MutualFundWire.com
The insiders' edge for 40 Act industry executives!
an InvestmentWires' Publication
an InvestmentWires' Publication
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MutualFundWire.com
The insiders' edge for 40 Act industry executives!
an InvestmentWires' Publication |
|
Wednesday, November 13, 2002 Principal Inks New 529 Distribution Deal The Principal Financial Group has inked a new distribution agreement with Alliance Capital, manager of the largest single-state 529 college savings plan, to meet growing demand for such programs. The Principal will market and distribute the new Principal CollegeBound fund through existing and new retirement plan sponsor clients, while Alliance Capital will provide investment management and administration services. Through the nationwide program, a section 529 college savings plan sponsored by the State of Rhode Island, employers can offer a tax-advantaged way to save for college through payroll deductions. "Retirement and college are two of the most significant savings goals facing Americans today," said Jim Sager, director, Retirement and Investors Services--The Principal. "Our clients tell us they want to be able to offer a total savings plan to their employees; one that covers all life events. By bringing the 529 plan option to the workplace, we're extending our range to meet yet another need of plan sponsors who recognize the growing demand from employees for this very attractive education savings vehicle." Indeed, an industry consultant, Cerulli Associates, considers employer-offered 529 plans an emerging market, and the firm estimates that they represent less than 3% of all 529 assets. The new 529 plan, which will be available nationally in January 2003, offers families 15 investment options, which includes two age-based portfolios--active asset allocation portfolios that change over time as the beneficiary nears college age; three additional core allocation portfolios--invested in a fixed mix of stock, bond and/or money market mutual funds; The Principal-Protection Income Portfolio--invested in a mix of fixed income and money market securities, insured to provide stable accrued earnings and principal protection; the Customized Allocation Portfolio--created by individual investors who select from an array of nine Alliance mutual funds. In addition to the employer-offered channel, The Principal will offer its new fund through its vast network of financial advisors and brokers at the retail level. Printed from: MFWire.com/story.asp?s=3983 Copyright 2002, InvestmentWires, Inc. All Rights Reserved |