National Life Insurance Company ® | Life Insurance Company of the Southwest TM National Life Insurance Company ® | Life Insurance Company of the Southwest ® National Life Group is a trade name of National Life Insurance Company, Montpelier, VT, Life Insurance Company of the Southwest, Addison, TX and their affiliates. Each company of National Life Group is solely responsible for its own financial condition and contractual obligations. Life Insurance Company of the Southwest is not an authorized insurer in New York and does not conduct insurance business in New York. [Agent Name] is a Registered Representative and Investment Adviser Representative of Equity Services, Inc. Securities and investment advisory services are offered solely by Equity Services, Inc., Member FINRA/SIPC, [branch office address and telephone number]. [DBA name] is independent of Equity Services, Inc. Equity Services, Inc. is a Broker/Dealer and Registered Investment Adviser affiliate of National Life Insurance Company. Qualified plans are offered and administered independently of the companies of National Life Group. National Life is bound only by the terms of the life insurance contracts issued by the Group insurance companies. TC87984(1215)3 This information is not intended as tax or legal advice. For advice concerning your own situation, please consult with your appropriate professional advisor. PREPARING FOR RETIREMENT QUALIFIED PLAN CHOICES (Select one) CONCEPTS TO CONSIDER

National Life Insurance Company ® | Life Insurance Company of the Southwest TM Where Will Your Retirement Funds Come From? Social Security Personal Savings / Non Qualified Plans Sale of Business Qualified Plans 2

National Life Insurance Company ® | Life Insurance Company of the Southwest TM How Much Will Your Retirement Cost? ? FamilyHousing New CostsContinued Life Style Set Amount as a Goal Percentage of Income Set Amount as a Goal Percentage of Income Set Amount as a Goal Percentage of Income Maximize Efficiency and Total Amount Available Set Amount as a Goal Percentage of Income Maximize Efficiency and Total Amount Available 3

National Life Insurance Company ® | Life Insurance Company of the Southwest TM Concepts to Consider 4 THE VALUE OF A TAX DEDUCTION RECOVERING YOUR LOST OPPORTUNITY COST PRE TAX VS AFTER TAX QUALIFIED PLAN VS BONUS PLAN

National Life Insurance Company ® | Life Insurance Company of the Southwest TM Concepts To Consider 5 THE VALUE OF A TAX DEDUCTION RECOVERING YOUR LOST OPPORTUNITY COST

National Life Insurance Company ® | Life Insurance Company of the Southwest TM The Value of a Tax Deduction – A Brief Test Questions: When your business makes a tax deductible payment for your benefit and you do not have to include the payment in income, which of the following is true?  More money may be put to work for your benefit  It feels good  You don’t suffer lost opportunity cost (For additional information select this button. )  All of the above  None of the above (Select All That Apply) 6

National Life Insurance Company ® | Life Insurance Company of the Southwest TM Lost Opportunity Cost What You Paid The Potential Gain You Did Not Earn Taxes Paid $1,000 in Taxes Paid Today Could Have Been $2,191* in 20 Years This assumes 4% after tax growth. This is a hypothetical example for illustrative purposes and not representative of any particular investment. 7

National Life Insurance Company ® | Life Insurance Company of the Southwest TM Recovering Lost Opportunity Cost - Taxes? $53,000 Contribution 34% Tax Bracket 20 Years 4% Interest Rate $ 18,020 Annual Tax Savings $360,400 Total Taxes Saved $536,601 Opportunity Cost Recovered 8 This example is purely hypothetical and for illustrative purposes only. The example shown here does not represent any particular plan and your results likely will differ.

National Life Insurance Company ® | Life Insurance Company of the Southwest TM Key Concepts 9 PRE TAX VS AFTER TAX

National Life Insurance Company ® | Life Insurance Company of the Southwest TM After Tax Contributions Annual Tax on Income or Gains Pre Tax Contributions Distributions No Annual Tax on Income or Gains Tax on Distributions 10 Distributions

National Life Insurance Company ® | Life Insurance Company of the Southwest TM Annual Tax on Income or Gains No Annual Tax on Income or Gains Tax on Distributions 11 Pre Tax Contributions Which Nets More? Distributions After Tax Contributions Distributions

National Life Insurance Company ® | Life Insurance Company of the Southwest TM Pre Tax vs. After Tax - Contribution 12 After Tax $34,980 Pre Tax $53,000 This example is purely hypothetical and for illustrative purposes only. The example shown here does not represent any particular plan and your results likely will differ. $53,000 Amount 34% Pre-Retirement Tax Bracket 20 Years to Accum ulate 4% Interest Rate 20 Years to Distribute 25% Post Retirement Tax Bracket

National Life Insurance Company ® | Life Insurance Company of the Southwest TM Pre Tax vs. After Tax Accumulation $1,041,637 Total A/T Spendable Over 20 Years of Distribution $1,410,091 Accumulation $1,578,238 Total A/T Spendable Over 20 Years of Distribution $1,741,940 Annual Withdrawal $76,645 (Partially Taxable) Annual Withdrawal $116,130 (Wholly Taxable) $53,000 Amount 34% Pre-Retirement Tax Bracket 20 Years to Accum ulate 4% Interest Rate 20 Years to Distribute 25% Post Retirement Tax Bracket 13 After Tax $34,980 Pre Tax $53,00 This example is purely hypothetical and for illustrative purposes only. The example shown here does not represent any particular plan and your results likely will differ.

National Life Insurance Company ® | Life Insurance Company of the Southwest TM Concepts To Consider 14 QUALIFIED PLAN VS BONUS PLAN

National Life Insurance Company ® | Life Insurance Company of the Southwest TM How a Qualified Plan May Help – Pre Tax Business and Participants Tax deductible contribution Reward yourself and key employees Provide rank and file meaningful benefit Executive Retirement benefits No current tax on contribution Tax deferred growth Income Tax Free Death Benefit (if plan includes life insurance). Permanent Life Insurance Acquired with pre tax funds Completes the retirement plan in the event of premature death Provides family with financial protection 15

National Life Insurance Company ® | Life Insurance Company of the Southwest TM Qualified Plan vs. Bonus This example is purely hypothetical and for illustrative purposes only. The example shown here does not represent any particular plan and your results likely will differ. 16 Bonus $34,980 Qualified Plan $53,000 After Tax Savings $11,893 $53,000 Amount 34% Pre-Retirement Tax Bracket 20 Years to Accum ulate 4% Interest Rate 20 Years to Distribute 25% Post Retirement Tax Bracket

National Life Insurance Company ® | Life Insurance Company of the Southwest TM Qualified Plan vs. Bonus Total $2,252,690 Accumulation $1,041,637 Total A/T Spendable Over 20 Years of Distribution $1,410,092 Accumulation $1,578,238 Total A/T Spendable Over 20 Years of Distribution $1,741,940 Accumulation $354,157 Total A/T Spendable Over 20 Years of Distribution $510,750 Annual Withdrawal $76,645 (Partially Taxable) Annual Withdrawal $116,130 (Wholly Taxable) Annual Withdrawal $26,059 (Partially Taxable) This example is purely hypothetical and for illustrative purposes only. The example shown here does not represent any particular plan and your results likely will differ. Bonus $34,980 Qualified Plan $53,000 Tax Savings $11,893 $53,000 Amount 34% Pre-Retirement Tax Bracket 20 Years to Accum ulate 4% Interest Rate 20 Years to Distribute 25% Post Retirement Tax Bracket

National Life Insurance Company ® | Life Insurance Company of the Southwest TM WHAT TYPE OF QUALIFIED PLAN? THE CHOICES YOU HAVE 18 LIFE INSURANCE? SAMPLE RESULTS

National Life Insurance Company ® | Life Insurance Company of the Southwest TM TYPES OF QUALIFIED PLANS Defined Contribution Flexible contributions Retirement benefit depends on the amount of contributions made and any growth of plan assets Defined Benefit Contributions designed to reach set retirement benefit Retirement benefit is known IRA Flexible contributions Easy to administer, low-cost Includes part-time employees Profit Sharing Money Purchase 401(k) Target Benefit 412(e) 3 Traditional Select SEP – IRA SIMPLE - IRA 19

National Life Insurance Company ® | Life Insurance Company of the Southwest TM Moving Ahead Qualified Plans Cash Flow Flexibility Tax Deductible Life Insurance Key Executives Contribution Many designs are available 1 Numerous factors drive the selection 2 Desired contribution / Cost goal Age / Years to retirement Flexibility Employee demographics Life Insurance 20

National Life Insurance Company ® | Life Insurance Company of the Southwest TM SAMPLE PROFIT SHARING PLAN 21

National Life Insurance Company ® | Life Insurance Company of the Southwest TM Preferred Demographics 22 Demographics Owner/Key Employees are older than the rank and file 3 or more participants Employer Concerns Flexibility Benefit older key people

National Life Insurance Company ® | Life Insurance Company of the Southwest TM Case Assumptions 23 AGESALARYCONTRIBUTION Owner A (K)61$265,000$53,000 Owner B (K)59265,00053,000 Owner C (K)52180,00053,000 Employees (7)Younger270,00013,500 Total$172,500 Keys$159,000 % to Keys92% This example is purely hypothetical and for illustrative purposes only. The example shown here does not represent any particular plan and your results likely will differ.

National Life Insurance Company ® | Life Insurance Company of the Southwest TM Contributions and Cash Flow Contribution for Keys After Tax Cash Flow Benefit for Keys* $113,850 $159, % Annual Plan Contribution $172, Business Tax Bracket 34% Personal Tax Bracket 92% Allocated To Key EEs 34% *(vs. taking as cash). This example is purely hypothetical and for illustrative purposes only. The example shown here does not represent any particular plan and your results likely will differ.

National Life Insurance Company ® | Life Insurance Company of the Southwest TM Tax Savings vs. Employee Contributions Contribution for Employees $13,500 Annual Tax Savings $58, Business Tax Bracket 34% Personal Tax Bracket 92% Allocated To Key EEs 34% This example is purely hypothetical and for illustrative purposes only. The example shown here does not represent any particular plan and your results likely will differ.

National Life Insurance Company ® | Life Insurance Company of the Southwest TM SAMPLE DEFINED BENEFIT PLAN 26

National Life Insurance Company ® | Life Insurance Company of the Southwest TM Preferred Demographics 27 Demographics Owner/Key Employees are older than the rank and file participants (or more depending on the details of the case) Employer Concerns Fixed commitment Benefit older key people

National Life Insurance Company ® | Life Insurance Company of the Southwest TM Case Assumptions 28 AGESALARYCONTRIBUTION Owner55$265,000$266,813 Employee 13550,00014,228 Employee 23040,0008,678 Employee 32530,0005,183 Total$294,902 Keys$266,813 % to Keys90% This example is purely hypothetical and for illustrative purposes only. The example shown here does not represent any particular plan and your results likely will differ.

National Life Insurance Company ® | Life Insurance Company of the Southwest TM Contributions and Cash Flow 29 Contribution for Keys After Tax Cash Flow Benefit for Keys* $194,635 $266, % Annual Plan Contribution $294,902 Business Tax Bracket 34% Personal Tax Bracket 90% Allocated To Key EEs 34% *(vs. taking as cash). This example is purely hypothetical and for illustrative purposes only. The example shown here does not represent any particular plan and your results likely will differ.

National Life Insurance Company ® | Life Insurance Company of the Southwest TM Tax Savings vs. Employee Contributions Contribution for Employees $28,089 Annual Tax Savings $100,267 This example is purely hypothetical and for illustrative purposes only. The example shown here does not represent any particular plan and your results likely will differ. 30 Business Tax Bracket 34% Personal Tax Bracket 90% Allocated To Key EEs 34%

National Life Insurance Company ® | Life Insurance Company of the Southwest TM LIFE INSURANCE IN A QUALIFIED PLAN Purchased on a pre tax basis May complete your retirement plan May increase tax deductible contribution 31

National Life Insurance Company ® | Life Insurance Company of the Southwest TM Next Steps Review the Business census 1 Review the Business financial statements 2 Complete Fact Finder 3 Prepare Plan Analysis 4 Contact Third Party Administrator 5 32

National Life Insurance Company ® | Life Insurance Company of the Southwest TM WITH A QUALIFIED PLAN FUNDED AND IN PLACE… YOU, YOUR FAMILY, AND YOUR BUSINESS ARE MORE SECURE. 33