Helping you retire with confidence

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Retirement Help for Life

®

Helping you retire

with confidence

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Who we are

Cofounded by Bill Sharpe,

Nobel Prize-winning economist

More than 15 years of trusted advice and professional management

Help available to 8.3 million participants1

Large plan expertise with 141 Fortune 500 companies2

Independent investment advisor

• No commissions

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Personal Retirement Plan

Whether you choose Online Advice or Professional Management, Financial Engines can help

Savings

We can point out your savings opportunities

Investing

We can help you diversify and manage

Retirement Income

We can give you a good idea of what

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Investing and retirement planning

Common concerns

Am I saving enough money?

Have I made good investment choices?

How much income can I expect in

retirement?

Are there strategies to enhance and

protect my retirement income?

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COMMIT TO SAVING INFORMED INVESTING MID-CAREER SHIFT WITH CONFIDENCE NEARING RETIREMENT FLEXIBLE SPENDING RETIREMENT

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Start Age Monthly Contribution Total Contribution

Typical savings example

With a 7% rate of return, how much must I save to have $500,000 at age 65?

25 $190 $91,000

35 $410 $148,000

45 $960 $230,000

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Savings steps to a successful retirement

Start saving as soon as possible.

Save as much money as you can afford to save. Don’t just limit yourself to the company match,

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Challenges to the traditional savings model

Are we all going to retire at age 65? We all have different abilities to save.

If you start late, can you afford the larger required savings rate?

We all have different future financial needs and therefore need our own custom goals.

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A personalized savings plan focuses on you

Every recommendation will be based on your personal financial profile!

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COMMIT TO SAVING INFORMED INVESTING STARTING OUT MID-CAREER SHIFT WITH CONFIDENCE NEARING RETIREMENT FLEXIBLE SPENDING RETIREMENT

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Three investment building blocks

Stocks

BENEFITS

Designed for long term growth

CONCERNS Volatility, stocks lost 43.1% in 1931 and 36.9% in 2008 Bonds BENEFITS Generally higher

income than cash and lower risk than stocks

CONCERNS

Limited growth potential, some

Cash

BENEFITS

The highest degree of price stability

CONCERNS

No growth and very low income generation

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Understanding portfolio structure

Asset allocation:

Significant influence on overall portfolio risk and potential return

The allocation should be based on your goals, time horizon, and risk tolerance.

How many of you know your current allocations?

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Understanding portfolio structure

Fund selection:

Looks at the specific funds used to build your appropriate allocation.

50% Stocks 23% Large Cap 11% Mid Cap 5% Small Cap 11% International 30% Fund A 15% Fund B 40% Bonds 15% Government 14% Corporate 11% Mortgage Backed 24% Fund X 16% Fund Y 10% Cash 10% Money Fund Z

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Understanding portfolio structure

Fund selection:

Looks at the specific funds used to build your appropriate allocation.

50% Stocks 23% Large Cap 11% Mid Cap 5% Small Cap 11% International 30% Fund A 15% Fund B 5% Fund C 40% Bonds 15% Government 14% Corporate 11% Mortgage Backed 24% Fund X 16% Fund Y 10% Cash 10% Money Fund Z

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Three key goals of portfolio structure

1) Appropriate diversification

2) Acceptable risk level 3) Cost efficient

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It’s all about optimization

Building an optimal portfolio

• An optimal portfolio is designed to manage risk appropriately • Improve performance by effectively capturing market returns • Be efficient by minimizing cost

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Challenges to portfolio design

• It can be difficult to research funds • Lack of comfort with personal finance

• Lack of time or desire to manage account • Portfolio construction is a complex process

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The easier way to portfolio design

You give Financial Engines the following:

Your desired retirement age

Your risk tolerance

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The solutions you need.

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COMMIT TO SAVING INFORMED INVESTING STARTING OUT MID-CAREER SHIFT WITH CONFIDENCE NEARING RETIREMENT FLEXIBLE SPENDING RETIREMENT

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Retirement income planning challenges

How do I generate consistent income from my

investment portfolio?

What can I do to make sure I don’t outlive my portfolio? Which investments should I distribute from and when? What can I do to maximize Social Security?

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Income longevity strategies

Lower your portfolio risk

Consider the purchase of an annuity

Possible part-time employment in retirement

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Why Social Security is so important

No longevity risk

No inflation risk

No management risk

Initially flexible payment options

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A choice of services

Professional Management Online Advice W e do the w or k Y ou do t he w or k

Receive a Retirement Plan Build a Retirement Plan

Get ready for retirement Get ready for retirement

Stay on track Stay on track

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Online Advice: Do-it-yourself investor

Personalized Retirement Plan, complete with an investment,

savings and retirement income forecast

Easy-to-use forecasting tools to help prepare for your future

Expert recommendations to

help reach your goals

Progress reports to keep you informed

Call center support

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Professional Management: Hands-off investor

Personalized Retirement Plan, complete with an investment,

savings and retirement income forecast

Access to an investment advisor representative

Ongoing management, where we:

• Create a personalized plan for you • Manage your 401(k) Plan account

and keep you on track

• Help you transition to retirement

A fee for Professional Management • Low rate

• Based on your 401(k) Plan account balance

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Investment Summary

Save early and save often.

Diversify appropriately to build an optimal portfolio. Look carefully at all income sources and determine if you’re on track to reach your goals.

Be diligent in selecting a Social Security claiming strategy.

Use Online Advice as a comprehensive research tool—at no cost to you.

If you need additional help, consider fee-based Professional Management service.

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Do it yourself – Online Advice

Enjoy

Online Advice is included as a service of your plan for no additional fee. To get started, login to www.401k.comand click the “Get Personalized Help from Financial Engines” link.

Partner with an expert – Professional Management

Relax

We make it affordable. Teradyne has negotiated a Professional Management fee of about $5.00 a month for

You use our online tools to build your strategy. You get specific fund recommendations.

You can log in anytime to see if you’re on track. You request the transactions for your 401(k).

You get online help/technical support by phone.

You can sign up for e-mail Retirement Updates. Log In

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Compare the two services

Professional Management Online Advice

Independent, objective advice and personalized

recommendations  

Proven investment methodology used to

evaluate investment options  

Personalized recommendations  

Other retirement savings & investments

influence recommendations  

Access to live Investment Advisor

Representatives by phone  

Monitors your investments over time

Handles investments and directs plan provider

to transact in order to reallocate your portfolio

Printed Retirement Updates every three months

Account Balance Annual Fee Up to $100,000 0.60%

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