Investing Your Congregation’s Endowment Fund Assets Jim Schroeder LCMS Foundation jim@iowadistrictwest.org 515.490.7371

Questions you may have Does the Lutheran Church - Missouri Synod offer an investment program for the endowment funds of LCMS congregations? How is this investment program managed? How many investment options are there? Can we have more than one account? Who will help us?

LCMS Corporations LCMS Inc. - Est. 1847 Concordia Publishing House – Est. 1869 Concordia University System – Est. 1839 Lutheran Church Extension Fund – 1902 Concordia Plan Services – Est. 1937 LCMS Foundation – Est.1958

The LCMS Foundation is the only LCMS organization that offers the investment expertise and gift planning services to help your congregation to establish, manage, and grow your endowment fund.

LCMS Foundation Board of Trustees (Nov 2012) Mr. Roger Prigge Retired Vice President Money Marketing Trading Wells Fargo Corp. Bloomington, Minnesota Rev. Dr. John Karl(Hans) Trinklein Senior Pastor Olive Branch Lutheran Church Okawville, Illinois Ex-Officio Member: Mr. Jerald Wulf LCMS Chief Financial Officer St Louis, Missouri Mr. Don Graf, Board Chairman Partner, McClesky, Harriger, Brazill & Graf LLP Lubbock, Texas Ms. Patricia Bokenkamp Special Assistant Salem Lutheran Church Tomball, Texas Mr. Mark Charron Board Vice-Chairman Partner, Deloitte Consulting, LLP Hartford, Connecticut Mr. A William (Bill) Kernen Co-Owner/President Kernen Partners, LLC Omaha, Nebraska Rev. Dr. William Meyer Part-time Director of Development Concordia University System St Louis, Missouri Dr. Mark Sheldon Ophthalmologist Grand Rapids Ophthalmology Grand Rapids, Michigan The Reverend Richard Drews Senior Financial Consultant Thrivent Financial Libertyville, Illinois Mr. John Schaller Retired, Former Owner/Mgr Sierra National Capital Co. Pocatello, Idaho Mr. Ernest Garbe LCMS President Representative Dieterich, Illinois

Wilshire Consulting… Advisor to over 125 clients with over 700 billion dollars in assets under management. www.wilshire.com Helps the Foundation Board of Trustees: Formulate the investment policy Structure the investment program Select the asset allocation targets Select the asset managers Evaluate asset managers performance

LCMS Foundation Investment Philosophy It is not possible to time market cycles. Capital markets revert to the mean over long time periods. Fees have a meaningful impact on returns. Asset allocation has the most significant impact on investment results. Investment performance measurement and monitoring activities provide assessment of the success of our investment strategies.

LCMS Foundation Investment Management The Foundation manages more than $900,000,000 dollars on behalf of LCMS donors and ministries. (June 2012) This is accomplished under the guidance and advice of the Foundation’s Board of Trustees through their Investment Committee and in counsel with their investment advisor, Wilshire Associates. The long term objective for the Foundation is to achieve total rates of return which exceed the appropriate market benchmarks with minimal excess risk versus those benchmarks. Eight carefully screened investment managers utilize thirteen funds to manage the Foundation’s assets under close supervision to ensure adherence to investment policies and objectives. Managers are reviewed monthly for returns, adherence to style and personnel changes.

Your LCMS Foundation gift planning counselor and trust administrator can help your committee: Design your asset allocation for your endowment fund assets. Select your income distribution plan. Receive your account statements for your reporting needs. Receive and administer gifts to your endowment fund. Assist the members of your congregation in making current and future gifts to your endowment fund.

LCMS Foundation Investment Services Staff The LCMS Foundation’s expert investment services staff will allow you to focus on the mission of your congregation and know that your endowment fund assets are in the capable hands of fellow LCMS Christians, who have the training and experience to support you and your congregation. 800.325.7912 www.lcmsfoundation.org Tom Angus Sr. VP Richard Christiansen – VP of Investment Operations Trust Administrators Donald Horn Liz Trost Tina Clasquin Wayne Sell Scott Radden Kerry Knipp

SCHEDULE OF LCMS FOUNDATION CUSTODIAL FUND FEES LCMS Foundation Account Services Fee: 0.55% SERVICES INCLUDE  Investment management of assets. Distributing income and principal as required. Quarterly account statements as required. The above charges are quoted on an annual basis, but will be charged monthly at one-twelfth the rate and allocated to income of the account at the time of charge. Rates will be applied to accounts in aggregate for each investor.   $5,000 minimum initial investment per account. $250 minimum for additional investments. You may have multiple custodial accounts. Each account will have it’s own identification. Effective April 1, 2012, and subject to change.

LCMS Foundation Standard Funds Fixed Income 100% Fixed Income 80% Core Bond 20% High Yield Bond Conservative Balanced 75% Fixed Income 25% Equity 60% Core Bond 15% High Yield Bond 15 % Domestic 10% International Moderate 40 % Fixed Income 60% Equity 32% Core Bond 8% High Yield 36% Domestic 24% International Aggressive 25% Fixed Income 75% Equity 20% Core Bond 5% High Yield 45% Domestic 30% International Equity 100% Equity 60% Domestic 40% International LCMS Foundation Standard Funds Core Bond 50% Pacific Investment Management Co. (PIMCO) 50% Prudential Fixed Income High Yield Bond 50% Fountain Capital Management 50% Fort Washington Domestic Equity 50% Blackrock 25% Intech – Enhanced investment technologies 15% Jacobs Levy 10% Tamro Capital Partners International Equity 12.5% Aberdeen Asset Management 33% Blackrock 10% American 16% MFS Institutional Advisors 16% Marathon London 12.5 % OFI Institutional Advisors