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Shifting Mindset: Turning Retirement Savings into Retirement Income

The Principal launches innovative new tool for financial professionals

February 3, 2014 (Des Moines, Iowa) — The moment of retirement brings a sudden shift from earning a paycheck and planning for retirement to a new reality and the need for a different income stream. With thousands of baby boomers retiring daily, financial professionals have an opportunity to help these individuals convert retirement savings into retirement income.

Principal Income ProtectorSM, a new easy-to-use tool from the Principal Financial Group®, helps financial professionals develop a customized retirement income plan for their clients. Powered by a proprietary algorithm created by QWeMA (Quantitative Wealth Management Analytics) Group, the tool provides an optimal product allocation strategy to generate a sustainable lifetime income.

"We've reached a demographic tipping point and are in the midst of one of the largest financial transitions in our history, spurred by the 10,000 boomers a day hitting age 65. The paycheck that fueled boomers' savings is gone and with that comes an instant shift in mindset," said Jerry Patterson, senior vice president Retirement and Investor Services for The Principal®. "Through our work with QWeMA, financial professionals now have a simple, yet important tool to help their clients attain financial security in a world without a paycheck."

"We've created a mathematical approach to retirement income that not only helps individuals better plan for the next and important phase of their life. It visually demonstrates the importance of creating sustainable retirement income, " notes Moshe Milevsky, professor at York University, founder of the QWeMA Group, and research director at CANNEX.

Planning and saving for retirement are intuitive goals, but Patterson says planning how to make savings last throughout retirement requires a whole new way of thinking and a more customized approach.

"This phase of life involves many complex decisions about a number of variables against some significant risks," said Patterson. "Without a steady paycheck, spending too much or making investment mistakes can very quickly unravel a lifetime of savings."

Designed specifically for those at the moment of retirement or very near, Principal Income Protector takes into account a wide variety of planning considerations to develop a retirement income plan customized to the needs of each individual. Based on each unique situation, the tool creates an appropriate product allocation that balances guaranteed income and future growth opportunities. Using this approach, the plan can help ensure basic expenses get paid regardless of market performance through guaranteed income sources, while striving to fund discretionary expenses such as travel.

"Retirement income planning is at a critical point and evolving, which is why we've created this latest tool as an important step towards addressing the unique needs of individuals at the moment of retirement," notes Patterson. "The Principal Income Protector tool is designed specifically for financial professionals as they help clients transition into retirement and a new world without a paycheck."

The new tool was revealed to a select group of financial professionals who attended the first-ever Retirement Income Boot Camp sponsored by The Principal. The camp was designed to help advisors turn the moment of retirement into a planning event. Moshe Milevsky; Ed Slott of Ed Slott and Company; and Laurie Santos, director of Yale University's Comparative Cognition Laboratory, were among the national speakers at the event.

Patterson shares extensive research and insights on a range of savings and retirement related topics for those nearing and in retirement in his regular blog on The Huffington Post.

For more news and insights from The Principal, connect with us on Twitter at

About the Principal Financial Group

The Principal Financial Group® (The Principal ®)[1] is a global investment management leader offering retirement services, insurance solutions and asset management. The Principal offers businesses, individuals and institutional clients a wide range of financial products and services, including retirement, asset management and insurance through its diverse family of financial services companies. Founded in 1879 and a member of the FORTUNE 500®, the Principal Financial Group has $466.2 billion in assets under management[2] and serves some 19.0 million customers worldwide from offices in Asia, Australia, Europe, Latin America and the United States. Principal Financial Group, Inc. is traded on the New York Stock Exchange under the ticker symbol PFG. For more information, visit

About QWeMA Group

QWeMA (Quantitative Wealth Management Analytics) Group, a division of CANNEX Financial Exchanges Limited, provides intellectual property, software algorithms, and product solutions in the fields of wealth management, investments, and insurance. QWeMA specializes in the business of retirement income planning including product allocation and annuity valuation services. QWeMA also provides a suite of analytical tools to the financial services industry.

CANNEX Financial Exchanges Limited is an independent and privately held company that compiles data and calculations for a variety of financial products and makes that information available to financial service providers and the media through a central exchange. CANNEX also provides software solutions and analytical services. CANNEX specializes in retirement income services by supplying annuity product information and software to support a variety of research, planning, sales, and operational processes across the industry. For more information about CANNEX, visit

The Principal Income Protector tool provides product allocation strategies to help protect against a shortfall in your retirement income needs. While the tool may provide strategies that recommend investing in products with guaranteed income elements, the guarantees are limited only to those specific products, or product features, and are dependent on the claims-paying ability of the issuing insurance company. The tool's results do not guarantee an overall amount of retirement income and some products still have the potential to lose value.

“The Principal Financial Group” and “The Principal” are registered service marks of Principal Financial Services, Inc., a member of the Principal Financial Group.
As of September 30, 2013.

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