Asset Allocation: Strategies: Target-Date
The Principal LifeTime Funds are professionally designed to help simplify asset allocation decisions.
The Principal LifeTime Funds are "fund-of-funds" investments — mutual funds that invest in other mutual funds. They provide asset allocation mixes that evolve over time, taking advantage of growth potential when appropriate and lowering risk exposure when it's time to focus on income. You can choose among six different Principal LifeTime Funds by simply selecting the target date that most closely matches your time horizon, such as the date you anticipate retiring.*
The Principal LifeTime Funds may be appropriate for retirement planning, college funding, or other long-term goals as you reach your target year. You can use the Principal LifeTime Funds in conjunction with other investments or as your primary asset allocation tool. Either way, you'll enjoy professional asset allocation, rebalancing, and portfolio adjustments for a lifetime of investing.
Principal LifeTime Funds Allocations - Target Allocations*:
|Principal Funds, Inc.||Fixed Income||U.S. Equity||Non-U.S. Equity||Global Equity||Real Estate||Alternative Assets|
|Principal LifeTime Strategic Income Fund||66.25%||13.95%||5.05%||1.00%||0.00%||13.75%|
|Principal LifeTime 2010 Fund||49.40%||26.50%||10.30%||1.70%||0.00%||12.10%|
|Principal LifeTime 2020 Fund||32.20%||37.50%||14.40%||4.75%||3.00%||8.15%|
|Principal LifeTime 2030 Fund||21.00%||46.25%||17.90%||5.10%||4.75%||5.00%|
|Principal LifeTime 2040 Fund||10.70%||52.50%||21.45%||5.75%||5.30%||4.30%|
|Principal LifeTime 2050 Fund||5.05%||55.55%||23.80%||6.60%||5.50%||3.50%|
- Allocations listed above may not reflect current portfolio composition.
- Asset allocation/diversification does not guarantee a profit or protect against a loss.
- Equity investment options involve greater risk, including heightened volatility, than fixed-income investment options. Fixed-income investment options are subject to interest rate risk, and their value will decline as interest rates rise.
- In total, there are 12 funds in the suite of Principal LifeTime portfolios encompassing target dates in 5 year increments up to the year 2060. Information on additional share classes of these funds can be found on www.principalfunds.com.
The Principal LifeTime Funds, which are target-date funds, invest in underlying Principal Funds. Each Principal LifeTime Fund is managed toward a particular target (retirement) date, or the approximate date the participant or investor starts withdrawing money. As each Principal LifeTime Fund approaches its target date, the investment mix becomes more conservative by increasing exposure to generally more conservative investment options and reducing exposure to typically more aggressive investment options. The asset allocation for each Principal LifeTime Fund is regularly re-adjusted within a timeframe that extends 10-15 years beyond the target date, at which point it reaches its most conservative allocation. Principal LifeTime Funds assume the value of the investor's account will be withdrawn gradually during retirement. Neither the principal nor the underlying assets of the Principal LifeTime Funds are guaranteed at any time, including the target date. Investment risk remains at all times.
Investing in real estate, small-cap, international, and high-yield investment options involves additional risks. Additionally, there is no guarantee an asset allocation investment option will provide adequate income at or through retirement.
Fixed-income and asset allocation investment options that invest in mortgage securities are subject to increased risk due to real estate exposure.
Neither the principal nor the underlying assets of target-date investment options are guaranteed at any time, including the target date, and investment risk remains at all times.
To obtain a prospectus, download online or call Sales Support at 1.800.787.1621
While this communication may be used to promote or market a transaction or an idea that is discussed in the publication, it is intended to provide general information about the subject matter covered and is provided with the understanding that The Principal® is not rendering legal, accounting, or tax advice. It is not a marketed opinion and may not be used to avoid penalties under the Internal Revenue Code. You should consult with appropriate counsel or other advisors on all matters pertaining to legal, tax, or accounting obligations and requirements. For more information about our funds, including their full names, please see the Principal Funds, Inc. prospectus or call Sales Support at 1.800.787.1621.
Investing involves risk, including possible loss of principal.
Principal Funds are distributed by Principal Funds Distributor, Inc.
Not FDIC Insured - May Lose Value - No Bank Guarantee