SECURITIES AND EXCHANGE COMMISSION
                             WASHINGTON, D.C. 20549

                               ------------------



                                    FORM 8-K

                                 CURRENT REPORT



                     PURSUANT TO SECTION 13 OR 15(D) OF THE
                         SECURITIES EXCHANGE ACT OF 1934

                         Date of Report: AUGUST 22, 2006
                        (Date of earliest event reported)



                         PRINCIPAL FINANCIAL GROUP, INC.
             (Exact name of registrant as specified in its charter)


      DELAWARE                        1-16725                42-1520346
(State or other jurisdiction    (Commission file number)  (I.R.S. Employer
    of incorporation)                                   Identification Number)


                     711 HIGH STREET, DES MOINES, IOWA 50392
                    (Address of principal executive offices)

                                 (515) 247-5111
              (Registrant's telephone number, including area code)

Check  the  appropriate  box  below  if the  Form  8-K  filing  is  intended  to
simultaneously  satisfy the filing obligation of the registrant under any of the
following provisions:

[ ] Written communications pursuant to Rule 425 under the Securities Act (17 CFR
    230.425)
[ ] Soliciting  material pursuant to Rule 14a-12 under the Exchange Act (17  CFR
    240.14a-12)
[ ] Pre-commencement  communications  pursuant  to  Rule 14d-2(b) under the
    Exchange Act (17 CFR 240.14d-2(b))
[ ] Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange
    Act (17 CFR 240.13e-4(c))

                               ------------------



<PAGE>



ITEM 1.01.  ENTRY INTO MATERIAL DEFINITIVE AGREEMENT.

On August 22, 2006, the board of directors of Principal  Financial  Group,  Inc.
(the "Company") agreed to revise three components of director compensation.

ANNUAL RETAINER

Beginning in November  2006,  directors who are not officers or employees of the
Company or its subsidiaries  will receive an annual retainer of $60,000 (payable
semiannually),  an increase  from the prior  annual  retainer  of  $45,000.  The
additional annual retainers received for serving as chair of the audit committee
($15,000),   the  human  resources  or  nominating  and  governance   committees
($10,000),  and of any other board committee or as presiding  director  ($5,000)
were not changed.

DIRECTORS STOCK PLAN

Beginning in May 2007, at the close of each annual  meeting,  each  non-employee
director will receive $85,000 worth of restricted  stock units (unless a greater
or  lesser  amount  is  determined  to be  appropriate  by  the  nominating  and
governance  committee),  an increase  from the existing  annual grant of $75,000
worth of restricted stock units. These restricted stock units will vest upon the
director's  continued  service to the next  annual  meeting.  The receipt of the
restricted  stock  units will be deferred  until the  director's  retirement  or
termination from the Board.  Any director first elected  subsequent to an annual
meeting will be granted the number of  restricted  stock units as  determined by
the committee.

The board of directors has also adopted  formal stock  ownership  guidelines for
non-employee directors effective immediately. Such directors are expected to own
the  Company's  common  stock,  restricted  stock units and phantom  stock units
acquired  through the  Company's  Deferred  Compensation  Plan for  Non-Employee
Directors  with a value  equal to or  greater  than five  times the value of the
non-employee director annual retainer. Non-employee directors are to achieve the
new ownership guidelines within five years of adoption.

DIRECTORS MATCHING GIFT PROGRAM

Beginning   immediately,   Principal  Life  will  match   charitable   gifts  of
non-employee  directors  to the United Way up to an annual  aggregate  limit for
each such director of $10,000 per calendar year during a director's term and for
each of the three years following the director's retirement from the board under
the Directors  Charitable  Matching Gift Program.  This is a new addition to the
program, pursuant to which Principal Life currently matches the charitable gifts
of non-employee  directors to eligible section 501(c)(3)  organizations up to an
annual  aggregate  limit for each such director of $6,000 per calendar year. The
directors who make personal  charitable gifts that Principal Life matches derive
no  financial  benefit  from the  Directors  Matching  Gift  Program  since  all
charitable  contribution  tax  deductions  for the Principal Life matching gifts
accrue solely to Principal Life.


                                       2
<PAGE>

                                    SIGNATURE


Pursuant  to the  requirements  of the  Securities  Exchange  Act of  1934,  the
registrant  has duly  caused  this  report  to be  signed  on its  behalf by the
undersigned thereunto duly authorized.



                                    PRINCIPAL FINANCIAL GROUP, INC.


                                    By:       /S/ JOYCE N. HOFFMAN
                                              ---------------------------------
                                    Name:     Joyce N. Hoffman
                                    Title:    Senior Vice President and
                                              Corporate Secretary


Date:    August 28, 2006



                                       3
<PAGE>
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SECURITIES AND EXCHANGE COMMISSION
                             WASHINGTON, D.C. 20549

                               ------------------

                                    FORM 8-K

                                 CURRENT REPORT

                     PURSUANT TO SECTION 13 OR 15(D) OF THE
                         SECURITIES EXCHANGE ACT OF 1934

                         Date of Report: AUGUST 22, 2006
                        (Date of earliest event reported)

                         PRINCIPAL FINANCIAL GROUP, INC.
             (Exact name of registrant as specified in its charter)

      DELAWARE                        1-16725                42-1520346
(State or other jurisdiction    (Commission file number)  (I.R.S. Employer
    of incorporation)                                   Identification Number)

                     711 HIGH STREET, DES MOINES, IOWA 50392
                    (Address of principal executive offices)

                                 (515) 247-5111
              (Registrant's telephone number, including area code)

Check  the  appropriate  box  below  if the  Form  8-K  filing  is  intended  to
simultaneously  satisfy the filing obligation of the registrant under any of the
following provisions:

[ ] Written communications pursuant to Rule 425 under the Securities Act (17 CFR
    230.425)
[ ] Soliciting  material pursuant to Rule 14a-12 under the Exchange Act (17  CFR
    240.14a-12)
[ ] Pre-commencement  communications  pursuant  to  Rule 14d-2(b) under the
    Exchange Act (17 CFR 240.14d-2(b))
[ ] Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange
    Act (17 CFR 240.13e-4(c))

                               ------------------
ITEM 1.01.  ENTRY INTO MATERIAL DEFINITIVE AGREEMENT.

On August 22, 2006, the board of directors of Principal  Financial  Group,  Inc.
(the "Company") agreed to revise three components of director compensation.

ANNUAL RETAINER

Beginning in November  2006,  directors who are not officers or employees of the
Company or its subsidiaries  will receive an annual retainer of $60,000 (payable
semiannually),  an increase  from the prior  annual  retainer  of  $45,000.  The
additional annual retainers received for serving as chair of the audit committee
($15,000),   the  human  resources  or  nominating  and  governance   committees
($10,000),  and of any other board committee or as presiding  director  ($5,000)
were not changed.

DIRECTORS STOCK PLAN

Beginning in May 2007, at the close of each annual  meeting,  each  non-employee
director will receive $85,000 worth of restricted  stock units (unless a greater
or  lesser  amount  is  determined  to be  appropriate  by  the  nominating  and
governance  committee),  an increase  from the existing  annual grant of $75,000
worth of restricted stock units. These restricted stock units will vest upon the
director's  continued  service to the next  annual  meeting.  The receipt of the
restricted  stock  units will be deferred  until the  director's  retirement  or
termination from the Board.  Any director first elected  subsequent to an annual
meeting will be granted the number of  restricted  stock units as  determined by
the committee.

The board of directors has also adopted  formal stock  ownership  guidelines for
non-employee directors effective immediately. Such directors are expected to own
the  Company's  common  stock,  restricted  stock units and phantom  stock units
acquired  through the  Company's  Deferred  Compensation  Plan for  Non-Employee
Directors  with a value  equal to or  greater  than five  times the value of the
non-employee director annual retainer. Non-employee directors are to achieve the
new ownership guidelines within five years of adoption.

DIRECTORS MATCHING GIFT PROGRAM

Beginning   immediately,   Principal  Life  will  match   charitable   gifts  of
non-employee  directors  to the United Way up to an annual  aggregate  limit for
each such director of $10,000 per calendar year during a director's term and for
each of the three years following the director's retirement from the board under
the Directors  Charitable  Matching Gift Program.  This is a new addition to the
program, pursuant to which Principal Life currently matches the charitable gifts
of non-employee  directors to eligible section 501(c)(3)  organizations up to an
annual  aggregate  limit for each such director of $6,000 per calendar year. The
directors who make personal  charitable gifts that Principal Life matches derive
no  financial  benefit  from the  Directors  Matching  Gift  Program  since  all
charitable  contribution  tax  deductions  for the Principal Life matching gifts
accrue solely to Principal Life.

                                       2
SIGNATURE

Pursuant  to the  requirements  of the  Securities  Exchange  Act of  1934,  the
registrant  has duly  caused  this  report  to be  signed  on its  behalf by the
undersigned thereunto duly authorized.

                                    PRINCIPAL FINANCIAL GROUP, INC.

                                    By:       /S/ JOYCE N. HOFFMAN
                                              ---------------------------------
                                    Name:     Joyce N. Hoffman
                                    Title:    Senior Vice President and
                                              Corporate Secretary

Date:    August 28, 2006

                                       3