Retirement funds from a former employer account
Savings you had in a former employer's retirement plan may have moved out of the plan and into an automatic rollover IRA(1) with Principal Bank®. This typically happens if:
- Your previous employer doesn’t allow former employees with retirement plan account balances of under $5,000 to keep their funds in its retirement plan. Rather than paying you the balance in cash, the law allows the employer to automatically roll over any savings under $5,000 to an IRA.
- The employer closes its retirement plan.
In either case, you'll receive information about the options for the account, including any fees and a decision due date. If you don’t decide what to do with your savings by this date, the retirement funds transfer to an automatic rollover IRA.
This is where Principal Bank comes in. Your former employer has an agreement with us to open this automatic rollover IRA on your behalf. Your funds earn interest and are protected by the Federal Deposit Insurance Corporation (FDIC) up to $250,000 per depositor.
Think of an automatic rollover IRA as a temporary parking spot until you decide what to do with your retirement savings. These accounts aim to minimize investment risk and preserve savings until you find the right spot for your money.
Manage your savings.
You should receive information from us within 10 business days after your automatic rollover IRA is opened. Your first step is to confirm your identity.
Once you confirm your identity, you can do all of this and more:
- Convert your Principal Bank® Automatic Rollover IRA to a Principal Bank CD or money market IRA, or another product with Principal® such as an annuity or mutual fund.
- Make additional deposits to your IRA.
- Roll over your funds to an IRA at another financial institution or another employer-sponsored retirement savings plan.
- Withdraw your funds. (You may face penalties if you're under age 59½.)
Footnote
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Principal Bank® IRA:
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- Annual fee: $15 charged on the anniversary date of account opening after start of first year. Fee waived for balances $10,000 and above.
- Closing fee: $30. Waived if funds transfer to a Principal Bank or Principal Financial Group® (Principal®) product.
- Funds placed in an interest-bearing savings account.
- Funds held in a Principal Bank® IRA are FDIC-insured up to $250,000 per depositor.
- Confirmation mailed once IRA is set up.
Bank products and services are provided through Principal Bank®, Member FDIC. Insurance products and plan administrative services provided through Principal Life Insurance Company®. Securities offered through Principal Securities, Inc., 800-547-7754, Member SIPC and/or independent broker-dealers. Annuities, insurance, retirement plans, mutual funds and other securities are not insured by the FDIC, are not obligations or deposits for Principal Bank® nor guaranteed by Principal Bank, and involve risk, including possible loss of the principal invested.