Approximately 2.8 million individual, business and institutional clients 1
Ameriprise is America’s largest financial planning company 2
More people come to Ameriprise for financial planning than any other company 2
Ameriprise Financial 1 Ameriprise Financial 2007 Annual Report 2 Based on the number of financial plans annually disclosed in Form ADV, Part 1A, Item 5, available at adviserinfo.sec.gov as of December 31, 2007, and the number of CFP® professionals documented by the Certified Financial Planner Board of Standards, Inc.
Tax planning strategies
Estate Panning strategies
Calculate your net worth What you own – What you owe = Your net worth
Cash flow Money coming in – Money coming out = Discretionary income
Jill’s opportunity cost > What was her opportunity cost for buying the car? $25,000 distribution – $8,750 taxes and penalty $16,250 This hypothetical story is for illustrative purposes only. It is possible the fictional character could have sustained an investment loss instead of the gain discussed.
Rule of 72 > Begin with the number 72 > Divide it by your rate of return — how much your investment earns in a year > The result is the approximate number of years it will take for your money to double Rate of return is for illustrative purposes only and not intended to reflect a specific investment or investment strategy. The value of your securities will fluctuate. This illustration is only intended to demonstrate mathematical principles and should not be regarded as absolute. Furthermore, periodic declines in markets will result in diminishing the effective application of the Rule 72. 9 years to double Rate of return 8% 72
Jill’s opportunity cost > What was her opportunity cost for buying the car? Rate of return is for illustrative purposes only and not intended to reflect a specific investment or investment strategy. The value of your securities will fluctuate. Number of years is approximate. This example does not reflect taxes or applicable fees or expenses that an investment may charge. Rollover $25,000 8% return Nine years to double money, four doubling periods by the time Jill is age 65 $25,000 to $50,000 to $100,000 to $200,000 to $400,000 in 36 years
For opportunities and emergencies
Cash = Flexibility
Auto and home
> Auto and homeowner’s insurance
> Look at the cost of the premiums vs. the deductible
Look for greatest coverage for smallest premium
> Lower annual premiums improve your cash flow
> Homeowner’s insurance
Buy enough to insure your home for at least 80% of its
Auto and home insurance is underwritten by Ameriprise Insurance Company, AMEX Assurance Company or IDS Property Casualty Insurance Company, De Pere, WI. Each company is a wholly owned subsidiary of Ameriprise Financial, Inc.
Most valuable asset > Your ability to earn an income
Long-term care > You and/or your eligible family members can apply for group long-term care insurance at any time. > The cost of coverage is based on your coverage selections and your age at the time your coverage takes effect. > You may be able to continue coverage when you retire.
The importance of life insurance > Provide for the needs and security of people you love > Provide for your own security > Leave your legacy
Types of life insurance > Term > Whole life > Universal life > Variable universal life
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Investing short course > Get invested > Diversify > Stay invested
Types of risk or “volatility” > Specific risk > Market risk > Industry risk > Interest rate risk
Riding out volatility S&P 500 historic rates from 1977 to 2007 26.3% 16.9% 14.7% -2.2% 5 years +0.8% 10 years +4.2% 20 years 34.1% This graph shows the historic range of average annual returns for the Standard & Poor’s 500 Index as documented by Ameriprise Financial Services, Inc., January 2008. The Standard & Poor’s 500 Market Index (S&P 500) is an unmanaged list of common stocks frequently used as a measure of market performance and may not necessarily be substantially similar to your portfolio. It is not possible to invest in the index directly. The highest return is represented by the top of each bar and the lowest annual return is shown at the bottom. The rolling 5- and 10-year ranges are also shown. Over time, lower performing years will be offset by higher performing years and vice versa. Therefore the range of the historical returns over the entire period is narrower than the range of returns in any single year. Past performance is no guarantee of future results. -23.4% 1 year
Dollar cost averaging > Put market fluctuations to work for you > Can be an effective means of accumulating shares > Does not guarantee profit or protect against losses due to declining prices
Dollar cost averaging Dollar-cost averaging not guarantee a profit or protect against losses in a declining market. Investors should consider their ability to continue investing during periods of low markets. This illustration is hypothetical and is not a forecast or guarantee of specific investment results. Average price per share: (10+8+5+7+9+10)/6= $8.17 Average cost per share: (600/77.9)= $7.70 Month You invest Share price Shares purchased January $100 ÷ $10 = 10 February $100 ÷ $8 = 12.5 March $100 ÷ $5 = 20 April $100 ÷ $7 = 14.3 May $100 ÷ $9 = 11.1 June $100 ÷ $10 = 10 Total $600 = 77.9
What helps the market determine performance? > Market timing > Security selection > Asset allocation