R ONALD B LUE & C O., LLC Saving and Investing The Biblical Way

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Short Term Goals- Liquidity 6 months - 5 years Long Term Goals - Growth 5 Years + SEQUENTIAL INVESTING Eliminate all high interest debt Credit Cards Automobiles Keep 1 month’s living expenses in interest bearing checking (living expenses as determined by your monthly budget) Keep 3 month’s living expenses in a Money Market or savings account (reserves in case of disability, job loss or other emergency) Put savings for major expenses in a Money Market Fund, CD’s, or similar account. 1. Automobiles 2. Furniture 3. Home Improvements Invest to meet LONG-TERM goals in: MMF’s/CD’s/ etc Mutual Funds Real Estate Bonds Equities 1. Liquid Assets 2. Retirement Assets SPECULATE after careful research Venture Capital Private Equity

4 “Divide your portion to seven, or even to eight, for you do not know what misfortune may occur on the earth.” Ecclesiastes 11:2 “Ants are creatures of little strength, yet they store up food in the summer.” Proverbs 30:25 Scriptural Investing

5 Investments Perspective Biblical PerspectiveWorldly Perspective Preservation and steady growth of capital ( Prov. 28:20) Get Rich Quick! Long Time Horizon ( Luke 14:28) Short Time Horizon Saving/Investing First ( Ecc. 5:13,14; Prov. 24:27) Spend/Consume First Time is a Tool ( Prov. 6:6-8, 28:22) Time is An Enemy Cycles are Inevitable (2 Peter 3:4) Upward Trend Hopeful Diversification Strategy (Ecc. 11:1-2) Timing Strategy

6 Diversification The value and return on most investments will fluctuate; there is no guarantee of future results. These returns are hypothetical and do not represent returns of any particular investment. $10,000 $57,435 Amy Amy puts all her money in 1 Investment earning 6% per year for 30 years. $10,000 $2,000 $11,487 $34,899 $0 $83,285 Mike Mike splits his $ among 5 investments, equally; $4,000 earns 10% $2,000 earns 6 % $2,000 earns 0% $2,000 loses 100 % In 30 years, Mike has almost $26,000 more

7 Today’s World Economy - Still No “Great Depression II” Source: Fidelity Management & Research Co. 4Q Great Depression ( ) Today unemployment banks U.S. Gov’t response Global response 25%8-9% 9,000 bank failures* no deposit insurance 25 bank failures to date * Wikipedia.org/wiki/Great_Depression Fed Res: DECREASED money supply Fed Gov’t: small steps, raised taxes Fed Res: Massive INCREASES in money supply Fed Gov’t: Massive recapitalization of financial system Isolationism, raised tariffs – destroyed world trade united world policies to aid banking systems (G7- G20)

Investment Management For informational purposes only, not specific investment advice. See Important Explanatory Notes on page 2. 3Q08 QIS

9 Global Response to Crisis Source: Fidelity 4Q

10 What went wrong? Why Smart People Make Big Money Mistakes-And How to Correct Them: Lessons from the New Science of Behavioral Economics by Gary Belsky and Thomas Gilovich

11 Fund Return vs. Investor Return Source: Dalbar Quantitative Analysis of Investor Behavior (QAIB) Fund return does not necessarily equal investor return. Individual returns have historically been much lower than the fund returns. We call this difference, the cost of uninformed investing.

12 Why “market timing” is difficult $10,000 Invested Invested all days $50,875 Missed10 Missed 10 best days $34,033 Missed20 Missed 20 best days $25,055 Missed 30 best days $19,433 Missed 40 best days $15,374 THE IMPACT OF MISSING A FEW KEY DAYS THE IMPACT OF MISSING A FEW KEY DAYS Ten-year period ending 2000 This hypothetical illustration is based on the Russell 1000® Index, dividends reinvested, and no fees. SOURCE: Nicholas-Applegate Management Co.

13 growth – preservation - cash Your “non RE”, “non-Business”, “non-personal” portfolio

14 growth - preservation - cash Your “non RE”, “non-Business”, “non-personal” portfolio