1. 2014 © 2014 LWI Financial Inc. All rights reserved. Unauthorized copying, reproducing, duplicating, or transmitting of this material is prohibited. LWI Financial Inc. (“Loring Ward”) is an investment adviser registered with the Securities and Exchange Commission. Securities transactions are offered through its affiliate, Loring Ward Securities Inc., member FINRA/SIPC. B 14-059 (Exp. 07/16)

2. 2 This Quarter brought to you by the number Number of S&P 500 moves greater than 1% since April 16 th Change on the Dow Jones Index on April 24 th Three of them following the one and seven in the Dow There were nine 0s behind the two which the LA Clippers NBA team was bid for Number of World Cup Championships the US Men’s National Team has Number of the nine asset classes we track which had negative returns in Q2 Source: Yahoo! Finance, NBA.com, FIFA.com

3. Volatility at lowest level since 2007 VIX index Jan 1, 2000 – Jun 30, 2014 Source: Yahoo! Finance, VIX Index. Indexes are unmanaged baskets of securities that are not available for direct investment by investors. Index performance does not reflect the expenses associated with the management of an actual portfolio. Past performance is not a guarantee of future results. All investments involve risk, including loss of principal.

4. 4 U.S. and International Market Indexes April 1, 2014 through June 30, 2014 Market Returns Global 1-5 Year Bonds +0.6% BONDS U.S. STOCKS Emerging Markets Stocks +6.6% Int’l Small Stocks +3.2% Int’l Value Stocks +5.2% U.S. REIT Stocks +7.2% U.S. Small Cap Stocks +2.1% U.S. Value Stocks +5.1% U.S. Large Cap Stocks +5.2% INTERNATIONAL STOCKS U.S. Gov/ Credit 1-3 Year Bonds +0.4% Source: Morningstar Direct 2014. Market segment (Index representation) as follows: U.S. Large Cap (S&P 500 Index), U.S. Value Stocks (Russell 1000 Value Index), U.S. Small Company Stocks (Russell 2000 Index), U.S. Real Estate Market (Dow Jones U.S. Select REIT Index), International Developed Value (MSCI World Ex USA Value Index (net div.)), International Small (MSCI World Ex USA Small (net div.)), Emerging Markets (MSCI Emerging Markets Index (net div)), Global Bonds (Citi WGBI 1-5 Yr Hdg USD), US Bonds (BofA ML Corp & Govt 1-3 Yr TR). Indexes are unmanaged baskets of securities that are not available for direct investment by investors. Index performance does not reflect the expenses associated with 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. Fixed income investments are subject to interest rate and credit risk. Annualized for 5 and 10 Year Periods ONE Year 24.623.823.613.326.929.514.31.81.2 FIVE Years 18.819.220.223.811.515.39.21.91.8 TEN Years 7.88.08.79.47.18.711.93.23.0

5. 5 Source: Morningstar Direct 2014. 5 and 10 year periods are annualized. Asset allocations and index portfolio returns are for illustrative purposes only and do not represent actual performance. Stocks represented by MSCI World IMI Index (net div.) and Bonds represented by 50% Citi World Government Bond Index 1-5 Yr Hedged and 50% Bank of America Merrill Lynch US Treasury/Agency 1-3 Yr. Globally diversified portfolios rebalanced annually. Hypothetical value of $1 and kept invested through June 30, 2014 from the respective dates. Assumes reinvestment of income and no transaction costs or taxes. This is for illustrative purposes only and not indicative of any investment. Indexes are unmanaged baskets of securities that are not available for direct investment by investors. Index performance does not reflect the expenses associated with the management of an actual portfolio. Past performance is not a guarantee of future results. Stock investing involves risks, including volatility (up and down movement in the value of your assets) and loss of principal. Diversified Portfolios Review Asset Class Qtr 1 Year 5 Year 10 Year 10 Year Volatility 100% Stocks 4.724.515.57.616.3 75-25 3.618.812.27.011.9 50-50 2.613.08.76.07.7 25-75 1.57.25.24.63.7 100% Bonds 0.41.31.63.01.2 Growth of Wealth Jul 2004 – Jun 2014

6. 6 Historical US Bull and Bear Markets S&P 500 Index, Jan 1926 – Jun 2014 Defined as trend of +/- 20% Source: Morningstar Direct 2014. Market segment (Index representation) as follows: U.S. Large Cap (S&P 500 Index). Indexes are unmanaged baskets of securities that are not available for direct investment by investors. Index performance does not reflect the expenses associated with 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. Fixed income investments are subject to interest rate and credit risk.

7. 7 Investment Perspectives

8. 8

9. 99

10. 10 Do you know the difference between a Temporary Decline and a Permanent Loss? DEVASTATION DEFLATION CONFISCATION CAPITULATION INFLATION

11. 11 A loss due to erosion of purchasing power High probability Inflation

12. 12 Reduction in Purchasing Power Source: Consumer Price Index, Morningstar Direct 2014. Hypothetical reduction in purchasing power when starting with $1,000,000 on January 1, 1967 and 1984 over following 30 years. This is for illustrative purposes only and not indicative of any investment. Past performance is not a guarantee of future results. Starting with $1,000,000, actual inflation 12 Purchasing Power Time 1

13. 13 Inflation Risk: Will Returns Keep Pace with Inflation? Annualized Returns 1926 to 2013 Source: Morningstar Direct. Annualized returns before and after inflation. Past performance is no guarantee of future results. Assumes reinvestment of income and no transaction costs or taxes. This is for illustrative purposes only and not indicative of any investment. Stocks are represented by the CRSP 1-10 Index; Bonds are represented by the Ibbotson/SBBI Long-Term Government Bonds Index; Inflation is represented by CPI. Gold represented by London Fix Gold PM PR index. Indexes are unmanaged baskets of securities that are not available for direct investment by investors. Index performance does not reflect the expenses associated with the management of an actual portfolio. Stock investing involves risks, including volatility (up and down movement in the value of your assets) and loss of principal. Investors with time horizons of less than five years should consider minimizing or avoiding investing in common stocks. Bonds are subject to market and interest rate risk. Bond values will decline as interest rates rise, issuer's creditworthiness declines, and are subject to availability and changes in price. The price of gold may be affected by global gold supply and demand, currency exchange rates and interest rates. Investors should be aware that there is no assurance that gold will maintain its long-term value in terms of purchasing power in the future. 0% 2% 4% 6% 8% 10% 12% 0.5% After Inflation 3.5% Before Inflation Cash 5.5% Bonds Before Inflation 2.5% After Inflation 4.7% Gold Before Inflation 1.7% After Inflation 9.9% Stocks Before Inflation 6.7% After Inflation 13

14. 14 Understanding the Tradeoffs Purchasing Power of $1 Source: Morningstar Direct 2014. Market segment (Index representation) as follows: Bonds (SBBI US Long Term Government Bond), Stocks (CRSP 1-10 Index), Gold (London Fix Gold PM PR). Indexes are unmanaged baskets of securities that are not available for direct investment by investors. Index performance does not reflect the expenses associated with the management of an actual portfolio. Past performance is not a guarantee of future results. Stock investing involves risks, including increased volatility (up and down movement in the value of your assets) and loss of principal. Fixed income investments are subject to interest rate and credit risk. The price of gold may be affected by global gold supply and demand, currency exchange rates and interest rates. Investors should be aware that there is no assurance that gold will maintain its long-term value in terms of purchasing power in the future. 14

15. 15 Inflation High probability Avg 10 year change has been 33% Help protect through diversification and stock exposure Source: Morningstar Direct 2014. Inflation defined as Consumer Price Index.

16. 16 Capitulation A loss due to investor behavior High probability

17. 17 Past performance is no guarantee of future results. This is for illustrative purposes only. © 2014 Morningstar. All Rights Reserved. 17 Hot-Hand Fallacy: Chasing Fund Performance Wealth versus Cash Flows 2004 - 2013 Growth of $10,000 Cash Flows –$3 $0 $1 $2 $3 $4 $5 $6 –$1 $0 $10 $20 $25 $40 $45 $35 $30 $15 $5 –$2 2008200420052006200720092010201120122013 BILLIONS THOUSANDS

18. 18 For illustrative purposes only The Cycle of Market Emotions Emotion often leads to trying to time the markets.

19. 19 Source: Morningstar Direct 2014. Past performance is no guarantee of future results. Assumes reinvestment of income and no transaction costs or taxes. This is for illustrative purposes only and not indicative of any investment. Stocks are represented by the CRSP 1-10 Index; Bonds are represented by the Ibbotson/SBBI Long-Term Government Bonds Index; Inflation is represented by CPI. Indexes are unmanaged baskets of securities that are not available for direct investment by investors. Index performance does not reflect the expenses associated with the management of an actual portfolio. © 2013 Morningstar. All Rights Reserved. When shown a distribution of one-year returns, investors allocated 40% to stocks. Stocks 40% Bonds 60% 19 –20% 0% 20% 40% 60% 80% 100% 120% 160% 140% –60% -40% 1 Year Rolling Period Returns 1926 - 2013

20. 20 Source: Morningstar Direct 2014. Past performance is no guarantee of future results. Assumes reinvestment of income and no transaction costs or taxes. This is for illustrative purposes only and not indicative of any investment. Stocks are represented by the CRSP 1-10 Index; Bonds are represented by the Ibbotson/SBBI Long-Term Government Bonds Index; Inflation is represented by CPI. Indexes are unmanaged baskets of securities that are not available for direct investment by investors. Index performance does not reflect the expenses associated with the management of an actual portfolio. © 2013 Morningstar. All Rights Reserved. Stocks 90% Bonds 10% 20 30 Year Rolling Period Returns 1926 - 2013 –20% 0% 20% 40% 60% 80% 100% 120% 160% 140% –60% -40% When shown a distribution of 30-year returns, investors allocated 90% to stocks.

21. 21 Capitulation A loss due to investor behavior High probability Help protect through diversification and working with a financial advisor

22. 22 Confiscation Loss due to seizure (also includes taxes) Low to medium probability Help protect through diversification and tax management

23. 23 Loss due to decline in prices During Great Depression prices fell by 26% Since 1926 only 6% of 10 year rolling periods have been deflationary Help protect through cash, bonds and diversification Deflation Source: Morningstar Direct 2014. Fixed income securities are subject to interest rate risk because the prices of fixed income securities tend to move in the opposite direction of interest rates. In general, fixed income securities with longer maturities are more sensitive to these price changes and may experience greater fluctuation in returns.

24. 24 Devastation Loss due to disaster Low probability Help protect through diversification and insurance Diversification neither assures a profit nor guarantees against loss in a declining market.

25. 25 The Risks EventLikelihoodProtection Potential Devastation Insurance, geographical diversification DeflationCash, bonds, diversification Confiscation Tax management, geographical diversification Capitulation Work with a financial advisor, diversification Inflation Stocks, short term bonds, diversification 1 4 5 1 2

26. 26 “How do we know when irrational exuberance has unduly escalated asset values?” Fed Chairman Alan Greenspan, 1996 Source: Morningstar Direct 2014. Market segment (Index representation) as follows: U.S. Large Cap (S&P 500 Index). Indexes are unmanaged baskets of securities that are not available for direct investment by investors. Index performance does not reflect the expenses associated with 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. Fixed income investments are subject to interest rate and credit risk.

27. 27 Standardized Performance Data and Disclosures Average Annual Total Returns (%)3 Mo1 Yr5 Yr10 YrSince Inception S&P 500 TR 5.2324.6118.847.7810.67 Jan-70 Russell 1000 Value TR USD 5.1023.8119.238.0312.56 Dec-78 Russell 2000 TR USD 2.0523.6420.218.7012.00 Dec-78 DJ US Select REIT TR USD 7.1513.2723.769.419.36 Dec-86 MSCI World Ex USA Value NR USD 5.2426.9111.547.0912.01 Dec-74 MSCI World Ex USA Small Cap NR USD 3.2329.5515.328.749.63 Dec-00 MSCI EM NR USD 6.6014.319.2411.9410.97 Dec-98 Citi WGBI 1-5 Yr Hdg USD 0.581.841.893.255.87 Jan-85 BofAML US Corp&Govt 1-3 Yr TR USD 0.371.251.802.975.31 Jun-86 Data as of 6/30/14 Source: Morningstar Direct 2014. Indexes are unmanaged baskets of securities that are not available for direct investment by investors. Index performance does not reflect the expenses associated with 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. Fixed Income investments are subject to interest and credit risk.

28. To ask a question, open your GoToWebinar control panel by clicking on the orange icon with an arrow. Type your question into the Question box and hit send. For further questions, please contact Your Financial Advisor QUESTIONS Loring Ward is a strategist on the Lifetime Wealth Portfolios Platform offered by Eagle Strategies LLC (Eagle). The strategist creates and updates a model portfolio utilizing various mutual funds or exchange traded funds and delivers the model portfolio to Envestnet Asset Management, Inc. (Envestnet) for implementation. [Loring Ward uses the Dimensional Funds exclusively in its management under the Lifetime Wealth Portfolio platform.] An investor should refer to his/her Investment Management Agreement as well as the Disclosure Brochure for each of the firms noted above for complete information on their respective roles and responsibilities. Loring Ward, Envestnet, and Eagle are registered investment advisers with the Securities and Exchange Commission and are not affiliated companies. SMRU# 528301 Exp. 4/30/2014