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Schwab
Funds®
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Summary
Prospectus February 29,
2012
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Schwab New York
AMT Tax-Free Money
Fundtm
Ticker
Symbol: Value Advantage
Shares®: SWYXX
Before you invest, you may want to review the funds
prospectus, which contains more information about the fund and
its risks. You can find the funds prospectus, Statement of
Additional Information (SAI) and other information about the
fund online at www.schwabfunds.com/prospectus. You can
also obtain this information at no cost by calling
1-866-414-6349
or by sending an email request to
orders@mysummaryprospectus.com. If you purchase or hold
fund shares through a financial intermediary, the funds
prospectus, SAI, and other information about the fund are
available from your financial intermediary.
The funds prospectus dated April 30, 2011, and SAI
dated April 30, 2011, as supplemented February 29,
2012, include a more detailed discussion of fund investment
policies and the risks associated with various fund investments.
The prospectus and SAI are incorporated by reference into the
summary prospectus, making them legally a part of the summary
prospectus.
Investment
objective
The funds goal is to seek the highest current income that
is consistent with stability of capital and liquidity, and is
exempt from federal and New York State and local income tax.
Fund fees
and expenses
This table describes the fees and expenses you may pay if you
buy and hold Value Advantage Shares of the fund.
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Shareholder
fees
(fees
paid directly from your investment)
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None
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Annual
fund operating expenses
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(expenses
that you pay each year as a % of the value of your investment)
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Management fees
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0.33
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Distribution (12b-1) fees
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None
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Other expenses
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0.24
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Total annual fund operating expenses
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0.57
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Less expense reduction
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(0.12)
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Total annual fund operating expenses after expense
reduction1
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0.45
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1
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The investment
adviser and its affiliates have agreed to limit the total annual
fund operating expenses (excluding interest, taxes and certain
non-routine expenses) of the Value Advantage Shares to 0.45% for
so long as the investment adviser serves as the adviser to the
fund. This agreement may only be amended or terminated with the
approval of the funds Board of Trustees. Non-routine
expenses that are not subject to the foregoing contractual
operating expense limitation include, but are not limited to,
any reimbursement payments made by the Value Advantage Shares to
the investment adviser
and/or its
affiliates of fund fees and expenses that were previously waived
or reimbursed by the investment adviser
and/or its
affiliates in order to maintain a positive net yield for the
Value Advantage Shares.
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Example
This example is intended to help you compare the cost of
investing in the funds Value Advantage Shares with the
cost of investing in other mutual funds. The example assumes
that you invest $10,000 in the fund for the time periods
indicated and then redeem all of your shares at the end of those
time periods. The example also assumes that your investment has
a 5% return each year and that the Value Advantage Shares
operating expenses remain the same. The figures are based on
total annual fund operating expenses after expense reduction.
The expenses would be the same whether you stayed in the fund or
sold your shares at the end of each period. Your actual costs
may be higher or lower.
Expenses on
a $10,000 investment
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1 year
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3 years
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5 years
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10 years
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$46
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$144
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$252
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$567
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Principal
investment strategies
To pursue its goal, the fund invests in money market
securities from New York issuers and from municipal agencies,
U.S. territories and possessions. These securities may
include general obligation issues, which typically are backed by
the issuers ability to levy taxes, and revenue issues,
which typically are backed by a stream of revenue from a given
source, such as a toll highway or a public water system. These
securities also may include municipal notes as well as municipal
leases, which municipalities may use to finance construction or
to acquire equipment. The fund may invest more than 25% of its
total assets in municipal securities financing similar projects
such as those relating to education, health care,
transportation, utilities, industrial development and housing.
Under normal circumstances, the fund will invest at least 80% of
its net assets in municipal money market securities the interest
from which is exempt from federal and New York State income tax,
including the federal alternative minimum tax (AMT).
The fund does not currently intend to invest in any municipal
securities whose interest is subject to AMT; however, this would
not prevent the fund from investing in such securities as a
temporary defensive measure discussed below.
The fund may purchase certain variable rate demand securities
issued by closed-end municipal bond funds, which, in turn,
invest primarily in portfolios of New York tax-exempt municipal
bonds. It is anticipated that the interest on the variable rate
demand securities will be exempt from federal and New York State
income tax, including the AMT. These securities are considered
municipal money market securities for purposes of
the funds 80% investment policy stated above.
Many of the funds securities will be subject to credit or
liquidity enhancements from U.S. and/or non-U.S. entities, which
are designed to provide incremental levels of creditworthiness
or
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liquidity. Some municipal securities have been structured to
resemble variable- and floating-rate securities so that they
meet the requirements for being considered money market
instruments.
In choosing securities, the funds manager seeks to
maximize current income within the limits of the funds
investment objective and credit, maturity and diversification
policies. Some of these policies may be stricter than the
federal regulations that apply to all money funds.
The investment advisers credit research department
analyzes and monitors the securities that the fund owns or is
considering buying. The manager may adjust the funds
holdings or its average maturity based on actual or anticipated
changes in interest rates or credit quality. To preserve its
investors capital, the fund seeks to maintain a stable
$1.00 share price.
During unusual market conditions, the fund may invest in taxable
money market securities and municipal securities whose interest
is subject to the AMT as a temporary defensive measure. When the
fund engages in such activities, it may not achieve its
investment goal.
Principal
risks
The fund is subject to risks, any of which could cause an
investor to lose money. The funds principal risks include:
Investment Risk. Your investment in the fund is not
a bank deposit and is not insured or guaranteed by the Federal
Deposit Insurance Corporation or any other government agency.
Although the fund seeks to preserve the value of your investment
at $1.00 per share, it is possible to lose money by investing in
the fund.
Interest Rate Risk. Interest rates rise and fall
over time. As with any investment whose yield reflects current
interest rates, the funds yield will change over time.
During periods when interest rates are low, the funds
yield (and total return) also will be low. In addition, to the
extent the Value Advantage Shares make any reimbursement
payments to the investment adviser and/or its affiliates, the
Value Advantage Sharess yield would be lower.
Credit Risk. The fund is subject to the risk that a
decline in the credit quality of a portfolio investment could
cause the fund to lose money or underperform. The fund could
lose money if the issuer of a portfolio investment fails to make
timely principal or interest payments or if a guarantor or
liquidity provider of a portfolio investment fails to honor its
obligations. For fixed rate investments, the negative
perceptions of the ability of an issuer, guarantor or liquidity
provider to make payments or otherwise honor its obligations, as
applicable, could also cause the price of that investment to
decline. The credit quality of the funds portfolio
holdings can change rapidly in certain market environments and
any downgrade or default on the part of a single portfolio
investment could cause the funds share price or yield to
fall. The funds investments in securities with credit or
liquidity enhancements provided by foreign entities may involve
certain risks that are greater than those associated with
investments in securities with credit or liquidity enhancements
provided by U.S. entities. These include risks of adverse
changes in foreign economic, political, regulatory and other
conditions; differing accounting, auditing, financial reporting
and legal standards and practices; differing securities market
structures; and higher transaction costs. In addition, sovereign
risk, or the risk that a government may become unwilling or
unable to meet its loan obligations or guarantees, could
increase the credit risk of financial institutions connected to
that particular country.
Management Risk. Any actively managed mutual fund is
subject to the risk that its investment adviser will make poor
security selections. The funds investment adviser applies
its own investment techniques and risk analyses in making
investment decisions for the fund, but there can be no guarantee
that they will produce the desired results. The investment
advisers maturity decisions will also affect the
funds yield, and in unusual circumstances potentially
could affect its share price. To the extent that the investment
adviser anticipates interest rate trends imprecisely, the
funds yield at times could lag those of other money market
funds.
State Risk. The fund invests primarily in securities
issued by the state of New York and its municipalities. Any
reduction in the credit ratings of obligations of these issuers
could adversely affect the market values and marketability of
such securities, and, consequently, the value of the funds
portfolio. Further, the funds share price and performance
could be affected by local, state and regional factors,
including erosion of the tax base and changes in the economic
climate. National governmental actions, such as elimination of
tax-exempt status, also could affect performance.
Investment Concentration Risk. To the extent that
the fund invests a substantial portion of its assets in
municipal securities financing similar projects, the fund may be
more sensitive to adverse economic, business or political
developments. A change that affects one project, such as
proposed legislation on the financing of the project, a shortage
of materials needed for the project, or a declining need for the
project, would likely affect all similar projects and the
overall municipal securities market.
Taxable Determinations Risk. Some of the funds
income could be taxable. If certain types of investments the
fund buys as tax-exempt are later ruled to be taxable, a portion
of the funds income could become taxable. This risk,
although generally considered low, is somewhat higher for
investments that have been structured as municipal money market
securities than for investments in other types of municipal
money market securities. Any defensive investments in taxable
securities or securities whose interest is subject to the AMT
could generate taxable income.
Liquidity Risk. Liquidity risk exists when
particular investments are difficult to purchase or sell. The
market for certain investments may become illiquid due to
specific adverse changes in the conditions of a particular
issuer or under adverse market or economic conditions
independent of the issuer. The funds investments in
illiquid securities may reduce the returns of the fund because
it may be unable to sell the illiquid securities at an
advantageous time or price. Further, transactions in illiquid
securities may entail transaction costs that are higher than
those for transactions in liquid securities.
Redemption Risk. The fund may experience periods of
heavy redemptions that could cause the fund to liquidate its
assets at inopportune times or at a loss or depressed value,
particularly during periods of declining or illiquid markets.
Redemptions by
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Summary Prospectus February 29, 2012
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Schwab New York AMT Tax-Free Money
Fundtm
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a few large investors in the fund may have a significant adverse
effect on the funds ability to maintain a stable
$1.00 share price. In the event any money market fund fails
to maintain a stable net asset value, other money market funds,
including the fund, could face a market-wide risk of increased
redemption pressures, potentially jeopardizing the stability of
their $1.00 share prices.
Money Market Risk. The fund is not designed to offer
capital appreciation. In exchange for their emphasis on
stability and liquidity, money market investments may offer
lower long-term performance than stock or bond investments.
Performance
The bar chart below shows how the funds Value Advantage
Shares investment results have varied from year to year, and the
following table shows the funds Value Advantage Shares
average annual total returns for various periods. This
information provides some indication of the risks of investing
in the fund. All figures assume distributions were reinvested.
Keep in mind that future performance may differ from past
performance. For current performance information, please see
www.schwab.com/moneyfunds
or call toll-free
1-800-435-4000
for a current
seven-day
yield.
Annual
total returns
(%) as of
12/31
Best
quarter: 0.83% Q2 2007 Worst
quarter: 0.00% Q3 2010
Average
annual total returns
(%) as of
12/31/10
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1 year
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5 years
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10 years
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Value Advantage
Shares®
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0.04%
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1.66%
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1.51%
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Investment
adviser
Charles Schwab Investment Management, Inc.
Purchase
and sale of fund shares
The fund is open for business each day that the New York Stock
Exchange is open except when the following federal holidays are
observed: Columbus Day and Veterans Day.
When you place orders to purchase, exchange or redeem fund
shares through Charles Schwab & Co., Inc. (Schwab) or
another financial intermediary, you must follow Schwabs or
the other financial intermediarys transaction procedures.
Eligible Investors (as determined by the fund and which
generally are limited to institutional investors) may invest
directly in the fund by placing purchase, exchange and
redemption orders through the funds transfer agent.
Eligible Investors must contact the transfer agent by phone or
in writing to obtain an account application. Eligible Investors
may contact the transfer agent:
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by telephone at
1-800-407-0256; or
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by mail in writing at Boston Financial Data Services, Attn:
Schwab Funds, P.O. Box 8283, Boston, MA
02266-8323.
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Set forth below are the investment minimums for the funds
Value Advantage Shares. These minimums may be waived for certain
investors or in the funds sole discretion.
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Minimum
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Minimum initial
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additional
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Minimum
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investment
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investments
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balance
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$25,000 ($15,000 for IRA
and custodial accounts)
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$
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500
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$20,000 ($15,000 for IRA
and custodial accounts)
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Tax
information
Distributions received from the fund are typically intended to
be exempt from federal and New York State and local personal
income tax, including the AMT. The fund may invest a portion of
its assets in securities that generate income that is not exempt
from federal and New York State and local personal income tax.
Further, any of the funds defensive investments in taxable
securities and securities whose interest is subject to the AMT
also could generate taxable income.
Payments
to financial intermediaries
If you purchase shares of the fund through a broker-dealer or
other financial intermediary (such as a bank), the fund and its
related companies may pay the intermediary for the sale of fund
shares and related services. These payments may create a
conflict of interest by influencing the broker-dealer or other
financial intermediary and your salesperson to recommend the
fund over another investment. Ask your salesperson or visit you
financial intermediarys website for more information.
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Summary Prospectus February 29, 2012
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3 of 4
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Schwab New York AMT Tax-Free Money
Fundtm
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Schwab
Funds®
REG54675FLD-05
Schwab
New York AMT Tax-Free Money
Fundtm;
Ticker Symbol: Value Advantage
Shares®: SWYXX
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Summary Prospectus February 29, 2012
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4 of 4
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Schwab New York AMT Tax-Free Money
Fundtm
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