Updated 2026-03-20

Principal vs Morgan Stanley 401(k) Comparison

Compare Principal Financial (#6, 8.3/10) and Morgan Stanley at Work (#19, 6.8/10) side by side across fees, ratings, features, and investment options.

Overall Comparison

FeaturePrincipalMorgan Stanley
Overall Score8.3/106.8/10
Rank#6#19
AUM$700 billion$6.2 trillion
Participants6 million6 million
Plan Sponsors46,000+15,000+
Founded18791935

Ratings Comparison

CategoryPrincipalMorgan Stanley
Fees & Costs3.5/53.0/5
Investment Options3.8/54.5/5
Customer Service4.2/54.1/5
Mobile App3.9/54.0/5

Fee Comparison

Fee TypePrincipalMorgan Stanley
Admin Fees$1,500 - $5,000/year for small plansVaries by plan size and services
Expense Ratios0.25% - 1.5%0.03% - 1.5%
Trading FeesVaries$0 for stocks/ETFs via E*Trade
Advisory Fees0.40% - 1.0%0.50% - 1.5%

Principal Strengths

Morgan Stanley Strengths

Rollover, Loans & Withdrawals

FeaturePrincipalMorgan Stanley
Rollover PlatformPrincipal.comMorgan Stanley at Work Portal
Loans AvailableYesYes
Withdrawal MethodsOnline via Principal.com, Phone (800-547-7754)Online via Morgan Stanley portal, Phone (800-869-3326), Through Morgan Stanley financial advisor, Branch office visit
Distribution OptionsLump sum, Partial withdrawal, Installment payments, Annuity purchase, Rollover to IRALump sum, Partial withdrawal, Systematic withdrawals, Rollover to IRA, Required Minimum Distributions

Which Should You Choose?

Choose Principal if you want:

  • Small businesses
  • Bundled benefit seekers
  • Companies wanting insurance integration

Choose Morgan Stanley if you want:

  • Companies with stock plans
  • Employees wanting full brokerage access
  • High-net-worth participants
  • Self-directed traders

Our Verdict: Principal vs Morgan Stanley

Principal Financial wins this comparison with a score of 8.3/10 vs 6.8/10. Principal excels with excellent for small business 401(k) plans, making it the stronger choice for most investors in this matchup. However, the best choice ultimately depends on your specific needs, employer plan availability, and investment preferences.

Full Principal Review Full Morgan Stanley Review

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Principal vs Morgan Stanley: Complete 401(k) Comparison for 2026

Choosing between Principal Financial and Morgan Stanley at Work for your 401(k) is an important decision that affects your retirement savings. Principal offers small business focus while Morgan Stanley is known for wealth management. In terms of fees, Principal charges 0.25% - 1.5% expense ratios compared to Morgan Stanley's 0.03% - 1.5%. Principal manages $700 billion in assets and serves 6 million participants, while Morgan Stanley has $6.2 trillion AUM and 6 million participants.

Key Differences: Principal vs Morgan Stanley

When comparing Principal and Morgan Stanley, consider their core strengths: Principal excels with excellent for small business 401(k) plans, while Morgan Stanley stands out for access to morgan stanley financial advisors. Both providers offer a wide range of investment options including target-date funds, index funds, and managed accounts. Principal's customer service rating is 4.2/5 compared to Morgan Stanley's 4.1/5. For mobile experience, Principal scores 3.9/5 while Morgan Stanley scores 4.0/5.

Which Provider is Right for You?

Choose Principal if you prioritize small businesses. Choose Morgan Stanley if you're looking for companies with stock plans. Your decision should also consider your employer's plan availability, fee sensitivity, desired investment options, and customer service expectations. For detailed reviews, visit our individual Principal and Morgan Stanley provider pages.

Frequently Asked Questions

Principal Financial scores higher in our 2026 rankings with 8.3/10. Principal is best for small businesses, while Morgan Stanley is best for companies with stock plans. The right choice depends on your employer's plan and your priorities.

Principal charges expense ratios of 0.25% - 1.5% with admin fees of $1,500 - $5,000/year for small plans. Morgan Stanley charges 0.03% - 1.5% expense ratios with admin fees of Varies by plan size and services. Principal's fees rating is 3.5/5 compared to Morgan Stanley's 3.0/5.

Yes, you can roll over between Principal and Morgan Stanley. Principal uses Principal.com for rollovers, while Morgan Stanley uses Morgan Stanley at Work Portal. A direct rollover avoids mandatory tax withholding. Contact your new provider to initiate the transfer.

Principal offers 401(k) loans. Morgan Stanley offers 401(k) loans. Both providers typically allow loans up to 50% of your vested balance or $50,000, whichever is less.

Principal scores 3.8/5 for investment options, while Morgan Stanley scores 4.5/5. Both offer target-date funds, index funds, and managed accounts. Principal's investment options include Mutual Funds, Target Date Funds, Stable Value. Morgan Stanley offers Mutual Funds, Target Date Funds, Index Funds.

For small businesses, consider plan minimums and per-participant costs. Principal is best for small businesses, bundled benefit seekers, companies wanting insurance integration. Morgan Stanley is best for companies with stock plans, employees wanting full brokerage access, high-net-worth participants, self-directed traders. Compare admin fees: Principal charges $1,500 - $5,000/year for small plans vs Morgan Stanley's Varies by plan size and services.

Pavlo Pyskunov

Pavlo Pyskunov

Managing Director & Investment Fund Director

Pavlo Pyskunov analyzes employer-sponsored retirement plans using IRS publications and DOL Form 5500 filings, helping workers maximize their 401(k) savings through data-driven guidance.

Last updated: 2026-03-20