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New Principal Fixed Income Guaranteed Option (PFIGO) vintage opening soon

Starting June 1, 2018, Principal Fixed Income Guaranteed Option (PFIGO) will have a new vintage available for new sales. The composite crediting rate for the new vintage — the Vintage-Current— will be 2.50 percent for June 1, 2018 through Nov. 30, 2018*.

We’ll keep the existing vintage

We’ll continue to keep the existing vintage, referred to as the Vintage-Primary for existing plans. The composite crediting rate for this vintage will increase to 1.75 percent for June 1, 2018 through Nov. 30, 2018*.

As a reminder:

  • The composite crediting rate is a dollar weighted average of underlying guaranteed interest rates with both:
    • New guaranteed interest rates opened that provide current market interest rates and
    • Prior guarantees that have been set over time.
  • Due to the older guarantees in the calculations, the composite crediting rate generally declines more slowly than the market in falling interest rate environments and increases more slowly in rising interest rate environments.

Here’s more on how composite crediting rates are reset

What’s this mean for clients using PFIGO?

Existing Principal® clients have options. They can choose to do nothing and leave the plan’s interest in the Vintage-Primary. Or, they can look at other options including moving the plan’s interest to the Vintage-Current. Learn more about these options.

Let’s talk timing

Plans that have an interest in PFIGO will receive notification about the new vintage through the employer website at principal.com on June 1, 2018. You can login to the advisor website at principal.com to access your current client list.

Want to discuss their options with them before that? Here’s an email template to help you get the conversation started.

Questions?

Feel free to contact your Principal representative with any questions.

*This is a gross rate, assuming 0.00 percent is deducted from the composite crediting rate for fees for administrative and recordkeeping services to the plan.

Asset allocation and diversification do not ensure a profit or protect against a loss.

For more information on this or other investment options, visit principal.com, or call 800-547-7754.

This document is not a recommendation and is not intended to be taken as a recommendation. This material was prepared for general distribution and is not directed to a specific individual.

Liquid asset investment options are not insured or guaranteed by the Federal Deposit Insurance Corporation (FDIC), or any other government agency. Although the investment option may seek to preserve the value of an investment, it is possible to lose money by investing in the portfolio.

Principal Fixed Income Guaranteed Option is not FDIC insured and is not an obligation or deposit for any bank nor guaranteed by a bank. The guarantees provided with regard to the Principal Fixed Income Guaranteed Option are supported by the general account of Principal Life.

Principal Fixed Income Guaranteed Option is the Group Annuity Contract - Custodial Guaranteed Interest Contract available through Principal Life Insurance Company, a member of the Principal Financial Group®, Des Moines, Iowa, 50392.

Separate Accounts are available through a group annuity contract with Principal Life Insurance Co. Insurance products and plan administrative services provided through Principal Life Insurance Company, a member of the Principal Financial Group, Des Moines, Iowa 50392. See the group annuity contract for the full name of the Separate Account. Certain investment options and contract riders may not be available in all states or U.S. commonwealths. Principal Life Insurance Company reserves the right to defer payments or transfers from Principal Life Separate Accounts as permitted by the group annuity contracts providing access to the Separate Accounts or as required by applicable law. Such deferment will be based on factors that may include situations such as: unstable or disorderly financial markets; investment conditions which do not allow for orderly investment transactions; or investment, liquidity, and other risks inherent in real estate (such as those associated with general and local economic conditions). If you elect to allocate funds to a Separate Account, you may not be able to immediately withdraw them.

©2018 Principal Financial Services, Inc.

PQ12512A | 481666-042018 | 04/2018

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