Risk-based
Glidepaths
Fiduciary to glidepath creation and asset allocation
Largest asset manager in the world with over $10 trillion in AUM
Works with 60% of Fortune 100 firms
Inventor of the target date fund (1993)
Multiple glidepaths allow participants to easily choose their own path to retirement based on their personal needs and preferences
Independent Underlying
Fund Selection
Fiduciary to underlying investment selection and monitoring
Largest provider of multiple-glidepath target date funds in the industry
Fastest growing target date fund manager with over $36 billion in AUM
Robust investment search processQuantitative research driven by the Scorecard SystemTM, used by 3,000+ retirement financial professionals with over $800 billion in assets
Qualitative research driven by committee of 9 CFA charterholders
Exclusive to Principal Retirement Plans
Index management by BlackRock, the largest index manager in the world and inventor of the index fund (1971)
Incorporates stable value with the goal of improving portfolio stability and risk-adjusted returns
Low cost
Discover Your PATH to Retirement
The Discover Your PATH tool is designed to measure your need to take investment risk, based on your projected savings at retirement. Risk tolerance is a combination of both desire and need to take investment risk. Many investors have an intuitive understanding of their desire to take investment risk, but may need a helping hand to better understand their need to take investment risk. Generally, investors who are on track for retirement can afford to de-risk and invest more conservatively to emphasize stability of their hard earned assets. On the other hand, investors who are behind saving for retirement may need to invest more aggressively to emphasize growth, and/or begin saving more in order to make up for a shortfall of current savings.
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Conservative PATH
Risk is limited because enough has been or is being saved to live on during retirement. The goal is to achieve a more consistent retirement income pattern throughout retirement.
Conservative PATH characteristics:
- Retirement savings rate more than 12%
- High account balance
- Emphasis on stability and capital preservation in retirement
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Moderate PATH
Risk can be moderate because current savings will accomplish most retirement goals. Additional risk is necessary to fully achieve all retirement goals, balanced with a more consistent income pattern.
Moderate PATH characteristics:
- Retirement savings rate between 6-12%
- Average account balance
- Balance stability and long-term return in retirement
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Aggressive PATH
Risk is greater because current savings alone will not be enough to reach most retirement goals. The goal is to generate greater expected return through riskier investments in order to supply adequate income at and throughout retirement.
Aggressive PATH characteristics:
- Retirement savings rate less than 6%
- Low account balance
- Emphasis on long-term return in retirement