Principal 401k Rollover: Complete Transfer Guide
How to roll over your Principal Financial 401(k) to an IRA after leaving your job. Step-by-step instructions and options explained.
Key Takeaways
- 1Principal rollovers can be initiated online at principal.com
- 2Choose direct rollover to avoid 20% tax withholding
- 3Compare Principal IRA vs other providers for best options
- 4Gold IRA provides diversification beyond Principal's offerings
- 5Process typically takes 7-10 business days
- 6No taxes or penalties if rolled over correctly
- 7Contact Principal at 1-800-547-7754 for rollover questions
Principal 401(k) Rollover Overview
Principal Financial Group is one of the largest 401(k) providers in America, serving thousands of employer plans. When you leave your employer, you gain the right to roll your Principal 401(k) to an IRA of your choice.
- Principal serves over 40,000 employer retirement plans
- Rollover rights activate when you leave employment
- Can roll to Principal IRA or any other IRA provider
- Same process for voluntary departure, layoff, or retirement
- Roth 401(k) portions roll to Roth IRA
Your Rollover Options
You have several choices when rolling over from Principal. Don't feel obligated to stay with Principal.
- **Principal IRA**: Convenient but may have limited investment options
- **Discount broker IRA** (Fidelity, Schwab, Vanguard): Lower costs, more choices
- **Gold IRA**: Physical precious metals for diversification
- **New employer's 401(k)**: If they accept rollovers
- **Leave it**: Possible but not recommended (forgotten money)
Compare Before Deciding
Principal IRAs may charge higher fees than discount brokers. Compare expense ratios and account fees before automatically rolling to a Principal IRA.
How to Roll Over Your Principal 401(k)
Principal offers multiple ways to initiate your rollover.
- 1Log into your account at principal.com
- 2Navigate to "Withdrawals and Rollovers" section
- 3Select "Rollover to IRA" option
- 4Open an IRA at your chosen destination (if not already done)
- 5Provide destination account information
- 6Choose direct rollover (trustee-to-trustee)
- 7Complete electronic signature or request mailed paperwork
- 8Monitor transfer and confirm receipt at new institution
Phone Option
Prefer to talk to someone? Call Principal at 1-800-547-7754. Representatives can walk you through the rollover process.
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Timeline & What to Expect
Understanding the timeline helps you plan and avoid surprises.
| Step | Typical Timeline |
|---|---|
| Submit rollover request | Day 1 |
| Principal processes request | 3-5 business days |
| Funds transferred/check mailed | 5-7 business days |
| Funds appear in new IRA | 7-10 business days total |
| Check deposits (if mailed) | Add 5-7 days for mail + deposit |
Key Considerations Before Rolling Over
Think through these factors before initiating your rollover.
- **Outstanding loans**: Must repay or it becomes a distribution
- **Company stock**: Special tax treatment (NUA) may apply
- **Stable value fund**: May have surrender restrictions
- **Age considerations**: Rule of 55 penalty exemption lost if you roll over
- **Creditor protection**: 401(k) has stronger federal protection than IRA
Consider Rolling to a Gold IRA
Principal 401(k) plans typically offer stocks, bonds, and target-date funds - but no precious metals. A Gold IRA rollover gives you access to physical gold and silver that most 401(k)s don't offer.
- Diversify beyond Principal's stock/bond funds
- Physical gold provides inflation protection
- Same tax-free direct rollover process
- Can roll partial amount to Gold IRA, rest to traditional IRA
- No penalties when done correctly
- Augusta Precious Metals specializes in 401(k) rollovers
Frequently Asked Questions
1Can I roll over if I still work for my employer?
Generally no - you must leave employment first. However, if you're over 59½, some Principal plans allow in-service rollovers. Check your specific plan documents or call Principal.
2What if I have a loan on my Principal 401(k)?
Loans must be repaid before rolling over, or the outstanding balance is treated as a distribution (taxable + potential 10% penalty). Some plans give you 60 days after leaving to repay.
3Can I roll over to multiple accounts?
Yes. You can split your Principal 401(k) between multiple IRAs - for example, 70% to a traditional IRA and 30% to a Gold IRA.
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