Fill - What to do with your retirement savings (Constant Contact)

Important information

for retirement plan participants

Know your options:

What to do with your retirement savings

It’s important to understand the options for the savings you have

in your former employer’s retirement plan. If you are eligible to

take your money out (this is known as a distribution), there are

typically four possible options.

There are advantages and drawbacks for each option. You should

consider the differences in investment options, fees and expenses,

tax implications, services and penalty-free withdrawals.

This summary can help you identify some important considerations.

There may be other factors to consider due to your specific needs

and situation. You may wish to consult with your tax or legal advisor.

Retirement Savings Options

• Roll savings into an individual

retirement account (IRA)

• Keep savings in your former employer’s

retirement plan

• Roll savings to your new employer’s

retirement plan

• Cash out savings and close the account

(May use a combination of these options)

Roll savings into an IRA

Advantages Drawbacks

• Maintains tax-deferred status of savings

• Continue to make contributions and save for retirement

• Combine other qualiﬁed plans or IRA savings into one account

• Oers greater control as it’s your account and you make

the decisions

• Oers broad range of investment options to ﬁt needs as

they change over time

• Protected from bankruptcy

• May have the services of a ﬁnancial professional to help with

investing and retirement planning

• Flexibility when setting up periodic or unscheduled withdrawals

• May help with planning and managing required minimum

distributions at age 72 (70½ prior to 01/01/2020)

• Investment expenses and account fees may be higher

than those of employer plans

• No ﬁduciary required to prudently monitor the cost

and quality of the investment options

• IRS penalty-free withdrawals generally not allowed

until age 59½

• Loans not allowed. Can only access money by taking

a taxable distribution

• Limited protection from creditors

• In-kind transfers of company stock to an IRA will result

in appreciated value being taxed as ordinary income at

withdrawal from the IRA

Retirement Savings Options

It’s important to know the types and range of investments and fees of an IRA.

Keep savings in your former employer’s plan (if allowed)

Advantages Drawbacks

• Maintains tax-deferred status of savings

• Keeps current investment choices

• Preserves any guaranteed interest rate

• Keeps ownership of company stock in the account where

it may have certain tax beneﬁts at withdrawal

• Fees in employer plan may be lower than similar

individual accounts

• Plan ﬁduciary required to prudently monitor the cost and

quality of the investments options

• Changes made to the plan by your former employer will

impact you (i.e., plan investments, fees, services, plan

providers, plan termination)

• Investment choices limited to those oered through your

former employer’s retirement plan

• Subjects you to limitations of the plan, including income

distribution provisions when you retire

• Account may be assessed fees for plan administration

or other reasons

Continued on next page

Roll savings to your new employer’s plan – This is an option if you are joining a company that oers a retirement plan.

Advantages Drawbacks

• Maintains tax-deferred status of savings

• Continue to make contributions and save for retirement

• Combine other qualiﬁed plans or IRA savings into one account

• Fees in employer plan may be lower than similar

individual accounts

• Plan ﬁduciary required to prudently monitor the cost and

quality of the investments options

• IRS penalty-free withdrawals if you’re at least 55 years old

in the year you leave your new job*

• Protected from creditors and bankruptcy

• Plan may provide access to planning tools, educational

resources and phone helpline

• Loan provisions may allow borrowing from the rolled over money

•

No required minimum distribution at age 72 (70½ prior to

01/01/2020) from a current employer’s plan is required,

unless you are a 5% or more owner of the company

• Changes made to the plan by your employer will impact

you (i.e., plan investments, fees, services, plan providers,

plan termination)

• Investment choices limited to those the plan oers

• Subjects you to limitations of the plan, including income

distribution provisions when you retire

• Account may be assessed fees for plan administration

or other reasons

• Access to personalized investment advice or advice that

takes into account your other assets or particular needs

may not be available through the retirement plan

• Plan may oer fewer or more expensive investment options

than your former employer’s plan

• May be more restrictive on withdrawals while employed

• Roll-ins may not be allowed or an eligibility period may need

to be satisﬁed

• In-kind transfers of company stock will result in appreciated

value being taxed as ordinary income at withdrawal from

the retirement plan

Check your new employer’s summary plan description to confirm plan details and requirements.

Cash out savings and close the account

Advantages Drawbacks

• Immediate access to cash

• May see signiﬁcant tax advantage for company stock that

has substantially appreciated

• If after-tax contributions were made, could take these

amounts tax-free (though you will be required to pay tax

on the earnings of these contributions)

• At distribution, 20% withheld on the taxable account

balance for pre-payment of federal income taxes

• State taxes and a 10% early distribution penalty may also

apply on taxable account balance

• May move you to a higher tax bracket

• Forfeits future tax-deferred growth potential

• Not protected from creditors or bankruptcy

If this money is no longer set aside for retirement, will you have the savings you need when you want to retire or can no longer work?

*In-service withdrawals may be allowed while you are still working for

the company sponsoring the retirement plan. Check with the plan

administrator for details and requirements.

These considerations were prepared for pre-tax 401(k) accounts. Some – but

not all – of these considerations may also apply to other types of plans and/or

accounts (e.g., Roth after-tax accounts). You may wish to consult a tax advisor if

you participate in a dierent type of plan or hold a dierent type of account.

These descriptions are for general educational purposes and should not be

construed as advice or recommendations. This is not tax or legal advice and

you may wish to consult with your tax or legal advisors on these issues.

Insurance products and plan administrative services provided through

Principal Life Insurance Co., a member of Principal Financial Group,

Des Moines, IA 50392.

Keep savings in your former employer’s plan (continued)

Advantages Drawbacks

• IRS penalty-free withdrawals if you’re at least 55 years old

in the year you left your job

• Protected from creditors and bankruptcy

• Plan may provide access to planning tools, educational

resources and phone helpline

• Access to personalized investment advice or advice that takes

into account your other assets or particular needs may not be

available through the retirement plan

• No new contributions allowed

Check your former employer’s summary plan description to confirm plan details and requirements.

Contract/Plan ID Number:

Location:

Principal Life Insurance Company

Des Moines, IA 50306-9394

Instructions: Complete all steps listed and sign this form to roll over funds from a previous employer’s

plan or Individual Retirement Account (IRA) into the current retirement plan with services by Principal

1. Personal information (please print with black ink)

Name Date of Birth Social Security Number

Last First MI

Mailing Address

Street Apt City State Zip Code

Date of Hire Phone Number Email Address

Rollover Form

2. Tell us about your rollover funds

Do you know if the funds are pre-tax or after-tax contributions? (check one)

Yes. Please provide more details (check all that apply).

Pre-tax. Approximate account value $ ___________________

After-tax. What kind of after-tax contributions are the funds? (check all that apply)

1.) Roth

– Roth deferral amount (excluding any earnings/losses) $ ___________________

– Earnings on Roth deferral $ ___________________

– Tax year of the ﬁrst Roth deferral $ ___________________

Was any part of the Roth account originally a pre-tax contribution?

Yes, I’ve completed an in-plan Roth conversion of pre-tax contribution to a Roth account. $___________________

2.) Other after-tax contributions (not Roth)

– Other after-tax contribution amount (excluding any earning/losses) $ ___________________

No. Not sure? That’s ok. We’ll work with you to get this information from the ﬁnancial institution

currently holding the funds.

The email address you provide will be used for services provided by the Principal

Financial Group®. For more information, see the privacy policy at principal.com.

Contract/Plan ID Number:

4. Plan sponsor signature

The plan sponsor is typically your employer. This signature is required to process the rollover.

Based on the information above, this rollover contribution is acceptable according to the plan provisions Principal Life Insurance

Company is directed to accept this rollover contribution and keep the appropriate records and accounts.

Plan Sponsor or Trustee Name

3. Conﬁrm rollover

By signing this form, I agree that ...

This form is designed to be a quick way to direct the investment of eligible rollover funds. If I do not have an investment election on

ﬁle or wish to make an alternative allocation, I will select investment options by logging in to principal.com or calling 1-800-547-7754.

If I don’t make a dierent investment election prior to my rollover funds being received by Principal

, my funds will be invested

based on my current investment election. If I do not have a current investment election on ﬁle, my funds will be directed to the

plan’s investment default alternative(s).

I certify that this rollover contains no funds from a hardship withdrawal, no excess contribution amounts, and no funds subject

to a required minimum distribution.

I certify that no part of this rollover is part of an inherited IRA, SIMPLE IRA within 2 years of the ﬁrst contribution, or Roth IRA.

I certify that, if the funds are coming from a former employer’s plan, I have verified that the plan is a plan qualified under Internal

Revenue Code 401(a), 403(b) or 457(b).

I understand that Principal will rely on the information I have provided on this form and/or information from the current ﬁnancial

institution regarding the breakdown between pre-tax and after-tax contributions (including any Roth contributions).

You have options other than rolling the retirement account from your former employer’s retirement plan to your new employer’s

plan. Fees, investment options, services and plan features vary between retirement plans.

By rolling over funds to this account, I agree that I have received and reviewed information about the plan’s investment options so

that I may make an informed investment decision. Information about the plan’s investment options is available in the Investment

Option Summary included in the enrollment booklet and online at principal.com.

You must roll over qualiﬁed funds within 60 days of distribution to avoid tax penalties. If it has been more than 60 days, I agree that

I am self-certifying this rollover because I am eligible for a waiver of that period per the guidelines provided by the IRS, and will be

submitting a copy of my self-certiﬁcation to Principal.

My Signature Date

*You may roll over a distribution from a traditional IRA to a plan qualiﬁed under the Internal Revenue Code §401(a), 403(b), an annuity, or a Governmental

457(b) plan to the extent that the distribution would be taxable if not rolled over. After-tax contributions in an IRA (including non-deductible

contributions to a traditional IRA) may not be rolled over to one of these plans. Amounts rolled into a Governmental 457(b) plan other than another

Governmental 457(b) plan are subject to an early withdrawal tax.

You may roll over a Roth account only into a plan that allows Roth contributions. Please check your Summary Plan Description or plan document before

rolling over Roth accounts to make sure Roth contributions are available.

Rollover Form

Plan Sponsor or Trustee Signature Date

Contract/Plan ID Number:

5. Request the funds and contribution details

You need to request the funds from the current ﬁnancial institution holding them. You’ll need to provide them some instructions

regarding how they provide the funds to us and the breakdown of how they should be directed based on your pre-tax and after-

tax contributions (see below). We’ll rely on this information and/or the information you’ve provided on this form when directing

the funds here at Principal.

Or we can help you do it. If you’d like some help contacting the current ﬁnancial institution, call us at 1-800-547-7754

for more information.

Checks must be made payable to:

Principal Life Insurance Company

FBO <Your Name>

Contract/plan ID number <9999999>

Breakdown between pre-tax

and after-tax contributions

Checks must be mailed to:

Principal Financial Group

P.O. Box 9394

Des Moines, IA 50306-9394

Wire transfer instructions:

ABA number: 121000248

Account number: 0000901239

FBO <Your Name>

Contract/plan ID number <999999>

Breakdown between pre-tax

and after-tax contributions

Rollover Form

6. Send completed form and rollover funds

If we don’t receive this form within 15 business days of receiving the rollover funds, the rollover funds will be returned.

Check enclosed Prior ﬁnancial institution will send check/wire funds

Mailing address for completed form and check:

Principal Financial Group

P.O. Box 9394

Des Moines, IA 50306-9394

Fax this completed and signed form to the number

below so we know your rollover funds are on the way:

1-866-704-3481

For residents of Florida: Any person who knowingly and with intent to injure, defraud, or deceive any insurer ﬁles a statement of claim or an application

containing any false, incomplete, or misleading information is guilty of a felony of the third degree.

Investing involves risk, including possible loss of principal.

If funds are rolled into the plan prior to the participant attaining eligibility, this form is only valid if the participant receives the plan’s investment

option summary and 404 notice prior to executing.

Insurance products and plan administrative services provided through Principal Life Insurance Co., a member of the Principal Financial Group

Des Moines, IA 50392.

PG4576-12 | 1299530-082020 | 08/2020

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