STRATEGIC ASSET MANAGEMENT (“SAM”) CONSERVATIVE BALANCED PORTFOLIO
	Class A	Class B	Class C
Ticker Symbol(s)	SAIPX	SBIPX	SCIPX

Principal Funds, Inc. Summary Prospectus February 29, 2012 

Before you invest, you may want to review the Fund’s prospectus, which contains more information about the 

Fund and its risks. You can find the Fund’s prospectus and other information about the Fund online at 

www.principalfunds.com/prospectus. You can also get this information at no cost by calling 1-800-222-5852 

or by sending an email request to prospectus@principalfunds.com. 

This Summary Prospectus incorporates by reference the Statutory Prospectus for Classes A, B, C, and P 

shares dated February 29, 2012 and the Statement of Additional Information dated February 29, 2012 (which 

may be obtained in the same manner as the Prospectus). 

Objective: The Portfolio seeks to provide a high level of total return (consisting of reinvestment of income 

and capital appreciation), consistent with a moderate degree of principal risk. 

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. You 

may qualify for sales charge discounts if you and your family invest, or agree to invest in the future, at least 

$50,000 in Principal Funds, Inc. More information about these and other discounts is available from your 

financial professional and in “Choosing a Share Class and The Costs of Investing” beginning on page 194, of 

the Fund’s prospectus and “Multiple Class Structure” beginning on page 129 of the Fund’s Statement of 

Additional Information. 

Shareholder Fees (fees paid directly from your investment)
	Class A	Class B	Class C
Maximum Sales Charge (Load) Imposed on Purchases	5.50%	None	None
(as a percentage of offering price)
Maximum Deferred Sales Charge (Load)	1.00%	5.00%	1.00%
(as a percentage of dollars subject to charge)

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Annual Fund Operating Expenses 

(expenses that you pay each year as a percentage of the value of your investment) 

For the year ended October 31, 2011	Class A	Class B	Class C
Management Fees	0.34%	0.34%	0.34%
Distribution and/or Service (12b-1) Fees	0.25	1.00	1.00
Other Expenses	0.11	0.17	0.10
Acquired Fund Fees and Expenses	0.61	0.61	0.61
Total Annual Fund Operating Expenses	1.31%	2.12%	2.05%
Expense Reimbursement(1)	N/A		N/A
Total Annual Fund Operating Expenses after Expense Reimbursement	1.31%	2.12%	2.05%

(1)	Principal Management Corporation ("Principal"), the investment advisor, has contractually agreed to limit the Fund’s expenses
	attributable to Class B shares and, if necessary, pay expenses normally payable by the Fund, excluding interest expense through
	the period ending February 28, 2013. The expense limit will maintain a total level of operating expenses and Acquired Fund Fees
	and Expenses (expressed as a percent of average net assets on an annualized basis) not to exceed and 1.69% for Class B. It is
	expected that the expense limit will continue through the period disclosed; however, Principal Funds, Inc. and Principal, the parties
	to the agreement, may agree to terminate the expense limit prior to the end of the period.

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 assumes 

conversion of the Class B shares to Class A shares after the eighth year. 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	5 years	10 years
Class A	$676	$942	$1,229	$2,042
Class B	$715	$1,064	$1,339	$2,245
Class C	$308	$643	$1,103	$2,379
You would pay the following expenses if you did not redeem your shares:
	1 year	3 years	5 years	10 years
Class A	$676	$942	$1,229	$2,042
Class B	$215	$664	$1,139	$2,245
Class C	$208	$643	$1,103	$2,379

Portfolio Turnover 

As a fund of funds, the Fund does not pay transaction costs, such as commissions, when it buys and sells 

shares of underlying funds (or “turns over” its portfolio). An underlying fund does pay transaction costs when 

it buys and sells portfolio securities, and a higher portfolio turnover may indicate higher transaction costs. 

These costs, which are not reflected in annual fund operating expenses or in the examples, affect the 

performance of the underlying fund and the Fund. During its most recent fiscal year, the Fund's portfolio 

turnover rate was 21.4% of the average value of its portfolio. 

Principal Investment Strategies 

The SAM Portfolios operate as funds of funds and invest principally in Institutional Class shares of Principal 

Funds, Inc. equity funds, fixed-income funds and specialty funds ("Underlying Funds"); the Sub-Advisor 

generally categorizes the Underlying Fund based on the investment profile of the Underlying Fund. Each 

SAM Portfolio typically allocates its assets among Underlying Funds, and within predetermined percentage 

ranges, as determined by the Sub-Advisor in accordance with its outlook for the economy, the financial 

markets and the relative market valuations of the Underlying Funds. 

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The Portfolio:
·	Generally invests between 40% and 80% of its assets in fixed-income funds, and less than 40% in any
	one fixed-income fund (fixed-income funds that generally invest in fixed income instruments such as
	mortgage-backed securities, government and government-sponsored securities, corporate bonds and
	preferred securities)
·	Generally invests between 20% and 60% of its assets in equity funds, and less than 30% in any one
	equity fund (equity funds that generally invest in US and international (including emerging markets)
	equity securities) and
·	Generally invests less than 20% of its assets in specialty funds, and less than 20% in any one specialty
	fund (specialty funds that generally offer unique combinations of traditional equity securities and fixed-
	income securities or that use alternative investment strategies that aim to offer enhanced diversification
	beyond traditional equity securities and fixed-income securities)
The Portfolio may temporarily exceed these percentage ranges for short periods, and the Sub-Advisor may
alter the percentage ranges when it deems appropriate.
Principal Risks
The broad diversification of the Portfolio is designed to cushion severe losses in any one investment sector
and moderate overall price volatility. However, the Portfolio is subject to the particular risks of the Underlying
Funds in which it invests, and its share prices and performance will fluctuate with the shares prices and
performance of the Underlying Funds. The Portfolio operates as a fund of funds and thus bears both its own
expenses and, indirectly, its proportionate share of the expenses of the underlying funds in which it invests.
An investment in the Portfolio is not a deposit of a bank and is not insured or guaranteed by the Federal
Deposit Insurance Corporation or any other government agency. If you sell your shares when their value is
less than the price you paid, you will lose money.
The principal risks of investing in the Portfolio that are inherent in the fund of funds, in alphabetical order,
are:
Asset Allocation Risk. A fund's selection and weighting of asset classes may cause it to underperform
other funds with a similar investment objective.
Conflict of Interest Risk. The Advisor and its affiliates earn different fees from different underlying funds
and may have an incentive to allocate more fund-of-fund assets to underlying funds from which they receive
higher fees.
Investment Company Securities Risk. Fund shareholders bear indirectly their proportionate share of the
expenses of other investment companies in which the fund invests.
The principal risks of investing in the Portfolio that are inherent in the underlying funds, in alphabetical order,
are:
Emerging Market Risk. Investments in emerging market countries may have more risk than those in
developed market countries because the emerging markets are less developed and more illiquid. Emerging
market countries can also be subject to increased social, economic, regulatory, and political uncertainties
and can be extremely volatile.
Equity Securities Risk. Equity securities (common, convertible preferred stocks and other securities whose
values are tied to the price of stocks, such as rights, warrants and convertible debt securities) could decline
in value if the issuer's financial condition declines or in response to overall market and economic conditions.
A fund's principal market segment(s), such as large cap, mid cap or small cap stocks, or growth or value
stocks, may underperform other market segments or the equity markets as a whole. Investments in smaller

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companies and mid-size companies may involve greater risk and price volatility than investments in larger, 

more mature companies. 

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). 

High Yield Securities Risk. High yield fixed-income securities (commonly referred to as "junk bonds") are 

subject to greater credit quality risk than higher rated fixed-income securities and should be considered 

speculative. 

Investment Company Securities Risk. Fund shareholders bear indirectly their proportionate share of the 

expenses of other investment companies in which the fund invests. 

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. 

Preferred Securities Risk. Preferred securities are junior subordinated securities in a company’s capital 

structure and therefore can be subject to greater credit and liquidation risk. An issuer of preferred securities 

could redeem the security prior to the stated maturity date and reduce the return of the security. 

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). 

Risk of Being an Underlying Fund. An underlying fund of 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 A 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 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.principalfunds.com or by calling 1-800-222-5852. 

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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 July 25, 1996. The predecessor portfolio’s performance between 1996 and 2003 

benefited from the agreement of Edge and its affiliates to limit the portfolio’s expenses. 

Performance of a blended index shows how the Fund's performance compares to an index with similar 

investment objectives. Performance of the components of the blended index are also shown. The weightings 

for Capital Benchmark (40/60) are 40% S&P 500 Index and 60% Barclays Capital Aggregate Bond Index. 

Total Returns as of December 31 each year (Class A shares) 

Highest return for a quarter during the period of the bar chart above:	Q2 '09	11.55%
Lowest return for a quarter during the period of the bar chart above:	Q4 '08	-9.94%
Average Annual Total Returns
For the periods ended December 31, 2011	1 Year	5 Years	10 Years
Class A Return Before Taxes	-3.93%	2.49%	4.42%
Class A Return After Taxes on Distributions	-4.75%	1.22%	3.27%
Class A Return After Taxes on Distribution and Sale of Fund Shares	-2.31%	1.53%	3.22%
Class B Return Before Taxes	-4.04%	2.51%	4.36%
Class C Return Before Taxes	-0.02%	2.90%	4.23%
Barclays Capital Aggregate Bond Index (reflects no deduction for fees, expenses, or	7.84%	6.50%	5.78%
taxes)
S&P 500 Index (reflects no deduction for fees, expenses, or taxes)	2.11%	-0.25%	2.92%
Capital Benchmark (40/60) (reflects no deduction for fees, expenses, or taxes)	5.84%	4.20%	4.97%

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 A shares only and would be different for Class B and Class C 

shares. 

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Management
Investment Advisor: Principal Management Corporation
Sub-Advisor(s) and Portfolio Manager(s):
Edge Asset Management, Inc.
·	Charles D. Averill (since 2010), Portfolio Manager
·	Jill R. Cuniff (since 2010), President and Portfolio Manager
·	Todd A. Jablonski (since 2010), Portfolio Manager
Purchase and Sale of Fund Shares
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.
Effective March 1, 2010, Class B shares of the Fund are no longer available for purchase, except through
exchanges and dividend reinvestments.
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 8024, Boston, MA 02266-8024 (regular mail) or 30 Dan Road, Canton, MA
02021-2809 (overnight mail); calling us at 1-800-222-5852; 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.

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