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Funding Your Retirement Saving for retirement isn’t always easy Most underestimate how much they will need

We’re living longer, so retirement lasts longer Average life expectancy in the U.S. Sources: Central Intelligence Agency, The World Factbook 2011; CRS Report for Congress: Life Expectancy in the U.S., August 16, 2006.

Health care costs continue to rise Seniors will be asked to devote an increasing share of their own incomes to pay for health care. Percentage of income spent on health care by seniors Sources: Liqun Liu, Andrew J. Rettenmaier and Zijun Wang, “The Rising Burden of Health Spending on Seniors,” National Center for Policy Analysis, NCPA Policy Report No. 297, February % % %

Social Security benefits are not enough is the current average monthly Social Security benefit payment as of October 2011 Future benefits may decline as the ratio of workers paying into the system to retirees collecting benefits continues to fall Benefits do not generally increase annually, and if they increase, they generally do at a rate that is below the inflation rate $1,082 Sources: Social Security Administration, Monthly Statistical Snapshot, September 2010,

Inflation reduces your purchasing power A dollar today will almost certainly be worth less at retirement because of inflation $619, $273,100$110,300 new home new car $67,142$29,602$12,652 gallon of milk $8.21$3.62$2.22 Sources: U.S. Bureau, Median and Average Sale Prices of New Homes Sold in United States, U.S. Department of Energy, Average Price of a New Car, , “A Bad Year for Car Bargains,” by Bill Vlasic and Nick Bunckley, The New York Times, May 20, 2011, sourcing data from TrueCar.com; U.S. Bureau of Labor Statistics, Consumer Price Index - Average Price Data as of October The effect of inflation on everyday costs (assuming 3.2% annual rate of inflation)

Investigate the options Saving for retirement is up to you Maximize your retirement plan savings and personal savings to help ensure you enjoy the retirement lifestyle you want

Leveraging the power of tax-deferral Source: Legg Mason, The above illustration assumes a $1,000 lump some investment, a 35% income tax bracket, a hypothetical pre-tax return rate of 6%, compounded annually over 10-, 20-, 30- and 40- year periods for both the tax-deferred and the taxable accounts and does not represent an actual investment. Actual investments may include fees, charges and other expenses that would affect an investments return. It assumes no distributions are made during these periods. However, lower maximum tax rates on capital gains and dividends would make the investment return for the taxable investment more favorable. Changes in tax rates and tax treatment of investment earnings may impact the comparative results. This illustration is not representative of any investment product. Actual returns will vary. Withdrawals of earnings from a tax-deferred account are subject to ordinary income tax, and if taken prior to age 59½ can be subject to a 10% IRS penalty charge and/or surrender charges. Growth of a $1,000 one-time investment over 40 years: Tax-deferred vs. taxable Taxable account After-tax value of tax-deferred account There are a number of ways to help you achieve the goals you have for retirement. Tax-deferred account Account Value

Create a savings strategy Determine how much you will need Review your budget Start your saving now Give careful consideration not only to everyday expenses but for health care expenses. By reviewing your budget, you can determine how you can best save for retirement. The sooner you get started with saving for retirement the better

The high cost of procrastination Two hypothetical investors making a $200 monthly contribution that grows at 6% annually years old 30 years $201,708 started investing at age... Invested regularly for... amount at age years old 20 years $92,870 Source: Legg Mason. This illustration assumes a $200 monthly contribution that grows (earns interest) at 6% annually. This chart is for illustrative purposes only and does not represent an actual investment or the performance of any specific investment. Actual investments may include fees, charges and other expenses that would affect an investment’s return.

Action Steps Carefully consider the goals for your retirement Speak to your Primerica Registered Representative Consider the investment opportunities offered by Legg Mason

“The journey of a thousand miles starts with a single step” –Lao-Tsu

All investments involve risk, including loss of principal amount invested. There is no guarantee that investment objectives will be achieved. Investors should carefully consider their objective, risk tolerance and time horizon before investing. Visit us: Follow us: Legg Mason, Inc., its affiliates, and its employees are not in the business of providing tax or legal advice to taxpayers. These materials and any tax- related statements are not intended or written to be used, and cannot be used or relied upon, by any such taxpayer for the purpose of avoiding tax penalties or complying with any applicable tax laws or regulations. Tax-related statements, if any, may have been written in connection with the “promotion or marketing” of the transaction(s) or matter(s) addressed by these materials, to the extent allowed by applicable law. Any such taxpayer should seek advice based on the taxpayer’s particular circumstances from an independent tax advisor." © 2012 Legg Mason Investor Services, LLC, member FINRA, SIPC. Legg Mason Investor Services, LLC is a subsidiary of Legg Mason, Inc. FN INVESTMENT PRODUCTS: NOT FDIC INSURED NOT BANK GUARANTEE MAY LOSE VALUE