FROM CHAOS TO CLARITY 1. Ruby A. Miller, CLTC, LUTCF Agent/Owner State Farm Insurance Oak Ridge, TN.

FROM CHAOS TO CLARITY

1

Ruby A. Miller, CLTC, LUTCF

Agent/Owner

State Farm Insurance

Oak Ridge, TN

FROM CHAOS TO CLARITY

Getting your financial house in order

2

A few key facts on your financial influence:

(1)Re-Imagine, Tom Peters, Dorling Kindersley Publishing. 2003 (2), (3) sfredportfolio.com, June 2004

• $3.3 trillion in annual consumer spending and more than half the personal wealth in the U.S. controlled by women (1)

• 89% of household financial services decisions are influenced by women (2)

• 87% of U.S. homes are jointly or solely owned by women (3)

3

A few key facts about me:

• Family

• Education

• Insurance/financial credentials

4

How I got here…

• 1968 – Came to Oak Ridge out of college• Husband, three children, six grandchildren• Worked at all federal facilities & townsite• 1990 – resigned from MMES, started State

Farm Agency & RAM/VITEC• Sell all types of insurance & financial Services to

individuals & businesses• Licenses, certifications, registered rep

Three basic steps to financial success:

• Look at what you have now

• Find the best ways to protect it

• Figure out how to save and invest for tomorrow

5

Looking at what you have now:

• Net Worth – what you own – and owe

• Cash Flow – money coming in vs. money going out

• The State Farm Insurance and Financial Review®

1. Analyze level of debt

2. Uncover opportunities for improvement

3. Locate discretionary income to set up family emergency fund, save for college, and more

6

Protecting what’s important:

• Auto & Home

• Life, Income, Health, Well-being

• Investments

• Retirement

7

Your insurance action plan:

• Analyze the potential for auto savings…Should I consider raising the deductible on an older car to help lower my premium?

• Review amount of homeowner’s coverage…Has our policy kept up with improvements and appreciation of the property?

8

What steps can I take to help my teen become a safer driver?

Your insurance action plan:

• Thorough evaluation of existing health plan…How well would it get us through a major medical problem?

• Realistic look at your life insurance coverage and needs…

How would your family’s standard of living change without your income?

• Contingency for chronic illness or disabling condition…

9

Will my current financial situation allow me

to handle this without additional products?

As a State Farm agent I’m here to help answer any of those insurance questions

• As a good neighbor, I can also answer your questions when it comes to saving and investing

• State Farm now manages about 350,000 mutual fund accounts worth more than $4 billion

10

Saving and investing for tomorrow:

• Just because they’re called investMENts, don’t assume the guy in your life knows it all

11

Men are more likely to:

MsMoney.com July 12, 2005

• Hold a losing investment too long

• Wait too long to sell a winning investment

• Allocate too much to one investment

• Buy a “hot” investment without doing research

12

The “Big Three” saving and investing goals:

(You may even be working toward all three simultaneously)

• Buying a house

• Sending children to college

• Building a retirement fund

13

But…the biggest goal–retirement–often gets neglected in favor of the

other two• For a woman, that can be double trouble

• Women live more years in retirement, with a life expectancy of 5 - 7 years more than men (4)

• Average income for a woman over 65 is just $7,000 per year (5)

14

(4) U.S. Center for Disease Control, CDC, 2003(5) “Smart Women Finish Rich”, David Bach,Broadway Books © 1999, 2003

Four keys to saving and investing success

(especially for retirement):

• Understand risk/return relationship

• Start early

• Invest regularly (dollar-cost averaging)

• Defer taxes whenever possible

15

Balancing risk and return

16

Assessing your risk tolerance

• Time Frame–the longer it is, the more opportunity to recover from declines

• Asset Choices–your degree of comfort/knowledge with stocks, bonds, mutual funds, money market funds

• Guidance–do you have access to a financial services professional for answers and ideas on a strategy?

17

44,948 reasons not to wait!

18

Dollar-cost averaging helps you keep fluctuating markets in

perspective

19

Dollar-cost averaging does not

assure a profit and does not

protect against loss in

declining markets. Dollar-cost

averaging involves continuous

investment in securities

regardless of fluctuating

prices. You should consider

your financial ability to

continue purchases through

periods of high or low price

levels.

Tax deferral makes every dollar work harder

20

1The Traditional IRA figure is comprised of the following:

$367,037–Traditional IRA lump-sum distribution value ($489,383) less a deduction for federal income taxes at 25% ($122,346).

+$83,802–This figure represents the savings in federal income taxes of $1,000 ($4,000 @ 25%) per year which we assume is reinvested in a taxable account earning 8% per year and reduced by federal taxes (25%) on the earnings each year.

$450,839–Equals the sum of $367,037 and $83,802.

Source: State Farm. These assumptions and figures are hypothetical and do not imply the future performance of any particular investment. Fees, charges and expenses that would otherwise be applicable have not been included. If these were included, the figures would be less. The tax rate used is 25% and represents federal income taxes only. State income taxes should also be considered. In certain states, state income tax laws may not match the new federal higher contribution limits. The lower maximum tax rate on capital gains and dividends may make the after-tax return for the taxable investment more favorable and reduce the difference between the value of the accounts. This hypothetical chart is for illustrative purposes only and is not intended to represent or imply the actual performance of any specific investment. It is important to note that any investment involves risks that may result in the loss of principal and there is no guarantee that the strategies illustrated will produce positive investment results.

Your financial role continues to expand

• In the year 2000, 43% of individuals with more than $500,000 in assets were women

• By 2010, 53% of all U.S. wealth is expected to be controlled by women

Source: 2000 U.S. Census

21

You have to stay organized to stay in control

Please, don’t put it off.

• Look at what you have now

• Find the best ways to protect it

• Figure out how much to save and invest for tomorrow

22

I’m here to help you take the next step in organizing your

financial future

• The State Farm Insurance and Financial review is a great place to start

23

State Farm Mutual Funds are available through prospectus by registered representatives of State Farm VP Management Corp., One State Farm Plaza, Bloomington, Illinois 61710, 1-800-447-4930. Please read the prospectus and consider the investment objectives, risks, charges and expenses and other information it contains about State Farm Mutual Funds carefully before investing.

An investment in the Money Market Fund is not insured or guaranteed by the Federal Deposit Insurance Corporation or any other government agency. Although the Fund seeks to preserve the value of your investment at $1.00 per share, it is possible to lose money by investing in the Fund.

State Farm VP Management Corp. is a separate entity from those State Farm entities which provide banking and insurance products.

State Farm Agents do not provide tax, legal or investment advice.

State Farm Life Insurance Company (Not Licensed in MA, NY or WI) State Farm Life and Accident Assurance Company (Licensed in NY and WI) State Farm Mutual Automobile CompanyState Farm Indemnity CompanyBloomington, ILstatefarm.com®

AP2007/03/826324