KAI RYSSDAL: Most financial experts believe mutual funds are a good way to invest. You don't have to be a stock market expert and the funds are usually pretty cost effective. But should just anybody be able to offer them? American Airlines, the construction manufacturer Caterpillar, and recently the lobbying group for seniors, AARP, have launched their own funds. Ian McDonald is with the Wall Street Journal. Ian, whaddya think?

IAN MCDONALD: The AARP actually has somewhat of a history in the mutual fund business. For about 20 years they had their own share class, what was then known as the Skudder mutual funds, but that's something that they gave up and at the and of last year they started three mutual funds. The AARP Aggressive fund has 75 percent of your money that you put into it in a set of stock index funds and 25 percent in bond index funds. The Moderate fund is 50-50, Conservative is the opposite of Aggressive, 25-75 percent in bonds. It is a little strange. It feels like when you walk into a Starbucks and they're selling music and movies, sort of an extension of the brand that you weren't expecting.

RYSSDAL: Are you getting a good deal at AARP with these funds?

MCDONALD: There are plusses and minuses. One of the good things that they've done is they've kept it to a reasonably short menu. As we said there's only 3 funds. Also they're not very expensive, they also have low minimums, $25 if you set up automatic investments, $100 otherwise. But frankly if this is the kind of fund you're looking for, there are ample options that are cheaper and might make more sense for you, certainly folks with a longer track record.

RYSSDAL: So then what the heck is AARP doing here?

MCDONALD: Well, this is something that they have tried before, as we said, it didn't work out too well. I think that what is probably happening here is that obviously these are folks who are at, near or in retirement, and really these are the fish that everybody in the financial services business want to have in their net, when their net worth is frankly the highest.

So if these are people that they know, that they're talking to, that they have a relationship with, I'm sure someone on a white board has written up that this is sort of a natural extension. The funds I should say aren't offered by AARP specifically but a unit of them called AARP Financial.

RYSSDAL: Well now that's interesting because, you know, you'd think that if you sign up with AARP you'd be getting that warm and cozy feeling you get from AARP which is there to take care of you in your golden years, and really, you know, it's a business.

MCDONALD: It is and this is an extension of the business. I think, if I had to handicap it, I would think that they would have a bit of an uphill battle in trying to gather assets with these funds and trying to get people interested in them. Because if they are going for folks in retirement or near retirement, really those folks have their money in accounts and in investments they're already comfortable with and it's pretty difficult to get people to totally switch gears. When you know somebody for one thing, it's pretty risky to try to get them to know you for something else. Because really, when you think AARP, you don't think of investing. You don't think of this sort of business. So this is kind of a risk. Every time you extend your brand and your business into things that you have never done before and things that are sort of uncharted for you or that you haven't done well in the past, you're taking a pretty big risk, because trust is a huge factor.

RYSSDAL: Ian McDonald from the Wall Street Journal, thanks for your time.

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