New Principal® Platform Helps Small and Medium Businesses Expand Retirement Plan Access
June 26, 2018 at 07:00 AM EDT
Principal Financial Group® today launched Principal® Flex for retirement plans under $1 million, which consists of two streamlined retirement packages developed to help small- and medium-sized businesses (SMBs) and tax-exempt organizations offer flexible retirement benefits to employees.
The two plan packages, Principal® Flex and Principal® Flex - Open feature advisor benefits, including:
“Principal serves more than 37,000 SMB clients with nearly 1.3 million participants,” said Kevin Morris, VP and Chief Marketing Officer, Retirement and Income Solutions.1 “We’ve generated a wealth of data-driven insights from these clients and talked with advisors – and that allows us to uniquely understand the challenges SMB owners face and how to provide them effective products.”
Depending on the respective Principal® Flex package selected, advisors can leverage several advantages for employer clients including offsetting administrative costs, tax saving strategies and paperwork reduction. Principal® Flex packages also offers participant services and additional customizable plan features typically enjoyed by larger organizations.
Growing Retirement Plan Market Demands More Efficient Access
SMBs, which have 500 or fewer employees, are the backbone of the U.S. economy — making up 99.9 percent of all U.S. businesses.2 Of those with fewer than 100 employees, 47 percent do not have a retirement plan — a benefit generally expected by employees. 3
“Driven by our commitment to continued innovation in retirement solutions, Principal® Flex was delivers flexibility in plan design, investment selection, expense collection, and compensation while offering employers simplicity in how the plan services are provided,” said Morris. “Our goal is to build plans that help employers take care of their employees’ future lives but spend less time on administrative complexity.”
Growing Demand for Competitive Benefits Packages
With 69 percent of small U.S. businesses planning to hire in 20184, there’s a high demand for qualified workers. U.S. unemployment is hovering around four percent – a 17-year low – making the need for competitive benefit packages critical to the continued success and growth of small businesses.5
To keep business running and growing, employers need to find and hire good talent. The longer this market stays strong, the tighter the employment market may get.
"The flip side to a great job market is that it puts extra pressure on recruiting and retention, so employer-sponsored retirement plans are moving from a want to a need," said Morris. "Principal® Flex helps advisors build attractive plans for small business owners, tailored to their needs."
Advisors are encouraged to visit principal.com/smb to learn more about Principal® Flex and available tools and resources to efficiently start the retirement planning process with SMBs.
Insurance products and plan administrative services provided through
Principal Life Insurance Co., a member of the Principal Financial Group®,
Des Moines, IA 50392.
1 Plans under $5M in assets under management, as of 5/1/2017