1. Successful Financial Planning… Vance L. Falbaum, CIMA® Senior Vice President – Financial Consultant

2. 2 The future belongs to those who believe in the beauty of their dreams. Eleanor Roosevelt

3. 3 Today’s Agenda Setting Goals Developing a Plan Monitoring the Plan Challenges to Your Success Where to get the best caddy for THIS game

4. 4 But first a word on…words! For purposes of this presentation:  Retirement is having the CHOICE of whether or not to go to work today  Safety is achieving your goals  Volatility is the daily movements of an investment  Risk is something outside your personal comfort level  Goals are a wish with a time line and are written down

5. 5 Setting Goals Think in today’s dollars Consider inflation Prepare for the unavoidable inevitable

6. 6 Developing a Plan What is YOUR safety net Determining the correct buckets to use How much can you save What should you expect to earn based on the investment decisions you make

7. 7 The Safety Net Cash Insurance Wealthy Parents or Kids

8. 8 Where and how is the best place to save and invest? Earnings Pre-Tax Savings 401(k) Plan SIMPLE Plan IRA’s After-Tax Savings Bank Brokerage Firm

9. 9 How Much to Save?!  In 1980 the average saving rate for an American was 8.2% of their wage  By the end of the 1990’s that had dropped to less than 1%! Center for a New American Dream

10. 10 “The most powerful force in the universe is compound interest” Albert Einstein

11. 11 Historical Growth of $1 January 1926 – June 2010 AssetEndingAverage ClassBalanceReturn Small Cap$7,05811.1% Large Cap$2,4179.7% LT Gov''t Bonds$955.5% Treasury Bills$213.7% Inflation$123.0% Small Cap Equities: Represented by the Russell 2000 Index. Large Cap Equities: Represented by the S&P 500 Index. Long Term Gov’t Bonds: Represented by the Citigroup USBIG Treasury 10+ Year Index. Treasury Bills: Represented by the Citigroup 3-month T-Bill Index. Inflation: Represented by the Consumer Price Index – All Urban Consumers (CPI-U). Past performance does not guarantee future results. Data Source: Ibbotson Associates and Zephyr Associates.

12. 12 U.S. Stocks vs. U.S. Bonds Calendar Year Returns Returns through September 2010. U.S. Stocks represented by the S&P 500 Index. U.S. Bonds represented by the BarCap Intermediate Government Credit Index. Data Source: Zephyr Associates. U.S. Stocks Outperform U.S. Bonds U.S. Stocks Underperform U.S. Bonds

13. 13 Balancing Savings Against Time

14. 14 Monitoring the Plan Frequency? What to look at? Manage risk not returns!

15. 15 Challenges to Your Success Potentially Bad Information – The Media Cognitive Biases Inflation Taxes Yourself

16. 16 Media Effects…and the DJIA March 9 th, 2009 October 13 th, 2008 September 14 th, 1998 November 7 th, 1987 Source – Bloomberg through 12/2010 86.1% 31.9% 93.1% 975.6%

17. 17 Biases Conditioning Overconfidence Fear Recency Herding

18. 18 The New 1040 Tax form… Line 1 – How much did you make? $_______ Line 2 – Send it in!

19. 19 Protecting yourself from…yourself Average Return S&P 500 1989-2008 8.35% 1.87% Average Equity Investor Return 1989-2008 Data Source: Standard & Poor's Financial Services LLC

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22. 22 THANK YOU!