1. The returns and other characteristics of the allocation mixes contained in this presentation are based on model/back-tested simulations to demonstrate broad economic principles. They were achieved with the benefit of hindsight and do not represent actual investment performance. There are limitations inherent in model performance; it does not reflect trading in actual accounts and may not reflect the impact that economic and market factors may have had on an advisor’s decision making if the advisor were managing actual client money. Model performance is hypothetical and is for illustrative purposes only. Model performance shown includes reinvestment of dividends and other earnings but does not reflect the deduction of investment advisory fees or other expenses. Clients’ investment returns would be reduced by the advisory fees and other expenses they would incur in the management of their accounts. Past performance is not a guarantee of future results, and there is always the risk that an investor may lose money. Indexes are not available for direct investment. Their performance does not reflect the expenses associated with the management of an actual portfolio. QWAFAFEW January 26, 2010 Investment Overview www.RedLighthouseInvestment.com

2. 1 Principles Asset allocation is what counts. The asset classes that comprise a portfolio and the risk levels of those asset classes are responsible for most of the variability of portfolio returns. Markets work. Capital markets do a good job of fairly pricing all available information and investor expectations about publicly traded securities. Diversification is key. Comprehensive, global asset allocation can neutralize the risks specific to individual securities. Risk and return are related. The compensation for taking on increased levels of risk is the potential to earn greater returns. Fee Only. Aligns your interests with those of your advisor

3. 2 Any Patterns? Annual Return (%) Highest Return Lowest Return In US dollars. Source: MSCI developed markets country indices (net dividends) with at least twenty-five years of data. MSCI data copyright MSCI 2009, all rights reserved; see MSCI disclosure page for additional information. Indexes are not available for direct investment. Index performance does not reflect expenses associated with the management of an actual portfolio. Past performance is not a guarantee of future results.

4. Colors indicate best market for the year. Where is the U.S.? Annual Return (%) In US dollars. Source: MSCI developed markets country indices (net dividends) with at least twenty-five years of data. MSCI data copyright MSCI 2009, all rights reserved; see MSCI disclosure page for additional information. Indexes are not available for direct investment. Index performance does not reflect expenses associated with the management of an actual portfolio. Past performance is not a guarantee of future results. 1984198519861987198819891990199119921993199419951996199719981999200020012002200320042005200620072008 -13.6719.5542.289.2536.409.29-17.5333.65-10.8435.185.4011.1916.47-10.436.0717.62-9.941.68-1.3449.9430.3416.0230.8628.34-50.67 -4.92176.2734.752.230.58103.916.35-12.23-10.6428.09-6.28-4.734.511.580.34-9.11-11.97-5.6316.5658.0371.5224.6436.542.17-68.41 11.3676.6078.397.8653.6117.30-10.9713.76-1.4623.518.2325.8812.0313.5667.67-14.27-16.85-10.90-14.9632.3143.539.0536.66-2.73-66.48 -10.9112.247.4411.6614.2521.36-15.328.29-14.2215.10-4.8616.0926.3411.20-7.4351.774.85-20.44-13.2154.6322.2028.3117.8029.57-45.51 -35.8260.301.2513.2352.7043.92-0.9116.55-28.2532.813.7618.7821.8034.548.9812.083.47-14.80-16.0452.2730.8224.5038.7725.59-47.56 4.3282.0378.36-13.8237.8636.14-13.8417.832.8020.90-5.1814.1221.1911.9441.5329.26-4.32-22.36-21.1937.8118.489.8834.4813.24-43.27 -5.70135.2335.29-24.7520.6045.28-9.368.15-10.2835.674.6616.4113.5724.5829.4420.03-15.59-22.39-33.1954.7316.179.9235.9935.21-45.87 46.9951.6856.10-4.1228.108.389.1849.5132.29116.67-28.9122.5833.07-23.28-2.9059.51-14.75-18.61-17.7929.9324.988.4030.3541.20-51.21 8.11131.71108.31-21.3111.4619.41-19.20-1.83-22.2228.5311.551.0512.5935.5052.53-0.26-1.31-26.60-7.3338.1932.491.9032.496.06-49.98 16.8843.0399.4143.0035.381.72-36.118.91-21.4525.4521.440.70-15.50-23.675.0361.54-28.16-29.41-10.3035.9015.8625.526.24-4.23-29.21 10.2359.6240.737.0614.1735.78-3.1917.812.3035.2811.7027.7227.5123.7723.226.88-4.10-22.11-20.8422.8012.2413.8531.3820.59-48.22 0.0968.62-2.525.6642.4045.530.66-15.50-22.3042.0223.576.0228.646.25-30.0631.68-0.89-12.22-7.2539.3938.3924.2645.1231.43-64.24 -26.92-22.1845.182.2933.3542.29-11.6824.946.2967.976.706.47-6.88-30.05-12.8699.42-27.73-23.42-11.0528.2222.2714.3746.7128.35-47.35 39.0554.73121.2236.9113.559.75-13.8415.62-21.8629.76-4.8229.8340.0525.4349.904.83-15.86-11.34-15.2955.7028.934.4149.3623.95-40.60 -21.7156.9465.602.0048.3231.82-21.0014.42-14.4337.0018.3333.3937.2212.9313.9679.76-21.27-27.18-30.4954.7336.2810.3143.390.62-49.86 -11.95105.7633.37-9.466.1726.20-6.2215.7517.2445.753.5444.112.2744.2523.53-7.035.83-21.36-10.3029.0414.9616.3327.405.29-30.49 5.3153.0426.9635.075.9321.8710.2916.02-3.6724.43-1.6121.2627.4422.6117.8212.44-11.54-14.06-15.2231.2619.577.3530.618.36-48.34 4.4631.0816.282.9114.6130.01-3.1530.076.399.151.1337.1423.2433.3830.1421.92-12.84-12.39-23.0928.4110.145.1414.675.44-37.57 Australia Austria Belgium Canada Denmark France Germany Hong Kong Italy Japan Netherlands Norway Singapore Spain Sweden Switzerland United Kingdom United States Boxed Return is highest return for the year.

5. 4 The Failure of Active Management Percentage of Active Public Equity Funds That Failed to Beat the Index July 2004-June 2009 Source: Standard & Poor’s Indices Versus Active Funds Scorecard, August 20, 2009. Index used for comparison: US Large Cap—S&P 500 Index; US Mid Cap—S&P MidCap 400 Index; US Small Cap—S&P SmallCap 600 Index; Global Funds—S&P Global 1200 Index; International—S&P 700 Index; International Small—S&P Developed ex. US SmallCap Index; Emerging Markets—S&P IFCI Composite. Data for the SPIVA study is from the CRSP Survivor-Bias-Free US Mutual Fund Database. US Large Cap US Mid Cap US Small Cap GlobalInternationalInternational Small Emerging Markets % of Active Funds That Failed to Outperform Benchmark Equity Fund Category

6. 5 The Failure of Active Management Percentage of Active Fixed Income Funds That Failed to Beat the Index July 2004-June 2009 Source: Standard & Poor’s Indices Versus Active Funds Scorecard, August 20, 2009. Index used for comparison: Government Long—Barclays Capital US Long Government Index; Government Intermediate—Barclays Capital US Intermediate Government Index; Government Short—Barclays Capital US 1-3 Year Government Index; Investment Grade Long—Barclays Capital US Long Government/Credit; Investment Grade Intermediate—Barclays Capital US Intermediate Government/Credit; Investment Grade Short— Barclays Capital US 1-3 Year Government/Credit; National Muni—S&P National Municipal Bond Index; CA Muni—S&P California Municipal Bond Index. Data for the SPIVA study is from the CRSP Survivor-Bias-Free US Mutual Fund Database. Barclays Capital data, formerly Lehman Brothers, provided by Barclays Bank PLC. Government Long Government Intermediate Government Short Investment- Grade Long Investment- Grade Intermediate Investment- Grade Short National MuniCA Muni Fixed Income Category % of Active Funds That Failed to Outperform Benchmark

7. 6 Longer Maturity Bonds – Higher Risk Without Much Higher Return Evaluating the Maturity Risk/Return Tradeoff Quarterly: 1964-2008 Source: One-Month US Treasury Bills, Five-Year US Treasury Notes, and Twenty-Year (Long-Term) US Government Bonds provided by Ibbotson Associates. Six-Month US Treasury Bills provided by CRSP (1964-1977) and Merrill Lynch (1978-present). One-Year US Treasury Notes provided by CRSP (1964-May 1991) and Merrill Lynch (June 1991-present). Ibbotson data © Stocks, Bonds, Bills, and Inflation Yearbook™, Ibbotson Associates, Chicago (annually updated work by Roger G. Ibbotson and Rex A. Sinquefield). CRSP data provided by the Center for Research in Security Prices, University of Chicago. The Merrill Lynch Indices are used with permission; copyright 2009 Merrill Lynch, Pierce, Fenner & Smith Incorporated; all rights reserved. Indexes are not available for direct investment. Index performance does not reflect expenses associated with the management of an actual portfolio. Past performance is not a guarantee of future results. Values change frequently and past performance may not be repeated. There is always the risk that an investor may lose money. Fixed income securities are subject to interest rate risk because the prices of fixed income securities tend to move in the opposite direction of interest rates. In general, fixed income securities with longer maturities are more sensitive to these price changes and may experience greater fluctuation in returns. Annualized Compound Returns Annualized Standard Deviation Maturity One-Month US Treasury Bills Six-Month US Treasury Bills One-Year US Treasury Notes Five-Year US Treasury Notes Twenty-Year US Govt. Bonds Annualized Compound Return (%)5.696.466.667.507.87 Annualized Standard Deviation (%)1.341.712.326.2411.10

8. 7 Size and Value Effects Are Strong around the World Annual Index Data In US dollars. Indices are not available for direct investment. Their performance does not reflect the expenses associated with the management of an actual portfolio. Past performance is not a guarantee of future results. US value and growth index data (ex utilities) provided by Fama/French. The S&P data are provided by Standard & Poor’s Index Services Group. CRSP data provided by the Center for Research in Security Prices, University of Chicago. International Value data provided by Fama/French from Bloomberg and MSCI securities data. International Small data compiled by Dimensional from Bloomberg, StyleResearch, London Business School, and Nomura Securities data. MSCI EAFE Index is net of foreign withholding taxes on dividends; copyright MSCI 2009, all rights reserved. Emerging markets index data simulated by Fama/French from countries in the IFC Investable Universe; simulations are free-float weighted both within each country and across all countries. Indexes are not available for direct investment. Their performance does not reflect the expenses associated with the management of an actual portfolio. Past performance is not a guarantee of future results. Values change frequently and past performance may not be repeated. There is always the risk that an investor may lose money. Small company risk: Securities of small firms are often less liquid than those of large companies. As a result, small company stocks may fluctuate relatively more in price. Emerging markets risk: Numerous emerging countries have experienced serious, and potentially continuing, economic and political problems. Stock markets in many emerging countries are relatively small, expensive, and risky. Foreigners are often limited in their ability to invest in, and withdraw assets from, these markets. Additional restrictions may be imposed under other conditions. Foreign securities and currencies risk: Foreign securities prices may decline or fluctuate because of: (a) economic or political actions of foreign governments, and/or (b) less regulated or liquid securities markets. Investors holding these securities are also exposed to foreign currency risk (the possibility that foreign currency will fluctuate in value against the US dollar). US Large Value S&P 500 US Large Growth US Small Value CRSP 6-10 US Small Growth Intl. Value Intl. Small MSCI EAFE Emg. Markets Value Emg. Markets “Market” Emg. Markets Growth US Large Capitalization Stocks 1927-2008 US Small Capitalization Stocks 1927-2008 Non-US Developed Markets Stocks 1975-2008 Emerging Markets Stocks 1989-2008 13.6711.6710.9518.3615.4313.4417.6618.3612.6420.8216.2914.33 27.2120.6921.9935.0531.0834.3024.6028.6122.5839.2435.4734.96 Annualized Compound Returns (%) Average Return (%) Standard Deviation (%) 10.04 9.60 8.64 13.03 11.11 8.40 14.95 14.82 10.29 14.58 10.70 8.69

9. 8 Over 96% of the variation in returns is due to risk factor exposure. After fees, traditional management typically reduces returns. The Model Tells the Difference between Investing and Speculating average expected return (minus T-bills ) = average excess return + sensitivity to market [ market return minus T-bills ] + sensitivity to size [ small stocks minus big stocks] + random error e(t) Priced Risk Positive expected return. Systematic. Economic. Long-term. Investing. Unpriced Risk Noise. Random. Short-term. Speculating. 4% Stock Picking and Market Timing 96% Structured Exposure to Factors Market. Size. Value/growth. sensitivity to BtM [ value stocks minus growth stocks] Source: Dimensional Fund Advisors study (2002) of 44 institutional equity pension plans with $452 billion total assets. Factor analysis run over various time periods, averaging nine years. Total assets based on total plan dollar amounts as of year end 2001. Average explanatory power (R 2 ) is for the Fama/French equity benchmark universe. + Structure Determines Performance

10. 9 Data provided by Fama/French. A small cap run of 3, 4, or 5 years may not increase the likelihood of underperformance in the following year. Average US Small Cap Premiums Following Multi-Year Runs Annual In the July 1927-June 2008 period, there were 20 periods (events) when small cap beat large cap in three consecutive years. The Subsequent Premium in the following year averaged 11.71% across the 20 periods.

11. 10 Data provided by Fama/French. A value run of 3, 4, or 5 years may not increase the likelihood of underperformance in the following year. Average US Value Premiums Following Multi-Year Runs Annual In the July 1927-June 2008 period, there were 20 periods (events) when value beat growth in three consecutive years. The Subsequent Premium in the following year averaged 6.91% across the 20 periods.

12. 11 Equity Market (complete value-weighted universe of stocks) Stocks tend to have higher expected returns than fixed income over time. Company Size (measured by market capitalization) Small company stocks tend to have higher expected returns than large company stocks over time. Company Price (measured by ratio of company book value to market equity) Lower-priced “value” stocks tend to have higher expected returns than higher-priced “growth” stocks over time. Eugene F. Fama and Kenneth R. French, “The Cross-Section of Expected Stock Returns,” Journal of Finance 47, no. 2 (June 1992): 427-65. Eugene F. Fama and Kenneth R. French are consultants for Dimensional Fund Advisors. This page contains the opinions of Eugene F. Fama and Kenneth R. French but not necessarily of Dimensional Fund Advisors or DFA Securities LLC, and does not represent a recommendation of any particular security, strategy, or investment product. The opinions expressed are subject to change without notice. This material is distributed for educational purposes only and should not be considered investment advice or an offer of any security for sale. Dimensional Fund Advisors (“Dimensional”) is an investment advisor registered with the Securities and Exchange Commission. All materials presented are compiled from sources believed to be reliable and current, but accuracy cannot be guaranteed. This article is distributed for educational purposes, and it is not to be construed as an offer, solicitation, recommendation, or endorsement of any particular security, products or services described. ©2009 by Dimensional Fund Advisors. All rights reserved. Value Large Small Growth Increased Risk Exposure and Expected Return Total Stock Market Decreased Risk Exposure and Expected Return Three Dimensions of Stock Returns around the World Risk and Return Are Related

13. 12 Returns are from market-close to market-close. Indices are not available for direct investment; their performance does not reflect the expenses associated with the management of an actual portfolio. The S&P data are provided by Standard & Poor’s Index Services Group. Dow Jones data provided by Dow Jones Indexes. Russell data copyright © Russell Investment Group 1995-2009, all rights reserved. Mutual fund universe statistical data and non-Dimensional money managers’ fund data provided by Morningstar, Inc. Nasdaq Composite Index data provided by The Nasdaq Stock Market, Inc. KBW Bank Index data provided by Keefe, Bruyette & Woods, Inc. (KBW). Past performance is not a guarantee of future results. ► March 9 was the low closing date for four of the five featured indexes year-to-date. ► The Dow Jones Industrial Average rose 5.8% on March 10, 2009. ► Looking at daily returns, it’s difficult to tell if a recovery is occurring. Q1 2009 Returns 1/1-3/31 -12.4% -11.0% -14.9% -2.7% -35.8% Negative Return Period 1/1-3/9 -24.7%-24.6% -31.0% -19.3% - 55.3% Return excluding March 10, 2009 Positive Return Period 3/10-3/31 16.4% 18.1% 23.4% 20.5% 43.8% Dow Jones Industrial Average Russell 2000 Index Nasdaq Composite Index KBW Bank Index S&P 500 Index Perils of Market Timing As of March 31, 2009

14. 13 Timing the Market is Impossible As Measured by the Dow Jones Industrial Average Dow Jones data provided by Dow Jones Indexes. Past performance is not a guarantee of future results. Values change frequently and past performance may not be repeated. There is always the risk that an investor may lose money. DateEvent First Trading Session ResponseSubsequent Market Behavior Prior Day CloseCloseChange Percent Change One Month Six Months One Year September 11, 2001World Trade Center towers destroyed9,605.518,920.70-684.81-7.13%-3.66%11.12%-8.71% January 16, 1991US launches bombing attack on Iraq2,508.912,623.51114.604.57%16.97%18.93%29.52% August 2, 1990Iraq invades Kuwait2,899.262,864.60-34.66-1.20%-8.74%-4.67%4.95% March 30, 1981President Reagan shot by John Hinckley Jr.994.78992.16-2.62-0.26%1.95%-14.33%-16.90% August 9, 1974President Nixon resigns784.89777.30-7.59-0.97%-14.71%-8.87%5.98% November 22, 1963President Kennedy assassinated in Dallas732.64711.48-21.16-2.89%6.57%15.37%24.99% October 22, 1962Cuban missile crisis568.60558.06-10.54-1.85%15.55%27.41%33.89% September 24, 1955President Eisenhower heart attack487.44455.55-31.89-6.54%0.04%12.48%5.72% June 25, 1950North Korea invades South Korea224.30213.90-10.40-4.64%-4.49%7.34%15.13% December 7, 1941Japan attacks Pearl Harbor, Hawaii115.90112.52-3.38-2.92%-0.86%-6.19%2.88%

15. 14 Missing only a small fraction of days can defeat a market timer’s strategy Performance of the S&P 500 Index Daily: January 1, 1970-December 31, 2008 Performance data for January 1970-August 2008 provided by CRSP; performance data for September 2008-December 2008 provided by Bloomberg. The S&P data are provided by Standard & Poor’s Index Services Group. CRSP data provided by the Center for Research in Security Prices, University of Chicago. US bonds and bills data © Stocks, Bonds, Bills, and Inflation Yearbook™, Ibbotson Associates, Chicago (annually updated work by Roger G. Ibbotson and Rex A. Sinquefield). Indexes are not available for direct investment. Their performance does not reflect the expenses associated with the management of an actual portfolio. Past performance is not a guarantee of future results. Values change frequently and past performance may not be repeated. There is always the risk that an investor may lose money. 5.67%9.49% 9.18%5.85% 6.87% Annualized Compound Return8.30% Growth of $1,000

16. 15 Five-Year Moving Average of the US Size and Value Premiums Annual: 1927-2008 US Value Premium On an annualized basis, small cap and value stocks have had more positive than negative five-year periods relative to large cap and growth stocks. These periods typically offer stronger performance relative to large cap and growth. Small cap and value stocks are still subject to extended periods of underperformance. Multifactor data provided by Fama/French. SmB and HmL research factors. Past performance is not a guarantee of future results. Values change frequently and past performance may not be repeated. There is always the risk that an investor may lose money. Securities of small firms are often less liquid than those of large companies. As a result, small company stocks may fluctuate relatively more in price. Even a long-term investment approach cannot guarantee a profit. Economic, political, and issuer-specific events will cause the value of securities, and the funds that own them, to rise or fall. Because the value of investments will fluctuate, there is a risk that investors will lose money. US Size Premium 2008

17. 16 Investment Considerations Reduce expenses. Diversify systematically. Minimize taxes and turnover. Think long-term. Apply discipline. Hold low-cost funds. Maintain asset allocation.