | | | |
| Shares sold | – | 1,673 | $– | $98,478 |
| Reinvestment of distributions | 67 | 176 | 4,065 | 10,305 |
| Shares redeemed | (991) | (2,517) | (60,679) | (148,353) |
| Net increase (decrease) | (924) | (668) | $(56,614) | $(39,570) |
| Class C | | | | |
| Shares sold | – | 1,169 | $– | $70,718 |
| Reinvestment of distributions | 38 | 91 | 2,311 | 5,318 |
| Shares redeemed | (209) | (633) | (12,786) | (38,307) |
| Net increase (decrease) | (171) | 627 | $(10,475) | $37,729 |
| Income Replacement 2028 | | | | |
| Shares sold | 11,439 | 195,909 | $696,960 | $11,547,098 |
| Reinvestment of distributions | 5,140 | 12,560 | 312,262 | 737,302 |
| Shares redeemed | (98,413) | (165,141) | (5,996,367) | (9,729,252) |
| Net increase (decrease) | (81,834) | 43,328 | $(4,987,145) | $2,555,148 |
| Class I | | | | |
| Shares sold | – | 4,724 | $– | $284,670 |
| Reinvestment of distributions | 16 | 90 | 957 | 5,277 |
| Shares redeemed | (140) | (8,655) | (8,423) | (514,080) |
| Net increase (decrease) | (124) | (3,841) | $(7,466) | $(224,133) |
| Fidelity Income Replacement 2030 Fund | | | | |
| Class A | | | | |
| Shares sold | – | 55 | $– | $3,199 |
| Reinvestment of distributions | 23 | 113 | 1,401 | 6,525 |
| Shares redeemed | (494) | (2,218) | (29,688) | (127,398) |
| Net increase (decrease) | (471) | (2,050) | $(28,287) | $(117,674) |
| Class T | | | | |
| Shares sold | – | 34 | $– | $2,000 |
| Reinvestment of distributions | 4 | 12 | 255 | 694 |
| Shares redeemed | – | (129) | (1) | (7,200) |
| Net increase (decrease) | 4 | (83) | $254 | $(4,506) |
| Class C | | | | |
| Shares sold | – | 1,610 | $– | $92,155 |
| Reinvestment of distributions | 37 | 162 | 2,215 | 9,314 |
| Shares redeemed | (69) | (4,087) | $(4,108) | $(232,547) |
| Net increase (decrease) | (32) | (2,315) | $(1,893) | $(131,078) |
| Income Replacement 2030 | | | | |
| Shares sold | 10,502 | 22,765 | $634,856 | $1,310,359 |
| Reinvestment of distributions | 3,032 | 8,985 | 181,442 | 519,663 |
| Shares redeemed | (27,933) | (80,152) | (1,670,870) | (4,631,240) |
| Net increase (decrease) | (14,399) | (48,402) | $(854,572) | $(2,801,218) |
| Class I | | | | |
| Reinvestment of distributions | 9 | 21 | $568 | $1,208 |
| Shares redeemed | – | (27) | – | (1,496) |
| Net increase (decrease) | 9 | (6) | $568 | $(288) |
| Fidelity Income Replacement 2032 Fund | | | | |
| Class A | | | | |
| Reinvestment of distributions | 121 | 249 | $6,896 | $13,708 |
| Shares redeemed | (438) | (636) | (25,000) | (35,019) |
| Net increase (decrease) | (317) | (387) | $(18,104) | $(21,311) |
| Class T | | | | |
| Shares sold | – | 1,176 | $– | $64,363 |
| Reinvestment of distributions | 15 | 48 | 831 | 2,667 |
| Shares redeemed | (645) | (1,358) | (36,603) | (71,273) |
| Net increase (decrease) | (630) | (134) | $(35,772) | $(4,243) |
| Class C | | | | |
| Reinvestment of distributions | 39 | 74 | $2,206 | $4,046 |
| Shares redeemed | (35) | (237) | (1,961) | (12,646) |
| Net increase (decrease) | 4 | (163) | $245 | $(8,600) |
| Income Replacement 2032 | | | | |
| Shares sold | 5,321 | 3,094 | $301,439 | $172,900 |
| Reinvestment of distributions | 1,694 | 4,515 | 96,135 | 248,476 |
| Shares redeemed | (8,162) | (23,938) | (468,224) | (1,316,244) |
| Net increase (decrease) | (1,147) | (16,329) | $(70,650) | $(894,868) |
| Class I | | | | |
| Reinvestment of distributions | 22 | 41 | $1,275 | $2,278 |
| Shares redeemed | – | (52) | – | (2,741) |
| Net increase (decrease) | 22 | (11) | $1,275 | $(463) |
| Fidelity Income Replacement 2034 Fund | | | | |
| Class A | | | | |
| Reinvestment of distributions | 16 | 61 | $953 | $3,517 |
| Shares redeemed | (227) | (264) | (13,458) | (15,261) |
| Net increase (decrease) | (211) | (203) | $(12,505) | $(11,744) |
| Class T | | | | |
| Shares sold | – | 2,372 | $- | $132,706 |
| Reinvestment of distributions | 8 | 64 | 481 | 3,703 |
| Shares redeemed | (1,201) | (2,511) | (72,690) | (138,710) |
| Net increase (decrease) | (1,193) | (75) | $(72,209) | $(2,301) |
| Class C | | | | |
| Shares sold | – | 435 | $– | $25,000 |
| Reinvestment of distributions | 24 | 80 | 1,449 | 4,572 |
| Shares redeemed | – | (262) | – | (14,590) |
| Net increase (decrease) | 24 | 253 | $1,449 | $14,982 |
| Income Replacement 2034 | | | | |
| Shares sold | 1,825 | 19,850 | $109,468 | $1,163,917 |
| Reinvestment of distributions | 993 | 5,159 | 59,647 | 296,849 |
| Shares redeemed | (20,575) | (48,419) | $(1,229,940) | $(2,795,141) |
| Net increase (decrease) | (17,757) | (23,410) | $(1,060,825) | $(1,334,375) |
| Class I | | | | |
| Shares sold | – | 570 | $– | $30,763 |
| Reinvestment of distributions | 57 | 166 | 3,410 | 9,540 |
| Shares redeemed | (29) | (566) | (1,720) | (31,395) |
| Net increase (decrease) | 28 | 170 | $1,690 | $8,908 |
| Fidelity Income Replacement 2036 Fund | | | | |
| Class A | | | | |
| Shares sold | – | 1,233 | $– | $70,588 |
| Reinvestment of distributions | 176 | 260 | 10,573 | 15,180 |
| Shares redeemed | (298) | (509) | (17,968) | (30,132) |
| Net increase (decrease) | (122) | 984 | $(7,395) | $55,636 |
| Class T | | | | |
| Shares sold | – | 311 | $– | $18,325 |
| Reinvestment of distributions | 258 | 551 | 15,458 | 32,064 |
| Shares redeemed | (8,341) | (1,416) | (506,544) | (82,028) |
| Net increase (decrease) | (8,083) | (554) | $(491,086) | $(31,639) |
| Class C | | | | |
| Reinvestment of distributions | 92 | 183 | $5,485 | $10,599 |
| Shares redeemed | (270) | (1,005) | (16,194) | (58,699) |
| Net increase (decrease) | (178) | (822) | $(10,709) | $(48,100) |
| Income Replacement 2036 | | | | |
| Shares sold | 4,289 | 12,583 | $259,922 | $727,911 |
| Reinvestment of distributions | 2,303 | 4,205 | 138,319 | 244,970 |
| Shares redeemed | (18,737) | (17,250) | (1,139,165) | (1,012,347) |
| Net increase (decrease) | (12,145) | (462) | $(740,924) | $(39,466) |
| Class I | | | | |
| Reinvestment of distributions | 1 | 1 | $18 | $30 |
| Shares redeemed | – | (2) | – | (38) |
| Net increase (decrease) | 1 | (1) | $18 | $(8) |
| Fidelity Income Replacement 2038 Fund | | | | |
| Class A | | | | |
| Shares sold | – | 141 | $– | $7,909 |
| Reinvestment of distributions | 1 | 115 | 58 | 6,415 |
| Shares redeemed | (969) | (2,057) | (56,471) | (114,735) |
| Net increase (decrease) | (968) | (1,801) | $(56,413) | $(100,411) |
| Class T | | | | |
| Reinvestment of distributions | 33 | 103 | $1,893 | $5,729 |
| Shares redeemed | (64) | (140) | (3,702) | (7,817) |
| Net increase (decrease) | (31) | (37) | $(1,809) | $(2,088) |
| Class C | | | | |
| Reinvestment of distributions | 20 | 59 | $1,154 | $3,281 |
| Shares redeemed | (59) | (200) | (3,382) | (11,180) |
| Net increase (decrease) | (39) | (141) | $(2,228) | $(7,899) |
| Income Replacement 2038 | | | | |
| Shares sold | 1,316 | 4,366 | $76,478 | $246,487 |
| Reinvestment of distributions | 1,114 | 3,916 | 64,577 | 218,216 |
| Shares redeemed | (8,135) | (32,653) | (475,033) | (1,818,911) |
| Net increase (decrease) | (5,705) | (24,371) | $(333,978) | $(1,354,208) |
| Class I | | | | |
| Reinvestment of distributions | 10 | 25 | $572 | $1,412 |
| Shares redeemed | – | (31) | $– | $(1,612) |
| Net increase (decrease) | 10 | (6) | $572 | $(200) |
| Fidelity Income Replacement 2040 Fund | | | | |
| Class A | | | | |
| Reinvestment of distributions | 29 | 64 | $1,690 | $3,649 |
| Shares redeemed | – | (291) | – | (16,674) |
| Net increase (decrease) | 29 | (227) | $1,690 | $(13,025) |
| Class T | | | | |
| Shares sold | – | 9,235 | $– | $527,973 |
| Reinvestment of distributions | 170 | 303 | 10,001 | 17,283 |
| Shares redeemed | (425) | (5,773) | (25,207) | (327,421) |
| Net increase (decrease) | (255) | 3,765 | $(15,206) | $217,835 |
| Class C | | | | |
| Reinvestment of distributions | 44 | 93 | $2,573 | $5,260 |
| Shares redeemed | (18) | (40) | (1,048) | (2,283) |
| Net increase (decrease) | 26 | 53 | $1,525 | $2,977 |
| Income Replacement 2040 | | | | |
| Shares sold | 4,321 | 16,324 | $256,355 | $939,546 |
| Reinvestment of distributions | 2,169 | 5,088 | 127,658 | 289,555 |
| Shares redeemed | (18,249) | (21,837) | (1,075,129) | (1,251,519) |
| Net increase (decrease) | (11,759) | (425) | $(691,116) | $(22,418) |
| Class I | | | | |
| Reinvestment of distributions | 1 | 12 | $37 | $671 |
| Shares redeemed | – | (279) | – | (16,071) |
| Net increase (decrease) | 1 | (267) | $37 | $(15,400) |
| Fidelity Income Replacement 2042 Fund | | | | |
| Class A | | | | |
| Shares sold | – | 48 | $– | $2,788 |
| Reinvestment of distributions | 161 | 406 | 9,540 | 23,116 |
| Shares redeemed | – | (1,820) | – | (105,363) |
| Net increase (decrease) | 161 | (1,366) | $9,540 | $(79,459) |
| Class T | | | | |
| Shares sold | – | 7 | $– | $406 |
| Reinvestment of distributions | 104 | 266 | 6,153 | 15,110 |
| Shares redeemed | (208) | (1,080) | (12,401) | (62,622) |
| Net increase (decrease) | (104) | (807) | $(6,248) | $(47,106) |
| Class C | | | | |
| Shares sold | – | 5,320 | $– | $289,821 |
| Reinvestment of distributions | 95 | 230 | 5,545 | 13,021 |
| Shares redeemed | (1,121) | (6,862) | (65,888) | (385,276) |
| Net increase (decrease) | (1,026) | (1,312) | $(60,343) | $(82,434) |
| Income Replacement 2042 | | | | |
| Shares sold | 17,244 | 76,280 | $1,027,023 | $4,335,174 |
| Reinvestment of distributions | 6,649 | 18,992 | 392,987 | 1,080,834 |
| Shares redeemed | (60,360) | (184,484) | (3,597,862) | (10,474,890) |
| Net increase (decrease) | (36,467) | (89,212) | $(2,177,852) | $(5,058,882) |
| Class I | | | | |
| Reinvestment of distributions | 23 | 81 | $1,358 | $4,598 |
| Shares redeemed | (117) | (1,198) | (7,000) | (68,734) |
| Net increase (decrease) | (94) | (1,117) | $(5,642) | $(64,136) |
8. Other.
The Funds' organizational documents provide former and current trustees and officers with a limited indemnification against liabilities arising in connection with the performance of their duties to the Funds. In the normal course of business, the Funds may also enter into contracts that provide general indemnifications. The Funds' maximum exposure under these arrangements is unknown as this would be dependent on future claims that may be made against the Funds. The risk of material loss from such claims is considered remote.
The Funds do not invest in the Underlying Funds for the purpose of exercising management or control; however, investment by the Fund within their principle investment strategies may represent a significant portion of the underlying Fund's net assets. At the end of the period, the following Funds were the owners of record of 10% or more of the total outstanding shares of the Underlying Funds:
| Fund | Fidelity Income Replacement 2028 Fund | Fidelity Income Replacement 2042 Fund |
| Fidelity Series Broad Market Opportunities Fund | 16% | 23% |
The Funds, in aggregate, were the owners of record of more than 20% of the total outstanding shares of the following Underlying Funds.
| Fund | % of shares held |
| Fidelity Series Broad Market Opportunities Fund | 98% |
In January 2017, the Board of Trustees approved a Plan of Liquidation and Dissolution whereby the Fidelity Income Replacement 2018 Fund and Fidelity Income Replacement 2020 Fund, consistent with the Funds' original design, will distribute all of their net assets to their shareholders on or about March 24, 2017.
Shareholder Expense Example
As a shareholder of a Fund, you incur two types of costs: (1) transaction costs, including sales charges (loads) on purchase payments or redemption proceeds, and (2) ongoing costs, including distribution and/or service (12b-1) fees and other Fund expenses. This Example is intended to help you understand your ongoing costs (in dollars) of investing in the Funds and to compare these costs with the ongoing costs of investing in other mutual funds.
The Example is based on an investment of $1,000 invested at the beginning of the period and held for the entire period (August 1, 2016 to January 31, 2017).
Actual Expenses
The first line of the accompanying table for each class of each fund provides information about actual account values and actual expenses. You may use the information in this line, together with the amount you invested, to estimate the expenses that you paid over the period. Simply divide your account value by $1,000.00 (for example, an $8,600 account value divided by $1,000.00 = 8.6), then multiply the result by the number in the first line for a class of the fund under the heading entitled "Expenses Paid During Period" to estimate the expenses you paid on your account during this period. In addition, each Fund, as a shareholder in underlying Fidelity Funds, will indirectly bear its pro-rata share of the fees and expenses incurred by the underlying Fidelity Funds. These fees and expenses are not included in each Fund's annualized expense ratio used to calculate the expense estimates in the table below.
Hypothetical Example for Comparison Purposes
The second line of the accompanying table for each class of each fund provides information about hypothetical account values and hypothetical expenses based on a Class' actual expense ratio and an assumed rate of return of 5% per year before expenses, which is not the Class' actual return. The hypothetical account values and expenses may not be used to estimate the actual ending account balance or expenses you paid for the period. You may use this information to compare the ongoing costs of investing in the Fund and other funds. To do so, compare this 5% hypothetical example with the 5% hypothetical examples that appear in the shareholder reports of the other funds. In addition, each Fund, as a shareholder in underlying Fidelity Funds, will indirectly bear its pro-rata share of the fees and expenses incurred by the underlying Fidelity Funds. These fees and expenses are not included in each Fund's annualized expense ratio used to calculate the expense estimates in the table below.
Please note that the expenses shown in the table are meant to highlight your ongoing costs only and do not reflect any transaction costs. Therefore, the second line of the table is useful in comparing ongoing costs only, and will not help you determine the relative total costs of owning different funds. In addition, if these transactional costs were included, your costs would have been higher.
| | Annualized Expense Ratio-A | Beginning
Account Value
August 1, 2016 | Ending
Account Value
January 31, 2017 | Expenses Paid
During Period-B
August 1, 2016
to January 31, 2017 |
| Fidelity Income Replacement 2018 Fund | | | | |
| Class A | .25% | | | |
| Actual | | $1,000.00 | $1,003.10 | $1.26 |
| Hypothetical-C | | $1,000.00 | $1,023.95 | $1.28 |
| Class T | .50% | | | |
| Actual | | $1,000.00 | $1,001.70 | $2.52 |
| Hypothetical-C | | $1,000.00 | $1,022.68 | $2.55 |
| Class C | 1.00% | | | |
| Actual | | $1,000.00 | $999.20 | $5.04 |
| Hypothetical-C | | $1,000.00 | $1,020.16 | $5.09 |
| Income Replacement 2018 | - % | | | |
| Actual | | $1,000.00 | $1,004.30 | $- |
| Hypothetical-C | | $1,000.00 | $1,025.21 | $- |
| Class I | - % | | | |
| Actual | | $1,000.00 | $1,004.30 | $- |
| Hypothetical-C | | $1,000.00 | $1,025.21 | $- |
| Fidelity Income Replacement 2020 Fund | | | | |
| Class A | .25% | | | |
| Actual | | $1,000.00 | $1,007.30 | $1.26 |
| Hypothetical-C | | $1,000.00 | $1,023.95 | $1.28 |
| Class T | .50% | | | |
| Actual | | $1,000.00 | $1,006.00 | $2.53 |
| Hypothetical-C | | $1,000.00 | $1,022.68 | $2.55 |
| Class C | 1.00% | | | |
| Actual | | $1,000.00 | $1,003.40 | $5.05 |
| Hypothetical-C | | $1,000.00 | $1,020.16 | $5.09 |
| Income Replacement 2020 | - % | | | |
| Actual | | $1,000.00 | $1,008.40 | $- |
| Hypothetical-C | | $1,000.00 | $1,025.21 | $- |
| Class I | - % | | | |
| Actual | | $1,000.00 | $1,008.40 | $- |
| Hypothetical-C | | $1,000.00 | $1,025.21 | $- |
| Fidelity Income Replacement 2022 Fund | | | | |
| Class A | .25% | | | |
| Actual | | $1,000.00 | $1,012.20 | $1.27 |
| Hypothetical-C | | $1,000.00 | $1,023.95 | $1.28 |
| Class T | .50% | | | |
| Actual | | $1,000.00 | $1,010.90 | $2.53 |
| Hypothetical-C | | $1,000.00 | $1,022.68 | $2.55 |
| Class C | 1.00% | | | |
| Actual | | $1,000.00 | $1,008.40 | $5.06 |
| Hypothetical-C | | $1,000.00 | $1,020.16 | $5.09 |
| Income Replacement 2022 | - % | | | |
| Actual | | $1,000.00 | $1,013.40 | $- |
| Hypothetical-C | | $1,000.00 | $1,025.21 | $- |
| Class I | - % | | | |
| Actual | | $1,000.00 | $1,013.40 | $- |
| Hypothetical-C | | $1,000.00 | $1,025.21 | $- |
| Fidelity Income Replacement 2024 Fund | | | | |
| Class A | .25% | | | |
| Actual | | $1,000.00 | $1,018.70 | $1.27 |
| Hypothetical-C | | $1,000.00 | $1,023.95 | $1.28 |
| Class T | .50% | | | |
| Actual | | $1,000.00 | $1,017.60 | $2.54 |
| Hypothetical-C | | $1,000.00 | $1,022.68 | $2.55 |
| Class C | 1.00% | | | |
| Actual | | $1,000.00 | $1,014.80 | $5.08 |
| Hypothetical-C | | $1,000.00 | $1,020.16 | $5.09 |
| Income Replacement 2024 | - % | | | |
| Actual | | $1,000.00 | $1,019.90 | $- |
| Hypothetical-C | | $1,000.00 | $1,025.21 | $- |
| Class I | - % | | | |
| Actual | | $1,000.00 | $1,019.90 | $- |
| Hypothetical-C | | $1,000.00 | $1,025.21 | $- |
| Fidelity Income Replacement 2026 Fund | | | | |
| Class A | .25% | | | |
| Actual | | $1,000.00 | $1,023.40 | $1.28 |
| Hypothetical-C | | $1,000.00 | $1,023.95 | $1.28 |
| Class T | .50% | | | |
| Actual | | $1,000.00 | $1,022.10 | $2.55 |
| Hypothetical-C | | $1,000.00 | $1,022.68 | $2.55 |
| Class C | 1.00% | | | |
| Actual | | $1,000.00 | $1,019.60 | $5.09 |
| Hypothetical-C | | $1,000.00 | $1,020.16 | $5.09 |
| Income Replacement 2026 | - % | | | |
| Actual | | $1,000.00 | $1,024.70 | $- |
| Hypothetical-C | | $1,000.00 | $1,025.21 | $- |
| Class I | - % | | | |
| Actual | | $1,000.00 | $1,024.70 | $- |
| Hypothetical-C | | $1,000.00 | $1,025.21 | $- |
| Fidelity Income Replacement 2028 Fund | | | | |
| Class A | .25% | | | |
| Actual | | $1,000.00 | $1,026.90 | $1.28 |
| Hypothetical-C | | $1,000.00 | $1,023.95 | $1.28 |
| Class T | .50% | | | |
| Actual | | $1,000.00 | $1,025.60 | $2.55 |
| Hypothetical-C | | $1,000.00 | $1,022.68 | $2.55 |
| Class C | 1.00% | | | |
| Actual | | $1,000.00 | $1,023.00 | $5.10 |
| Hypothetical-C | | $1,000.00 | $1,020.16 | $5.09 |
| Income Replacement 2028 | - % | | | |
| Actual | | $1,000.00 | $1,028.20 | $- |
| Hypothetical-C | | $1,000.00 | $1,025.21 | $- |
| Class I | - % | | | |
| Actual | | $1,000.00 | $1,028.20 | $- |
| Hypothetical-C | | $1,000.00 | $1,025.21 | $- |
| Fidelity Income Replacement 2030 Fund | | | | |
| Class A | .25% | | | |
| Actual | | $1,000.00 | $1,029.10 | $1.28 |
| Hypothetical-C | | $1,000.00 | $1,023.95 | $1.28 |
| Class T | .50% | | | |
| Actual | | $1,000.00 | $1,027.70 | $2.56 |
| Hypothetical-C | | $1,000.00 | $1,022.68 | $2.55 |
| Class C | 1.00% | | | |
| Actual | | $1,000.00 | $1,025.20 | $5.10 |
| Hypothetical-C | | $1,000.00 | $1,020.16 | $5.09 |
| Income Replacement 2030 | - % | | | |
| Actual | | $1,000.00 | $1,030.40 | $- |
| Hypothetical-C | | $1,000.00 | $1,025.21 | $- |
| Class I | - % | | | |
| Actual | | $1,000.00 | $1,030.40 | $- |
| Hypothetical-C | | $1,000.00 | $1,025.21 | $- |
| Fidelity Income Replacement 2032 Fund | | | | |
| Class A | .25% | | | |
| Actual | | $1,000.00 | $1,030.70 | $1.28 |
| Hypothetical-C | | $1,000.00 | $1,023.95 | $1.28 |
| Class T | .50% | | | |
| Actual | | $1,000.00 | $1,029.50 | $2.56 |
| Hypothetical-C | | $1,000.00 | $1,022.68 | $2.55 |
| Class C | 1.00% | | | |
| Actual | | $1,000.00 | $1,026.90 | $5.11 |
| Hypothetical-C | | $1,000.00 | $1,020.16 | $5.09 |
| Income Replacement 2032 | - % | | | |
| Actual | | $1,000.00 | $1,032.00 | $- |
| Hypothetical-C | | $1,000.00 | $1,025.21 | $- |
| Class I | - % | | | |
| Actual | | $1,000.00 | $1,032.00 | $- |
| Hypothetical-C | | $1,000.00 | $1,025.21 | $- |
| Fidelity Income Replacement 2034 Fund | | | | |
| Class A | .25% | | | |
| Actual | | $1,000.00 | $1,031.90 | $1.28 |
| Hypothetical-C | | $1,000.00 | $1,023.95 | $1.28 |
| Class T | .50% | | | |
| Actual | | $1,000.00 | $1,030.20 | $2.56 |
| Hypothetical-C | | $1,000.00 | $1,022.68 | $2.55 |
| Class C | 1.00% | | | |
| Actual | | $1,000.00 | $1,028.00 | $5.11 |
| Hypothetical-C | | $1,000.00 | $1,020.16 | $5.09 |
| Income Replacement 2034 | - % | | | |
| Actual | | $1,000.00 | $1,033.20 | $- |
| Hypothetical-C | | $1,000.00 | $1,025.21 | $- |
| Class I | - % | | | |
| Actual | | $1,000.00 | $1,033.20 | $- |
| Hypothetical-C | | $1,000.00 | $1,025.21 | $- |
| Fidelity Income Replacement 2036 Fund | | | | |
| Class A | .25% | | | |
| Actual | | $1,000.00 | $1,032.80 | $1.28 |
| Hypothetical-C | | $1,000.00 | $1,023.95 | $1.28 |
| Class T | .50% | | | |
| Actual | | $1,000.00 | $1,031.50 | $2.56 |
| Hypothetical-C | | $1,000.00 | $1,022.68 | $2.55 |
| Class C | 1.00% | | | |
| Actual | | $1,000.00 | $1,029.00 | $5.11 |
| Hypothetical-C | | $1,000.00 | $1,020.16 | $5.09 |
| Income Replacement 2036 | - % | | | |
| Actual | | $1,000.00 | $1,034.10 | $- |
| Hypothetical-C | | $1,000.00 | $1,025.21 | $- |
| Class I | - % | | | |
| Actual | | $1,000.00 | $1,034.40 | $- |
| Hypothetical-C | | $1,000.00 | $1,025.21 | $- |
| Fidelity Income Replacement 2038 Fund | | | | |
| Class A | .24%-D | | | |
| Actual | | $1,000.00 | $1,033.60 | $1.23 |
| Hypothetical-C | | $1,000.00 | $1,024.00 | $1.22 |
| Class T | .50% | | | |
| Actual | | $1,000.00 | $1,032.40 | $2.56 |
| Hypothetical-C | | $1,000.00 | $1,022.68 | $2.55 |
| Class C | 1.00% | | | |
| Actual | | $1,000.00 | $1,030.00 | $5.12 |
| Hypothetical-C | | $1,000.00 | $1,020.16 | $5.09 |
| Income Replacement 2038 | - % | | | |
| Actual | | $1,000.00 | $1,035.00 | $- |
| Hypothetical-C | | $1,000.00 | $1,025.21 | $- |
| Class I | - % | | | |
| Actual | | $1,000.00 | $1,035.00 | $- |
| Hypothetical-C | | $1,000.00 | $1,025.21 | $- |
| Fidelity Income Replacement 2040 Fund | | | | |
| Class A | .25% | | | |
| Actual | | $1,000.00 | $1,034.40 | $1.28 |
| Hypothetical-C | | $1,000.00 | $1,023.95 | $1.28 |
| Class T | .50% | | | |
| Actual | | $1,000.00 | $1,033.30 | $2.56 |
| Hypothetical-C | | $1,000.00 | $1,022.68 | $2.55 |
| Class C | 1.00% | | | |
| Actual | | $1,000.00 | $1,030.70 | $5.12 |
| Hypothetical-C | | $1,000.00 | $1,020.16 | $5.09 |
| Income Replacement 2040 | - % | | | |
| Actual | | $1,000.00 | $1,035.70 | $- |
| Hypothetical-C | | $1,000.00 | $1,025.21 | $- |
| Class I | - % | | | |
| Actual | | $1,000.00 | $1,035.70 | $- |
| Hypothetical-C | | $1,000.00 | $1,025.21 | $- |
| Fidelity Income Replacement 2042 Fund | | | | |
| Class A | .25% | | | |
| Actual | | $1,000.00 | $1,035.30 | $1.28 |
| Hypothetical-C | | $1,000.00 | $1,023.95 | $1.28 |
| Class T | .50% | | | |
| Actual | | $1,000.00 | $1,034.10 | $2.56 |
| Hypothetical-C | | $1,000.00 | $1,022.68 | $2.55 |
| Class C | 1.00% | | | |
| Actual | | $1,000.00 | $1,031.40 | $5.12 |
| Hypothetical-C | | $1,000.00 | $1,020.16 | $5.09 |
| Income Replacement 2042 | - % | | | |
| Actual | | $1,000.00 | $1,036.60 | $- |
| Hypothetical-C | | $1,000.00 | $1,025.21 | $- |
| Class I | - % | | | |
| Actual | | $1,000.00 | $1,036.80 | $- |
| Hypothetical-C | | $1,000.00 | $1,025.21 | $- |
| | | | | |
A Annualized expense ratio reflects expenses net of applicable fee waivers.
B Expenses are equal to each Class' annualized expense ratio, multiplied by the average account value over the period, multiplied by 184/ 365 (to reflect the one-half year period). The fees and expenses of the underlying Fidelity Funds in which each Fund invests are not included in each Fund's annualized expense ratio.
C 5% return per year before expenses
D On certain classes, the size and fluctuation of net assets may cause rounding of expenses amounts and ratios to differ from contractual rates.
Board Approval of Investment Advisory Contracts and Management Fees
Fidelity Income Replacement Funds
Each year, the Board of Trustees, including the Independent Trustees (together, the Board), votes on the renewal of the management contract (the Advisory Contract) with FMR Co., Inc. (FMRC), an affiliate of Fidelity Management & Research Company (FMR), for each fund. The Board, assisted by the advice of fund counsel and Independent Trustees' counsel, requests and considers a broad range of information relevant to the renewal of the Advisory Contracts throughout the year.
The Board meets regularly and, at each of its meetings, covers an extensive agenda of topics and materials and considers factors that are relevant to its annual consideration of the renewal of each fund's Advisory Contract, including the services and support provided to each fund and its shareholders. The Board has established four standing committees (Committees) — Operations, Audit, Fair Valuation, and Governance and Nominating — each composed of and chaired by Independent Trustees with varying backgrounds, to which the Board has assigned specific subject matter responsibilities in order to enhance effective decision-making by the Board. The Operations Committee, of which all of the Independent Trustees are members, meets regularly throughout the year and considers, among other matters, information specifically related to the annual consideration of the renewal of each fund's Advisory Contract. The Board, acting directly and through its Committees, requests and receives information concerning the annual consideration of the renewal of each fund's Advisory Contract. The Board also meets as needed to consider matters specifically related to the Board's annual consideration of the renewal of the Advisory Contracts. Members of the Board may also meet with trustees of other Fidelity funds through ad hoc joint committees to discuss certain matters relevant to all of the Fidelity funds.
At its September 2016 meeting, the Board unanimously determined to renew each fund's Advisory Contract. In reaching its determination, the Board considered all factors it believed relevant and reached a determination, with the assistance of fund counsel and Independent Trustees' counsel and through the exercise of its business judgment, that the renewal of the Advisory Contract was in the best interests of each fund and its shareholders and that the fact that no fees are payable under the Advisory Contracts was fair and reasonable. The Board's decision to renew the Advisory Contracts was not based on any single factor, but rather was based on a comprehensive consideration of all the information provided to the Board at its meetings throughout the year. In reaching its determination, the Board was aware that shareholders of each fund have a broad range of investment choices available to them, including a wide choice among funds offered by Fidelity's competitors, and that each fund's shareholders, who have the opportunity to review and weigh the disclosure provided by the fund in its prospectus and other public disclosures, have chosen to invest in that fund, which is part of the Fidelity family of funds.
Nature, Extent, and Quality of Services Provided. The Board considered Fidelity's staffing as it relates to the funds, including the backgrounds of investment personnel of FMRC, and also considered the funds' investment objectives, strategies, and related investment philosophies. The Independent Trustees also had discussions with senior management of Fidelity's investment operations and investment groups with responsibility for the underlying Fidelity funds in which each fund invests. The Board considered the structure of the investment personnel compensation program and whether this structure provides appropriate incentives to act in the best interests of each fund. Additionally, the Board considered the portfolio managers' investments, if any, in the funds that they manage.
Resources Dedicated to Investment Management and Support Services. The Board reviewed the general qualifications and capabilities of Fidelity's investment staff, including its size, education, experience, and resources, as well as Fidelity's approach to recruiting, managing, and compensating investment personnel. The Board noted that Fidelity has continued to increase the resources devoted to non-U.S. offices, including expansion of Fidelity's global investment organization. The Board also noted that Fidelity's analysts have extensive resources, tools and capabilities that allow them to conduct sophisticated quantitative and fundamental analysis, as well as credit analysis of issuers, counterparties and guarantors. Further, the Board considered that Fidelity's investment professionals have sufficient access to global information and data so as to provide competitive investment results over time, and that those professionals also have access to sophisticated tools that permit them to assess portfolio construction and risk and performance attribution characteristics continuously, as well as to transmit new information and research conclusions rapidly around the world. Additionally, in its deliberations, the Board considered Fidelity's risk management, compliance, and technology and operations capabilities and resources, which are integral parts of the investment management process.
Shareholder and Administrative Services. The Board considered (i) the nature, extent, quality, and cost of advisory, administrative, and shareholder services performed by Fidelity under the Advisory Contract and under separate agreements covering transfer agency and pricing and bookkeeping services for each fund; (ii) the nature and extent of the supervision of third party service providers, principally custodians, subcustodians, and pricing vendors; and (iii) the resources devoted to, and the record of compliance with, each fund's compliance policies and procedures.
The Board noted that the growth of fund assets over time across the complex allows Fidelity to reinvest in the development of services designed to enhance the value or convenience of the Fidelity funds as investment vehicles. These services include 24-hour access to account information and market information through telephone representatives and over the Internet, investor education materials and asset allocation tools, and the expanded availability of Fidelity Investor Centers.
Investment in a Large Fund Family. The Board considered the benefits to shareholders of investing in a Fidelity fund, including the benefits of investing in a fund that is part of a large family of funds offering a variety of investment disciplines and providing a large variety of mutual fund investor services. The Board noted that Fidelity had taken, or had made recommendations that resulted in the Fidelity funds taking, a number of actions over the previous year that benefited particular funds, including: (i) continuing to dedicate additional resources to investment research and to the support of the senior management team that oversees asset management; (ii) continuing efforts to enhance Fidelity's global research capabilities; (iii) launching new funds and making other enhancements to meet client needs; (iv) broadening eligibility requirements for certain lower-priced share classes of, and streamlining the fee structure for, certain existing equity index funds; (v) lowering expense caps for certain existing funds and classes to reduce expenses paid by shareholders; (vi) eliminating redemption fees for certain variable insurance product funds and classes; (vii) continuing to launch dedicated lower cost underlying funds to meet portfolio construction needs related to expanding underlying fund options for Fidelity funds of funds, specifically for the Freedom Fund product lines; (viii) launching a lower cost share class for use by the Freedom Index Fund product line; (ix) rationalizing product lines and gaining increased efficiencies through fund mergers and share class consolidations; (x) continuing to develop, acquire and implement systems and technology to improve services to the funds and shareholders, strengthen information security, and increase efficiency; (xi) implementing investment enhancements to further strengthen Fidelity's target date product line to increase investors' probability of success in achieving their goals; (xii) accelerating the conversion of all remaining Class B shares to Class A shares, which have a lower expense structure; and (xiii) implementing changes to Fidelity's money market fund product line in response to recent regulatory reforms.
Investment Performance. The Board considered whether each fund has operated in accordance with its investment objective, as well as its record of compliance with its investment restrictions and its performance history.
The Board took into account discussions with representatives of the investment adviser about fund investment performance that occur at Board meetings throughout the year. In this regard the Board noted that as part of regularly scheduled fund reviews and other reports to the Board on fund performance, the Board considers annualized return information for each fund for different time periods, measured against one or more securities market indices, including a customized blended index representative of the fund's asset classes (each a "benchmark index") and a peer group of funds with similar objectives ("peer group"), if any. In its evaluation of fund investment performance at meetings throughout the year, the Board gave particular attention to information indicating underperformance of certain Fidelity funds for specific time periods and discussed with the investment adviser the reasons for such underperformance.
In addition to reviewing absolute and relative fund performance, the Independent Trustees periodically consider the appropriateness of fund performance metrics in evaluating the results achieved. In general, the Independent Trustees believe that fund performance should be evaluated based on gross performance (before fees and expenses, including acquired fund fees and expenses, but after transaction costs, if any) compared to appropriate benchmark indices, over appropriate time periods that may include full market cycles, and on net performance (after fees and expenses, including acquired fund fees and expenses) compared to peer groups, as applicable, over the same periods, taking into account relevant factors including the following: general market conditions; the extent to which particular underlying funds affected performance; and fund cash flows and other factors. Depending on the circumstances, the Independent Trustees may be satisfied with a fund's performance notwithstanding that it lags its benchmark index or peer group for certain periods.
The Independent Trustees recognize that shareholders evaluate performance on a net basis over their own holding periods, for which one-, three-, and five-year periods are often used as a proxy. For this reason, the performance information reviewed by the Board also included net cumulative calendar year total return information for each fund and an appropriate benchmark index for the most recent one-, three-, and five-year periods.
Based on its review, the Board concluded that the nature, extent, and quality of services provided to each fund under the Advisory Contracts should continue to benefit the shareholders of each fund.
Competitiveness of Management Fee and Total Expense Ratio. The Board noted that the funds do not pay FMRC a management fee for investment advisory services, and that each fund bears indirectly the fees and expenses, including the management fees, paid by the underlying Fidelity funds in which it invests. The Board considered each fund's management fee and total expense ratio compared to "mapped groups" of competitive funds and classes created for the purpose of facilitating the Trustees' competitive analysis of management fees and total expenses. Fidelity creates "mapped groups" by combining similar Lipper investment objective categories that have comparable investment mandates. Combining Lipper investment objective categories aids the Board's management fee and total expense ratio comparisons by broadening the competitive group used for comparison.
Management Fee. The Board considered two proprietary management fee comparisons for the 12-month periods shown in basis points (BP) in the charts below. The group of Lipper funds used by the Board for management fee comparisons is referred to below as the "Total Mapped Group." The Total Mapped Group comparison focuses on a fund's standing in terms of gross management fees before expense reimbursements or caps relative to the total universe of funds with comparable investment mandates, regardless of whether their management fee structures also are comparable. Funds with comparable investment mandates offer exposure to similar types of securities. Funds with comparable management fee structures have similar management fee contractual arrangements (
e.g., flat rate charged for advisory services, all-inclusive fee rate,
etc.). "TMG %" represents the percentage of funds in the Total Mapped Group that had management fees that were lower than a fund's. For example, a hypothetical TMG % of 20% would mean that 80% of the funds in the Total Mapped Group had higher, and 20% had lower, management fees than a fund. The funds' actual TMG %s and the number of funds in the Total Mapped Group are in the charts below. The "Asset-Size Peer Group" (ASPG) comparison focuses on a fund's standing relative to a subset of non-Fidelity funds within the Total Mapped Group that are similar in size and management fee structure. For example, if a fund is in the first quartile of the ASPG, the fund's management fee ranks in the least expensive or lowest 25% of funds in the ASPG. The ASPG represents at least 15% of the funds in the Total Mapped Group with comparable asset size and management fee structures, subject to a minimum of 50 funds (or all funds in the Total Mapped Group if fewer than 50). Additional information, such as the ASPG quartile in which a fund's management fee rate ranked, is also included in the charts and considered by the Board.
Income Replacement 2016 Fund
Income Replacement 2018 Fund
Income Replacement 2020 Fund
Income Replacement 2022 Fund
Income Replacement 2024 Fund
Income Replacement 2026 Fund
Income Replacement 2028 Fund
Income Replacement 2030 Fund
Income Replacement 2032 Fund
Income Replacement 2034 Fund
Income Replacement 2036 Fund
Income Replacement 2038 Fund
Income Replacement 2040 Fund
Income Replacement 2042 Fund
The Board noted that each fund's management fee rate of 0.00% ranked below the median of its Total Mapped Group and below the median of its ASPG for 2015. The Board further noted that many peer funds pay fund-level expenses, including management fees, to which the funds are not subject. The Board noted that, beginning with the 2014 competitive results, the comparisons reflect a revised Total Mapped Group that includes only non-target date funds-of-funds that invest in affiliated funds.
The Board noted that, in 2014, the ad hoc Committee on Group Fee was formed by it and the boards of other Fidelity funds to conduct an in-depth review of the "group fee" component of the management fee of funds with such management fee structures, and that while the funds do not pay a management fee, they indirectly bear a portion of the management fees paid by the Fidelity funds in which they invest, some of which are subject to the group fee. The Committee's focus included the mechanics of the group fee, the competitive landscape of group fee structures, Fidelity funds with no group fee component (such as the funds) and investment products not included in group fee assets. The Board also considered that, for funds subject to the group fee, FMR agreed to voluntarily waive fees over a specified period of time in amounts designed to account for assets converted from certain funds to certain collective investment trusts.
Based on its review, the Board concluded that each fund's management fee is fair and reasonable in light of the services that the fund receives and the other factors considered.
Total Expense Ratio. In its review of the total expense ratio of each class of each fund, the Board considered fund-paid 12b-1 fees and noted that each fund invests in a class of shares of the underlying Fidelity fund that does not charge a 12b-1 fee to avoid charging fund-paid 12b-1 fees at both fund levels. The Board considered that the funds do not pay transfer agent fees. Instead, the applicable class of each underlying Fidelity fund bears its pro rata portion of each fund's transfer agent fee according to the percentage of each fund's assets invested in that underlying fund. The Board further noted that FMR pays all other expenses of each fund, with limited exceptions.
The Board noted that the total expense ratio of each of Class A, Class C, Class I, and the retail class of each fund ranked below the competitive median for 2015 and the total expense ratio of Class T of each fund ranked equal to the competitive median for 2015.
In considering the total expense ratio of each class of each fund, the Board also considered an alternative competitive analysis that included both top level (
i.e., direct) fund fees and acquired fund fees and expenses for the class and the other funds and classes to which it is compared. The Board noted that, under this alternative competitive analysis, the total expense ratio of each class of each fund ranked below the competitive median for 2015.
Fees Charged to Other Fidelity Clients. The Board also considered Fidelity fee structures and other information with respect to clients of Fidelity, such as other funds advised or subadvised by Fidelity, pension plan clients, and other institutional clients with similar mandates. The Board noted that an ad hoc joint committee created by it and the boards of other Fidelity funds periodically (most recently in 2013) reviews and compares Fidelity's institutional investment advisory business with its business of providing services to the Fidelity funds, including the differences in services provided, fees charged, and costs incurred, as well as competition in their respective marketplaces.
Based on its review of total expense ratios and fees charged to other Fidelity clients, the Board concluded that the total expense ratio of each class of each fund was reasonable in light of the services that the fund and its shareholders receive and the other factors considered.
Costs of the Services and Profitability. The Board considered the level of Fidelity's profits in respect of all the Fidelity funds, including the Fidelity funds in which the funds invest.
PricewaterhouseCoopers LLP (PwC), independent registered public accounting firm and auditor to Fidelity and certain Fidelity funds, has been engaged annually by the Board as part of the Board's assessment of Fidelity's profitability analysis. PwC's engagement includes the review and assessment of the methodologies used by Fidelity in determining the revenues and expenses attributable to Fidelity's mutual fund business, and completion of agreed-upon procedures in respect of the mathematical accuracy of the fund profitability information and its conformity to established allocation methodologies. After considering PwC's reports issued under the engagement and information provided by Fidelity, the Board concluded that while other allocation methods may also be reasonable, Fidelity's profitability methodologies are reasonable in all material respects.
The Board also reviewed Fidelity's non-fund businesses and fall-out benefits related to the mutual fund business as well as cases where Fidelity's affiliates may benefit from or be related to the funds' business.
The Board concluded that the costs of the services provided by and the profits realized by Fidelity in connection with the operation of each fund were not relevant to the renewal of each fund's Advisory Contract because the funds do not pay management fees and FMR pays all other expenses of each fund, with limited exceptions.
Economies of Scale. The Board concluded that because the funds do not pay management fees and FMR pays all other expenses of each fund, with limited exceptions, economies of scale cannot be realized by the funds, but may be realized by the other Fidelity funds in which each fund invests, many of which may benefit from breakpoints under the group fee arrangement.
Additional Information Requested by the Board. In order to develop fully the factual basis for consideration of the Fidelity funds' advisory contracts, the Board requested and received additional information on certain topics, including: (i) Fidelity's fund profitability methodology, profitability trends for certain funds, and the impact of certain factors on fund profitability results; (ii) portfolio manager changes that have occurred during the past year and the amount of the investment that each portfolio manager has made in the Fidelity fund(s) that he or she manages; (iii) Fidelity's compensation structure for portfolio managers, research analysts, and other key personnel, including its effects on fund profitability, the rationale for the compensation structure, and the extent to which current market conditions have affected retention and recruitment; (iv) the arrangements with and compensation paid to certain fund sub-advisers on behalf of the Fidelity funds; (v) Fidelity's voluntary waiver of its fees to maintain minimum yields for certain money market funds and classes as well as contractual waivers in place for certain funds; (vi) the methodology with respect to competitive fund data and peer group classifications; (vii) Fidelity's transfer agent fee, expense, and service structures for different funds and classes relative to competitive trends, and the impact of the increased use of omnibus accounts; (viii) Fidelity's long-term expectations for its offerings in the workplace investing channel; (ix) new developments in the retail and institutional marketplaces; (x) the approach to considering "fall-out" benefits; and (xi) the impact of money market reform on Fidelity's money market funds, including with respect to costs and profitability. In addition, the Board considered its discussions with Fidelity throughout the year regarding enhanced information security initiatives and the funds' fair valuation policies.
Based on its evaluation of all of the conclusions noted above, and after considering all factors it believed relevant, the Board concluded that the advisory fee structures are fair and reasonable, and that each fund's Advisory Contract should be renewed.
Board Approval of Investment Advisory Contracts and Management Fees
Fidelity Income Replacement 2022 FundFidelity Income Replacement 2024 FundFidelity Income Replacement 2026 FundFidelity Income Replacement 2028 FundFidelity Income Replacement 2030 FundFidelity Income Replacement 2032 FundFidelity Income Replacement 2034 FundFidelity Income Replacement 2036 FundFidelity Income Replacement 2038 FundFidelity Income Replacement 2040 FundFidelity Income Replacement 2042 FundAt its January 2017 meeting, the Board of Trustees, including the Independent Trustees (together, the Board) voted to approve an amended and restated management contract (New Advisory Contract) between FMR Co., Inc. (FMRC) and each fund to add a management fee payable by each fund. The Board considered that each fund's New Advisory Contract will not take effect unless it is approved by the fund's shareholders.
The Board noted that, under each fund's current management contract (Current Advisory Contract), the funds do not pay a management fee to FMRC. Instead, the Board noted that, each fund currently indirectly incurs a portion of the management fee and other expenses of each underlying fund in which each fund invests and that such expenses are currently reflected in each fund's expense ratio as acquired fund fees and expenses. The Board considered that, under each fund's New Advisory Contract, each class or each fund, as applicable, will pay a monthly management fee to FMRC at an annual rate for the class or the fund, as applicable.
The Board considered that the increase in each fund's management fee under the New Advisory Contract will result in the fund's management fee rate ranking above the median of the management fee rates of its competitor funds based on the competitive mapped group data provided to the Board in July 2016 in connection with its consideration of the annual renewal of the Current Advisory Contract. However, the Board considered that the increase in management fees under the New Advisory Contract will be offset by a decrease in each fund's acquired fund fees and expenses as a result of the repositioning of the funds to invest only in a particular subset of the underlying funds (Series Funds) together with fee reductions for the Series Funds under new management contracts, sub-advisory agreements, transfer agent agreements, and pricing and bookkeeping agreements (collectively, the New Series Fund Contracts) that will go into effect if new advisory contracts for certain other Fidelity funds that invest in the Series Funds are approved by shareholders of those other Fidelity funds. The Board noted that, once the New Series Fund Contracts take effect, the Series Funds will no longer pay any operating expenses, except 12b-1 fees, interest and taxes, brokerage commissions, independent trustee expenses, custodian fees, expenses related to proxy solicitations, and extraordinary expenses (such as litigation expenses), and, thus, the funds' acquired fund fees and expenses will be significantly reduced. The Board noted that, as a result, the increased management fee and decreased acquired fund fees and expenses are expected to have the combined effect of reducing the total expenses incurred by shareholders of each fund by at least 0.01%.
After approving the New Advisory Contracts and implementing the New Series Fund Contracts, the total expense ratio of each class of each fund, including acquired fund fees and expenses, is expected to continue to rank below the median, except for Class C and Class T of certain funds which will rank above median, of those funds and classes used by the Board for management fee comparisons that have a similar sales load structure. The Board noted that the total expense ratio of Class T of certain funds will rank above the competitive median primarily because of higher 12b-1 fees on Class T as compared to most competitor funds. Class T has a higher 12b-1 fee, but a lower front-end sales charge, than traditionally priced front-end sales charge classes. The Board considered that Class T is primarily sold load-waived in the retirement plan market where its 0.50% 12b-1 fee is comparable to competing no-load, higher 12b-1 fee classes designed specifically for retirement plans. The Board noted that the total expense ratio of Class C of certain funds will rank above the competitive median primarily because of Class C's 12b-1 fees. The Board also noted that, once the New Series Fund Contracts take effect, the funds' total expense ratios are expected to be more predictable because all the Series Funds will be priced similarly and, thus, the funds' investment decisions will not result in shifting expense levels.
The Board considered that, because the implementation of the New Series Fund Contracts is dependent on approval of new advisory contracts by the shareholders of certain other Fidelity funds, FMRC will adopt an expense contract for each fund. Under each fund's expense contract, the fund will waive its management fee so long as the Series Funds continue to pay management fees.
The Board considered that the approval of the New Advisory Contracts will not result in any changes to (i) the investment process or strategies employed in the management of the funds' assets (although the Board separately approved changes to the funds' investment objectives and strategies); (ii) the nature, extent and quality of services provided to each fund; or (iii) the day-to-day management of each fund and the personnel primarily responsible for such management. The Board noted that, under the Current Advisory Contracts, FMRC or an affiliate undertakes to pay all operating expenses of the funds, except Independent Trustee expenses, interest, taxes, brokerage fees and commissions, redemption fees and other shareholder charges associated with investments in other mutual funds, and extraordinary expenses (such as litigation expenses). The Board considered that the New Advisory Contracts provide that FMRC or an affiliate undertakes to pay all operating expenses of the funds, except 12b-1 fees, Independent Trustee expenses, interest, taxes, brokerage fees and commissions, redemption fees and other shareholder charges associated with investments in other mutual funds, expenses related to proxy solicitations, and extraordinary expenses (such as litigation expenses).
The Board did not consider the costs of the services and profitability to Fidelity or whether there have been economies of scale in respect of the management of the Fidelity funds (including the funds) to be material factors in approving the New Advisory Contracts because the new fee arrangements have not yet been implemented. The Board noted however that it evaluated such information in connection with its consideration of the annual renewal of the Current Advisory Contracts at its September 2016 meeting and that it will consider these factors in connection with future renewals of the New Advisory Contracts, if approved.
Based on its evaluation of all of the conclusions noted above, and after considering all factors it believed relevant, the Board ultimately concluded that the management fee structures under the New Advisory Contracts are fair and reasonable, and that each fund's New Advisory Contract should be approved.
RW-SANN-0317
1.848178.109
Item 2.
Code of Ethics
Not applicable.
Item 3.
Audit Committee Financial Expert
Not applicable.
Item 4.
Principal Accountant Fees and Services
Not applicable.
Item 5.
Audit Committee of Listed Registrants
Not applicable.
Item 6.
Investments
(a)
Not applicable.
(b)
Not applicable
Item 7.
Disclosure of Proxy Voting Policies and Procedures for Closed-End Management Investment Companies
Not applicable.
Item 8.
Portfolio Managers of Closed-End Management Investment Companies
Not applicable.
Item 9.
Purchase of Equity Securities by Closed-End Management Investment Company and Affiliated Purchasers
Not applicable.
Item 10.
Submission of Matters to a Vote of Security Holders
There were no material changes to the procedures by which shareholders may recommend nominees to the Fidelity Income Fund’s Board of Trustees.
Item 11.
Controls and Procedures
(a)(i) The President and Treasurer and the Chief Financial Officer have concluded that the Fidelity Income Fund’s (the “Trust”) disclosure controls and procedures (as defined in Rule 30a-3(c) under the Investment Company Act) provide reasonable assurances that
material information relating to the Trust is made known to them by the appropriate persons, based on their evaluation of these controls and procedures as of a date within 90 days of the filing date of this report.
(a)(ii) There was no change in the Trust’s internal control over financial reporting (as defined in Rule 30a-3(d) under the Investment Company Act) that occurred during the second fiscal quarter of the period covered by this report that has materially affected, or is reasonably likely to materially affect, the Trust’s internal control over financial reporting.
Item 12.
Exhibits
| | |
(a) | (1) | Not applicable. |
(a) | (2) | Certification pursuant to Rule 30a-2(a) under the Investment Company Act of 1940 (17 CFR 270.30a-2(a)) is filed and attached hereto as Exhibit 99.CERT. |
(a) | (3) | Not applicable. |
(b) |
| Certification pursuant to Rule 30a-2(b) under the Investment Company Act of 1940 (17 CFR 270.30a-2(b)) is furnished and attached hereto as Exhibit 99.906CERT. |
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934 and the Investment Company Act of 1940, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.
Fidelity Income Fund
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By: | /s/Stephanie J. Dorsey |
| Stephanie J. Dorsey |
| President and Treasurer |
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Date: | March 29, 2017 |
Pursuant to the requirements of the Securities Exchange Act of 1934 and the Investment Company Act of 1940, this report has been signed below by the following persons on behalf of the registrant and in the capacities and on the dates indicated.
| |
By: | /s/Stephanie J. Dorsey |
| Stephanie J. Dorsey |
| President and Treasurer |
|
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Date: | March 29, 2017 |
| |
By: | /s/Howard J. Galligan III |
| Howard J. Galligan III |
| Chief Financial Officer |
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Date: | March 29, 2017 |
