In its annual ranking of mutual fund families, Barron’s magazine named Principal Funds the No. 5 fund family based on one-year performance in 2014. Sixty-five fund companies qualified for this year’s one-year Barron's/Lipper Fund Family Ranking, highlighted in the magazine’s Feb. 9 issue.

“Our focus has always been on consistent, long-term performance for our investors, no matter the market environment,” said Nora Everett, president and CEO of Principal Funds. “We’re honored to be recognized by Barron’s as one of the top fund families for 2014. It’s a testament to our commitment to help investors get to and through a successful retirement.”

Principal Funds also finished strong in the longer-term performance categories, ranking No. 9 in the five-year timeframe and No. 20 in the 10-year timeframe. In addition, Principal Funds’ solid, across-the-board performance yielded top third or better rankings across each of the five asset class categories included in the survey.

In order to meet the requirements for the Barron's/Lipper fund survey, a firm must have at least three funds in Lipper’s general U.S.-stock category, one fund in world equity, one mixed-asset (or balanced) fund, two taxable-bond funds and one tax-exempt offering.

Principal Funds is a member of the Principal Financial Group®, a global investment management leader with nearly $520 billion in assets under management1. Principal Funds’ expertise in asset allocation combines multiple asset classes and multiple managers—including in-house boutiques and outside specialty managers—to help create the outcomes investors seek.

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About the Barron’s/Lipper Fund Family Ranking
Past performance is no guarantee of future results. Of fund companies that met the criteria, Principal Funds was ranked #5 out of 65 companies for one year, #9 out of 56 for five years, and #20 out of 48 for 10 years, all periods ended 12/31/2014. In Barron's one-year sub-category rankings, Principal Funds ranked #20 in Mixed Equity, #21 in World Equity, #12 in U.S. Equity, #21 in Taxable Bond and #11 in Tax-Exempt Bond (out of 65 fund families). Performance data used for the rankings does not account for any up-front sales charges, contingent deferred sales charges or 12b-1 fees.

To qualify for the rankings, a fund family must have at least three funds in Lipper's general U.S. stock category, one in world equity (combining global and international funds), one mixed-equity fund (stocks and bonds), at least two taxable bond funds and one tax-exempt offering. Each fund's return is measured against those of all funds in its Lipper category and assigned a percentile ranking, with 100 as the highest and 1 the lowest, which is then weighted by asset size, relative to the fund family's other assets in its general classification. The score is multiplied by the weighting of its general classification, as determined by the entire Lipper universe of funds. The category weightings for the one-year results: general equity, 40%; world equity, 15.9%; mixed asset, 19.2%; taxable bond, 21.5%; and tax-exempt bond, 3.4%. The category weightings for the five-year results: general equity, 41%; world equity, 15.5%; mixed asset, 19.2%; taxable bonds, 20.7%, and tax-exempt bonds, 3.6%. The category weightings for the 10-year results: general equity, 45.2%; world equity, 13.6%; mixed asset, 17.6%; taxable bonds, 19.5%; and tax-exempt bonds, 4.1%.

About Principal Funds
Principal Funds is a leading provider of mutual funds, with $120.3 billion in assets under management.2 Principal Funds brings expertise in global investment management, asset allocation and retirement leadership to financial professionals and investors. Including its target-risk and target-date offerings, Principal Funds is the fifth largest manager of lifecycle funds in the industry.3 The companies that make up Principal Funds are members of the Principal Financial Group®. For more information, visit www.principalfunds.com.

About the Principal Financial Group
The Principal Financial Group® (The Principal®)4 is a global investment management leader offering retirement services, insurance solutions and asset management. The Principal offers businesses, individuals and institutional clients a wide range of financial products and services, including retirement, asset management and insurance through its diverse family of financial services companies. Founded in 1879 and a member of the FORTUNE 500®, the Principal Financial Group has $519.3 billion in assets under management5 and serves some 19.7 million customers worldwide from offices in Asia, Australia, Europe, Latin America and the United States. Principal Financial Group, Inc. is traded on the New York Stock Exchange under the ticker symbol PFG. For more information, visit www.principal.com.

Carefully consider a fund’s objectives, risks, charges, and expenses. Contact your financial professional or visit principalfunds.com for a prospectus, or summary prospectus if available, containing this and other information. Please read it carefully before investing.

Investing involves risk, including possible loss of principal.

Principal Funds are distributed by Principal Funds Distributor, Inc.

1 As of December 31, 2014.
2 As of December 31, 2014. Includes all share classes of the Principal Funds, Inc. and Principal Variable Contracts Funds, Inc.
3 Strategic Insight Mutual Fund Lifecycle Report Q4 2014.
4 “The Principal Financial Group” and “The Principal” are registered service marks of Principal Financial Services, Inc., a member of the Principal Financial Group.
5 As of Dec. 31, 2014.