SecurePlus VIP: A Fixed Indexed Annuity (FIA) Exclusively for 401(k) Plans Phase 3 Training

1. SecurePlus VIP: A Fixed Indexed Annuity (FIA) Exclusively for 401(k) PlansPhase 3 Training Presented by: Shelby J. Smith, Ph.D.Training/Service/Support by: 401k Marketing For Agent Use Only

2. Enrollment Meeting with Employees This training session will cover FIA only Securities & other assets choices of the 401(k) plan will not be discussed; however, record keepers, third party providers and product providers generally provide materials/assistance for conducting enrollment meetings. If ExpertPlan is your record keeper and/or TPA please contact their internal wholesalers for assistance or your 401k Marketing marketing representative.

3. Enrollment Meeting for FIA: Options • Traditional Presentation (cameo appearance): • Employee do-it-yourself with little or no help • No relationship, trust or credibility built with advisor • Fosters lower participation rate • On-Line Enrollment • Only help is via 800# • Same shortcomings as traditional presentation • Outsourced – you’re not of loop & out of mind • The 401k Marketing way

4. Typical Enrollment Meeting • You must master information provided at:https://www.expertplan.com/secureplusvip.jspSecureadvisor/Password1Securesponsor/Password1 • Supplemental information at www.401kmarketing.com • On-line materials & presentations can be purchased • Ask record keeper/TPA/product provider for enrollment presentation • ExpertPlan: guide, PowerPoint & presentation featuring on-line enrollment • Objective: pique interest, boost participation & foster one-on-one meeting

5. Planning Your Enrollment Meeting • All employees at once or smaller groups? • Communicating the meeting & agenda • e-mails, bulletin board,n, etc. • Highlight: new menu, enhanced plan & lifetime income option • Order & distribute materials in advance of meeting • FIA: 401kMarketing for materials: 877-319-2078 • Other: Record Keeper, TPA and/or product providers • Summary of employer’s 401(k) plan orSummary Plan Document • Schedule during business hours if possible • Duration: 30 to 45 minutes (a business meeting) • Script presentation, test equipment & prepare

6. Opening the Meeting • Senior management (you provide script or outline): • The company’s commitment to their employees • The company’s success depends on good employees • Only happy employees are good employees • Retirement requires advance preparation & one answer is 401(k) • Overview of the company’s 401(k) – supplements handout • Matching contributions/profit sharing • Commitment to keep fees reasonable & competitive • Dedication to offer best 401(k) plan possible for employees’ retirement • The importance of getting sound professional help • A new plan option for the risk avoiders & those approaching retirement • Your introduction (qualifications & background) • Your appearance and demeanor

7. Keeping it Simple • Assume most employees are not knowledgeable • Avoid jargon and technical terms • Why save for retirement using a 401(k) • Payroll deduction is painless plus employer makes contributions • Tax deferral or tax free growth (if Roth is offered): Example • Increasing life spans means a longer retirement: Example • Inflation has averaged 4% annually for last 50 years: Example • Life spans have increased dramatically since 1900: Example • Most people approaching retirement not prepared: Example • Pay yourself first by contributing to 401(k) • Social Security will probably not be enough • Not intended to frighten – factual presentation

8. Examples • Compound Interest: • Work for 30 days starting @ 1¢ a day & doubles daily: yes or no?Day 1 = $0.01, Day 2 = $0.02, Day 3 = $0.04……Day 30 = $10,737,418.24 • Bob saves $100/month for 30 years starting @ age 25, Mary saves $200/month for 20 years starting @ 35, and Shelby saves $300/month for 10 years starting @ 45. If all earn 6% simple, who has the most money @ age 55?Bob: $100,562 Mary: $93,582 Shelby: $50,298 • Inflation at 4% annually and impact on retirement:Gas @ $2.50/gallon today will be $5.48 in 20 years, $50,000 car will cost $109,556 and $85 hair tint will cost $186.25. • Life expectancy & retirement years are increasing

9. Example: Life Expectancies & Retirement • Male and Females age 40:

10. Example: Average Savings by Age • Workers under age 35 have < $6,000 in savings. • Ages of 35 and 44 have roughly $22,500. • Ages 45-54 have saved just under $44,000. • Baby boomers (55-64) approximately $65,000 • Those 65 and over have savings of $56,000Source: Employee Benefit Research Institute • Cost of retirement varies widely - Medical expenses for retired age 65 couple = $240,000: Source Fidelity Investments 2012 - U.S. Census: Average income of households headed by age 65+ was $49,000 in 2010 • 75% x $49,000 x 18 years = $661,500: P.V. @ 4% = $465,230 (before inflation)

11. Presenting the FIA Option • FIA unfamiliar to most employees – keep it simple • Features & benefits: • Two separate accounts: Accumulation & Income • Accumulation: Contributions + earnings (explain) • Income: Annual increase is roll up rate (GLIR is optional) • Minimum rate guaranteed on accumulation account • Income & accumulation compared & adjusted at 5 year intervals • Surrender period/penalties – (explain additional premiums) • Penalty free withdrawals/inside transfers after year 1 • Clearly explain Guarantees • Worth considering for some of your 401(k) money

12. Guaranteed Lifetime Income Rider • The GLIR is optional (may appeal to near retirees & risk averse) • Cost is 0.7% annually & fixed for first 20 years • Cost increases to 0.8% in years 21 – 30 • GLI determined by age-factors starting at age 55(specify percentages) • Roll-up rate guaranteed for first 10 years only – varies thereafter • GLI will be paid for life unless withdrawal option exercised • Joint life option for spouse is available – reduced pay out factor • Nursing home benefits in some state (omit if not state approved) • Provide details of requirements • Not available if joint life option chosen • Provide other details of GLI

13. Video explaining FIA and GLIR • Two versions: • LSW Animated • NAFA approved • Available from 401k Marketing or on-line @ • http://www.401kmarketing.com/mktg.html • Consumer e-brochure (p. 3 & 5) & consumer video • For your information 401k Marketing offers: • PayCheck for Life video • Retain Your Gains Video • Available on-line @ • http://www.theretirementpros.com

14. Enrollment Aids from Record Keeper/TPA • ExpertPlan: • PowerPoint presentation for on-line enrollment • Enrollment Guide for employees & tutorials • Private label site for sponsor/participants (review) • https://www.expertplan.com/secureplusvip.jsp • (username/password) Securesponsor/Password1 (case sensitive) • If not ExpertPlan • TPA or Record Keeper generally assist with enrollment • May have written materials and/or website • Master the materials/sites

15. Your Objective in the Enrollment Meeting • Make favorable impression & stress your availability • Encourage one-on-one meeting for further details • FIA option will be new and meeting not sufficient for details • FIA target should be those approaching retirement or fearful of risk of loss • Volunteer to help participants understand the on-line enrollment process • Provide your contact information for future reference • Handout materials should provide access to FIA video(s) you showed • Lots of good videos at www.theretirementpros.com • Briefly explain diversification – ABC approach works well • Stress why participating, starting early & contribution targets are vital • Explain how combined Social Security & GLIR would work (example)

16. Example: Social Security & GLIR • Annual SS benefits at retirement will be $24,000 • http://www.socialsecurity.gov/planners/benefitcalculators.htm • Desired annual retirement income estimate is $55,000 • Shortfall is $55,000 - $24,000 = $31,000 • Now 45 & retire @ 65: needs $31,000/year from 401(k) • Age 65 GLIR factor 4.5%: $31,000/0.045 = $688,889 from 401(k) • Current 401(k) is $100,000 & all annual contributions = $10,000 • At 6% roll-up FIA income balance $710,641 at age 65 • Need $689K, got $711K – goal reach & mission accomplished • Don’t forget inflation & possibly higher taxes

17. Five Facts to Boost Participation with FIA • AT EVERY OPPORTUNITY STRESS… • FIA has no fees that come out of employee’s money • 401(k) offers tax-deferred or tax-free (Roth only) growth • Value of FIA is always up or sideways, never down • Guaranteed Lifetime Income (optional) is predictable • Start at any age 25 or better

18. Assuring an individual meeting • Your fiduciary responsibilities are… • Your service includes: • Help in understanding the investment choices, including FIA • Assistance with retirement & 401(k) contribution goal setting • Guidance in assessing risk for individual circumstances • On-going availability as circumstances change • 401(k) reviews and progress assessments • Will schedule private, confidential meeting upon request • Will schedule routine meetings to review 401(k) matters • You’re their pro-bono personal 401(k) professional ready to help • Always available for non-401(k) financial advice if needed • Helping employer make 401(k) even better

19. Questions? Call Help Desk at 401k Marketing at 877.319.2078for details. Talk to your marketer: Andy Alvis, Celeste duPreez or Rebecca Brundage To do list: Start prospecting for 401(k) plans to add FIA Training session #4: follow up & servicing