Saving for retirement is one of the most important financial goals that you can have. However, it can also be challenging and overwhelming, especially if you do not have a clear plan or a reliable partner to help you. That is why choosing a 401k plan with a leading provider like Principal Financial Group can be a smart and effective way to save for your future. A 401k plan is a type of retirement plan that allows you to save a portion of your income before taxes in an account that grows over time.
A 401k plan can offer many benefits, such as:
- Reducing your taxable income and saving on taxes
- Receiving employer contributions or matching funds (if available)
- Enjoying tax-deferred growth and compounding interest
- Having a variety of investment options and strategies to suit your risk tolerance and goals
- Accessing online tools and resources to manage your account and track your progress
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In this article, we will explain how to enroll in and use a 401k plan with Principal Financial Group, one of the largest and most reputable retirement plan providers in the US. We will also provide some tips and resources to help you maximize your savings and achieve your retirement dreams.
How to enroll in a 401k plan with Principal Financial Group
If your employer offers a 401k plan with services through Principal, you can enroll online in minutes by following these steps:
- Visit Principal’s website and click on “Log in” at the top right corner.
- Click on “Create an account” and enter your personal information, such as your name, date of birth, Social Security number, email address, and phone number.
- Create a username and password and set up your security questions and answers.
- Review and agree to the terms and conditions and privacy policy.
- Log in to your account and click on “Enroll now” to start the enrollment process.
- Choose how much you want to contribute to your 401k plan each pay period. You can contribute up to $19,500 in 2020 if you are under 50 years old, or up to $26,000 if you are 50 or older1. You can also use the retirement wellness planner tool to estimate how much you need to save to reach your retirement goals2.
- Choose how you want to invest your contributions among the available investment options. You can either select a pre-mixed portfolio based on your risk profile and target date, or create your own portfolio by choosing from various funds across different asset classes and sectors3.
- Review and confirm your enrollment details and submit your application.
- Congratulations! You have successfully enrolled in your 401k plan with Principal.
How to use your 401k plan with Principal Financial Group
Once you have enrolled in your 401k plan with Principal, you can use the online services or phone system to manage your account and track your progress. You can also access various features and benefits that can help you improve your financial situation, such as:
- Account balance: You can see how much money you have in your 401k account at any time by logging into your online account or calling the automated phone system4.
- Account activity: You can see all the transactions that have occurred in your 401k account, such as contributions, withdrawals, transfers, fees, dividends, etc., by logging into your online account or requesting a statement by mail4.
- Investment performance: You can see how well your investments are performing over time by logging into your online account or requesting a performance report by mail4. You can also compare your returns with benchmarks and peers4.
- Investment changes: You can change how you invest your current or future contributions at any time by logging into your online account or calling the automated phone system4. You can also rebalance your portfolio periodically to maintain your desired asset allocation4.
- Loans and withdrawals: You can borrow or withdraw money from your 401k account under certain circumstances and conditions by logging into your online account or calling the customer service center4. However, you should be aware of the potential tax consequences and penalties of doing so4.
- Rollovers: You can roll over money from another retirement plan or IRA into your 401k account or vice versa by logging into your online account or calling the customer service center4. However, you should consider the fees, investment options, tax implications, and other factors before doing so4.
- Education: You can access free online classes, podcasts, videos, blogs, and books that teach you how to save and invest effectively for retirement by visiting Principal’s website or [YouTube channel].
- Advice: You can get personalized advice and guidance from a financial professional about your 401k plan and other financial goals by calling the customer service center or finding a financial professional near you4.
What are the fees associated with a Principal 401k plan?
The fees associated with a Principal 401k plan depend on several factors, such as the size of the plan, the type of investments, and the payment method. According to the web search results, some of the common fees that Principal may charge include:
- Administration fees: These are fees that cover the cost of running and maintaining the plan, such as recordkeeping, compliance, reporting, and communication. These fees may be paid by the employer, the employee, or both. According to one source1, Principal plans cost small businesses an average of $455.94 per participant in administration fees.
- Investment fees: These are fees that cover the cost of managing and operating the investment options in the plan, such as mutual funds, annuities, or collective trusts. These fees are usually deducted from the returns of the investments and may vary depending on the fund’s expense ratio, revenue sharing, or variable annuity wrap. According to one source1, Principal plans charge an average of 0.78% of plan assets in investment fees.
- Other fees: These are fees that cover the cost of specific services or transactions in the plan, such as loans, withdrawals, rollovers, advice, or education. These fees may be charged as a flat dollar amount or a percentage of the transaction value and may vary depending on the frequency or complexity of the service.
To calculate your total 401k fees with Principal, you need to add up their administration and investment fees into a single “all-in” fee. You can express this fee as both a percentage of plan assets and a dollar amount per participant. One source1 provides a spreadsheet that you can use to calculate your all-in fee with Principal using their fee disclosure document. Another source2 provides a simple formula that you can use to calculate your all-in fee with any 401k provider using your annual report.
Saving for retirement is one of the most important financial goals that you can have. However, it can also be challenging and overwhelming, especially if you do not have a clear plan or a reliable partner to help you. That is why choosing a 401k plan with a leading provider like Principal Financial Group can be a smart and effective way to save for your future. A 401k plan with Principal can offer many benefits, such as reducing your taxes, receiving employer contributions, enjoying tax-deferred growth, having a variety of investment options, and accessing online tools and resources. In this article, we have explained how to enroll in and use a 401k plan with Principal, and provided some tips and resources to help you maximize your savings and achieve your retirement dreams. We hope that this article has been helpful and informative for you. If you have any questions or comments about this article, please feel free to contact us. Thank you for reading.
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