Staying the Course:
Reacting to the current financial climate
Location – Date
www.ing.com
Insurance products, annuities, and retirement plan funding issued by (third party administrative services may also be provided by) ING Life Insurance and
Annuity Company (Windsor, CT). Securities are distributed by ING Financial Advisers, LLC (member SIPC), Windsor, CT or through other broker-dealers
with which it has selling agreements. Annuities may also be issued by ReliaStar Life Insurance Company (Minneapolis, MN) and ReliaStar Life Insurance
Company of New York (Woodbury, NY). Variable annuities issued by ReliaStar Life Insurance Company are distributed by ING Financial Advisers, LLC.
Variable annuities issued by ING USA Annuity and Life Insurance Company and ReliaStar Life Insurance Company of New York are distributed by Directed
Services, LLC. Only ING Life Insurance Annuity Company and ReliaStar Life Insurance Company of New York are admitted and issue products in the state of
New York. All companies are members of the ING family of companies. © 2008 ING North America Insurance Corporation. ELC.M.P.MS.904
C08-1023-007R (10/08) Not FDIC Insured \ Not NCUA/NCUSIF insured \ May Lose Value \ No Bank Guarantee \ No Credit Union Guarantee
Staying the Course:
Reacting to the current financial climate
Location – Date
www.ing.com
Insurance products, annuities, and retirement plan funding issued by (third party administrative services may also be provided by) ING Life Insurance and
Annuity Company (Windsor, CT). Securities are distributed by ING Financial Advisers, LLC (member SIPC), Windsor, CT or through other broker-dealers
with which it has selling agreements. Annuities may also be issued by ING USA Annuity and Life Insurance Company (Des Moines, IA). Variable annuities
issued by ING USA Annuity and Life Insurance Company and are distributed by Directed Services, LLC. All companies are members of the ING family of
companies. © 2008 ING North America Insurance Corporation. ELC.M.P.MS.904 C08-1023-007R (10/08)
Not FDIC Insured \ Not NCUA/NCUSIF insured \ May Lose Value \ No Bank Guarantee \ No Credit Union Guarantee
Staying the Course:
Reacting to the current financial climate
Location – Date
www.ing.com
Securities and [financial planning] offered through ING Financial Advisers, LLC (member SIPC), One Orange Way, Windsor, CT, 09095-4774.
© 2008 ING North America Insurance Corporation. ELC.M.P.MS.904 C08-1023-007R (10/08)
Not FDIC Insured \ Not NCUA/NCUSIF insured \ May Lose Value \ No Bank Guarantee \ No Credit Union Guarantee
Staying the Course:
Reacting to the current financial climate
Location – Date
www.ing.com
Recordkeeping and Plan administrative services provided by ING Institutional Plan Services, LLC
© 2008 ING North America Insurance Corporation. ELC.M.P.MS.904 C08-1023-007R (10/08)
Not FDIC Insured \ Not NCUA/NCUSIF insured \ May Lose Value \ No Bank Guarantee \ No Credit Union Guarantee
Staying the Course:
Reacting to the current financial climate
Location – Date
www.ing.com
Framewor(k) and (k)Choice Recordkeeping and Plan administrative services provided by ING Institutional Plan Services, LLC Mutual funds offered through
ING Financial Advisers, LLC (member SIPC)© 2008 ING North America Insurance Corporation. ELC.M.P.MS.904 C08-1023-007R (10/08)
Not FDIC Insured \ Not NCUA/NCUSIF insured \ May Lose Value \ No Bank Guarantee \ No Credit Union Guarantee
Important Information
Variable annuities, group annuities, or funding agreements are long-term investments designed for retirement purposes.
If withdrawals are taken prior to age 59½, an IRS 10% premature distribution penalty tax may apply. Money taken from
the annuity will be taxed as ordinary income in the year the money is distributed. An annuity does not provide any
additional tax deferral benefit, as tax deferral is provided by the plan. Annuities may be subject to additional fees and
expenses to which other tax-qualified funding vehicles may not be subject. However, an annuity does provide other
features and benefits, such as lifetime income payments and death benefits, which may be valuable to you.
Variable investments , of any kind, are not guaranteed and are subject to investment risk including the possible loss of
principal. The investment return and principal value of the security will fluctuate so that when redeemed, it may be worth
more or less than the original investment. In addition, there is no guarantee that any variable investment option will meet
its stated objective.
For 403(b)(1) annuities, the Internal Revenue Code (IRC) generally prohibits withdrawals of 403(b) salary reduction
contributions and earnings on such contributions prior to death, disability, age 59½, severance of employment, or financial
hardship. Amounts held in a 403(b)(1) annuity as of 12/31/1988 are “grandfathered” and are not subject to these
restrictions. For 403(b)(7) custodial accounts, the IRC generally prohibits withdrawals of any contributions and attributable
earnings prior to death, disability, age 59½, severance of employment, or financial hardship. For both 403(b)(1) annuities
and 403(b)(7) custodial accounts, the amount available for hardship is limited to the lesser of the amount necessary to
relieve the hardship, or the account value as of 12/31/1988, plus the amount of any salary reduction contributions made
after 12/31/1988 (exclusive of any earnings).
You should consider the investment objectives, risks, and charges and expenses of the investment options
carefully before investing. Fund prospectuses contain this and other information and can be obtained by
contacting your local ING representative. Please read carefully before investing.
Important Information
Variable annuities, group annuities, or funding agreements are long-term investments designed for retirement purposes.
If withdrawals are taken prior to age 59½, an IRS 10% premature distribution penalty tax may apply. Money taken from
the annuity will be taxed as ordinary income in the year the money is distributed. An annuity does not provide any
additional tax deferral benefit, as tax deferral is provided by the plan. Annuities may be subject to additional fees and
expenses to which other tax-qualified funding vehicles may not be subject. However, an annuity does provide other
features and benefits, such as lifetime income payments and death benefits, which may be valuable to you.
Variable investments , of any kind, are not guaranteed and are subject to investment risk including the possible loss of
principal. The investment return and principal value of the security will fluctuate so that when redeemed, it may be worth
more or less than the original investment. In addition, there is no guarantee that any variable investment option will meet
its stated objective.
For 403(b)(1) annuities, the Internal Revenue Code (IRC) generally prohibits withdrawals of 403(b) salary reduction
contributions and earnings on such contributions prior to death, disability, age 59½, severance of employment, or financial
hardship. Amounts held in a 403(b)(1) annuity as of 12/31/1988 are “grandfathered” and are not subject to these
restrictions. For 403(b)(7) custodial accounts, the IRC generally prohibits withdrawals of any contributions and attributable
earnings prior to death, disability, age 59½, severance of employment, or financial hardship. For both 403(b)(1) annuities
and 403(b)(7) custodial accounts, the amount available for hardship is limited to the lesser of the amount necessary to
relieve the hardship, or the account value as of 12/31/1988, plus the amount of any salary reduction contributions made
after 12/31/1988 (exclusive of any earnings).
All guarantees are based on the financial strength and claims-paying ability of the issuing insurance company, who is
solely responsible for all obligations under its policies.
You should consider the investment objectives, risks and charges, and expenses of the variable annuity and its
underlying investment options carefully before investing. The prospectuses for the variable annuity and
underlying investment options contain this and other information. You may obtain free prospectuses by calling
your financial professional or 800-366-0066. Please read the prospectuses carefully before investing.
Important Information
You should consider the investment objectives, risks, and charges
and expenses of the investment options carefully before investing.
Fund prospectuses contain this and other information and can be
obtained by contacting your local ING representative. Please read
carefully before investing.
What We’ll Cover
Financial Rollercoaster
What’s happening?
Tips for Staying focused
Dollar-Cost Averaging
Asset Allocation
Diversification
Top Retirement Bloopers
Don’t make these mistakes!
Where Do I Go From Here?
Financial Roller Coaster
Recent volatility of the
stock market:
Is this cause for concern?
A realization that market volatility
is a way of life?
Most likely, a bit of both.
How Did We Get Here?
Gaining insight into what’s going on in the
marketplace. Questions to ponder...
Where within your portfolio did you incur the losses?
Was your account properly diversified? Were you focusing on
certain asset classes and overlooking others?
Were your stock holdings broadly diversified by:
Size
(small-, mid and large-cap stocks)
Style
(value and growth)
Sector (retail, energy, utilities, etc.)
Staying Focused
• Have a destination; set your
goal
• Specify your time frame
• Prioritize objectives
• Make periodic direction checks
4
The ups and downs of the market cycle
This chart depicts a
rising and falling
market period.
There are risks in
buying high and
selling low. Those
who only try to
invest at the “perfect
time” can never truly
predict the way
things will go.
Investing Through Dollar Cost Averaging
10
$10
Share Price
9
8
$8
$8
7
$6
6
5
$6
$5
Month:
Investment:
Shares:
January
$100
10
February
$100
20
Total Investment: $600
Average Cost per Share: $6.80
March
$100
16.6
April
$100
12.5
May
$100
12.5
June
$100
16.6
Total Shares Purchased: 88.2
Average Market Price per Share: $7.16
(From previous example)
Dollar cost averaging/Systematic Investment plan does not ensure a profit nor guarantee against loss. Investors should consider their financial
ability to continue their purchases through periods of low price levels. The hypothetical investment results are for illustrative purposes only and
should not be deemed a representation of past or future results. This example does not represent any specific product, nor does it reflect sales
charges or other expenses that may be required for some investments.
Making a One-time Investment
10
$10
Share Price
9
8
7
$6
6
5
Month:
Investment:
Shares:
January
$600
60
February
$0
0
Total Investment: $600
Average Cost per Share: $10.00
March
$0
0
April
$0
0
May
$0
0
June
$0
0
Total Shares Purchased: 60
Average Market Price per Share: $7.16
(From previous example)
Dollar cost averaging/Systematic Investment plan does not ensure a profit nor guarantee against loss. Investors should consider their financial
ability to continue their purchases through periods of low price levels. The hypothetical investment results are for illustrative purposes only and
should not be deemed a representation of past or future results. This example does not represent any specific product, nor does it reflect sales
charges or other expenses that may be required for some investments. A lump sum investment fluctuates with market conditions and does not
ensure future returns.
What a Difference a Year Can Make!
Timing of Returns Can Be More Important than Average Returns
Ed, who retired at the end of 1972 immediately faced two
years of heavy market declines, which were compounded by
his annual withdrawals of an inflation adjusted amount of
$12,500 per year or 5% of his original $250k portfolio. As a
result, it took only 17 years – until 1989 – for Ed to deplete
his portfolio.
Dan, who retired one year later, at the end of 1973,
and maintained the same investment and annual
withdrawal plan as Ed, had a completely different
experience. Although he was spared the stock
market’s 1973 decline, he otherwise experienced the
same conditions as Ed. As insignificant as this one
year may seem, it made all the difference to these
hypothetical retirees. Unlike Ed, Dan has watched his
portfolio grow.
This illustration is used with permission from Van Kampen.
Stocks are represented by the Standard and Poor’s 500© Index (S&P 500). The Standard and Poor’s 500© Index (S&P 500) is a broad-based index,
the performance of which is based on the performance of 500 widely-held common stocks chosen for market size, liquidity, and industry group
representation. The index does not include product expenses, fees or sales charges, which would lower performance. The index is unmanaged and
should not be considered an investment. It is not possible to invest directly in an index. Withdrawals are adjusted for inflation so that the current real
value of the money withdrawn each year is $12,500. Withdrawals are made at the beginning of each year and are hypothetical examples. All results
are shown gross of taxes on capital gains and ordinary income. If taxes were included, returns would be lower. This illustration is not intended to
predict the performance of any specific investment. Past performance does not guarantee future results.
Smart Investors Know How Much
Risk They’re Willing to Take.
Higher
Potential Reward
AGGRESSIVE
Lower
The higher the risk potential,
the higher long-term reward
potential
MODERATE
CONSERVATIVE
The lower the risk potential,
the less long-term reward
potential
Risk
Using diversification as part of an investment strategy neither assures nor guarantees better performance and cannot protect
against loss in declining markets.
Higher
Smart Investors Know How Much
Risk They’re Willing to Take.
Relative Return/Risk Continuum
for Sample Asset Classes
POTENTIAL REWARD
Higher
Lower
Potential risk/reward balance of asset classes
Global/International
Small/Mid/Specialty
Large Cap Growth
Large Cap Value
Balanced
Bonds
Stability of Principal
RISK
Using diversification as part of an investment strategy neither assures nor guarantees better performance and cannot protect
against loss in declining markets.
Higher
Relative Return/Risk Continuum
for Sample Asset Classes
Bond Risk Comparison Disclosure
The value of debt securities may fall when interest rates rise. Debt securities with longer maturities tend to be more sensitive to
changes in interest rates, usually making them more volatile than debt securities with shorter maturities. For all bonds there is a
risk that the issuer will default. High-yield bonds generally are more susceptible to the risk of default than higher rated bonds.
Government Bonds (Generally 10 to 30 years in duration)
Long term Government Bonds are measured using a one-bond portfolio with a maturity near 20 years. They are guaranteed by
the U. S. Government and, if held to maturity, offer a fixed rate of return and fixed principal value.
Growth
Growth-oriented stocks typically sell at relatively high valuations as compared to other types of stocks. Historically, growthoriented stocks have been more volatile than value-oriented stocks.
High Yield
Investments in high yield bonds are high risk investments. High yielding fixed-income securities generally are subject to greater
market fluctuations and risk of loss of income and principal than are investments in lower yielding fixed-income securities.
International
International investing involves special risks such as currency fluctuation, lower liquidity, political and economic uncertainties,
and differences in accounting standards. [Risks of foreign investing are generally intensified for investments in emerging
markets.]
Mid Sized Company Stocks
In exchange for higher growth potential, investing in stocks of small- and mid-sized companies may entail greater price volatility
and less liquidity than investing in stocks of larger companies.
Mid-Cap
Securities of mid-sized companies may be more susceptible to price swings and are less liquid than investments in larger
companies. Using diversification/asset allocation as part of your investment strategy neither assures nor guarantees better
performance and cannot protect against loss in declining markets.
Relative Return/Risk Continuum
for Sample Asset Classes
Diversify Between Asset Classes
• An asset class is a category of funds with similar investment
objectives and risk profiles.
• Asset class diversification attempts to reduce risk and/ or improve
overall return.
• Over time, the variance of returns within an investor’s portfolio
primarily depend on the invested asset classes vs. individual fund
selection
Source: A landmark study, “Determinants of Portfolio Performance,” by Brinson, Hood and Beebower, presented in Financial Analysts
Journal (May –June, 1992), and its update in 1996, showed that asset allocation decisions, far more than any other factor, affected the
long-term performance of an investment portfolio.
Asset Class Winners and Losers
Historical Performance
HIGHEST
RETURN
1998
1999
Large
Stocks
Int’l
Stocks
LT Gov’t
Bonds
Small
Stocks
Int’l
Stocks
Small
Stocks
30 Day
T-Bills
Int’l
Stocks
LT Gov’t
Bonds
Large
Stocks
30 Day
T-Bills
LOWEST
RETURN
Small LT Gov’t
Stocks Bonds
2000
2001
Small
Stocks
Large
Stocks
Int’l
Stocks
2002
2003
2004
2005
2006
2007
Int’l
Stocks
Small
Stocks
LT Gov’t
Bonds
Int’l
Stocks
Large
Stocks
LT Gov’t
Bonds
Large
Stocks
Small
Stocks
LT Gov’t
Bonds
Large
Stocks
30 Day
T-Bills
Large
Stocks
30 Day
T-Bills
Source: Thomson Financial Company
These unmanaged indexes are not intended to represent specific mutual funds. Investors cannot
invest directly in an index. Individual results may vary to management fees, transaction costs and
taxes. Performance figures do not take into account the fees and expenses of investing in mutual
funds or variable products. Past performance is no guarantee of future results.
LT Gov’t Small
Bonds Stocks
Potential Benefits to Diversification
Charting the Growth of $1
Source: Commodity Systems, Inc. (CSI) via Yahoo Finance, September 2008.
This chart is for illustration purposes only and represents a hypothetical investment in the S&P 500 Index. This illustration only includes market
growth and does not take inflation into account. Such an illustration does not represent the performance of any ING Product. Index performance
assumes reinvestment of all income. The S&P 500 is an unmanaged capitalization-weighted index of 500 stocks designed to measure
performance on the broad domestic economy through changes in the aggregate market value of 500 stocks representing all major industries. An
investor cannot directly invest in an index. However, this index accurately reflects the historical performance of the represented assets. Investing
involves risks of fluctuating prices and the uncertainties of rates of return and yield inherent in investment. Current performance may be lower or
higher than the performance data shown.
Staying Focused
Avoid stops & starts: Don’t lose
sight of your
long-term objectives:
• Overall investment strategy
• Investment horizon timeline (years until
retirement)
• Diversification through asset allocation
• Disciplined investing through dollar-cost
averaging
Don’t Get Caught Chasing Returns
A Lesson in Patience
Investment Returns 1988 - 2007
12.00%
11.81%
10.00%
8.00%
6.00%
4.49%
4.00%
2.00%
0.00%
S&P 500
Source: Dalbar, 2008 and Thomson Financial Company.
Average Equity
Investor
Returns as of 12/31/07. Average Equity Investor returns were calculated by applying the retention rates of investors of mutual funds to the returns of the S&P
500. The S&P 500 is an unmanaged index and is not intended to represent specific mutual funds. Investors cannot invest directly in an index. Individual
results may vary to management fees, transaction costs and taxes. Performance figures do not take into account the fees and expenses of investing in mutual
funds or variable products. Past performance is no guarantee of future results. While the S&P 500 Index returned an average of 11.90% per year from
January 1986 through December 2005, the typical equity investor earned only 3.90% per year for the same period. Average equity investor returns were
calculated by measuring the average amount of time investors held onto their investments. The simple truth: From 1986 through 2005, the average equity
investor, invested in S&P 500 funds, consistently pulled out of their investments and adopted more of a short-term investment strategy. This reason alone,
may have significantly contributed to their smaller overall returns for this period when compared to the S&P 500 Index.
Smart Investors Recognize the
Mile Markers Towards Success.
Keep Perspective
Have a Destination
2003
11.81%
12.00%
2004
2005
2006
10.00%
8.00%
6.00%
4.49%
4.00%
2.00%
0.00%
S&P 500
Average Equity
Investor
Be Patient
Don’t Chase Returns
Top Retirement Bloopers
1.
You aren’t saving at all for retirement
Will Social Security subsidize your retirement needs?
2.
You don’t know the first thing about planning for retirement
Do you know there are a world of options to help you save for
retirement?
3.
You aren’t taking full advantage of your options.
Will you forgo the potential tax-deferred growth?
4.
You aren’t diversified
Have you checked the Top 10 holdings of your investment
options?
Top Retirement Bloopers
(continued)
5.
You assume you’ll need less income in retirement
Upon reaching retirement, will your lifestyle change?
6.
You’re not taking advantage of higher savings limits
Do you know what options you have to save more?
7.
You borrowed from your retirement plan when it wasn’t really an
emergency
Do you know you’re missing out on potential market growth while
paying yourself back?
8.
You cashed out your retirement plan
Did you pay over 35% in taxes including a 10% penalty?
9.
You don’t have a retirement income distribution strategy
Will you take a lump sum or opt for a systematic payout?
Where Do I Go From Here?
• Determine your true risk tolerance.
• Analyze and rebalance your long-term investment strategy.
• Consider increasing your contributions.
• Remember, rash reactions to losses could lead to decisions that
are later regretted.
• Define and reevaluate long-term investment objectives.
• Devise strategies to help achieve your objectives.
Time to Take Action
Learn more at [ingretirementplans.com]
[ing.com/us] about Asset Allocation
See your ING [Plan] representative.
Check the Internet.
Contact me today at (XXX) XXX-XXXX
What’s next?
Questions?
22