497 1 supplements-all.htm SUPP FOR CLASS J AND R CLASSES FOR SHORT-TERM INCOME supplements-all.htm - Generated by SEC Publisher for SEC Filing
Supplement dated July 12, 2010
to the Class J Shares Prospectus
for Principal Funds, Inc.
dated March 1, 2010
As Supplemented on March 1, 2010, March 17, 2010, May 3, 2010,
May 19, 2010, May 27, 2010, June 16, 2010 and July 1, 2010
 
This supplement updates information currently in the Prospectus. Retain this supplement with the Prospectus. 
 
On page 1, add the following to the ticker symbol table: 

    J 
Short-Term Income  PSJIX 
Insert the following fund summary: 
SHORT-TERM INCOME FUND   
Objective: The Fund seeks to provide as high a level of current income as is consistent with prudent 
                  investment management and stability of principal. 
Fees and Expenses of the Fund 
This table describes the fees and expenses that you may pay if you buy and hold shares of the Fund. 

Shareholder Fees (fees paid directly from your investment)   
  Class J 
                 Maximum Deferred Sales Charge (Load)  1.00% 
                 (as a percentage of dollars subject to charge)   

Annual Fund Operating Expenses   
(expenses that you pay each year as a percentage of the value of your investment) 
 
             Estimated for the year ended October 31, 2010  Class J 
 
             Management Fees     0.48% 
             Distribution and/or Service (12b-1) Fees     0.45 
             Other Expenses     0.26 
                                                                                             Total Annual Fund Operating Expenses     1.19% 
             Expense Reimbursement     0.12 
                         Total Annual Fund Operating Expenses After Expense Reimbursement     1.07% 

Principal has contractually agreed to limit the Fund’s expenses attributable to Class J shares and, if necessary, 
pay expenses normally payable by the Fund, excluding interest expense, through the period ending 
February 29, 2012. The expense limit will maintain a total level of operating expenses (expressed as a percent 
of average net assets on an annualized basis) not to exceed 1.07%. 
Example     
This Example is intended to help you compare the cost of investing in the Fund with the cost of investing in 
other mutual funds.     
         The Example assumes that you invest $10,000 in the Fund for the time periods indicated and then redeem 
         all of your shares at the end of those periods. The Example also assumes that your investment has a 5% 
         return each year and that the Fund’s operating expenses remain the same. Although your actual costs may 
         be higher or lower, based on these assumptions your costs would be: 
 
 
  1 year  3 years 
                   Class J  $209  $364 
 
         You would pay the following expenses if you did not redeem your shares: 
 
 
  1 year  3 years 
                   Class J  $109  $364 



Portfolio Turnover 
The Fund pays transaction costs, such as commissions, when it buys and sells securities (or “turns over” its portfolio). 
A higher portfolio turnover rate may indicate higher transaction costs and may result in higher taxes when Fund 
shares are held in a taxable account. These costs, which are not reflected in annual fund operating expenses or in the 
example, affect the Fund’s performance. During the most recent fiscal year, the Fund’s portfolio turnover rate was 
40.8% of the average value of its portfolio. 
 
Investor Profile:                        The Fund may be an appropriate investment for investors seeking diversification by investing in a 
                                                 fixed-income mutual fund. 
 
Principal Investment Strategies 
The Fund invests in high quality short-term bonds and other fixed-income securities that, at the time of purchase, are 
rated BBB- or higher by Standard & Poor’s Rating Service or Baa3 or higher by Moody’s Investors Service, Inc. or, if 
unrated, in the opinion of Edge Asset Management, Inc. (“Edge”) of comparable quality. Under normal circumstances, 
the Fund maintains an effective maturity of five years or less and a dollar-weighted average duration of three years or 
less. The Fund’s investments may also include corporate securities, U.S. and foreign government securities, 
repurchase agreements, mortgage-backed and asset-backed securities, and real estate investment trust securities. 
 
The Fund may invest in foreign fixed-income securities, primarily bonds of foreign governments or their political 
subdivisions, foreign companies and supranational organizations, including non-U.S. dollar-denominated securities 
and U.S. dollar-denominated fixed-income securities issued by foreign issuers and foreign branches of U.S. banks. 
The Fund may invest in preferred securities. The Fund may enter into dollar roll transactions, which may involve 
leverage. The Fund may utilize derivative strategies, which are financial contracts whose value depends upon, or is 
derived from, the value of an underlying asset, reference rate, or index, and may relate to stocks, bonds, interest 
rates, currencies or currency exchange rates, and related indexes. Derivative strategies may include certain options 
transactions, financial futures contracts, swaps, currency forwards, and related options for purposes such as earning 
income and enhancing returns, managing or adjusting the risk profile of the Fund, replacing more traditional direct 
investments, or obtaining exposure to certain markets. This Fund may be used as part of a fund of funds strategy. 
 
Principal Risks 
The value of your investment in the Fund changes with the value of the Fund’s investments. Many factors affect that 
value, and it is possible to lose money by investing in the Fund. The principal risks of investing in the Fund, in 
alphabetical order, are: 
 
Derivatives Risk. Transactions in derivatives (such as options, futures, and swaps) may increase volatility, cause the 
liquidation of portfolio positions when not advantageous to do so and produce disproportionate losses. Certain Fund 
transactions, such as reverse repurchase agreements, loans of portfolio securities, and the use of when-issued, 
delayed delivery or forward commitment transactions, or derivative instruments, may give rise to leverage, causing the 
Fund to be more volatile than if it had not been leveraged. 
 
Fixed-Income Securities Risk. Fixed-income securities are subject to interest rate risk and credit quality risk. The 
market value of fixed-income securities generally declines when interest rates rise, and an issuer of fixed-income 
securities could default on its payment obligations. 
 
Foreign Securities Risk. The risks of foreign securities include loss of value as a result of: political or economic 
instability; nationalization, expropriation or confiscatory taxation; changes in foreign exchange rates and foreign 
exchange restrictions; settlement delays; and limited government regulation (including less stringent reporting, 
accounting, and disclosure standards than are required of U.S. companies). 
 
Portfolio Duration Risk. Portfolio duration is a measure of the expected life of a fixed-income security and its 
sensitivity to changes in interest rates. The longer a fund's average portfolio duration, the more sensitive the fund will 
be to changes in interest rates. 
 
Prepayment Risk. Unscheduled prepayments on mortgage-backed and asset-backed securities may have to be 
reinvested at lower rates. A reduction in prepayments may increase the effective maturities of these securities, 
exposing them to the risk of decline in market value over time (extension risk). 
 
Real Estate Securities Risk. Real estate securities (including real estate investment trusts ("REITs")) are subject to 
the risks associated with direct ownership of real estate, including declines in value, adverse economic conditions, 
increases in expenses, regulatory changes and environmental problems. A REIT could fail to qualify for tax-free pass- 
through of income under the Internal Revenue Code, and Fund shareholders will indirectly bear their proportionate 
share of the expenses of REITs in which the Fund invests. 



Underlying Fund Risk. An underlying fund to a fund of funds may experience relatively large redemptions or 
investments as the fund of funds periodically reallocates or rebalances its assets. These transactions may cause the 
underlying fund to sell portfolio securities to meet such redemptions, or to invest cash from such investments, at times 
it would not otherwise do so, and may as a result increase transaction costs and adversely affect underlying fund 
performance. 
 
U.S. Government Securities Risk. Yields available from U.S. government securities are generally lower than yields 
from many other fixed-income securities. 
 
U.S. Government Sponsored Securities Risk. Securities issued by U.S. government-sponsored or –chartered 
enterprises such as the Federal Home Loan Mortgage Corporation, the Federal National Mortgage Association, and 
the Federal Home Loan Banks are not issued or guaranteed by the U.S. Treasury. 
 
Performance 
The following information provides an indication of the risks of investing in the Fund. The bar chart shows the 
investment returns of the Fund’s Class J shares for each full calendar year of operations for 10 years (or, if shorter, 
the life of the Fund). These annual returns do not reflect sales charges; if they did, results would be lower. The table 
shows, for Class J shares of the Fund and for the last one, five, and ten calendar year periods (or, if shorter, the life of 
the Fund), how the Fund’s average annual total returns compare to the returns of one or more broad-based market 
indices. Past performance (before and after taxes) is not necessarily an indication of how the Fund will perform in the 
future. You may get updated performance information online at www.principalfunds.com or by calling 1-800-222-5852. 
 
The Fund commenced operations after succeeding to the operations of another fund on January 12, 2007. 
Performance for periods prior to that date is based on the performance of the predecessor fund which commenced 
operations on November 1, 1993. The performance of Class J shares, for periods prior to the date Class J shares 
were first sold is based upon the performance of Class A shares adjusted to reflect the fees and expenses of Class J 
shares. 


Highest return for a quarter during the period of the bar chart above:  Q2 ’09  3.92% 
Lowest return for a quarter during the period of the bar chart above:  Q4 ’08  -1.90% 

Average Annual Total Returns
For the periods ended December 31, 2009  1 Year  5 Years  10 Years 
Class J Return Before Taxes  9.68%     3.67%  4.46% 
Class J Return After Taxes on Distributions  8.33%     2.33%  2.88% 
Class J Return After Taxes on Distribution and Sale of Fund Shares  6.26%     2.34%  2.86% 
Citigroup Broad Investment Grade Credit 1-3 Years Index (reflects no deduction for fees,       
expenses, or taxes)  11.04%     4.73%  5.50% 
 
After-tax returns are calculated using the historical highest individual federal marginal income tax rates and do 
not reflect the impact of state and local taxes. Actual after-tax returns depend on an investor’s tax situation and 
may differ from those shown. The after-tax returns shown are not relevant to investors who hold their Fund 
shares through tax deferred arrangements, such as 401(k) plans or individual retirement accounts.   



Management     
 
Investment Advisor: Principal Management Corporation   
 
Sub-Advisor(s) and Portfolio Manager(s):   
Edge Asset Management, Inc.   
           John R. Friedl (since 2010), Portfolio Manager   
           Ryan P. McCann (since 2010), Portfolio Manager   
           Scott J. Peterson (since 2010), Portfolio Manager   
           Brian L. Placzek (since 2010), Head of Fixed Income, Portfolio Manager   
 
Purchase minimums per fund (some exceptions apply):   
          Initial Investment    $1,000 
   For accounts with an Automatic Investment Plan (AIP)  $100 
          Subsequent Investments  $100 
    For accounts with an AIP, the subsequent automatic investments must total $1,200 annually if the 
     initial $1,000 minimum has not been met.   
 
You may purchase or redeem shares on any business day (normally any day when the New York Stock 
Exchange is open for regular trading) through your Financial Professional; by sending a written request to 
Principal Funds at P.O. Box 55904, Boston, MA 02205; calling us at 800-222-5852; or accessing our website 
(www.principalfunds.com).     
 
Tax Information     
The Fund’s distributions are generally taxable to you as ordinary income, capital gains, or a combination of the 
two, unless you are investing through a tax-deferred arrangement, such as a 401(k) plan or an individual 
retirement account.     
 
Payments to Broker-Dealers and Other Financial Intermediaries.   
If you purchase the Fund through a broker-dealer or other financial intermediary (such as a bank, insurance 
company, investment adviser, etc.), the Fund and its related companies may pay the intermediary for the sale of 
Fund shares and related services. These payments may create a conflict of interest by influencing the broker- 
dealer or other intermediary and your salesperson to recommend the Fund over another investment, or to 
recommend one share class of the Fund over another share class. Ask your salesperson or visit your financial 
intermediary’s website for more information.   
 
CERTAIN INVESTMENT STRATEGIES AND RELATED RISKS   
 
On page 206, in the “High Yield Securities” section, add the Short-Term Income Fund to the list of funds in the 
first sentence of the first paragraph.   
 
On page 210, in the “Small and Medium Capitalization Companies” section, add the Short-Term Income 
Fund to the list of funds in the second sentence of the first paragraph.   
 
MANAGEMENT OF THE FUNDS   
 
Fees Paid to Principal     
On page 227, add the following information to the table under this heading:   
  Short-Term Income Fund  0.48%   
 
On page 227, in the “Fees Paid to Principal” sub-section, add the following information before the paragraph 
that begins, “The Fund operates as a Manager of Managers.”   
         The Distributor has voluntarily agreed to limit the Short-Term Income Fund’s Distribution and/or Service 
         (12b-1) Fees normally payable by the Fund. The expense limit will maintain the level of Distribution and/or 
         Service (12b-1) Fees (expressed as a percent of average net assets on an annualized basis) not to exceed 
         0.40% for Class J shares. The expense limit may be terminated at any time.   
 
DIVIDENDS AND DISTRIBUTIONS   
 
On page 230, add the Short-Term Income Fund to the list of funds in the first bullet in this section. 



Supplement dated July 12, 2010
to the R-1, R-2, R-3, R-4, and R-5 Classes Prospectus
for Principal Funds, Inc.
dated March 1, 2010
(As Supplemented on March 1, 2010, March 17, 2010, May 3, 2010,
May 19, 2010, May 27, 2010, and June 16, 2010)
 
This supplement updates information currently in the Prospectus. Retain this supplement with the Prospectus. 
 
On page 1, add the following to the ticker symbol table:       
  R-1  R-2  R-3  R-4  R-5 
Short-Term Income  PSIMX   PSINX  PSIOX  PSIPX  PSIQX 

Insert the following fund summary:   
SHORT-TERM INCOME FUND   
Objective: The Fund seeks to provide as high a level of current income as is consistent with prudent 
                 investment management and stability of principal.   
Fees and Expenses of the Fund   
This table describes the fees and expenses that you may pay if you buy and hold shares of the Fund. 
Shareholder Fees (fees paid directly from your investment):  None 

Annual Fund Operating Expenses           
(expenses that you pay each year as a percentage of the value of your investment)       
 
       Estimated for the year ended October 31, 2010  Class R-1  Class R-2  Class R-3  Class R-4  Class R-5 
 
       Management Fees     0.48%     0.48%     0.48%     0.48%     0.48% 
       Distribution and/or Service (12b-1) Fees     0.35     0.30     0.25     0.10  N/A 
       Other Expenses     0.54     0.46     0.33     0.29     0.27 
                                         Total Annual Fund Operating Expenses     1.37     1.24     1.06     0.87     0.75 
       Expense Reimbursement     0.07     0.06     0.07     0.08     0.07 
                                         Total Annual Fund Operating Expenses     1.30%     1.18%     0.99%     0.79%     0.68% 
                                                           After Expense Reimbursement           

Principal has contractually agreed to limit the Fund’s expenses attributable to Class R-1, Class R-2, Class R-3, 
Class R-4, and Class R-5 shares and, if necessary, pay expenses normally payable by the Fund, excluding 
interest expense, through the period ending February 29, 2012. The expense limit will maintain a total level of 
operating expenses (expressed as a percent of average net assets on an annualized basis not to exceed 1.30% 
for Class R-1, 1.18% for Class R-2, 0.99% for Class R-3, 0.79% for Class R-4, and 0.68% for Class R-5. 
 
Example     
This Example is intended to help you compare the cost of investing in the Fund with the cost of investing in 
other mutual funds.     
 
         The Example assumes that you invest $10,000 in the Fund for the time periods indicated and then redeem 
         all of your shares at the end of those periods. The Example also assumes that your investment has a 5% 
         return each year and that the Fund’s operating expenses remain the same. Although your actual costs may 
         be higher or lower, based on these assumptions your costs would be: 
 
 
  1 year  3 years 
                   Class R-1  $132  $426 
                   Class R-2  $120  $386 
                   Class R-3  $101  $329 
                   Class R-4  $81  $268 
                   Class R-5  $69  $231 



Portfolio Turnover 
The Fund pays transaction costs, such as commissions, when it buys and sells securities (or “turns over” its 
portfolio). A higher portfolio turnover rate may indicate higher transaction costs and may result in higher taxes 
when Fund shares are held in a taxable account. These costs, which are not reflected in annual fund operating 
expenses or in the example, affect the Fund’s performance. During the most recent fiscal year, the Fund’s 
portfolio turnover rate was 40.8% of the average value of its portfolio. 
 
Investor Profile:                        The Fund may be an appropriate investment for investors seeking diversification by 
                                                 investing in a fixed-income mutual fund. 
 
Principal Investment Strategies 
The Fund invests in high quality short-term bonds and other fixed-income securities that, at the time of 
purchase, are rated BBB- or higher by Standard & Poor’s Rating Service or Baa3 or higher by Moody’s 
Investors Service, Inc. or, if unrated, in the opinion of Edge Asset Management, Inc. (“Edge”) of comparable 
quality. Under normal circumstances, the Fund maintains an effective maturity of five years or less and a dollar- 
weighted average duration of three years or less. The Fund’s investments may also include corporate securities, 
U.S. and foreign government securities, repurchase agreements, mortgage-backed and asset-backed 
securities, and real estate investment trust securities. 
 
The Fund may invest in foreign fixed-income securities, primarily bonds of foreign governments or their political 
subdivisions, foreign companies and supranational organizations, including non-U.S. dollar-denominated 
securities and U.S. dollar-denominated fixed-income securities issued by foreign issuers and foreign branches 
of U.S. banks. The Fund may invest in preferred securities. The Fund may enter into dollar roll transactions, 
which may involve leverage. The Fund may utilize derivative strategies, which are financial contracts whose 
value depends upon, or is derived from, the value of an underlying asset, reference rate, or index, and may 
relate to stocks, bonds, interest rates, currencies or currency exchange rates, and related indexes. Derivative 
strategies may include certain options transactions, financial futures contracts, swaps, currency forwards, and 
related options for purposes such as earning income and enhancing returns, managing or adjusting the risk 
profile of the Fund, replacing more traditional direct investments, or obtaining exposure to certain markets. This 
Fund may be used as part of a fund of funds strategy. 
 
Principal Risks 
The value of your investment in the Fund changes with the value of the Fund’s investments. Many factors affect 
that value, and it is possible to lose money by investing in the Fund. The principal risks of investing in the Fund, 
in alphabetical order, are: 
 
Derivatives Risk. Transactions in derivatives (such as options, futures, and swaps) may increase volatility, 
cause the liquidation of portfolio positions when not advantageous to do so and produce disproportionate 
losses. Certain Fund transactions, such as reverse repurchase agreements, loans of portfolio securities, and the 
use of when-issued, delayed delivery or forward commitment transactions, or derivative instruments, may give 
rise to leverage, causing the Fund to be more volatile than if it had not been leveraged. 
 
Fixed-Income Securities Risk. Fixed-income securities are subject to interest rate risk and credit quality risk. 
The market value of fixed-income securities generally declines when interest rates rise, and an issuer of fixed- 
income securities could default on its payment obligations. 
 
Foreign Securities Risk. The risks of foreign securities include loss of value as a result of: political or economic 
instability; nationalization, expropriation or confiscatory taxation; changes in foreign exchange rates and foreign 
exchange restrictions; settlement delays; and limited government regulation (including less stringent reporting, 
accounting, and disclosure standards than are required of U.S. companies). 
 
Portfolio Duration Risk. Portfolio duration is a measure of the expected life of a fixed-income security and its 
sensitivity to changes in interest rates. The longer a fund's average portfolio duration, the more sensitive the 
fund will be to changes in interest rates. 
 
Prepayment Risk. Unscheduled prepayments on mortgage-backed and asset-backed securities may have to 
be reinvested at lower rates. A reduction in prepayments may increase the effective maturities of these 
securities, exposing them to the risk of decline in market value over time (extension risk). 



Real Estate Securities Risk. Real estate securities (including real estate investment trusts ("REITs")) are 
subject to the risks associated with direct ownership of real estate, including declines in value, adverse 
economic conditions, increases in expenses, regulatory changes and environmental problems. A REIT could fail 
to qualify for tax-free pass-through of income under the Internal Revenue Code, and Fund shareholders will 
indirectly bear their proportionate share of the expenses of REITs in which the Fund invests. 
 
Underlying Fund Risk. An underlying fund to a fund of funds may experience relatively large redemptions or 
investments as the fund of funds periodically reallocates or rebalances its assets. These transactions may 
cause the underlying fund to sell portfolio securities to meet such redemptions, or to invest cash from such 
investments, at times it would not otherwise do so, and may as a result increase transaction costs and adversely 
affect underlying fund performance. 
 
U.S. Government Securities Risk. Yields available from U.S. government securities are generally lower than 
yields from many other fixed-income securities. 
 
U.S. Government Sponsored Securities Risk. Securities issued by U.S. government-sponsored or –chartered 
enterprises such as the Federal Home Loan Mortgage Corporation, the Federal National Mortgage Association, 
and the Federal Home Loan Banks are not issued or guaranteed by the U.S. Treasury. 
 
Performance 
The following information provides an indication of the risks of investing in the Fund. The bar chart shows the 
investment returns of the Fund’s Class R-2 shares for each full calendar year of operations for 10 years (or, if 
shorter, the life of the Fund). The table shows, for each share class of the Fund and for the last one, five, and 
ten calendar year periods (or, if shorter, the life of the Fund), how the Fund’s average annual total returns 
compare to the returns of one or more broad-based market indices. Past performance (before and after taxes) is 
not necessarily an indication of how the Fund will perform in the future. You may get updated performance 
information online at www.principal.com or by calling 1-800-547-7754. 
 
The Fund commenced operations after succeeding to the operations of another fund on January 12, 2007. 
Performance for periods prior to that date is based on the performance of the predecessor fund’s Class A 
shares adjusted to reflect the fees and expenses of these classes. The adjustments result in performance (for 
periods prior to the date these classes began operations) that is no higher than the historical performance of 
Class A shares. The predecessor fund commenced operations on November 1, 1993. The R-1, R-2, R-3, R-4 
and R-5 Class shares were first sold on July 12, 2010. 

 
Highest return for a quarter during the period of the bar chart above:  Q2 ’09  3.89% 
Lowest return for a quarter during the period of the bar chart above:  Q4 ’08  -1.92% 



Average Annual Total Returns
 
For the periods ended December 31, 2009  1 Year  5 Years  10 Years 
Class R-1 Return Before Taxes  10.43%     3.43%  4.23% 
Class R-1 Return After Taxes on Distributions  9.08%     2.09%  2.65% 
Class R-1 Return After Taxes on Distribution and Sale of Fund Shares  6.74%     2.13%  2.65% 
Class R-2 Return Before Taxes  10.56%     3.55%  4.35% 
Class R-3 Return Before Taxes  10.77%     3.75%  4.55% 
Class R-4 Return Before Taxes  10.87%     3.87%  4.66% 
Class R-5 Return Before Taxes  10.87%     3.87%  4.66% 
Citigroup Broad Investment Grade Credit 1-3 Years Index (reflects no deduction for fees,       
expenses, or taxes)  11.04%     4.73%  5.50% 
 
After-tax returns are calculated using the historical highest individual federal marginal income tax rates and do 
not reflect the impact of state and local taxes. Actual after-tax returns depend on an investor’s tax situation and 
may differ from those shown. The after-tax returns shown are not relevant to investors who hold their Fund 
shares through tax deferred arrangements, such as 401(k) plans or individual retirement accounts. After-tax 
returns are shown for Class R-1 shares only and would be different for Class R-2, R-3, R-4 and R-5 shares. 

Management   
 
Investment Advisor: Principal Management Corporation 
 
Sub-Advisor(s) and Portfolio Manager(s): 
Edge Asset Management, Inc. 
           John R. Friedl (since 2010), Portfolio Manager 
           Ryan P. McCann (since 2010), Portfolio Manager 
           Scott J. Peterson (since 2010), Portfolio Manager 
           Brian L. Placzek (since 2010), Head of Fixed Income, Portfolio Manager 
 
Purchase and Sale of Fund Shares 
There are no restrictions on amounts to be invested in R-1, R-2, R-3, R-4, and R-5 Class shares of the Fund for 
an eligible purchaser. You may purchase or redeem shares on any business day (normally any day when the 
New York Stock Exchange is open for regular trading) through the retirement plan offering the Fund. 
 
Tax Information   
The Fund’s distributions are generally taxable to you as ordinary income, capital gains, or a combination of the 
two, unless you are investing through a tax-deferred arrangement, such as a 401(k) plan or an individual 
retirement account.   
 
Payments to Broker-Dealers and Other Financial Intermediaries. 
If you purchase the Fund through a broker-dealer or other financial intermediary (such as a bank, insurance 
company, investment adviser, etc.), the Fund and its related companies may pay the intermediary for the sale of 
Fund shares and related services. These payments may create a conflict of interest by influencing the broker- 
dealer or other intermediary and your salesperson to recommend the Fund over another investment, or to 
recommend one share class of the Fund over another share class. Ask your salesperson or visit your financial 
intermediary’s website for more information. 
 
CERTAIN INVESTMENT STRATEGIES AND RELATED RISKS 
On page 261, in the “High Yield Securities” section, add the Short-Term Income Fund to the list of funds in the 
first sentence of the first paragraph. 
 
On page 265, in the “Small and Medium Capitalization Companies” section, add the Short-Term Income 
Fund to the list of funds in the second sentence of the first paragraph. 
 
MANAGEMENT OF THE FUNDS 
 
Fees Paid to Principal   
On page 284, add the following information to the table under this heading: 
  Short-Term Income Fund  0.48% 
 
DIVIDENDS AND DISTRIBUTIONS 
 
On page 287, add the Short-Term Income Fund to the list of funds in the first bullet in this section. 



SUPPLEMENT DATED JULY 12, 2010 
TO THE STATEMENT OF ADDITIONAL INFORMATION 
FOR PRINCIPAL FUNDS, INC. 
DATED MARCH 1, 2010 
(as supplemented on March 17, 2010, May 3, 2010, 
May 19, 2010, May 27, 2010, and June 16, 2010) 
 
 
This supplement updates information currently in the Statement of Additional Information. Retain this 
supplement with the Statement of Additional Information. 

On page 3, add the following to the ticker symbol table:       
 
  J  R-1  R-2  R-3  R-4  R-5 
Short-Term Income  PSJIX  PSIMX  PSINX  PSIOX  PSIPX  PSIQX 

FUND HISTORY               
On page 6, add an “X” to the Class J, R-1, R-2, R-3, R-4, and R-5 columns on the Short-Term Income 
Fund line.               
 
INVESTMENT ADVISORY AND OTHER SERVICES         
Add the following information to the table on pages 104-105:       
  R-1  R-2  R-3  R-4  R-5  Class J  Expiration 
Short-Term Income  1.30%  1.18%  0.99%  0.79%  0.68%  1.07%  2/29/2012