Registered-index linked annuity options

Give clients more investment control with a registered-index linked annuity (RILA)

Woman in a meeting room speaking to another person with their back to the camera.

RILAs offer defined outcome investment options that allow clients to personalize their investment strategies.

Segment options
Segments of one, two, and six years.

Level of protection
Buffers, floors, peak buffer, or a fixed account.

Investment growth strategies
Multiple indices available.

Choosing an investment segment

Clients can choose one or more investment options called segments. Each segment is linked to a specific index for a defined length of time. Some protection against investment loss is available with either a buffer or a floor. A fixed segment option is also available.

Clients can mix segment options to help diversify their investment and to help manage their comfort with financial risk.

Graph showing correlation between longer investment lengths and higher participation rates.

Investing in longer segments give clients higher participation rates, and the opportunity for higher account gains. Shorter segments provide them with more investment flexibility by allowing them to move assets around more frequently.

Segment performance lock-in

The segment lock-in feature comes automatically at no extra charge. It allows clients to lock in the performance of their segment, removing them from market movement until the next segment anniversary. A different performance lock-in can be chosen for each segment clients invest in.

The performance threshold can be set in advance, activating the lock-in feature if predetermined performance levels are met. Or performance can be locked in at any time. And this can all be done online at principal.com.

Understanding levels of investment protection

Each segment option offers a protection strategy to help protect clients from some investment loss.

Graph illustrates how the buffer and floor help protect an investor from the first 10% of losses, and how a floor absorbs losses

Dual direction crediting - here's how the peak buffer works

Graph illustrates how a peak buffer segment is a dual direction crediting option. It offers you positive credits even in down ma

We also offer full protection options

We offer a fixed segment, as well as an indexed-linked segment with a 0% floor. Both of these provide an opportunity to allocate assets without risk of losing any account value due to market performance.

Amounts allocated to a fixed segment option earn interest at the applicable annual interest rate for the segment term. The annual interest rate declared at the beginning of the segment term is guaranteed until the segment end date.

Available indices and growth strategies

Growth within a RILA depends on the performance of a segment’s linked index. Point-to-point index crediting is used to calculate change from the segment start date to its end date.

Three well-known indices are available as well as a sustainability index not currently available in other investment products. (The MSCI EAFE index segments are not available with Principal® Strategic Income.)

S&P 500®    Russell 2000®    MSCI EAFE    SG Smart Climate

Caps and participation rates and how they affect client returns

Graph showing how participation rates and investment caps can affect client returns.

Give clients an extra performance boost

Principal Strategic Outcomes offers an optional rate enhancement rider that provides higher participation rates and caps. This rider is available for a fee and will result in greater gains to the account value in positive performing markets. The rate enhancement rider is not available with Principal® Strategic Income.

Graph showing how the optional rate enhancement rider can provide higher returns for investors.

These figures are hypothetical and do not guarantee any future returns nor represent the performance of any particular investment.
These examples are for illustrative purposes only.

If you allocate your accumulated value to the fixed segment option, the value of that segment at any time will be equal to the accumulated value allocated on the fixed segment start date, plus interest during the segment term and minus any amount deducted during the segment term.

Learn more

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For Financial Professional use only.

May not be available in all states or with all broker dealers.

Principal® Strategic Outcome and Principal® Strategic Income do not directly participate in any stock, equity investments or index. It is not possible to invest directly in an index.

Investing involves risk, including the possible loss of principal.

Before investing in variable annuities, investors should carefully consider the investment objectives, risks, charges and expenses of the contract and underlying investment options. This and other information is contained in the free prospectus which can be obtained from your local representative or online at principal.com. Please read the prospectus and, if available, the summary prospectus carefully before investing.

IMPORTANT CONSIDERATIONS
Index-linked deferred annuity contracts are complex insurance and investment vehicles. This contract is a security and there is a risk of substantial loss of principal and earnings. The risk of loss may be greater when early withdrawals are taken due to any charges and adjustments applied to such withdrawals. These charges and adjustments may result in loss even when the value of a segment option has increased. Clients should consult with a financial professional about the appropriateness of this product based on their financial situation and objectives.

There is risk that this segment interim value could be less than the original premium payment even if the applicable Index has been performing positively. The buffer or floor rate provides limited protection. There is a possibility of a significant amount of loss of the total premium payment, credited interest and prior earnings. In the index-linked segment options it is possible that the total loss could be 100%. If clients choose to allocate amounts to an index-linked segment option subject to a cap rate, that rate limits the positive index change, if any, that may be credited to the annuity for a given segment term. The participation rate limits the positive index change, if any, that may be credited to the annuity for a givensegment term. It is possible to receive less than the full protection of the buffer rate or floor rate. Once a segment lock-in is executed, it is irrevocable for that segment term. A lock-in will not be applied retroactively and can only be exercised for the entire segment option. A segment lock-in may only be exercised once per segment term for each index-linked segment option. There is no guarantee that any particular segment option or index will be available during the entire period.

Withdrawals will reduce the contract value and death benefit. Some withdrawals may be subject to additional charges and adjustments. Withdrawals before age 591/2 may be subject a 10% early withdrawal federal tax penalty in addition to ordinary income taxes.

Guarantees are based on the claims-paying ability of Principal Life Insurance Company®. All guarantees and benefits of the insurance policy are backed by the claims-paying ability of the issuing insurance company. Policy guarantees and benefits are not obligations of, nor backed by, the broker/dealer and/or insurance agency selling the policy, nor by any of their affiliates, and none of them makes any representations or guarantees regarding the claims-paying ability of the issuing insurance company.

Contract rider descriptions are not intended to cover all restrictions, conditions or limitations. Refer to rider for full details.

The subject matter in this communication is educational only and provided with the understanding that Principal® is not rendering legal, accounting, investment or tax advice. You should consult with appropriate counsel, financial professionals, and other advisors on all matters pertaining to legal, tax, investment or accounting obligations and requirements.

Annuity products and services are offered through Principal Life Insurance Company®. Securities offered through Principal Securities, Inc., member SIPC, and/or independent broker/dealers. Referenced companies are members of the Principal Financial Group®, Des Moines, Iowa 50392, principal.com.

Annuities have limitations. They are long-term vehicles designed for retirement purposes. Annuities are not intended to fund short-term savings goals.

Principal®, Principal Financial Group®, and Principal and the logomark design are registered trademarks of Principal Financial Services, Inc., a Principal Financial Group company, in the United States and are trademarks and services marks of Principal Financial Services, Inc., in various countries around the world.

© 2024 Principal Financial Services, Inc.

Principal® Strategic Income: SF 1027, SF 1028, SF 1029, SF 1031, SF 1032, SF 1053, SF 1054, SF 1055, ICC13 SF 932 / SF 932

Principal® Strategic Outcomes: Contract: SF 1027Riders/Endorsements: SF 1028, SF 1029, SF 1030, SF 1031, SF 1032, and SF1053

Not FDIC or NCUA insured
May lose value • Not a deposit • No bank or credit union guarantee
Note insured by any federal government agency