Principal’s New Retirement Plan Option Focuses On Guaranteed Return

Principal Financial Group(R) launched the Principal Guaranteed Option (PGO), a new addition to its suite of fixed income investment options focused on capital preservation and return.

The Principal Guaranteed Option boasts a compelling crediting rate at 3.05%* while providing more choice and flexibility to advisors and plan sponsors as they determine a fixed income strategy for their retirement plan. Regardless of a person's life stage, fixed income investment options, such as the new Principal Guaranteed Option, can strengthen 401(k) portfolio diversity, preserve principal and support performance through differing market cycles.

"Whether navigating volatile markets or needing more predictability and stability in a portion of a participant's long-term savings, the new Principal Guaranteed Option extends our fixed income offering to address these needs," said Jerry Patterson, senior vice president of Retirement and Income Solutions at Principal. "It is one more option that enables plan participants to design an investment portfolio focused on outcomes that are important to them."

Competitive advantage

The Principal Guaranteed Option offers a compelling guaranteed interest rate, while providing flexibility and portability. Unlike other fixed income options, advisors and plan sponsors don't have to sacrifice choice or flexibility to get a guarantee with the Principal Guaranteed Option.

* Capital preservation: seeks to preserve capital and provide a compelling guaranteed credit rate over a full interest rate cycle

* Portability: customers can maintain interest in PGO even if the plan moves to a new recordkeeper

* Accessible: available for 401(k), 401(a)-DC, 403(b), and governmental 457(b) plans

* Guaranteed rates: crediting rates reset every 6 months

* Solid backing: the guarantees are supported by the multi-billion dollar general account of Principal Life Insurance Company

* Rate level flexibility: 14 rate levels available

Providing choice and flexibility for advisors

"Advisors and plan sponsors want choice and flexibility as they look to select a fixed income investment option that meets the diverse savings needs and objectives of retirement plan participants," added Patterson. "We've delivered that with PGO and will continue to look for more ways to help people reach their financial goals and feel more confident about their future."

Principal has also developed a new online resource hub for advisors to support their conversations with plan sponsors about fixed income investment options, as they evaluate which best meets their retirement plan objectives. Additional features include videos, fact sheets, articles and client-ready materials about fixed income, capital preservation and return-focused products. Advisors are encouraged to visit principal.com/fixedincome to learn more.