This document summarizes an educational seminar presented by Rao K. Garuda about indexed annuities. It discusses how indexed annuities provide potential upside similar to the stock market but with greater safety of principal. Charts and examples are provided showing how indexed annuities have outperformed other investments like stocks, bonds, and CDs in recent years while avoiding downturns. The seminar explores different indexed annuity product features and strategies for maximizing returns.

1. Rao K. Garuda CLU, ChFC First Financial Resources, LLC Educational Seminar Contact Diana Miller Office Number: (216)-642-9211 Cell Phone Number: (216)-832-5734 Rao K. Garuda is a principal of First Financial Resources Registered Representative Securities offered through QA 3 Financial Corp

2. Rao K. Garuda is a principal of First Financial Resources Registered Representative Securities offered through QA 3 Financial Corp

3. Rao K. Garuda is a principal of First Financial Resources Registered Representative Securities offered through QA 3 Financial Corp Risk Tolerance Graph of Products The Opportunity of Indexed Annuities Stocks / Securities Mutual Funds Annuities CDs Indexed Annuities Money from the “low” end of the risk tolerance graph Is moving into Indexed Annuities, looking for more potential interest but without having to sacrifice safety and security of principal Money from the “high” end of the risk tolerance graph Is moving into Indexed Annuities, looking for a “floor” But without having to forego future potential upside

4. Rao K. Garuda is a principal of First Financial Resources Registered Representative Securities offered through QA 3 Financial Corp A Great Opportunity ? STOCKS/BONDS MUTUAL FUNDS FIXED ANNUITIES CD’S UPSIDE POTENTIAL SAFETY/SECURITY INDEXED ANNUITIES

5. $6 Trillion Dollars Rao K. Garuda is a principal of First Financial Resources Registered Representative Securities offered through QA 3 Financial Corp Average Yield: 1.07% Source: Investment Company Institute & Federal Reserve Board, October 2003

6. Rao K. Garuda is a principal of First Financial Resources Registered Representative Securities offered through QA 3 Financial Corp The Environment Has Changed 2 Years A Look Back The Media

7. Rao K. Garuda is a principal of First Financial Resources Registered Representative Securities offered through QA 3 Financial Corp

8. Rao K. Garuda is a principal of First Financial Resources Registered Representative Securities offered through QA 3 Financial Corp

9. Rao K. Garuda is a principal of First Financial Resources Registered Representative Securities offered through QA 3 Financial Corp

10. Rao K. Garuda is a principal of First Financial Resources Registered Representative Securities offered through QA 3 Financial Corp

11. Rao K. Garuda is a principal of First Financial Resources Registered Representative Securities offered through QA 3 Financial Corp

12. Rao K. Garuda is a principal of First Financial Resources Registered Representative Securities offered through QA 3 Financial Corp

13. Rao K. Garuda is a principal of First Financial Resources Registered Representative Securities offered through QA 3 Financial Corp

14. Rao K. Garuda is a principal of First Financial Resources Registered Representative Securities offered through QA 3 Financial Corp

15. Rao K. Garuda is a principal of First Financial Resources Registered Representative Securities offered through QA 3 Financial Corp

16. Rao K. Garuda is a principal of First Financial Resources Registered Representative Securities offered through QA 3 Financial Corp

17. If You could have a Stock Market-like Return How much would You Invest? Rao K. Garuda is a principal of First Financial Resources Registered Representative Securities offered through QA 3 Financial Corp WITHOUT Market Risk ,

18. Rao K. Garuda is a principal of First Financial Resources Registered Representative Securities offered through QA 3 Financial Corp 881 856 843 849 915 965 973 989 1009 997 1051 1066 S&P 500 Index As of 1/2/04 1108 From 881 to 1108 = 25.07% for policy year Jan04

19. Rao K. Garuda is a principal of First Financial Resources Registered Representative Securities offered through QA 3 Financial Corp 881 856 843 849 915 965 973 989 1009 997 1051 1066 S&P 500 Index As of 1/2/04 1108 Jan04 Total of 12 points = 11,621; div. by 12 = 968; 968 div by 881 = 9.87% © Creative Marketing International Corporation (CMIC) 2003

20. Rao K. Garuda is a principal of First Financial Resources Registered Representative Securities offered through QA 3 Financial Corp 9/30/98 9/30/99 9/30/00 9/30/01 9/30/02 9/30/03 1017 1282 1436 1040 815 995 +26% +12% -28% -22% +22% $100,000 Deposit in S&P 500 9/30/98 = $96,688 on 9/30/03 S&P 500 © Creative Marketing International Corporation (CMIC) 2003

21. Rao K. Garuda is a principal of First Financial Resources Registered Representative Securities offered through QA 3 Financial Corp 9/30/98 9/30/99 9/30/00 9/30/01 9/30/02 9/30/03 1017 1282 1436 1040 815 995 +26% +12% 0% 0% +22% Indexed Annuity IA +13% IA +6% IA +11% -28% -22% $100,000 Deposit in S&P 500 Indexed Annuity 9/30/98 = $132,955 on 9/30/03

22. Rao K. Garuda is a principal of First Financial Resources Registered Representative Securities offered through QA 3 Financial Corp Are You Capturing Gains “BELOW THE LINE?” Annual Ratchet, Annual Reset Indexed Annuity 1017 $100,000 +26% +12% 1436 $ 141,120 or $119,870 -28% -22% 815 $79,252 or $119,870 +22% 995 $96,688 or $132,955 1040 $101,606 or $119,870 © Creative Marketing International Corporation (CMIC) 2003

23. Rao K. Garuda is a principal of First Financial Resources Registered Representative Securities offered through QA 3 Financial Corp Five Year Index Annuity Returns 5.0% 9.3% 21.2% 23.0% 26.4% 27.6% 33.7% (The Advantage Group, November 2003)

24. Rao K. Garuda is a principal of First Financial Resources Registered Representative Securities offered through QA 3 Financial Corp CMIC Introduces: A NEW S&P 500 OPTION DESIGNED FOR THE NEXT BULL MARKET THE “ACCUMULATOR” STRATEGY ELIMINATES “TOO MANY” MOVING PARTS DESIGNED TO GIVE THE HIGHEST UPSIDE POTENTIAL IN A RISING MARKET

25. Rao K. Garuda is a principal of First Financial Resources Registered Representative Securities offered through QA 3 Financial Corp 881 856 843 849 915 965 973 989 1009 997 1051 1066 S&P 500 Index As of 1/2/04 -2.9% -.9% +1.0% +8.0% +5.5% +1.0% +1.7% +2.0% -1.0% +5.5% +1.5% 1108 Jan04 +4.0% © Creative Marketing International Corporation (CMIC) 2003

26. Rao K. Garuda is a principal of First Financial Resources Registered Representative Securities offered through QA 3 Financial Corp 881 856 843 849 915 965 973 989 1009 997 1051 1066 S&P 500 Index As of 1/2/04 -2.9% -.9% +1.0% +2.70% +2.70% +1.0% +1.7% +2.0% -1.0% +2.70% +1.5% 1108 Jan04 +2.70% 2.70% Sum of capped months = 13.20% (25.07%) F&G Spectrum Rewards – 1 year bucket © Creative Marketing International Corporation (CMIC) 2003

27. Monthly - Point to Point Monthly - Reset Monthly - Cap Annual, Biannual or Triennial Ratchet Rao K. Garuda is a principal of First Financial Resources Registered Representative Securities offered through QA 3 Financial Corp

28. Rao K. Garuda is a principal of First Financial Resources Registered Representative Securities offered through QA 3 Financial Corp 33% of Premium in 1-yr Mo P2P Bucket, Renew at 1 st Anniversary into new 3-year bucked 33% of Premium in 2-yr Monthly P2P Bucket, Renew at 1st Anniversary into new 3-year bucked 34% of Premium in 3-yr Monthly P2P Bucket, Renew at every 3 rd Anniversary into new 3-year bucket Maximize Return with Most Funds Earning Highest 3-year Cap, and EVERY Anniversary some funds have interest calculation and lock-in © Creative Marketing International Corporation (CMIC) 2003 3-year 6 3-year 9 3-year 12 2-year 14 3-year 3 3-year 5 3-year 8 3-year 11 3-year 14 2-year 2 3-year 4 3-year 7 3-year 10 3-year 13 1-year 14 1-year 1

29. Rao K. Garuda is a principal of First Financial Resources Registered Representative Securities offered through QA 3 Financial Corp © Creative Marketing International Corporation (CMIC) 2003

30. Rao K. Garuda is a principal of First Financial Resources Registered Representative Securities offered through QA 3 Financial Corp © Creative Marketing International Corporation (CMIC) 2003

31. Rao K. Garuda is a principal of First Financial Resources Registered Representative Securities offered through QA 3 Financial Corp © Creative Marketing International Corporation (CMIC) 2003

32. Rao K. Garuda is a principal of First Financial Resources Registered Representative Securities offered through QA 3 Financial Corp Immediate Annuity 5 Years Deferred Annuity 6-years $17,807 SPIA Split Annuity or “Double” Annuity Purchase 6-year SPIA and 6-year Deferred Annuity Deferred grows back to original Principal Amount Monthly Income: $307.18 ($9 taxable) $82,193 @ 4% interest, grows to… $100,000 Deferred Annuity 5-years © Creative Marketing International Corporation (CMIC) 2003

33. SPIA CD Interest Rate n/a 3% Income per Month $307 $250 Taxable Amount $ 9 $250 Tax @ 25% rate $ 3 $ 62 After-Tax Income $304 $188 Split Annuity Advantage: +60% Rao K. Garuda is a principal of First Financial Resources Registered Representative Securities offered through QA 3 Financial Corp Split Annuity vs Bank CD © Creative Marketing International Corporation (CMIC) 2003

34. A “Triple” Annuity for MORE Flexibility, Diversification, Income, and Yield Rao K. Garuda is a principal of First Financial Resources Registered Representative Securities offered through QA 3 Financial Corp Immediate Annuity Bonus Select Index Annuity Bonus Select Index Annuity $20,000 $20,000 $60,000 Monthly Income $27,969 after 5 yrs at 6% Assumed $112,286 after 10 years at 6% Pre-tax Income $345 60 months, Years 1-5 $482 60 months, Years 6-10 Withdrawals or Income Years 11+ Exclusion Tax Ratio 97% 72% 53%

35. Rao K. Garuda is a principal of First Financial Resources Registered Representative Securities offered through QA 3 Financial Corp An Idea for Averaging Buckets Point to point or Monthly Averaging? Which is better?

36. Lowest 20% < - $15,000 Next 20% $15,001 - $27,000 Next 20% $27,001 - $44,000 Next 20% $44,001 - $73,000 Next 15% $73,001 - $144,000 Next 4% $144,001- $350,000 Top 1% > - $350,000 Rao K. Garuda is a principal of First Financial Resources Registered Representative Securities offered through QA 3 Financial Corp Top 1% pays 37.4% of all taxes Who is Rich?

37. Doubling a Single Dollar 20X without TAX $1,048,000 Doubling a Single Dollar 20X with 30% TAX $25,000 Approx. Values, For illustration purposes only Rao K. Garuda is a principal of First Financial Resources Registered Representative Securities offered through QA 3 Financial Corp Why Defer Taxes? What’s the Big Deal? Don’t we have to pay the taxes eventually anyways…

38. After 20 Doubles Rao K. Garuda is a principal of First Financial Resources Registered Representative Securities offered through QA 3 Financial Corp Tax Deferred After Having Paid Taxes Yearly Total Principal After 20 Doubles $1,048,000 $25,000 10% Yearly Withdrawal $104,800 $2,500 Tax @ 30% ($31,440) ($750) Yearly Income After Taxes $73,360/ Year $1,750/ Year

39. Taking 10% per Year as Income TAX DEFERRED TAXED SCENARIO SCENARIO $73,360/ Year $1,750/ Year Which Income would you prefer for your children and grandchildren? Rao K. Garuda is a principal of First Financial Resources Registered Representative Securities offered through QA 3 Financial Corp

40. Goldberg v. Shirley Sawczak Legal Proceedings Dr. Goldberg was to remove the gall bladder duct on Ms Sawczak, Negligence lead to Complete Removal of the Gall Bladder and internal damage. Jury Awarded Ms. Sawczak $4M Dr. Goldberg had no malpractice insurance However, He had $4M in assets in Annuity Contracts  Florida State Law found that the proceeds of the Cash Surrender Value of the Annuity Contracts were exempt from creditors. Rao K. Garuda is a principal of First Financial Resources Registered Representative Securities offered through QA 3 Financial Corp

41. Rao K. Garuda is a principal of First Financial Resources Registered Representative Securities offered through QA 3 Financial Corp 0 5 10 15 20 25 % 30 % 35 % 40 % 45 % 1954 1960 1970 1980 1990 2000 Source : Office of Management & Budget; Fiscal 2003 estimate by Congressional Budget Office Tax Receipts Peak of 1990’s Market Clinton’s tax Increase Reagan’s tax cuts, recession Spending Borrowed ! Deep 1980’s recession Height of Vietnam War Birth Of Medicare U.S. Receipts / Spending / Borrowing as a % of GNP OUCH ! TAX REDUCTION

42. Rao K. Garuda is a principal of First Financial Resources Registered Representative Securities offered through QA 3 Financial Corp Advanced Asset Protection Techniques Basic Asset Protection Vehicles Essential Estate Planning Fully Funded Irrevocable Trust Wills PQA’s Living Wills Zero-out Estate Strategies Wealth Replacement Trusts Directors Liability Insurance Homestead Exemption Long Term Care Insurance Commercial Annuities Net Proceeds of Life Insurance Policy Tenancy by the Entireties Umbrella Policy Disability Insurance Malpractice Insurance Family Limited Liability Partnerships “ C” Corps Offshore Asset Protection Trusts CRT’s Guaranteed Income Trusts Incentive Trusts to Encourage Certain Behavior & Achievements Strategies for Large IRA’s Asset and Divorce Protection Trusts for Grandchildren Grantor Retained Annuity Trusts Family Charitable Foundations Conservation Easements Charitable Lead Trusts Private Annuities Marital Agreements Trust Protectors Asset Protection Self Settled Irrevocable Trust Family Close Limited Liability Company Buildup Equity Retirement Trust

43. Rao K. Garuda is a principal of First Financial Resources Registered Representative Securities offered through QA 3 Financial Corp How can 3 people carry the burden of 42??? Taxes have to go up And/ or Benefits will go down (Means Testing ???) 42 to 1 3.3 to 1 2.4 to1 2020 1984 1945 Ratio of Workers to Retirees Will the Social Security System Be Able to Support This Growing Group of Senior Citizens?

44. Rao K. Garuda is a principal of First Financial Resources Registered Representative Securities offered through QA 3 Financial Corp

45. Index Linked Fixed Guaranteed Annuity Rao K. Garuda is a principal of First Financial Resources Registered Representative Securities offered through QA 3 Financial Corp

46. 1-Year Case History National Western Life Ins. Co. Initial Investment: (03/05/03) $37,820.51 Index Value: 821.99 Current Value: (03/11/04) $41,740.79 Index Value: 1154.87 ACTUAL RETURN: 17.03% Rao K. Garuda is a principal of First Financial Resources Registered Representative Securities offered through QA 3 Financial Corp

47. 1-Year Case History Rao K. Garuda is a principal of First Financial Resources Registered Representative Securities offered through QA 3 Financial Corp Actual Annual Return: 37.7%

48. 7-Year Case History National Western Life Ins. Co. Initial Investment: (08/96) $100,000 Index Value: 1141.11 Current Value: (08/03) $170,230 Index Value: 1652.18 ACTUAL RETURN (over 7 years): 70.23% Rao K. Garuda is a principal of First Financial Resources Registered Representative Securities offered through QA 3 Financial Corp

49. Hot EIA Annuities Rao K. Garuda is a principal of First Financial Resources Registered Representative Securities offered through QA 3 Financial Corp All of the EIA annuities listed below allow for 10% free w/d per year ANNUITY Monthly Cap Surrender Years Comp. National Western Liberty Series 2.0% per Month Annual Reset 9 Years 8.0% Jefferson Pilot Accumulator 4.0% per month Biennial resent 12 Years 6.5% F & G Annuity 2.3% per month Annual Reset 13 Years 9.0%

50. Hot Variable Annuities Rao K. Garuda is a principal of First Financial Resources Registered Representative Securities offered through QA 3 Financial Corp Each account allows the client 10% free w/d per year, and also a commission of 6%, both products also have a 10-year surrender period Variable Annuity Cap Guaranteed Rate of Return Minimum Guaranteed Annual Income* *Assumes $100,000 investment for 60 year old, income begins after 10 th policy year US Allianz Rewards No Cap 7% No Annuitization Required Annual Ratchet Guaranteed Accumulation Value to double in 10.2 Years ING Premium Plus No Cap 7% $14,202 (Life with 10yr Certain) Annuitization is Required Quarterly ratchet

51. Rao K. Garuda is a principal of First Financial Resources Registered Representative Securities offered through QA 3 Financial Corp