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The Principal® Difference: An Investment Platform for Retirement Plans

At the Principal Financial Group®, we understand the challenging fiduciary responsibilities you face regarding the selection and ongoing monitoring of investment options made available within your retirement plan. The member companies of The Principal make available investment fiduciary support and services to help you manage this critical responsibility.

Providing you choice

You can select from our Sub-Advised Investment Options that are designed to be appropriate for retirement savings under employer-sponsored plans. They cover a wide range of asset classes and are managed by some of the industry's leading investment firms.

Through our comprehensive due diligence process The due diligence process and reporting are services provided by Principal Life Insurance Company, a member of the Principal Financial Group®., we screen and select premier investment managers whose areas of specialty complement our investment objectives. That institutional approach allows us to deliver an attractive mix of more than 70 Sub-Advised Investment Options managed by more than 30 investment managers[2], all of whom are vetted by our due diligence process.

For even more choice and flexibility, the Mutual Fund Network is available - a vast menu of investment choices featuring over 3,000 mutual funds from more than 170 fund families[3]. Together with our Sub-Advised Investment Options, this brings financial professionals and plan sponsors the choice, flexibility and asset management expertise to help meet the retirement needs of the participants they serve. In addition, we make available access to more than 20,000 additional mutual funds from third party companies through the National Securities Clearing Corporation.

Due diligence forms the foundation

The Principal® understands the fiduciary responsibilities plan sponsors face in developing and monitoring an investment lineup appropriate to help meet the diverse needs of retirement plan participants. We undertake a rigorous due diligence process as a direct response to this challenge, resulting in a key differentiator -- our Sub-Advised Investment Options[3]:

We perform quantitative and qualitative reviews of our Sub-Advised Investment Options allowing us to have fiduciary oversight and the ability to oversee the investment manager selection and ongoing monitoring process. Our team uses sophisticated analytics and independent third party metrics and market indices, providing a consistent process to evaluate and monitor the investment options we make available on our investment platform. Through the due diligence process we identify, hire and monitor a select group of investment managers that are typically only available to large, institutional retirement plans. Through this defined and proven process, Principal Life Insurance Company makes available to you and your financial professionals a level of indemnification and fiduciary support.

Investment fiduciary support & services

With education from your financial professional and third party administrator, you have a choice to receive a level of indemnification protection against three key areas of fiduciary concern:

  • Broad Range Requirement under ERISA 404(c)
  • Qualified Default Investment Alternative (QDIA)
  • Prudent selection and monitoring

While our due diligence process forms the foundation of the prudent selection and monitoring coverage, we make available additional investment fiduciary support & services to choose from. Let the range of Investment Fiduciary Support & Services we make available help you feel more confident and in control when selecting investment options for your retirement plan's lineup.

Helping to meet your plan participant's investment needs

To help you meet the diverse needs of your retirement plan participants, we provide a wide range of asset allocation choices. Our asset allocation flexibility gives your plan participants:

  • Access to broadly-diversified investment choices
  • Choices to streamline their investment decision making process
  • Comprehensive selection of asset allocation choices

The Principal LifeTime portfolios, which are target date portfolios, invest in underlying Principal Funds. Each Principal LifeTime portfolio is managed toward a particular target (retirement) date, or the approximate date the participant or investor starts withdrawing money. As each Principal LifeTime portfolio approaches its target date, the investment mix becomes more conservative by increasing exposure to generally more conservative investment options and reducing exposure to typically more aggressive investment options. The asset allocation for each Principal LifeTime portfolio is regularly re-adjusted within a time frame that extends 10-15 years beyond the target date, at which point it reaches its most conservative allocation. Principal LifeTime portfolios assume the value of the investor's account will be withdrawn gradually during retirement. Neither the principal nor the underlying assets of the Principal LifeTime portfolios are guaranteed at any time, including the target date. Investment risk remains at all times.

Principal TrustSM Target Date Funds may invest in various types of investments including underlying Principal Funds and each is managed toward a particular target (retirement) date, or the approximate date the participant or investor starts withdrawing money. As each Principal Trust Target Date Fund approaches its target date, the investment mix becomes more conservative by increasing exposure to generally more conservative investment options and reducing exposure to typically more aggressive investment options. The asset allocation for each Principal Trust Target Date Fund is regularly re-adjusted within a time frame that extends 10-15 years beyond the target date, at which point it reaches its most conservative allocation. Principal Trust Target Date Funds assume the value of the investor's account will be withdrawn gradually during retirement. Neither the principal nor the underlying assets of the Principal Trust Target Date Funds are guaranteed at any time, including the target date. Investment risk remains at all times.

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Have questions?

Contact a local representative today for more information or to find a financial professional in your area.

[1]
This is for informational purposes only and does not affect those terms and provisions of the investment fiduciary support and services document(s). For comprehensive details on investment fiduciary support and services, see the applicable Investment Fiduciary Support & Services Terms & Conditions document(s).
[2]
The due diligence process and reporting are services provided by Principal Life Insurance Company, a member of the Principal Financial Group®.
[3]
As of June 30, 2012.

Sub-Advised Investment Options include Separate Accounts available through a group annuity contract with Principal Life Insurance Company and mutual funds available through the Principal Funds, Inc. Separate Accounts are made available through a group annuity contract with the Principal Life Insurance Company, Des Moines, IA 50392. Securities are offered through Princor Financial Services Corporation, 800.547.7754, Member SIPC and/or independent broker/dealers. Securities sold by a Princor Registered Representative are offered through Princor®. Principal Funds Distributor, Princor, and Principal Life are members of the Principal Financial Group, Des Moines, IA 50392. They may not be available in all states or U.S. commonwealths. Ask your representative for more details

Investors should carefully consider a mutual fund's investment objectives, risks, charges, and expenses prior to investing. A prospectus, or summary prospectus if available, containing this and other information can be obtained by contacting a financial professional, visiting principal.com, or calling 1.800.547.7754. Read the prospectus carefully before investing.

Before directing retirement funds to a separate account, investors should carefully consider the investment objectives, risks, charges and expenses of the separate account as well as their individual risk tolerance, time horizon and goals. For additional information contact us at 1.800.547.7754 or by visiting principal.com.

The investment fiduciary support and services apply to covered plan investment options that are part of a Qualified Retirement Plan recordkept by Principal Life. 404(c) and QDIA coverage applies only to plans subject to ERISA. No member company of The Principal assumes any additional fiduciary responsibility for any nonqualified deferred compensation plan. No part of the investment fiduciary support and services applies to nonqualified deferred compensation plans subject to 409(A), 457(f) or 457(b) plans for employers under ยง457(e)(1)(B). For purposes of plans not subject to ERISA, Principal Life indemnifies, where applicable, the Plan Representative who signs the Service Agreement.

Investment options are subject to investment risk. Shares or unit values will fluctuate and investments, when redeemed, may be worth more or less than their original cost. This does not apply, however, to the guaranteed portions of group annuity contracts issued by Principal Life that constitute guaranteed benefit policies as defined in ERISA §401(b)(2)(B).

Asset allocation does not guarantee a profit or protect against a loss. Investing in real estate, small-cap, international, and high-yield investment options involves additional risks. Additionally there is no guarantee this type of investment option will provide adequate income at or through retirement.

Equity investment options involve greater risk, including heightened volatility, than fixed-income investment options.

Investment options are subject to investment risk. Shares or unit values will fluctuate and investments, when redeemed, may be worth more or less than their original cost.

Principal Life is not a fiduciary in the broader context of operating any plan. The selection of any investment options on behalf of a plan is the fiduciary responsibility of the appropriate plan fiduciary, which is not Principal Life, nor any affiliate. Principal Life does not guarantee performance of any investment option [other than the portion of a group annuity contract that constitutes a guaranteed benefit policy as described in ERISA §401(b)(2)]. Principal Life does not guarantee that any investment option will meet the criteria of any particular plan's investment policy statement, include reasonable fees, or otherwise be suitable for use by any specific plan. The fiduciary tasks undertaken by Principal Life do not eliminate all responsibilities of the relevant plan fiduciaries for the prudent selection of any investment option for a retirement plan. Plan fiduciaries remain subject to a varying amount of ongoing responsibility, depending on the structure of the plan the fiduciary serves and the nature of the plan fiduciary's position. Please consult with your counsel or other adviser as to the responsibility of a plan fiduciary with regard to the selection or retention of any plan investment option by a plan fiduciary.

Delaware Charter Guarantee & Trust Company, conducting business as Principal TrustSM Company ("Principal Trust") is a member of the Principal Financial Group®. The Principal TrustSM Target Date Funds, is a series of collective investment funds maintained by Principal Trust, as trustee, under the Plan and Declaration of Trust of Principal TrustSM Target Date Collective Investment Funds, as amended from time to time ("Trust"). Principal Management Corporation ("PMC"), an affiliate of Principal Trust, provides nondiscretionary advisory services to Principal Trust with respect to the Principal Trust Target Date Funds. Principal Trust and PMC are fiduciaries subject to the Employee Retirement Income Security Act of 1974, as amended.

Principal Trust Target Date Funds are available only to qualified plans and governmental 457(b) plans. They are not mutual funds and are not registered with the Securities and Exchange Commission, the State of Delaware or any other regulatory body. Principal Trust Target Date Funds are not guaranteed by Principal Trust, PMC, any of their affiliates, the FDIC or any other governmental agency.

The value of the Principal Trust Target Date Funds will fluctuate so that when redeemed, shares or units may be worth more or less than the original cost. Past performance is no guarantee of future results.

Participation in the Principal Trust Target Date Funds is governed by the terms of the Trust and a Participation Agreement, the form signed by the retirement plan's fiduciary at the time the plan invests in the Principal Trust Target Date Funds. The retirement plan's fiduciary will also be provided with a Principal Funds, Inc. Institutional Class Shares Prospectus ("Prospectus") before the plan invests in the Principal Trust Target Date Funds. The Trust and Prospectus are available from Principal Trust or Principal Life by visiting us at principal.com. A copy of the Participation Agreement can be obtained from your plan administrator.

Insurance products and plan administrative services are provided by Principal Life Insurance Company. Principal Funds, Inc., is distributed by Principal Funds Distributor, Inc. Securities are offered through Princor Financial Services Corporation, 800.547.7754, Member SIPC and/or independent broker/dealers. Securities sold by a Princor® Registered Representative are offered through Princor. Principal Funds Distributor, Princor and Principal Life are members of the Principal Financial Group®, Des Moines, IA 50392. Separate Accounts are made available through a group annuity contract with Principal Life, Des Moines, IA 50392. They may not be available in all states or U.S. commonwealths. Ask your representative for more details.

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Learn More

Forming an Investment Committee can help plan sponsors manage their fiduciary obligations.

Investment Committee Best Practices. (PDF: 446 KB)

Investment Committee Best Practices.

Have a question? Call us at 1.800.986.3343

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