Products October 16, 2014

Principal Launches Two New Fixed-Income Funds

October 16, 2014 (PLANSPONSOR.com) – Principal Funds has premiered two funds designed to meet client demand for flexible fixed-income strategies.
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The Principal Credit Opportunities Explorer Fund (PCEAX) and the Principal Dynamic High Yield Explorer Fund (PDYAX) are both are available to institutional investors.

“We believe fixed income is a critical part of any well-diversified portfolio,” says Nora Everett, president and CEO of Principal Funds. “Fixed-income investors are looking for adequate yield and effective ways to manage interest rate exposure, and these new funds address those needs and risks.”

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The Principal Credit Opportunities Explorer Fund seeks to achieve long-term returns composed of income and capital appreciation by opportunistically investing across the broad credit spectrum. The fund aims to reduce risk by using volatility-mitigation strategies in addition to considerable flexibility in managing interest rate exposure.

The Principal Dynamic High Yield Explorer Fund is designed for investors seeking high yield bond strategies that manage interest rate risk while providing the best possible total return opportunity within the high yield asset class.

The typical minimum investment for the funds’ I shares is $1 million; for A and C shares the minimum is $1,000. Other share classes, falling within defined benefit (DB) or defined contribution (DC) plans, require no minimum.

Both funds are managed by the Principal Global Investors fixed-income team, which the company credits with more than 30 years’ experience in managing multi-sector fixed-income strategies. The team manages $78.6 billion in fixed-income assets.

Principal Funds is a provider of mutual funds, with $118.5 billion in assets under management (AUM). 

Products October 16, 2014

The Principal Unveils Retirement Wellness Scores

October 16, 2014 (PLANSPONSOR.com) – The Principal Financial Group has introduced a personalized, at-a-glance retirement wellness scoring system for retirement plan participants.
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The Principal says the personalized Retirement Wellness Score is one feature of a broad new participant digital experience it is bringing to retirement plan clients. As explained by the firm, the score represents the percentage of a participant’s pre-retirement income that they will likely be able to maintain in retirement, ranging from 0% to 100% or higher. The score is based on account balances; contribution levels in defined contribution, defined benefit and nonqualified plans; an estimate of income from Social Security; outside savings entered by the participant; and other assumptions and data.

“It’s important to begin the retirement-planning process with a goal in mind—a desired outcome,” explains Jerry Patterson, senior vice president of retirement and investor services at The Principal. “We believe the Retirement Wellness Score is a great place to begin. This one number, displayed front and center on every participant’s account home page, allows them to know in real time whether they’re on track for a secure retirement.”

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The score is embedded in an intuitive color-coded display system that represents different ranges of income replacement. Participants with a score of 70% and above fit into the green group, while those with a 50% to 69% percent income replacement score are placed in the yellow category. The red group is for those with less than a 49% projected income replacement ratio. The Principal says the color-coding system helps motivate participants to take positive action to improve their retirement outlook.

Other features of the improved participant digital experience include expanded account management and educational resources and services. Mobile-friendly functionality and streamlined designs have also been introduced based on feedback from participants, plan sponsors, advisers and experts in behavioral finance and digital design. The new platform will be fully launched by the end of the year, according to The Principal.

Patterson says the digital enhancements are part of a new approach to workplace retirement readiness called Principal PlanWorks, a platform of capabilities and services designed to make retirement plans work better for both participants and plan sponsors through plan design, participant experience and strategic measures.

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