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INFLATIONWHAT YOU NEED TO KNOW WHEN BUYING YOUR ANNUITY

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IN·FLA·TION (in’flāSH(ә)n, noun): Increases in the price levels of goods and services in the economy over time.

WHAT IS INFLATION?

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INFLATION BASICS

When there is inflation, the pur-chasing power of a certain amount of money (let’s say $100) goes down. If there is deflation, the purchasing power of the $100 would go up.

INFLATION AND PURCHASING POWER MOVE IN OPPOSITE DIRECTIONS.

WHEN INFLATIONGOES UP

PURCHASING POWER GOES

DOWN

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WHY SHOULD YOU CARE?

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Inflation levels determine HOW MUCH YOUR ANNUITY WILL ACTUALLY BUY.

Interest rates determine HOW MUCH YOUR ANNUITY COSTS TO BUY. Interest rates are influenced by expected inflation (among other things).

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RECENT LEVELS OF INFLATION

5 YEAR - 2.08%

AVERAGE PER YEAR

10 YEAR – 2.38%

20 YEAR – 2.38%

5%

4%

3%

2%

1%

0%1995

INFLATION PERCENTAGE PER YEAR

2000 2005 2010

OVER THE LAST 20 YEARS, ANNUAL INFLATION HAS TYPICALLY BEEN BETWEEN 1% AND 3% AND THE FEDERAL RESERVE TARGETS 2% INFLATION LEVELS.

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ANNUITY AND INFLATION MYTHS

Fixed annuities do not protect you against inflation. FALSE Riders exist that do protect you!

If you buy an inflation rider, you no longer have to worry about inflation. FALSE It’s only one part of the process.

READ ON TO FIND OUT MORE.

MYTH 1

MYTH 2

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YOU CAN PROTECT YOURSELFFROM INFLATION IN

1 2 3

THREE SIMPLE STEPS

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STEP

1FIGURE OUT your fixed expenses less any pension or social security payments.

`Groceries $ $

$Housing $Medicine $Travel $Leisure $

SUBTOTAL NET TOTAL

ADD UP THEN SUBTRACT

FOR

$$$ $

Pensions

Social Security

PER MONTHEXPENSES

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STEP

2ESTIMATE using our tools how much those expenses will be in the future dollar terms.

MONTHLY EXPENSES IN TODAY’S DOLLARS

MONTHLY EXPENSES IN FUTURE DOLLAR TERMS

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STEP

3PURCHASE an annuity with an inflation rider tied to actual inflation levels.

1% 2% 3% SOMETHINGELSE?

OR OR OR

IT’S BETTER TO GO WITH... CPI-U

DON’T GUESS WHETHER INFLATION WILL AVERAGE…

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HOW ABARIS CAN HELP?

Contact our team if you have questions about inflation and how you can protect yourself when making your next annuity purchase.

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END NOTES

Slide 05: Minneapolis Fed Website, based on Bureau of Labor Statistics CPIU data. Available at:https://www.minneapolisfed.org/community/teachingaids/cpicalculatorinformation/consumerpriceindexandinflationrates1913

Based on fullyear data available as of September 2014.

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DISCLAIMERSThe information contained in this presentation, is provided for general informational purposes as a convenience to Abaris Financial Inc. customers and Internet users and is based upon information generally available to the public from sources believed to be reliable. Although we believe the information provided herein is reliable, we have not verified this information and we do not guarantee its accuracy, completeness, timeliness or availability. Any examples shown in this presentation are purely hypothetical and have been included for demonstrational purposes only. This information is subject to change without notice. This information is not a substitute for obtaining advice from a qualified professional. Therefore, you should not rely solely upon this information in making any decision. This information, including any prospectus information, is not and does not constitute an offer to sell or a solicitation of an offer to buy any security, service or product.

Abaris Financial, Inc., Philadelphia PA is neither a registered broker-dealer nor a registered investment adviser. Nothing in this presentation, including links to other material, is intended as legal or tax advice. Abaris Financial Inc.’s Licensed Producers do not give legal or tax advice. Taxpayers should seek advice based on their particular circumstances from an independent tax advisor.