There is no guarantee that the strategies set forth in this presentation will achieve their intended objectives LWI Financial Inc. (“Loring Ward”) is an investment adviser registered with the Securities and Exchange Commission. Securities transactions may be offered through Loring Ward Securities Inc., member FINRA/SIPC B (Exp. 2/15)

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8 Helping & Protecting Family Enjoying & Protecting Lifestyle Planning Ahead Creating Financial Comfort Building a Legacy Helping ChildrenIncome NeedsClarifying VisionManaging Resources Wills and Power of Attorney Assisting ParentsLeisure PlanningHealth ChallengesGenerating IncomeEstate Transfer Funding EducationPersonal HealthManaging ChangeMinimizing TaxesCharitable Giving Retirement Transition Planning Protecting Assets and Business Life Transition Planning Working with an Advisory Team Living Legacy Financial Life Map

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10 “Straw” Portfolio

11 “Wood” Portfolio

12 Diversification neither assures a profit nor guarantees against loss in a declining market. “Brick” Portfolio

13 Adam Smith Frederich Hayek Paul Samuelson Merton Miller Bill Sharpe Harry Markowitz

14 How You Allocate Between Stocks & Short-Term Bonds How You Allocate Between U.S. & International Stocks Your Comfort with Key Risk Factors Decisions 3

15 1 Risks associated with investing in stocks potentially include increased volatility (up and down movement in the value of your assets) and loss of principal. Indexes are unmanaged baskets of securities that investors cannot directly invest in. Past performance is no guarantee of future results. Hypothetical value of $1 invested at the beginning of 1927 and kept invested through December 31, Assumes reinvestment of income and no transaction costs or taxes. This is for illustrative purposes only and not indicative of any investment. An investment cannot be made directly in an index. Total returns in U.S. dollars. Long Term Government Bonds, One-Month US Treasury Bills, and US Consumer Price Index (inflation), source: Morningstar’s 2013 Stocks, Bonds, Bills, And Inflation Yearbook (2013); Fama/French Total U.S. Market Index provided by Fama/French from Center for Research in Security Prices (CRSP) data. Includes all NYSE securities (plus Amex equivalents since July 1962 and NASDAQ equivalents since 1973), including utilities. Growth of $1 Jan. 1, 1927 – Dec. 31, 2012 How You Allocate Between Stocks & Short-Term Bonds

16 How You Allocate Between Stocks & Short-Term Bonds 1 Source: One-Month US Treasury Bills, Five-Year US Treasury Notes, and Twenty-Year (Long-Term) US Government Bonds provided by Ibbotson Associates. Six-Month US Treasury Bills provided by CRSP ( ) and Merrill Lynch (1978-present). One-Year US Treasury Notes provided by the Center for Research in Security Prices (1964-May 1991) and Merrill Lynch (June 1991-present). Morningstar data © 2013 Stocks, Bonds, Bills, and Inflation Yearbook (2013), Morningstar. The Merrill Lynch Indices are used with permission; copyright 2013 Merrill Lynch, Pierce, Fenner& Smith Incorporated; all rights reserved. Assumes reinvestment of dividends. Past performance is not indicative of future results. All investments involve risk. Standard deviation annualized from quarterly data. Standard deviation is a statistical measurement of how far the return of a security (or index) moves above or below its average value. The greater the standard deviation, the riskier an investment is considered to be. Risk and Rewards Examined for Bonds 1964–2012

17 2 How You Allocate Between U.S. & International Stocks

18 World Market Capitalization $37.5 Trillion as of December 31, 2012 Source: Dimensional Fund Advisors. In US dollars. Market cap data is free-float adjusted from Bloomberg securities data. Many small nations not displayed. Totals may not equal 100% due to rounding. Past Performance is not indicative of future results. All investments involve risk. Foreign securities involve additional risks including foreign currency changes, taxes and different accounting and financial reporting methods. Capitalization over time ($ trillions) Developed Markets Emerging Markets Frontier Markets Bloomberg Index Affiliation How You Allocate Between U.S. & International Stocks 2

19 Past Performance is not indicative of future results. All investments involve risk. Foreign securities involve additional risks including foreign currency changes, taxes and different accounting and financial reporting methods. How You Allocate Between U.S. & International Stocks Source: Morningstar Direct Countries represented by their respective MSCI IMI (net div.). Indexes are unmanaged baskets of securities in which investors cannot directly invest; they do not reflect the payment of advisory fees or other expenses associated with specific investments or the management of an actual portfolio. Past performance is not a guarantee of future results. All investments involve risk, including loss of principal. Foreign securities involve additional risks, including foreign currency changes, political risks, foreign taxes, and different methods of accounting and financial reporting. Ranking of Markets Around the World Ten-Year Performance in US Dollars Annualized Returns Year Ending December 31,

20 How You Allocate Between U.S. & International Stocks 2

21 3 The risks associated with investing in stocks and overweighting small company and value stocks potentially include increased volatility (up and down movement in the value of your assets) and loss of principal. Your Comfort with Key Risk Factors Small Company Stocks Growth Company Stocks Value Company Stocks Large Company Stocks Total Stock Market Increased Expected Returns Decreased Risk and Expected Returns

22 Indices are not available for direct investment. Their performance does not reflect the expenses associated with the management of an actual portfolio. Past performance is not a guarantee of future results. US value and growth index data (ex utilities) provided by Fama/French. The S&P data are provided by Standard & Poor’s Index Services Group. CRSP data provided by the Center for Research in Security Prices, University of Chicago. International Value and Growth data provided by Fama/French from Bloomberg and MSCI securities data. International Small data compiled by Dimensional from Bloomberg, StyleResearch, London Business School, and Nomura Securities data. MSCI EAFE Index is net of foreign withholding taxes on dividends; copyright MSCI 2013, all rights reserved. Emerging markets index data simulated by Fama/French from countries in the IFC Investable Universe; simulations are free-float weighted both within each country and across all countries. Values change frequently and past performance may not be repeated. There is always the risk that an investor may lose money. Small company risk: Securities of small firms are often less liquid than those of large companies. As a result, small company stocks may fluctuate relatively more in price. Emerging markets risk: Numerous emerging countries have experienced serious, and potentially continuing, economic and political problems. Stock markets in many emerging countries are relatively small, expensive, and risky. Foreigners are often limited in their ability to invest in, and withdraw assets from, these markets. Additional restrictions may be imposed under other conditions. Foreign securities and currencies risk: Foreign securities prices may decline or fluctuate because of: (a) economic or political actions of foreign governments, and/or (b) less regulated or liquid securities markets. Investors holding these securities are also exposed to foreign currency risk (the possibility that foreign currency will fluctuate in value against the US dollar). Your Comfort with Key Risk Factors 3

23 The Key Academic Research Defining Value and Growth: Implications for Returns and Turnover Jim Davis and Inmoo Lee, Dimensional Fund Advisors (August 2008) Defining Value and Growth: Implications for Returns and Turnover The Anatomy of Value and Growth Stocks Fama, Eugene F., University of Chicago – Graduate School of Business and Kenneth R. French, Dartmouth College – Tuck School of Business; National Bureau of Economic Research (September 2007) The Anatomy of Value and Growth Stocks Migration Fama, Eugene and Kenneth R. French, Financial Analysts Journal (June 2007) Dissecting Anomalies Fama, Eugene F., University of Chicago – Graduate School of Business and Kenneth R. French, Dartmouth College – Tuck School of Business; National Bureau of Economic Research (June 2007) Migration Dissecting Anomalies Average Returns, B/M, and Share Issues Fama, Eugene F., University of Chicago – Graduate School of Business and Kenneth R. French, Dartmouth College - Tuck School of Business; (May 2007) International Evidence of the Size Effect Rizova, Savina, Dimensional Fund Advisors (August 2006) Average Returns, B/M, and Share Issuesnternational Evidence of the Size Effect Multi-Factor Investing Fama Jr., Eugene F., Dimensional Fund Advisors (July 2006) Multi-Factor Investing The Value Premium and the CAPM Fama, Eugene F., University of Chicago – Graduate School of Business and Kenneth R. French, Dartmouth College - Tuck School of Business; National Bureau of Economic Research (March 2005) The Value Premium and the CAPM

24 The Capital Asset Pricing Model: Theory and Evidence Fama, Eugene F., University of Chicago – Graduate School of Business and Kenneth R. French, Dartmouth College - Tuck School of Business; National Bureau of Economic Research (August 2003) The Capital Asset Pricing Model: Theory and Evidence The Corporate Cost of Capital and the Return on Corporate Investment Fama, Eugene F., University of Chicago – Graduate School of Business and Kenneth R. French, Dartmouth College – Tuck School of Business; (April 1998) The Corporate Cost of Capital and the Return on Corporate Investment Value Versus Growth: The International Evidence Fama, Eugene F., University of Chicago – Graduate School of Business and Kenneth R. French, Dartmouth College – Tuck School of Business; National Bureau of Economic Research (August 1997) Value Versus Growth: The International Evidence Cross Section of Expected Stock ReturnsFama, Eugene and Kenneth R. French, Journal of Finance 47 (1992) Luck Versus Skill in the Cross Section of Mutual Fund ReturnsFama, Eugene F. and French, Kenneth R., (December 14, 2009 ) Mutual Fund Performance Fama, Eugene F. and French, Kenneth R.; National Bureau of Economic Research (June 30, 2008) Mutual Fund Performance The Cost of Active Investing French, Kenneth R. (March 13, 2008) The Cost of Active Investing False Discoveries in Mutual Fund Performance: Measuring Luck in Estimated Alphas L. Barras, O. Scaillet, and R. Wermers (July 2006) False Discoveries in Mutual Fund Performance: Measuring Luck in Estimated Alphas The Key Academic Research

25 The Informational Efficiency of Stock Prices Davis, James L., Dimensional Fund Advisors (April 2006) The Informational Efficiency of Stock Prices Market Efficiency: A Theoretical Distinction and So What? Markowitz, Harry M., Financial Analysts Journal (2005) Market Efficiency: A Theoretical Distinction and So What? The Efficient Market Hypothesis and Its Critics Malkiel, Burton G. Princeton University, CEPS Working Paper No. 91 (April 2003) The Efficient Market Hypothesis and Its Critics Passive Investment Strategies and Efficient Markets Malkiel, Burton G. Princeton University, Princeton University - Bendheim Center for Finance; National Bureau of Economic Research (2003) Passive Investment Strategies and Efficient Markets Mutual Fund Performance and Manager Style Davis, James L., Dimensional Fund Advisors Financial Analysts Journal (January / February 2001 ) Market Efficiency, Long-term Returns, and Behavioral Finance Fama, Eugene F., University of Chicago Graduate School of Business (February 1997) Market Efficiency, Long-term Returns, and Behavioral Finance Asset Management: Active vs. Passive Management Sinquefield, Rex A., Dimensional Fund Advisors (October 1995) Asset Management: Active vs. Passive Management The Performance of Mutual Funds in the Period Jensen, Michael, The Journal of Finance (May 1968 ) Efficient Markets Hypothesis Fama, Eugene F.,University of Chicago (1965) Behavior of Securities Prices — 1965 Samuelson, Paul, MIT (1965) The Statistical Properties of Internationally Diversified Portfolios Davis, James L., Dimensional Fund Advisors (September 2004) The Statistical Properties of Internationally Diversified Portfolios The Key Academic Research

26 What Measures the Benefits of Diversification Statman, Meir, Santa Clara University - Department of Finance and Jonathan Scheid, Loring Ward Advisor Services (May 2005) How Much Diversification is Enough Statman, Meir Santa Clara University - Department of Finance (October 2002) What Measures the Benefits of Diversification How Much Diversification is Enough Have Individual Stocks Become More Volatile? An Empirical Exploration of Idiosyncratic Risk? Campbell, John Y., Martin Lettau, Burton G. Malkiel and Yexiao Xu, Harvard University - Department of Economics, New York University - Department of Finance, Princeton University - Bendheim Center for Finance and University of Texas at Dallas - Department of Finance & Managerial Economics (March 2000) Have Individual Stocks Become More Volatile? An Empirical Exploration of Idiosyncratic Risk? The Statistical Properties of Internationally Diversified Portfolios Davis, James L., Dimensional Fund Advisors (September 2004) Several recent studies have cast doubt on the diversification benefits of The Statistical Properties of Internationally Diversified Portfolios The Capital Asset Pricing Model: Theory and Evidence Fama, Eugene F., University of Chicago – Graduate School of Business and Kenneth R. French, Dartmouth College - Tuck School of Business; National Bureau of Economic Research (August 2003) The Capital Asset Pricing Model: Theory and Evidence What Measures the Benefits of Diversification Statman, Meir, Santa Clara University - Department of Finance and Jonathan Scheid, Loring Ward Advisor Services (May 2005) What Measures the Benefits of Diversification How Much Diversification is Enough Statman, Meir Santa Clara University - Department of Finance (October 2002) Diversification and Portfolio Risk Harry Markowitz, University of Chicago (1962) The Key Academic Research

28 The buying and selling of securities for the purpose of rebalancing may have adverse tax consequences.

29 Rebalancing and a 50% Stocks/50% Bonds Portfolio 1993 – 2012 Data source: Center for Research in Security Prices (CRSP), January Past performance is no indication of future results. All investments involve risk, including loss of principal. Stocks are represented by the S&P 500 Index. Bonds are represented by the SBBI Long-Term Bond Index. Indexes are unmanaged baskets of securities in which investors cannot invest and do not reflect the payment of advisory fees associated with a mutual fund or separate account. Returns assume dividend and capital gain reinvestment. Rebalancing does not guarantee a return or protect against a loss.

30 For Illustration Purposes Only

31 Average Investor vs. Major Indices 1992 – 2012 Average stock investor and average bond investor performances were used from a DALBAR study, Quantitative Analysis of Investor Behavior (QAIB), 03/2013. QAIB calculates investor returns as the change in assets after excluding sales, redemptions, and exchanges. This method of calculation captures realized and unrealized capital gains, dividends, interest, trading costs, sales charges, fees, expenses, and any other costs. After calculating investor returns in dollar terms (above), two percentages are calculated: Total investor return rate for the period and annualized investor return rate. Total return rate is determined by calculating the investor return dollars as a percentage of the net of the sales, redemptions, and exchanges for the period. The fact that buy- and-hold has been a successful strategy in the past does not guarantee that it will continue to be successful in the future. S&P 500 and Fixed Income index returns do not include expenses and fees Equities Behavior Gap = 3.96% Fixed Income Behavior Gap = 5.36%

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33 Can Past Performance Predict Future Results? 10-Year Annualized Performance of 862 U.S. Equity Funds vs. S&P –2007 Data source: Center for Research in Security Prices (CRSP), For illustrative purposes only. Mutual funds were placed in descending order of 10-year annualized performance, and subsequent 5-year performance assumes the same ordering as the 10- year period. The number of funds for the subsequent 5-year period represent existing funds from the 10- year period. Eligible universe is share classes of US Equity Open End mutual funds domiciled in the US with prospectus benchmark of the S&P 500, classified into the US Stock mutual fund asset class by Morningstar Direct with a ten-year annualized return as of Dec. 31, 2007 in Morningstar Direct. Mutual fund universe statistical data provided by Morningstar, Inc.; Indices are not available for direct investment; therefore, their performance does not reflect the expenses associated with the management of an actual portfolio. Past performance is no guarantee of future results, and there is always the risk that an investor may lose money. S&P 500® is a registered trademark of Standard & Poor’s Financial Services LLC All investments involve risk, including loss of principal.

34 5 Years Later… 248 Funds Have Closed Their Doors

35 5 Years Later, No Predictable Pattern of Performance 5-Year Annualized Performance of 862 U.S. Equity Funds vs. S&P Data source: Center for Research in Security Prices (CRSP), For illustrative purposes only. Mutual funds were placed in descending order of 10-year annualized performance, and subsequent 5-year performance assumes the same ordering as the 10- year period. The number of funds for the subsequent 5-year period represent existing funds from the 10- year period. Eligible universe is share classes of US Equity Open End mutual funds domiciled in the US with prospectus benchmark of the S&P 500, classified into the US Stock mutual fund asset class by Morningstar Direct with a ten-year annualized return as of Dec. 31, 2007 in Morningstar Direct. Mutual fund universe statistical data provided by Morningstar, Inc.; Indices are not available for direct investment; therefore, their performance does not reflect the expenses associated with the management of an actual portfolio. Past performance is no guarantee of future results, and there is always the risk that an investor may lose money. S&P 500® is a registered trademark of Standard & Poor’s Financial Services LLC All investments involve risk, including loss of principal.

36 1.Design A Plan To Meet Your Life Goals 2.Build Your Plan Using Scientific & Academic Research 3.Protect Your Plan with a Disciplined and Structured Approach In Summary

37 Questions? 37