Ameriprise Financial The Next Generation of American Express Financial Advisors Ameriprise Financial, Inc. All rights reserved.

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1 Ameriprise Financial The Next Generation of American Express Financial Advisors 2005 Ameriprise Financial, Inc. All rights reserved. September 2005

2 2 Forward-Looking Statements Some of the statements that we make in this presentation may constitute "forward-looking statements." These statements reflect management's expectations about future events and operating plans and performance and speak only as of the date hereof. These forward-looking statements involve a number of risks and uncertainties. A list of the factors that could cause actual results to be materially different from those expressed or implied by any of these forward-looking statements is detailed under "Risk Factors" and elsewhere in our Registration Statement on Form 10, as amended, filed with the SEC. We undertake no obligation to update publicly or revise these forward-looking statements for any reason. All 2004 financial data in this presentation is pro forma as per Form 10 filing unless otherwise noted.

3 3 Today s Agenda James M. Cracchiolo Chairman & Chief Executive Officer Walter S. Berman Executive Vice President and Chief Financial Officer > Transaction Overview > Company History > Integrated Business Model > Growth Strategies > Financial Overview > Summary and Q&A

4 4 Transaction Summary of Separation Shares to be Distributed Listing Ameriprise Financial, Inc. AMP / NYSE Distribution Timeline Record Date Distribution Date Distribution Ratio Shares Outstanding Transaction Advisors September 19, 2005 September 30, :5 ~ 253 million Citigroup Global Markets Inc. Goldman Sachs & Co.

5 Taking Ameriprise Financial s Historical Strengths to New Levels Well positioned to leverage our strengths as a public company A rich history helping clients achieve their personal financial objectives and Beyond IDS 1 $450 $400 $410.2 Amerprise Assets ($B) $350 $300 $250 $200 $150 $100 $50 $ Represents assets owned and managed for period from , and assets owned, managed and administered for period from $ Q

6 Ameriprise Financial, Inc. Our Business Today Large, established player > 2.8 Million Clients 1 1 As of 6/30/05 2 As of 12/31/2004; source: Securities Industry Association, Yearbook 3 Excludes non-proprietary sales with Ameriprise s wrap accounts > 19,234 Total Employees & Franchisees 1 > 10,500 Branded Advisors 1 5th Largest U.S. Sales Force 2 > Over $410 Billion in Assets Owned, Managed and Administered 1 > $96 Billion On-Balance Sheet Assets 1 > $53 Billion in 2004 Cash Sales 3 > Over $1 Billion in 2004 Premiums > $7.2 Billion in 2004 Revenues > $7 Billion in Book Value 1 > Equivalent of AA- financial strength rating from the major agencies > Approximately 90% of mortality risk is reinsured 6

7 Integrated Business Model Driving Better Economics Our integrated business model drives both growth opportunities and revenue stability 2.5+ Million Clients 1 Client / Advisor Planning Relationships Most Certified Financial Planner Practitioners 2 10,500 Branded Advisors Solutions Broad Product Solution Set 1 Ameriprise Financial Services retail clients, excluding P&C and Securities America (SAI) clients 2 More Certified Financial Planner practitioners than any other firm; source: Certified Financial Planner Board of Standards Asset Accumulation & Income Protection 7

8 8 Strategies for Profitable Growth and ROE Expansion Our existing foundation positions us well for our future growth strategies > Strengthen our lead in financial planning > Sharpen our focus on mass affluent, particularly their retirement needs > Deliver profitable growth and productivity in our advisor channel > Invest in marketing to support client growth > Improve and expand product solutions, in order to capture greater flows > Extend distribution reach with alternative channels > Expand operating margins and ROE through reengineering and capital optimization Revenue Growth Earnings Growth ROE Expansion

9 Planning Approach A Leader in Financial Planning & Advice Driven by the identification and fulfillment of client needs Comprehensive Approach > Apply Certified Financial Planner Board of Standards process > Broad and diversified solutions A Leader in Face-to-Face Planning > More Certified Financial Planner practitioners than any other firm > We have over 10% of all U.S. Certified Financial Planner practitioners 1 Based on the number of financial planning service agreements signed, as reflected in Item 5H of Form ADV, Part I for two years for Ameriprise Financial Services, Inc. and its competitors Individualized Plans Based on Client s Goals > 225,000 new financial planning service agreements in 2004; 13% CAGR since > 2x nearest competitor 1 9

10 Planning Approach Planning Drives Deeper Relationships Increasing financial planning penetration provides substantial growth opportunities Over 1 Million Clients with a Plan 1 % of Clients with a Plan > Hold 3x more assets 42.1% > Hold more than 4 products with us on average 37.9% 39.2% 40.3% > Generate 75% of total sales > Are more satisfied Focus on Ongoing Relationship Planning Ameriprise planning clients compared to Ameriprise clients without a plan 2 Gross Dealer Concession ( GDC ) is an internal measure, commonly used in the financial services industry, of the sales production of the advisor channel. > 3x more Gross Dealer Concession ( GDC ) 1 for planning vs. non-planning clients > 9x more GDC for ongoing planning relationships than nonplanning clients Opportunity to develop planning relationships with 58% of our client base 10

11 Client Focus Focusing on the Mass Affluent Profitably serving mass and mass-affluent segment Proven success attracting and retaining clients in this high-growth segment Largest, Fastest Growing Segment > 50% of U.S. investable assets 1 > Growth 2x faster than market 2 Indexed 5 Growth in AMP Mass-Affluent Clients Acute Need for Retirement > Biggest identified need 3 1 Source: MacroMonitor consumer survey prepared by SRI Consulting Business Intelligence 2 Source: BCG Wealth Market Sizing Database 3 Source: Federal Reserve Board Survey of Consumer Finances; EBRI; Financial Insights; U.S. Federal Reserve, Source: Spectrem Group, Planning for Retirement: Baby Boomer Expectations vs. Reality, April Indexed to 2002 levels of clients holding over $100,000 of assets with Ameriprise 6 Retail assets includes assets in the U.S., managed and administered for retail clients > 54% prefer having a financial planner 4 Mass-Affluent Clients represent over 70% of our retail assets 6 11

12 Financial Advisors Multiple Affiliation Platforms Flexible advisor value proposition More SUPPORT AVAILABLE Less Branded Platforms P1 P2 P3 Ameriprise Employees Ameriprise Franchisees Non-Branded (Securities America) Lower PAYOUT Higher > Over 3,100 advisors > Traditional point of entry for Ameriprise advisors > Over 7,400 advisors 1 > Opportunity to build equity in their practice > Over 1,500 advisors > Infrastructure provided by Securities America 1 Includes associate advisors 2 As of 12/31/04 > Average tenure 1.3 yrs 2 > 62% retention during 2004 > Recent changes making P1 platform compelling longterm option > Average tenure 11 yrs 2 > 93% retention during

13 Financial Advisors Improving Productivity Higher retention increases stability and drives client retention Strategies focus on plan creation and execution Strategies for Driving Growth and Productivity Enhancing Training 91% 46% Advisor Retention 93% 93% 92% 62% 65% 48% Strengthening Tools & Technology HY 2005 Franchisee Advisors Employee Advisors Investing in Corporate and Local Marketing Advisor Productivity 1 Retail assets defined as Managed and Administered Assets, excluding assets managed by Threadneedle; advisor count based on number of branded advisors at end-of period; represents CAGR from 12/31/02 to 6/30/05 > Retail assets per advisor have grown 18% 1 in last 3.5 years 13

14 14 Marketing Investing in Growth Investments driving client and asset growth and supporting advisors in mass-affluent focus Brand > Significant investment in brand development and advertising Elements of AMP Marketing Client Segment Propositions > Ameriprise Platinum Financial Services sm > Ameriprise Gold Financial Services sm Corporate Lead Generation > Financial Education and Planning Services ( FEPS ) > Alliances, e.g., Costco, Delta Local Marketing Programs > Marketing events in local communities, e.g., Lunch & Learn

15 Solution Set Leading Market Positions Broad and substantial solution set designed to meet clients needs Term / Whole VUL/UL Revenues by Product, 2004 P&C DI & Other Asset Mgmt Variable Annuity Mutual Fund Wrap Products Variable Annuity Products 401(k) Market Positions > #1 in assets 2 > #11 in new product sales 3 > Top 15 retirement service provider 4 1 Excludes revenue from Corporate/Other segment 2 As of 12/31/2004; source: Cerulli Associates 3 For year ended 12/31/2004; source: VARDS 4 As of 12/31/2004; source: CFO Buyer s Guide, April/May Source: Pensions & Investments Online 2005 Rankings 6 For year ended 12/31/2004; source: Tillinghast- Towers Perrin Value survey 7 For year ended 12/31/2004; source: LIMRA International Banking Brokerage & Other Certificates Total: $6.8B 1 Fixed Annuity Managed Assets VUL Sales Disability Income Insurance > #23 in worldwide AUM 5 > #2 in total premiums 6 > #7 in total premiums 7 15

16 Enhancing Our Solution Set Substantial Investments Investments focused on driving improved performance and long-term growth 1 Aggregated data shows only mutual funds actively managed by affiliated investment managers. Aggregated data does not include mutual funds subadvised by advisers not affiliated with Ameriprise Financial, Inc. or index funds. Aggregated equity rankings include AXP Portfolio Builder Series and other balanced and asset allocation funds that invest in both equities and fixed income. AXP Portfolio Builder Series funds are funds of mutual funds that may invest in thirdparty subadvised funds. Aggregated data only includes mutual funds in existence as of June 30, Refer to Exhibit 1 for individual mutual fund performance rankings and other important disclosures. Exhibit 1 includes performance rankings for funds subadvised by non-affiliated advisers for general reference although not included in the summary above. Strengthened U.S. Asset Management Performance > Hired new leadership > Added investment talent > Set up satellite structure for equities > Established sectorapproach for fixed income Added Capabilities > Cambridge Quantitative > Boston Large Cap Equity > New York & Minneapolis Value > Threadneedle International > Partner Funds 70% 60% 50% 40% 30% 20% 10% 0% Improving U.S. Fund Performance 1 % of Funds above Median (Equal Weighted on a 3 year Basis) 12% 0% 22% 20% 39% 40% 52% 67% 12/31/02 12/31/03 12/31/04 6/30/05 Equity Taxable Fixed Income 16

17 Enhancing Our Solution Set International Expansion - Threadneedle Investment in enhancing capabilities and expanding distribution One of Europe s Leading Asset Managers Acquired by AMP in 2003 Ameriprise Managed Assets 3 As of June 30, 2005 International (Threadneedle) 46% 3 rd Largest Retail Manager in U.K. 1 Over 100 Investment Professionals Domestic (U.S.) 54% 1 Source: UK Investment Management Association, as of 5/31/05 2 Standard & Poor s as of 3/31/05 3 Managed assets includes all assets managed by Ameriprise Financial, Inc., or its subsidiaries that are investment advisors, but does not include owned or administered assets. The presentation of managed assets may be different when provided by any of these subsidiaries. 24 Funds Rated by S&P 2 Total Managed Assets: $248.2B 17

18 18 Expanding Our Solution Set Meeting Evolving Needs Innovating solutions to help meet changing client needs Recent Introductions and Innovations Asset Management Solutions > Managed allocation funds > Partner funds Banking and Brokerage Solutions > Managed accounts > ONE sm Financial Account > Deposit and Credit products Insurance and Annuity Solutions > Annuities with living benefits Focus of Future Innovations > Retirement transition and income needs > Solutions with embedded advice > Integrated asset management and insurance

19 Product Distribution Expanding Our Reach Opportunity to grow scale and leverage manufacturing capabilities 3 rd Party Retail Distribution > Annuity product sales through over 26 banks and brokerdealers in 2005 Institutional > $22.9 billion in assets managed for Institutional clients in the U.S. 2,3 > Increased share in 15 of 17 accounts active in 2004 > Alternative investment capabilities, e.g., CDOs, Hedge Funds Retirement Services Sub-Advisory 1 Source: CFO Magazine, April/May Excluding Institutional assets managed by Threadneedle 3 Managed assets includes all assets managed by Ameriprise Financial, Inc., or its subsidiaries that are investment advisors, but does not include owned or administered assets. The presentation of managed assets may be different when provided by any of these subsidiaries. > Top 15 retirement services provider 1 > FEPS retail client acquisition > IRA rollover opportunity > Manage over $1.0 billion in sub-advisory mandates 19

20 Benefits of Integrated Model Driving Better Economics Focus on comprehensive financial plans and execution drives economic benefits for clients, advisors and company > Higher persistency than industry Annuity lapse rates lower by bps 1 Long-term mutual fund redemptions lower by over 300 bps 2 > Higher revenue per client $2,615 vs. peers of $742 3 > Diverse and stable revenue streams 33% investment income 30% management, advice and service fees 15% distribution fees 14% premiums Revenue Growth Earnings Growth ROE Expansion 1 Based on annuity lapse rates for 2004 from LIMRA International studies; based on full surrenders 2 Source: ICI 2004 fund data 3 Peers consist of Wachovia, Raymond James, AG Edwards, source: company web sites Reconciliation to GAAP accounting: Reported GAAP Revenue $7.245B Institutional & Non-Advisor Client Revenue ($0.717B) Designated Retail Advisor Client Revenue $6.528B > Target effective use of capital Diversity of solutions Proprietary and non-proprietary options 20

21 21 Long Term Financial Targets On Average, Over Time We are creating shareholder value > 6-8% Revenue Growth > 10-13% Net Income Growth > 12-15% Return on Equity

22 22 Financial Overview > Walter S. Berman Executive Vice President & Chief Financial Officer

23 23 Separation Ready for Future as Public Company Building upon our historical strengths Separation Independent Structure in Place Strong Financial Foundation Established Decision Framework

24 24 Balanced Decision Framework Driving the Business Forward A disciplined process for evaluating and prioritizing growth opportunities and associated trade-offs Market Potential Risk / Return Financial Metrics Competitor Positioning & Strategies Objective Strategic & Operational Decisions Ameriprise s Capabilities Customer Needs & Behaviors

25 Ameriprise Core Metrics - Momentum Solid trends in all core metrics: -Advisors - - Clients - - Volumes - BUSINESS METRICS ($ in millions unless noted) Total Advisors Branded Advisors Branded Advisor Retention Employee Franchisee 2Q05 12,162 10,579 65% 92% 1Q05 12,356 10,775 65% 92% 4Q04 12,344 10,741 62% 93% 3Q04 12,071 10,530 59% 93% 2Q04 11,943 10,413 55% 93% Clients: Total (000) 2,762 2,749 2,744 2,723 2,721 Clients with a Plan 1 43% 43% 42% 42% 41% Advisor Cash Sales 2 $6,258 $6,333 $6,014 $5,357 $5,762 Gross Dealer Concession 3 $417 $403 $382 $357 $368 1 Percent of Branded Advisor Clients with a financial plan 2 Excludes non proprietary sales within Ameriprise s wrap accounts 3 Gross Dealer Concession ( GDC ) is an internal measure, commonly used in the financial services industry, of the sales production of the advisor channel; excludes Securities America 4 Includes owned earning assets Assets Owned, Managed & Administered ($B) 4 $410 $401 $408 $378 $376 25

26 Ameriprise Reporting Clarification and Discussion Roadmap to our reporting > AEFA net income per American Express reporting Before accounting change After accounting change > Ameriprise historical net income per Form 10 Major changes from American Express reporting Amex Assurance Membership Banking SAB 55 Inclusion of separation costs > Ameriprise pro forma net income per Form 10 Major changes from historical net income Remove impact of Amex Assurance Transfer out jointly-owned Certificate company (AEIDC) Adjust interest cost of debt Remove costs of separation > Ameriprise going-forward reporting Pending resolution of Amex Assurance prior periods and AEIDC prior periods 26

27 27 Ameriprise Consolidated Income Statement - Historical Core shareholder value drivers ($ in millions unless specified) Revenues 2Q05 $1,964 2Q04 $1, $7,245 Income before Separation Costs and Accounting Change $ $ 186 $ 865 Net Income $ 155 $ 186 $ 794 Contribution Margin % 51.1% 51.5% Operating Income Margin 3 9.8% 10.4% 11.9% Net Income Margin 7.9% 10.4% 11.0% ROE Operating % 11.8% 12.3% 1 Excludes $37 million of after-tax separation costs. 2 Total revenues less field compensation and benefits, interest credited to account values and benefits, claims, losses and settlement expenses as a percentage of total revenues. 3 Income before separation costs and accounting change as a percentage of total revenues. 4 Calculated using the trailing 12 month income before separation costs and accounting change and the average shareholder s equity as of the last day of the preceding three quarters and the current quarter.

28 28 Ameriprise Consolidated Income Statement - Pro Forma Comparison Core shareholder value drivers ($ in millions unless specified) Pro Forma YTD June 2005 Historical YTD June 2005 Pro Forma 2004 Historical 2004 Revenues $3,592 $3,880 $6,770 $7,245 Income before Separation Costs and Accounting Change $317 1 $388 1 $708 $ 865 Contribution Margin % 50.7% 50.0% 51.5% Operating Income Margin 3 8.8% 10.0% 10.5% 11.9% ROE Operating % 12.0% 10.1% 12.3% 1 Excludes $50 million of after-tax separation costs. 2 Total revenues less field compensation and benefits, interest credited to account values and benefits, claims, losses and settlement expenses as a percentage of total revenues. 3 Income before separation costs and accounting change as a percentage of total revenues. 4 Calculated using the trailing 12 month income before separation costs and accounting change and the average historical shareholder s equity as of the last day of the preceding three quarters and the current quarter.

29 Ameriprise Consolidated Balance Sheet - Historical Solid capital generation ($ in millions unless specified) 2Q05 2Q High quality Shareholder s Equity ex OCI 1 $6,679 $6,569 $6,322 Conservative leverage Shareholder s Equity Dividends Paid $6,993 - $6,570 $532 $6,702 $1,325 AA and Higher Rated % Fixed Income AFS 51% 46% 48% High Yield % Fixed Income AFS 7% 9% 6% Non-Performing Assets as % of Invested Assets 3.02%.04%.02% Cash & Cash Equivalents $2,510 $1,026 $1,078 1 Excludes other comprehensive income of $314 mm, $1 mm, and $380 mm, respectively, for periods presented 2 Debt consists of short term line of credit with American Express Company and other long term debt with both American Express Company and third parties. Excluded is non recourse debt. Capital includes total shareholder s equity plus the previously described debt. 3 Excludes short-term cash positions and includes the impact of FIN 46 Debt to Capital % 17.4% 19.7% 29

30 30 Ameriprise Consolidated Balance Sheet Pro forma Comparison Solid capital generation High quality ($ in millions unless specified) Pro Forma 2Q 05 Historical 2Q 05 Pro Forma 2004 Historical 2004 Conservative leverage Shareholder s Equity ex OCI 1 Shareholder s Equity $7,744 $8,058 $6,679 $6,993 $7,387 $7,767 $6,322 $6,702 Cash & Cash Equivalents $3,319 $2,510 - $1,078 Debt to Capital % 19.2% 16.8% 19.7% 1 Excludes other comprehensive income of $314mm in 2Q 05 and $380mm in Historical debt consists of short term line of credit with American Express Company and other long term debt with both American Express Company and third parties. Pro forma debt consists of $1.5 billion senior debt and other long term debt with third parties. Both exclude non recourse debt. Capital includes total shareholder s equity plus the previously described debt.

31 Ameriprise Return on Equity - Pro Forma Comparison Opportunity for ROE improvement Pro Forma Income YTD June 2005 Historical Income YTD June 2005 Pro Forma Income 2004 Historical Income 2004 Contribution Margin % 50.7% 50.0% 51.5% Operating Income Margin 3 8.8% % % 11.9% 1 Excludes $50 mm of after-tax separation costs. 2 Total revenues less field compensation and benefits, interest credited to account values and benefits, claims, losses and settlement expenses as a percentage of total revenues. 3 Income before separation costs and accounting change as a percentage of total revenues. 4 Calculated using the trailing 12 month income before separation costs and accounting change and the average historical shareholder s equity as of the last day of the preceding three quarters and the current quarter. 5 Calculated using the trailing 12 month income before separation costs and accounting change and average pro forma shareholder s equity as of the last day of the preceding three quarters and the current quarter. 6 Calculated using the trailing 12 month income before separation costs and accounting change and average pro forma shareholder s equity as of the last day of the preceding three quarters and the current quarter less $570mm, which represents total separation costs, net of tax. ROE Operating 4 Using Historical Equity ROE Operating 5 Using Pro Forma Equity ROE Operating 6 Using Pro Forma Equity less $ % 9.0% 9.7% 12.0% 10.3% 11.1% 10.1% 8.7% 9.4% 12.3% 10.7% 11.5% 31

32 Shareholder Framework Goal: Improve Shareholder Value 32 Capital / Returns Profitability Profitability Growth Growth / Margins Margins Decision Framework balances tradeoffs to create sustainable value Constituents Stability

33 33 Shareholder Framework Goal: Improve Shareholder Value Targets Revenue Growth 6-8% Net Income Growth 10-13% Return on Equity 12-15% Profitability > Sustained Growth > Improving Margins Contribution Income before separation Drivers > Financial planning > Mass-affluent clients > Productivity > Brand marketing > Expanded product solutions > Alternative distribution channels > Reengineering

34 34 Shareholder Framework Goal: Improve Shareholder Value Targets Revenue Growth 6-8% Net Income Growth 10-13% Return on Equity 12-15% Capital/Returns > Current period > Multi-year horizon Drivers > Manage product capital intensity mix > Balance risk/return trade-off > Balance sheet optimization > Risk mitigation > Ongoing oversight Investments Balance sheet

35 35 Shareholder Framework Goal: Improve Shareholder Value Targets Revenue Growth 6-8% Net Income Growth 10-13% Return on Equity 12-15% Stability > Safety and soundness of Company and Brand Drivers > Integrated decision framework > Liquidity management > SOX 404 > Integrated compliance model > Earnings volatility mitigation > Leverage AXP best practices > Risk management framework

36 36 Summary > James M. Cracchiolo Chairman & Chief Executive Officer

37 37 Summary of Investment Highlights Solid Foundation > Proven integrated business model focused on financial planning and advice, delivered through face-to-face relationships > Conservative balance sheet and comprehensive risk management > Experienced management team with an average of over 20 years in the financial services industry Strategies in Place for Profitable Growth and ROE Expansion > Strengthen our lead in financial planning > Sharpen our focus on mass affluent, particularly their retirement needs > Deliver profitable growth and productivity in our advisor channel > Invest in marketing to support client growth > Improve and expand product solutions, in order to capture greater flows > Extend distribution reach with alternative channels > Expand operating margins and ROE through reengineering and capital optimization

38 2005 Ameriprise Financial, Inc. All rights reserved. 38

39 Exhibit 1 AXP Equity Fund Performance & Lipper Ranking as of June 30, 2005 Source: Lipper, net of fees Please note the following about the "Ranking since" Lipper Rankings: In order to obtain a more accurate "since inception" Lipper Ranking for funds with an inception prior to 1999, the Thursday or month-end date closest to the actual inception date was used, rather than the actual inception date. Since fund inception returns and rankings are not available. Actual fund inception date per-dates data in Lipper database. 1 yr 3 yr 5 yr 10 yr Since Inception Ranking Since Return Pct Rank / #Funds Return Pct Rank / #Funds Return Pct Rank / #Funds Return Pct Rank / #Funds Inc Date Return Date Pct Rank / #Funds Balanced Funds AXP Mutual A % 98 / % 189 / % 331 / % 159 / 163 4/16/1940 AXP Portfolio Builder Moderate Fund A % 95 / /04/ /4/ % 56 / 589 AXP Portfolio Builder Moderate Aggressive Fund A % 85 / /04/ /4/2004 9% 53 / 589 Lipper Emerging Market Funds Category AXP Threadneedle Emerging Markets Fund A % 123 / % 115 / % 82 / /13/ /14/ % 38 / 67 Lipper Equity Income Funds Category AXP Diversified Equity Income Fund A % 22 / % 6 / % 17 / % 18 / 70 10/15/ /18/ % 12 / 26 AXP Dividend Opportunity Fund A % 4 / % 119 / % 113 / % 55 / 70 08/01/ /4/ % 25 / 26 Lipper European Region Funds Category AXP Threadneedle European Equity Fund A % 87 / % 88 / % 63 / 69 06/26/ /26/ % 59 / 69 Lipper Flexible Portfolio Funds Category AXP Managed Allocation Fund A % 75 / % 86 / % 74 / % 71 / 84 01/23/ /24/ % 2 / 7 Lipper Global Flexible Portfolio Funds Category AXP Threadneedle Global Balanced Fund A % 18 / % 44 / % 67 / 71 11/13/ /14/ % 40 / 42 Lipper Global Large Cap Growth Funds Category AXP Threadneedle Global Equity Fund A % 2 / % 13 / % 15 / % 13 / 15 05/29/ /31/ % 5 / 5 Lipper Gold-Oriented Funds Category AXP Precious Metals Fund A % 44 / % 36 / % 26 / % 12 / 22 04/22/ /25/ % 4 / 10 Lipper Income Funds Category AXP Portfolio Builder Conservative Fund A % 143 / /04/ /4/ % 106 / 227 AXP Portfolio Builder Moderate Conservative Fund A % 80 / /04/ /4/ % 70 / 227 Lipper International Large Cap Core Funds Category AXP Threadneedle International Fund A % 146 / % 153 / % 115 / % 45 / 49 11/15/ /15/ % 5 / 5 Lipper International Multi Cap Growth Funds Category AXP Partners Int l Aggressive Growth Fund A % 23 / % 42 / /28/ /28/ % 48 / 134 Lipper International Multi Cap Value Funds Category AXP Partners Int l Core Fund A % 113 / /03/ /3/ % 95 / 99 AXP Partners Int l Select Value Fund A % 33 / % 28 / 90 09/28/ /28/ % 30 / 89 Lipper International Small/Mid Cap Core Funds Category AXP Partners Int l Small Cap Fund A % 42 / 51 10/03/ /3/ % 33 / 43 Lipper Large Cap Core Funds Category AXP Large Cap Equity Fund A % 361 / % 241 / /28/ /28/ % 203 / 759 AXP New Dimensions Fund A % 833 / % 696 / % 489 / % 114 / /01/ /1/ % 3 / 32 AXP Partners Growth Fund A % 786 / /24/ /24/ % 787 / 835 AXP Quantitative Large Cap Equity Fund A % 299 / /24/ /24/ % 167 / 835 AXP Stock Fund A % 420 / % 548 / % 302 / % 190 / 231 4/6/1945 Lipper Large Cap Growth Funds Category AXP Growth Fund A % 23 / % 115 / % 357 / % 107 / 140 3/1/1972 Large Cap Value Fund AXP Equity Value Fund A % 33 / % 94 / % 121 / % 75 / /20/ /23/ % 72 / 99 AXP Large Cap Value Fund A % 207 / % 140 / /27/ /27/ % 150 / 356 AXP Partners Value Fund A % 377 / % 177 / /18/ /18/ % 129 / 293 Lipper Mid Cap Growth Funds Category AXP Equity Select Fund A % 392 / % 334 / % 77 / % 23 / 114 6/4/1957 AXP Partners Aggressive Growth Fund A % 352 / /24/ /24/ % 118 / 490 AXP Strategy Aggressive Fund A % 404 / % 388 / % 281 / % 95 / /20/ /23/ % 93 / 112 Lipper Mid Cap Value Funds Category AXP Mid Cap Value Fund A % 28 / % 20 / /14/ /14/ % 25 / 182 Lipper Multi Cap Core Funds Category AXP Partners Fundamental Value Fund A % 256 / % 112 / /18/ /18/ % 125 / 451 AXP Portfolio Builder Aggressive Fund A % 211 / /04/ /4/ % 185 / 719 AXP Portfolio Builder Total Equity Fund A % 181 / /04/ /4/ % 171 / 719 Lipper Multi Cap Value Funds Category AXP Partners Select Value Fund A % 236 / % 34 / /08/ /8/2002 9% 30 / 345 Lipper Real Estate Funds Category AXP Real Estate Fund A % 124 / /04/ /4/ % 33 / 215 Lipper Science & Technology Fund Category AXP Global Technology Fund A % 54 / % 34 / % 108 / /13/ /14/ % 26 / 44 Lipper Small Cap Core Funds Category AXP Discovery Fund A* % 218 / % 78 / % 299 / % 93 / 97 08/24/ /27/ % 7 / 8 AXP Partners Small Cap Core Fund A % 180 / % 125 / /08/ /8/ % 292 / 463 AXP Partners Small Cap Value Fund A % 314 / % 315 / /18/ /18/ % 102 / 406 AXP Small Cap Advantage Fund A % 325 / % 157 / % 233 / /04/ /6/ % 231 / 286 Lipper Small Cap Growth Funds Category AXP Partners Small Cap Growth Fund A % 410 / % 357 / /24/ /24/ % 256 /

40 40 Exhibit 1 Source: Lipper as of 6/30/2005. Lipper rankings are based upon annualized total returns, excluding sales charges. *Closed to new investors. With minimum sales charge of 4.75%. Fee waivers were in place for each American Express Partners Fund shown. Return would have been lower for each Fund had fee waivers not been in place. The performance information shown represents past performance and is not a guarantee of future results. Fund returns for all periods would have been lower if the applicable sales charges were included. The value of your investment and returns will fluctuate so that your shares, when redeemed, may be worth more or less than their original cost. Current performance may be lower or higher than the performance information shown. You may obtain performance information current to the most recent month-end by visiting americanexpress.com.

41 Exhibit 1 AXP Fixed Income Fund Performance & Lipper Ranking as of June 30, 2005 Source: Lipper AXP Fixed Income Funds Annualized Total Returns 1 yr 3 yr 5 yrs 10 yrs Since First NAV Date Class A Shares First NAV Date Total Return Percentile Ranking Ranking # of funds Total Return Percentile Ranking Ranking # of funds Total Return Percentile Ranking Ranking # of funds Total Return Percentile Ranking Ranking # of funds Total Return Intermediate Investment Grade Debt Funds category AXP Core Bond Fund 6/19/ % AXP Diversified Bond Fund 10/3/ % % % % Global Income Funds category AXP Global Bond Fund1 3/20/ % % % % High Yield Funds category AXP High Yield Bond Fund 12/8/ % % % % AXP Income Opportunities Fund 6/19/ % Short-Intermediate Investment Grade Debt Funds AXP Limited Duration Bond Fund 6/19/ % Corporate Debt A rated Funds category AXP Selective Fund 12/31/ % % % % Short U.S. Government Funds category AXP Short Duration U.S. Government Fund 8/19/ % % % % Treasury Inflation Protected Securities Funds category AXP Inflation Protected Securities Fund 3/4/ % U.S. Mortgage Funds category AXP U.S. Government Mortgage Fund 2/14/ % % California Municipal Debt Funds category AXP California Tax-Exempt Fund 8/18/ % % % % General Municipal Debt Funds category AXP High Yield Tax-Exempt Fund 5/7/ % % % % AXP Tax-Exempt Bond Fund 12/7/ % % % % Insured Municipal Debt Funds category AXP Insured Tax-Exempt Fund 8/18/ % % % % Intermediate Municipal Debt Funds category AXP Intermediate Tax-Exempt Fund 11/13/ % % % Massachusetts Municipal Debt Funds category AXP Massachusetts Tax-Exempt Fund 7/2/ % % % % Michigan Municipal Debt Funds category AXP Michigan Tax-Exempt Fund 7/2/ % % % % Minnesota Municipal Debt Funds category AXP Minnesota Tax-Exempt Fund 8/18/ % % % % New York Municipal Debt Funds category AXP New York Tax-Exempt Fund 8/18/ % % % % Ohio Municipal Debt Funds category AXP Ohio Tax-Exempt Fund 7/2/ % % % %

42 42 Exhibit 1 Source: Lipper as of 6/30/2005. Lipper rankings are based upon annualized total returns, excluding sales charges. With minimum sales charge of 4.75%. The performance information shown represents past performance and is not a guarantee of future results. Fund returns for all periods would have been lower if the applicable sales charges were included. The value of your investment and returns will fluctuate so that your shares, when redeemed, may be worth more or less than their original cost. Current performance may be lower or higher than the performance information shown. You may obtain performance information current to the most recent month-end by visiting americanexpress.com

43 43 Exhibit 1 Important Disclosures > You should consider the investment objectives, risks, charges and expenses of mutual funds carefully before investing. For a free prospectus, which contains this and other important information about our funds, call (800) AXP-FUND, TTY: (800) Read the prospectus carefully before you invest. > An investment in money market funds is not insured or guaranteed by the Federal Deposit Insurance Corporation or any other government agency. Although these funds seek to preserve the value of your investment at $1.00 per share, it is possible to lose money by investing in these funds. > Stocks of small- and mid-capitalization companies involve substantial risk. Historically, these stocks have experienced greater price volatility than stocks of larger companies, and they can be expected to do so in the future. Stocks of mid-capitalization may be slightly less volatile than those of small-capitalization companies but still involve substantial risk. > The investment process used to manage the AXP Quantitative Large Cap Equity Fund employs new technologies and statistical methods that have not previously been used to manage openend mutual funds. Shareholders should be prepared for the possibility that the Fund may underperform its benchmark. While Ameriprise Financial, Inc. seeks to control trading activity, the Fund may trade more often that other funds in its peer group. Trading activity may result in increased fees, expenses and taxes. > International investing involves increased risk and volatility, not typically associated with domestic investing, due to changes in currency exchange rates, foreign government regulations, differences in auditing and accounting standards, potential political and economic instability, limited liquidity and volatile prices. The risks of international investing are particularly significant in emerging markets. > The AXP Global Technology Fund is a narrowly focused sector fund and it may exhibit higher volatility than funds with broader investment objectives. > The AXP Real Estate Fund is a narrowly focused sector fund and it may exhibit higher volatility than funds with broader investment objectives. An investment in a real estate fund is subject to the same risks as a direct investment in real estate. Such risks include market risk, economic risk and mortgage rate risk. > The AXP Precious Metals Fund is a narrowly focused sector fund and it may exhibit higher volatility than funds with broader investment objectives. > There are risks associated with an investment in a bond fund, including the impact of interest rates, credit and inflation. These and other risk considerations are discussed in the fund s prospectus. In general, bond prices rise when interest rates fall and vice versa. This effect is usually more pronounced for longer-term securities. > High-yield funds invest in lower-rated bonds, which generally have more volatile prices and carry more risk to principal and income than investment grade securities. > Income from tax-exempt funds may be subject to state and local taxes, and a portion of income may be subject to the federal and/or state alternative minimum tax for certain investors. Federal income tax rules will apply to any capital gains distribution. > Shares of the AXP Short Duration U.S. Government Fund and the AXP U.S. Government Mortgage Fund are not insured or guaranteed by the U.S. government. > Principal risks associated with the AXP Inflation Protected Securities Fund include style risk, interest rate risk, market risk, credit risk, liquidity risk and sector/concentration risk. Treasury Inflation Protected Securities (TIPS) are backed by the full faith and credit of the U.S. government. The U.S. government guarantee applies only to the underlying TIPS securities, and not the Fund itself. > Standard & Poor's, S&P, S&P 500, and Standard & Poor s 500 are trademarks of the McGraw-Hill Companies, Inc. These trademarks and service marks have been licensed for use by Ameriprise Financial Services, Inc. The Funds are not sponsored, endorsed, sold or promoted by Standard & Poor s or any of their subsidiaries or affiliates (the Licensors ), and the Licensors make no representation regarding the advisability of investing in the Funds. > Ameriprise Financial Services, Inc., Member NASD