AARP is getting out of the mutual fund business. The organization for the 50-and-above set plans to liquidate its five funds "on or about October 1, 2010," according to an SEC filing yesterday.

The AARP Funds yesterday closed to new shareholders.

AARP Funds president Richard "Mack" Hissey told MarketWatch that the funds' board of directors had looked at the possibility of selling the fund family. In the end, they decided to liquidate the funds.

"Liquidation was the best option for shareholders," Hisey was quoted as saying. "There are a number of reasonable alternatives to these funds in the marketplace."

AARP has three stock and one bond fund, which have total AUM of $160 million. Its lineup also includes a money market fund. AARP Financial launched the fund family at the end of 2005. 

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