SMART INVESTING FOR YOUR RETIREMENT. ENROLLMENT KIT

Transcription

1 CalPERS Supplemental Income 457 PL AN SMART INVESTING FOR YOUR RETIREMENT. ENROLLMENT KIT

2 Ready to Enroll? Two steps and you re on your way with the CalPERS Supplemental Income 457 Plan Jump Start Your Future Experienced investors know that a key principle to investing for retirement is to start as soon as you can and contribute as much as you can. In doing so you are working to ensure your ability to live the life you want when in retirement. keeping it together! If you have an eligible Individual Retirement Account (IRA) or retirement account from a previous employer, you may want to consider moving those funds into your CalPERS Supplemental Income 457 Plan account to take full advantage of all that CalPERS has to offer. Complete the enclosed Rollover Form to start the rollover process

3 step one... Deciding how much to contribute You may enroll in the CalPERS Supplemental Income 457 Plan at any time, as there is no waiting or enrollment period with this plan. Now, deciding how much to save is a personal decision. It is unique to you in that it is based on your retirement goals, your resources, and the amount of time you have to invest. Maximum annual contribution limit 100% of income, up to $17,000 for 2012.* See page 10 for details on the Age 50 Catch-Up and Three-Year Special 457(b) Catch-Up Provisions. Use the table below as a guide, or visit the Financial Resource Center on the Plan Web site and use the Plan Savings Calculator to help you calculate your contribution amount. Sample contribution amounts based on a percent of Annual Salary as a Bi-weekly Dollar Contribution Annual Salary 2% 5% 10% 15% 20% 25% $20,000 $15 $38 $77 $115 $154 $192 $30,000 $23 $58 $115 $173 $231 $288 $40,000 $31 $77 $154 $231 $308 $385 $50,000 $38 $96 $192 $288 $385 $481 $60,000 $46 $115 $231 $346 $462 $577 $70,000 $54 $135 $269 $404 $538 $634 Your contributions All contributions are made through payroll deductions. The CalPERS Supplemental Income 457 Plan is flexible so you may stop, increase or decrease your contributions as often as your employer allows without penalty or cost. To make changes, complete and submit a Participant Change Authorization Form to your employer s benefit coordinator. *Visit the Plan Web site under the Plan Information section for further information and current IRS annual contribution limits. step two... Complete the Employee New Enrollment Form and the Beneficiary Designation Form Return both to your Personnel/Payroll Department and you re on your way! Investment Elections Once enrolled in the Plan, you can choose your own investment elections from a series of Core Funds, Target Retirement Date Funds, and Risk-Based Funds that suit your personal investment style and goals. You will receive a confirmation notification and Password shortly after enrollment. You can make your own investment elections by accessing your account on-line at or by calling the toll-free plan information line at within a short period after submitting a completed Enrollment Form. Changes to how your contributions are being invested, including rebalancing or requesting fund transfers, must be done by accessing your account on the Plan website or by calling the Plan Information Line. The Target Retirement Date Funds have been designated by the Board as the default investment under the Plan. Your contributions will be invested in the appropriate Target Retirement Date Fund only if you do not make an affirmative investment election prior to the date the first contributions are deposited to your account. The appropriate Target Retirement Date Fund is based on your date of birth most closely corresponding with your retirement date assuming you will retire at age and 7 of this brochure. Prior to investing you should carefully review all fund information and objectives and consult with an outside investment adviser. Additional fund information can be obtained by calling , or by visiting the Plan Web site. Your Password You will receive a Password in the mail shortly after you have completed the enrollment process. You will need your Password to access your account information and to make transactions either online or through the Plan Information Line. Password Reset Capabilities When you log on to the Plan Web site for the first time, you will be prompted to establish a Username and to choose security questions to establish Password reset capabilities in case you forget, or misplace your Password in the future. If you misplaced your Password and haven t established Password reset capabilities, there are two ways to obtain one. Online at and click on the link Forgot Your Password? in the User Login box. Call , and provide your Social Security number. Your Password will be mailed to your address on record within three business days.

4 2 CalPERS designed for participant success The CalPERS commitment continues to offer you financial security, value, lower costs and quality customer service. World-class investment management and plan design Easy to understand, based on principles smart investors use Expertise in asset protection and performance Investment staff focused on CalPERS products Solid investment Plan design Full range of options by asset class, risk tolerance, age and time of distribution. Ability to create customized investment fund combinations Access to best-in-class external investment managers Superior bargaining power Superior economies of scale keep costs low Simple transparent fee structure Congratulations on your choice to participate in the CalPERS Supplemental Income 457 Plan The key to being a smart investor is to take advantage of the opportunities made available to you. All employees whose employers have adopted the CalPERS Supplemental Income 457 Plan (the Plan ) are immediately eligible to join the Plan and there are no minimum service requirements to fulfill. It s never too late to start, and it s never too small an amount to invest when it comes to putting your hard earned money to work for your own benefit! Today, most financial experts agree that you will need 70% or more of your current income to maintain your current lifestyle in retirement. Chances are you re going to need to rely on personal savings, over and above your Social Security and pension benefits, when it comes to retiring with your income goals. Participating in the CalPERS Supplemental Income 457 Plan is an excellent way to help achieve those financial goals for retirement

5 3 Soar to new heights with the power of CalPERS... First with the power of pre-tax contributions The CalPERS Supplemental Income 457 Plan is a voluntary savings program that allows you to defer an amount from your paycheck before you pay taxes on it. By making pre-tax contributions, your taxable income is lower and the amount taken out of your paycheck for taxes actually decreases. Keep more of what you earn Then with the power of tax-deferral Tax-deferred compounding is your money earning money. By investing with CalPERS, your retirement savings get a powerful boost. Your investments and their earnings get to grow over time without the burden of taxes. With CalPERS you don t pay income taxes on your investments until you begin taking withdrawals, usually in retirement when your tax bracket is presumably lower. The power of tax-deferral at work Not saving Saving with CalPERS More of your money stays in your account working for you over time, growing faster than it could in an account where you pay taxes on the monies going in, and each year on the earnings. Annual salary $35,000 $35,000 Monthly gross pay $2,917 $2,917 Less CalPERS Contribution $ 0 $300 $250,000 $200,000 $218,041 Taxable Income $2,917 $2,617 Taxes withheld $694 $619 Monthly paycheck* $2,223 $1,998 PAYChECk DIFFERENCE: ONLY $225 $150,000 $100,000 $50,000 $0 $182,495 $89,076 $101,454 $33,869 $36,352 Without CalPERS Supplemental Income 457 Plan With CalPERS Supplemental Income 457 Plan here, the $300 contribution s real cost is just $225 the amount the paycheck went down. By saving with CalPERS you save in your taxes paid each month, and you have money in your account working to grow over time in a tax-deferred account. * This paycheck example shows the impact of monthly contributions of $300 on an individual earning $35,000 annually. Calculations assume the 25.78% effective tax rate. Assumptions: $300 monthly investment over 10, 20, 30 years 6% annual rate of return After tax-account taxed at 25.78% effective tax rate This illustration is for hypothetical purposes only, and is not indicative of the performance of any specific investment; actual results may vary.

6 4 Pair the power of CalPERS with the power of time The sooner you start investing the better off you will be in the long run. By investing early on a regular basis, and letting your investments grow with the power of CalPERS, you have a greater likelihood of meeting your retirement income needs than you would if you save for years without the benefits of CalPERS. Investment Earnings Total Contributions The magic of compounding with the value of time The longer you have to invest, the longer you have to watch your savings grow. Assumptions: $300 monthly contributions for 35 years 6% annual rate of return $450,000 $400,000 $350,000 $300,000 $250,000 $200,000 $150,000 $100,000 $50,000 $ Years $18,000 $36,000 $54,000 $72,000 $90,000 $108,000 $126,000 Total contributions $2,846 $12,742 $32,074 $64,032 $112,887 $184,354 $286,081 Earnings $20,846 $48,742 $86,074 $136,032 $202,887 $292,354 $412,081 Total account value This illustration is for hypothetical purposes only and is not indicative of the performance of any specific investment; actual results may vary. Investment Earnings Total Contributions The power of time vs. the cost of waiting who wins? Start now and invest monthly contributions of $300 for 15 years, then stop to let the magic of compounding go to work on your investments for the next 20 years. Total contributions $54,000 Value of account after 35 years $277,393 Wait 15 years and then begin making monthly contributions of $300 for 20 years Total contributions $72,000 Value of account after 35 years $136,694 Starting early pays off! $300,000 $250,000 $200,000 $150,000 $100,000 $50,000 $0 START NOW WAIT TO START This illustration is for hypothetical purposes only. It assumes an annual rate of return of 6% and is not indicative of the performance of any specific investment; actual results may vary. the bottom line Contribute as much as you can for as long as you can. Not only will you have more in your account, but you will have spent less to earn it! Just starting out in your career? You might think you can t afford to put anything aside. Making small sacrifices now, like bringing your lunch to work or skipping dinner out once a week can make a big difference over the long term. By investing early, your savings can grow without the burden of taxes for a longer period of time. In the future you may want to consider increasing your contributions as your salary increases. Nearing retirement? It s never too late to start taking advantage of the power of CalPERS! When starting later in life it s important to consider your investment and tax-shelter strategies carefully. Due to a shorter investment time frame you may need to be more aggressive with your contributions to shelter more of your assets from taxes.

7 5 CalPERS helping participants become smart investors In today s rapidly changing financial markets, it s more important than ever to make sound, well-educated investment decisions. Before you start you should first understand a few investment basics. The Asset Classes There are three basic asset classes: cash equivalent, bond, and stock. Each asset class has specific risk and return features to consider. There are also asset-allocation investments that contain a mixture of any of the three asset classes. ASSETS CLASS BENEFIT RISK Cash Equivalent Short-Term Investment Fund Designed to protect original investment or principal May not keep pace with inflation over time LOWER RISK Investment risk vs. inflation risk Investment risk is generally associated with the potential that investments may go down in value as a result of market volatility. Stocks are considered riskier investments because they tend to fluctuate in value more than other investments like bonds. Conservative investments may help reduce investment risk, but over the long term they can expose you to another kind of risk inflation risk. When investments are earning less than the rate of inflation, they are actually losing purchasing power. Bond PIMCO Short-Term Bond Fund CalPERS Total Return Bond Fund CalPERS Treasury Inflation Protected Securities Fund Generally offer greater income potential than cash equivalent investments and not as much risk as stocks Sensitive to interest rate fluctuations The importance of diversification & asset allocation Diversification helps to reduce investment risk by spreading your assets among different investments, or the basic asset classes. Combining different types of investments may help you manage risk and maximize your return potential by smoothing out fluctuations in the stock market, while still taking advantage of the market s potential for higher returns. Stock CalPERS S&P 500 Equity Index Fund CalPERS Small & Mid Cap Equity Index Fund The Boston Company Small/Mid Value Fund The Boston Company Small/Mid Growth Fund Historically, stocks have provided greater long-term returns than cash equivalent investments and bonds Due to market volatility the value of stocks will go up and down over time Creating your investment strategy It is important for you to determine how long you plan to keep your money invested, and your willingness to stay invested during market ups and downs, and create a portfolio appropriate for that strategy. A good strategy is to assume as much investment risk as you are comfortable with, without exposing yourself to inflation risk. CalPERS International Index Fund Pyramis Select International Fund GREATER POTENTIAL REWARD

8 6 Your CalPERS investment options The CalPERS Supplemental Income 457 Plan offers a wide variety of investment fund options. The Fund Performance Summary included in this kit compares the fund performance and benchmarks of the various fund options and discloses fees. Asset Allocation Funds These target retirement date and risk-based funds are ideal for participants looking for a simple investment solution. Either style greatly simplifies your decision-making process regarding how to properly diversify your investments for meeting your own personal retirement savings goals. Target Retirement Date Funds The easiest of the asset allocation funds, these funds take much of the work and worry out of managing your account. With the target retirement date funds you make one decision when you plan to retire then let the fund do the rest. They are designed to help build value in the early years, and reduce risk as you approach retirement. You can avoid common obstacles to investment success: the temptation to buy and/or sell with market swings the potential for asset overlap lack of investment diversification They automatically adjust over time, gradually becoming more conservative as you get closer to retirement. Your investments stay tailored to your age and investment time horizon. Each maintains a diversified portfolio utilizing a fund of funds approach that helps reduce the impact of market volatility. They re easy to choose just select the one with the date closest to when you anticipate retiring. Risk-Based Funds These balanced asset allocation funds are appropriate for those looking for a bit more input into their investment decisions. They provide a mix of investments allocated among different investment classes in pre-established proportions suited to specific investor profiles. By self-identifying your risk tolerance, you can invest in the balanced fund that best suits your profile as a conservative, moderate or more aggressive investor. Over time you make the decision on when to shift to a more conservative fund as you approach retirement. For the most up-to-date Fund information please refer to the Fund Fact Sheets and Performance Summary Report on the Plan Web site in the Plan Investments section Target Retirement Date Funds CalPERS Target Retirement Income Fund Target Retirement Dat Date In retirement CalPERS Target Retirement 2003 through Fund In retirement CalPERS Target Retirement 2008 through Fund In or Near retirement CalPERS Target Retirement 2013 through Fund CalPERS Target Retirement 2018 through Fund CalPERS Target Retirement 2023 through Fund CalPERS Target Retirement 2028 through Fund CalPERS Target Retirement 2033 through Fund CalPERS Target Retirement 2038 through Fund CalPERS Target Retirement 2043 through Fund CalPERS Target Retirement 2050 Fund Risk-Based Funds CalPERS Conservative Asset Allocation Fund CalPERS Moderate Asset Allocation Fund CalPERS Aggressive Asset Allocation Fund 2048 or later Risk Level Conservative Moderate Aggressive * Other consists of Commodities and global REITs. Bond Stock Other* Bond Stock Other* 68% 30% 2% 56% 40% 4% 50% 46% 4% 41% 53% 6% 32% 61% 7% 21% 70% 9% 13% 77% 10% 6% 84% 10% 5% 85% 10% 5% 85% 10% 5% 85% 10% 68% 30% 2% 33% 60% 7% 5% 85% 10%

9 Core Funds The CalPERS Supplemental Income 457 Plan offers a line-up of core investment options for complete asset coverage and the opportunity for a well-diversified portfolio. These funds span the risk-return spectrum, without duplication, providing you with a clear-cut choice between investments representing different objectives, risk tolerances, and time horizons. The risk levels shown in the table below are for general guideline purposes only and are categorized based on investing in one fund. Before investing, carefully consider the funds' investment objectives, risks, fees, and expenses. The fund fact sheets contain this and other important information. be a smart investor! Visit the online Financial Resource Center for tools and educational resources on retirement planning, personal finance, estate planning and family finance. 7 Core Fund Offerings Conservative Asset Class Category Short-Term Investment Fund Cash Equivalent Short-Term Fixed Income PIMCO Short-Term Bond Fund Bond Short-Term CONSERVATIVE Moderate Asset Class Category CalPERS Total Return Bond Fund Bond Intermediate CalPERS Treasury Inflation Protected Securities Fund Bond Inflation Protected Aggressive Asset Class Category CalPERS S&P 500 Equity Index Fund Stock Large Cap Index CalPERS Small & Mid Cap Equity Index Fund Stock Small/Mid Cap Index The Boston Company Small/Mid Value Fund Stock Small/Mid Cap Value The Boston Company Small/Mid Growth Fund Stock Small/Mid Cap Growth CalPERS International Index Fund Stock International Equity Index Pyramis Select International Fund Stock International Equity R I S K L E V E L AGGRESSIVE Participant Fees Minimizing expenses is always an overall objective of CalPERS. We continue to provide investments and services at a low cost using a simple fee schedule. There are costs associated with investing in the underlying investment fund options offered under the CalPERS Supplemental Income 457 Plan. CalPERS aims to keep fees low, and we are proud that all of the investment fund options have an annual fee of less than one percent, prorated daily based on your account balance. One way we maintain our low fee structure is by not participating in sales incentive or commission programs. All of the Core and Asset Allocation Funds are no-load, no transaction fee funds. For the most up-to-date Fund information about the fees associated with each investment offering please refer to the Fund Fact Sheets or access Performance Summary Reports on the Plan Web site in the Plan Investments section under Fund Performance. Self-Managed Account Your employer must adopt the Self-Managed Account (SMA) option in order for you to participate. The SMA is a brokerage account that offers you the ability to invest in Mutual Funds and Certificates of Deposit (CD s). You have to apply for and set up a separate SMA account before you may trade mutual funds. Please confirm with your employer if they have adopted the SMA option. The SMA application package is available through your employer. In the package will be instructions on completing the application and the fees associated with the SMA. After you ve mailed your completed application to State Street Global Markets, you ll receive a welcome letter with your brokerage account number. prior to investing This information is for general discussion purposes only. You should carefully review all fund information, including investment objectives, strategies, performance and expenses you may consider consulting with an outside investment advisor. The current investment fund options are either internally managed funds or separate accounts, not registered mutual funds; therefore a prospectus is not available. Please review the Fund Performance Summary and the individual Fund Fact Sheets. Fund information can be obtained by calling , or by visiting the Plan Web site.

10 8 Account management is at your fingertips with CalPERS 24/7 at or The CalPERS Supplemental Income 457 Plan gives you access to your account to manage your Plan investments and manage your personal information 24 hours a day, 7 days a week by logging in to the Plan Web site at excluding any period of time dedicated to scheduled standard system maintenance. Plan Web site account access You will need your Password to access your account in order to complete any transactions, to make any changes to your account, or to change any personal information. See page 1 for details on how to obtain and reset your Password. Confirmation of changes You will be mailed a confirmation within three business days following any changes made to your account. If you do not receive a confirmation in a timely manner, please contact the Plan Information Line to ensure that your changes were properly made to your account. questions & requests CalPERS Customer Service Associates are available Monday Friday, 6:00 a.m. to 5:00 p.m. Pacific Time (except stock market holidays) to assist you with transactions, information about your account or any other general CalPERS Supplemental Income 457 Plan questions and requests

11 9 Managing your Plan investments Managing your personal information Changing your investment selections To change the way your current or future contributions are allocated among the various investment fund options, simply log on to the Plan Web site or call the Plan Information Line. CalPERS does not accept these types of changes by form. Transferring money between investment fund options You may transfer money between investment fund options, rebalance your portfolio or change your allocation at any time, as often as you like, at no additional cost. You may make these transactions by accessing your account online at the Plan Web site, or by calling the Plan Information Line. Automatic Rebalancing You may elect to have your current funds rebalanced by CalPERS on a quarterly, semi-annual, or annual basis, to match your current investment election percentages. This feature helps to keep your account weighted to the asset allocation model you established when making your investment elections. Reallocation of Existing Balances You may reallocate existing account balances in one simple transfer transaction. This combined transfer will generate one easy-to-read confirmation statement. Changing your contribution amount To make changes to the amount you are contributing to the Plan, you will need to complete a Participant Change Authorization Form and submit it to your employer s benefit coordinator. Account Statements Quarterly statements are mailed after the end of each calendar quarter showing your contributions, any interest and investment gains or losses, and your account balance. You can access account information on the Plan Web site or by calling the Plan Information Line. In addition, you may generate a customized statement online, including the most recent 24 months of history. Account values fluctuate with market conditions, and at any time, the value of an account may be worth more or less than the original amount invested. Fund prices are updated daily and can be found on the Plan Web site or by calling the Plan Information Line. Designation of Beneficiary Information You are required to submit your beneficiary designation and their information with your initial enrollment into the Plan. You may then view your beneficiary designation information at any time online in the My Account section of the Plan Web site. Please be advised that failure to meet state law requirements with respect to your beneficiary designation may result in your beneficiary designation becoming invalid and payments going to someone other than your designated beneficiary. Beneficiary election, if other than spouse If initially, or at any time in the future, you choose to name a beneficiary other than your spouse or registered domestic partner, your spouse or domestic partner will need to provide a notarized signature on the Beneficiary Designation Form acknowledging the change in beneficiaries you are designating. Beneficiary change, if other than spouse To name or change a beneficiary other than your spouse or registered domestic partner, if applicable, you must complete the appropriate section of the Beneficiary Designation Form. Changes to Personal Information To make changes to your personal information, you will need to complete a Participant Change Authorization Form and submit it to your employer s benefit coordinator: This includes the following changes: address name marital status domestic partner status contact information You may download a copy of the form from the Plan Web site or call the Plan Information Line to request that one be mailed to you. Additional Forms You may obtain copies of any of the forms or documents included in this kit by downloading or printing copies from the Plan Web site. You may also request that copies be mailed to you by calling the Plan Information Line, or by contacting your Plan Account Manager.

12 10 CalPERS Plan Features Contribution Limits and Catch-Up Provisions Contributions are subject to IRS regulations. You may increase or decrease, and stop or restart your contributions at any time by completing a Participation Change Authorization Form and submitting it to your Personnel or Payroll Department. Maximum annual contribution 100% of income, up to $17,000 for 2012.* Catch-Up Provisions Age 50 Catch-Up allows a participant who reaches age 50 before the end of the tax year to make additional contributions of $5,500 in 2012, for a maximum of $22,500.* Three-Year Special 457(b) Catch-Up allows a participant who meets special conditions and has not been contributing the maximum to contribute up to twice the maximum annual contribution amount during the three years prior to their Normal Retirement Age. The 2012 maximum is $34,000.* For help with this provision use the Three-Year Special 457(b) Catch-Up Worksheet found on the Plan Web site or call the Plan Information Line. In compliance with IRS regulations, the Catch-Up Provisions cannot be combined in any year, so eligible participants are limited to contributing the higher of their Age 50 Catch-Up Increase or their Three-Year Special 457(b) Catch-Up Contribution. *Visit the Plan Web site under the Plan Information section for further information and current IRS annual contribution limits. Tax Credit To encourage low- and moderate-income individuals to save more for the future, the government offers a tax credit for contributions to eligible retirement savings plans, including the CalPERS Supplemental Income 457 Plan. You may be eligible for a credit on your federal taxes equal to a percentage (up to 50%) of the first $2,000 you invest in the Plan. The credit is available if your adjusted gross income does not exceed $57,500 if you are married and file a joint return or $28,750 if you are single or married and file a separate return. The actual amount of your credit is based on your tax filing status and adjusted gross income (AGI) as shown below: Tax Credit Joint Return AGI Single (other filers) AGI 50% Less than $34,500 Less than $17,250 20% $34,501 - $37,500 $17,251 - $18,750 10% $37,501 - $57,500 $18,751 - $28,750 0% $57,501 or more $28,751 or more If you take this tax credit you can still deduct your contributions to qualified retirement savings plans as allowed under current law. To find out more information or to see if you qualify, please call the Plan Information Line at , and speak with a Customer Service Associate

13 11 CalPERS distribution options Distribution Flexibility You may begin taking distributions from your CalPERS Supplemental Income 457 Plan account at any time once you retire or separate from employment. Your distribution options include: a lump sum check a partial lump sum payment payments for a specific time period payments based on your life expectancy, or you and your spouse s joint life expectancy rollover account to another plan or IRA Monthly, quarterly, semi-annual or annual payment options are available and you may change your payment frequency whenever you need to. You may also increase, reduce or stop your benefit payments at any time. All distributions are taxable as ordinary income in the year received. There is no early withdrawal penalty in the CalPERS Supplemental Income 457 Plan. Any non-457 money rolled over from other sources may be subject to early withdrawal penalties. Distribution Requests You will need to submit your initial Distribution Request Form to your employer s benefits coordinator so they may verify that you have separated from employment. Your employer will forward the initial Distribution Request Form to the Plan. Subsequently, you may submit a Distribution Request Form directly to the Plan at the address on the form to make distribution modifications. Your employer s signature is not needed for distribution modifications. To avoid delays with processing your Distribution Request, your employer must submit a Notification of Separation from Employment Form to the CalPERS Supplemental Income 457 Plan. Required Minimum Distributions The federal tax law also requires you to begin taking distributions from your CalPERS Supplemental Income 457 Plan account no later than April 1 of the year following the year you reach age 70½, unless you are still employed. If you remain employed beyond April 1 following the year in which you reach age 70½, payment must begin by April 1 in the year following the year you end your employment. Please visit the Plan Web site for the most current information. Tax Liability on Distributions 20% is withheld for federal tax purposes, as well as 2% for state taxes, at the time of payment on all distributions as they are treated as ordinary income in the year the money is paid and are subject to federal and state income taxes. A rollover to another eligible retirement plan or a traditional IRA is not subject to tax withholding. Purchasing Service Credit You may choose to use your investments in the Plan to purchase Pension Service Credit. Call the Plan Information Line and speak with a Customer Service Associate for more information. In-service Withdrawals The CalPERS Supplemental Income 457 Plan is a retirement savings plan and not designed as a source to pay for emergency expenses. Generally, you may not withdraw money from your plan account while you are still employed by your current employer. You may, under qualifying circumstances request an emergency withdrawal prior to separation from employment. Federal tax law severely limits emergency withdrawals to very specific emergency circumstances. Supporting documentation must accompany all requests, and the amount withdrawn cannot exceed the amount needed to satisfy the emergency. Money you withdraw through an Unforeseeable Emergency Withdrawal is subject to income taxes. Unforeseeable Emergency Withdrawals may be made only for the following reasons: Hardship due to sudden and unexpected illness or accident of the participant or a dependent that is not covered by insurance or other financial resources Loss of property due to casualty that is not covered by insurance or other financial resources Other similar extraordinary and unforeseeable circumstances and events not covered by insurance or other financial resources Unforeseeable Emergency Withdrawals are not available for purposes such as home purchases or tuition expenses. An Unforeseeable Emergency Withdrawal request may be denied if you can relieve the hardship with other financial resources or by ceasing your contributions to the Plan. More guidelines on Unforeseeable Emergency Withdrawals are available on the Plan Web site. Loan Privilege You may borrow from your Plan account balance to assist you in meeting your financial needs only if your employer has adopted the Loan Provision of the Plan. All loans, plus interest, must be repaid within five years. Your loan payments, both principal and interest, will be credited to your account. Your account will be charged a one-time loan set-up fee in the amount of $50, with no additional annual fee. Limits: One outstanding loan is permitted at any one time Minimum loan amount: $1,000 Maximum loan amount: 50% of your account value, not to exceed $50,000 For more information or to see if your employer has adopted the Loan Provision, call the Plan Information Line and speak with a Customer Service Associate.

14 12 CalPERS Supplemental Income 457 Plan CalPERS provides financial and health security to California public employees, retirees, beneficiaries and their families. For over fifteen years, we have been offering a Deferred Compensation program to local employers and their employees. Designed for participant success Promotes smart investing principles Easy payroll deduction of contributions Contributions are made on a pre-tax basis and investments grow tax-deferred Withdrawals are taxed as ordinary income when distributions begin Simple fee structure Experienced retirement educators help participants define retirement goals, integrating them with existing defined benefit planning Access to financial learning resources Tools for retirement planning, personal finance, estate planning and family finance Easy account access, 24/7 at or Participant account information and management online or through the Plan Information Line both are easy to access and simple to use View, download, and print account statements, including 24 months of history Automatic account rebalancing Automatically rebalances an account to current investment elections Reallocation of account balances Redistribute fund balances across multiple funds in one simple transaction Download forms and stay up-to-date on Plan rules Download account data to Quicken & Microsoft Money for more information call: Customer Service Associates are available Monday Friday, 6:00 a.m. to 5:00 p.m. Pacific Time (except stock market holidays) to assist you with transactions, information about your account or any other general CalPERS Supplemental Income 457 Plan questions and requests by calling the Plan Information Line. additional forms You may obtain copies of any of the forms included in this kit by downloading or printing copies from the Plan Web site at You may also request that copies be mailed to you by calling the Plan Information Line at or contacting your Plan Account Manager

15 SMART INVESTING FOR YOUR RETIREMENT

16 CalPERS 457 Enroll

17 CalPERS Supplemental Income 457 Plan Employee New Enrollment Form Participant Information Name (Last / First / Middle Initial) Social Security Number Date of Birth Address City State Zip Work Telephone Home Telephone Address Marital Status: Are you legally married or in a domestic partnership? Yes, I am legally married or in a domestic partnership No, I am not legally married or in a domestic partnership Employer Information Employer Name EMPLOYER TO COMPLETE. Agency Plan Number: 45 - Contribution Election Information Enter the dollar amount or percentage of pay you wish to contribute to the CalPERS Supplemental Income 457 Plan per pay period. Your contribution will commence the month following the date on which you make this election unless you specify a later effective date. I elect to enroll in the CalPERS Supplemental Income 457 Plan and authorize my Employer to deduct $ or % from my gross wages and deposit this amount into my account in the Plan. Contributions will be deducted per pay period effective: Next qualifying pay period or Specific date / /. To make future changes to the amount of your contribution, to suspend contributions, or to make changes to your personal information, complete the Participant Change Authorization form found on the Plan Web site. Investment Elections Once enrolled in the Plan, you may choose your own investment elections from a series of Core Funds, Target Retirement Date Funds, and Risk-Based Funds that suit your personal investment style and goals. You will receive a confirmation notification and Password shortly after enrollment. You can make your own investment elections by accessing your account on-line at or by calling the tollfree plan information line at within a short period after submitting a completed Enrollment Form The Target Retirement Date Funds have been designated by the Board as the default investment under the Plan. Your contributions will be invested in the appropriate Target Retirement Date Fund only if you do not make an affirmative investment election prior to the date the first contributions are deposited to your account. The appropriate Target Retirement Date Fund is based on your date of birth most closely corresponding with your retirement date assuming you will retire at age 59. Investing involves market risk, and it is possible to lose money while investing in a fund. Please refer to the Employee Enrollment Kit and Fund Fact Sheets for more information. Optional Catch-up Provision You may only use ONE catch-up option during the tax year. Only complete if you wish to use a catch-up provision and are eligible. I will be age 50 or older in the current tax year and am using the Age 50 Catch-up method. I will be contributing more than the annual limit of $17,000 (subject to IRS limits of $5,500 for 2012). I am using the Special 457 Catch-up method. This feature allows me to contribute more than the normal maximum annual deferral amount an additional $17,000 in 2012 (for a total contribution of $34,000) to Catch-Up for earlier years when I did not contribute the maximum amounts allowed. I must complete the Special 457 Catch-Up Method Worksheet found on the Plan Web site. Signatures By signing below, I hereby authorize my employer to deduct from my payroll the contribution amount indicated for deposit into the Plan. I understand and agree my future contributions will be deducted from each paycheck on a before-tax basis and invested in the appropriate Target Retirement Date Fund only if I do not make an affirmative investment election prior to the date of the first contributions. I understand and agree the default investment designation I have authorized will remain in full force and effect until I authorize a change in accordance with the provisions of the Plan and the procedures set forth in this form. I acknowledge that I have received and had an opportunity to review the Employee Enrollment Kit and Fund Fact Sheets booklet. Participant s Signature Date Employer s Signature Date P.O. Box 5166 / Boston, MA CA-ENR-11.12

18 CalPERS Supplemental Income 457 Plan California Public Employees Retirement System (CalPERS) CalPERS Supplemental Income 457 Plan (the Plan ) BENEFICIARY DESIGNATION FORM C P.O. Box 5166 Boston, MA Complete this form to designate beneficiary (ies) who will receive your CalPERS Supplemental Income 457 Plan benefits in the event of your death. New Enrollment Change of Beneficiary I. PARTICIPANT INFORMATION Last Name First Name Middle Initial CalPERS ID Social Security Number Birth Date Mailing Address (number and street) City State Zip Code Telephone Number (work) Telephone Number (home) Address II. EMPLOYER INFORMATION Agency Plan Number: 45 - Employer Name: III. BENEFICIARY INFORMATION In the event of your death, your 457 account will be paid to the primary beneficiary (ies) you name below. You may name a Trust as a primary or secondary beneficiary. Print the beneficiaries names, social security numbers, and their relationship to you, their birth date and the percentages for each named beneficiary. The total percentages for BOTH of the primary and secondary beneficiary election must equal 100%. Whole integers only (example: you may not indicate 33 1/3%, or 30.5%). At least one Primary Beneficiary (ies) designation is required in order to complete the enrollment process. The total allocated percentage for your Primary Beneficiary (ies) must equal 100%. If you are legally married or in a registered domestic partnership, but do not name your spouse or your domestic partner as your sole (100%) primary beneficiary, he or she may still be entitled to a community property share of your account. CalPERS cannot be responsible for a participant s failure to properly designate a beneficiary in accordance with state law requirements. Please be advised that failure to meet state law requirements with respect to your beneficiary designation may result in your beneficiary designation being invalid and the payment of your account to someone other than your designated beneficiary. If you choose to name a sole (100%) primary beneficiary that is not your spouse or domestic partner, your spouse or domestic partner will need to complete the spousal waiver section below acknowledging the beneficiary (ies) that you are designating. You and your spouse or domestic partner s signature must also be notarized by a notary public. See the next page for notary signature. PRIMARY BENEFICIARY (IES) (ATTACH SEPARATE SHEET IF NECESSARY) Last name First name Middle Initial Social Security Number (optional) Relationship to you Birth date Allocated Percentage (must total 100% and be in whole integers) % % % % If your primary beneficiary(ies) is not living at the time of your death, your 457 account will be paid to the secondary (contingent) beneficiary(ies) you name below. SECONDARY/CONTINGENT BENEFICIARY (IES) (ATTACH SEPARATE SHEET IF NECESSARY) Last name First name Middle Initial Social Security Number Relationship to you Birth date Allocated Percentage (optional) (must total 100% and be in whole integers) % % % % V. SIGNATURES REQUIRED Participant s Signature Are you legally married or in a Domestic Partnership? Note: Spousal/Domestic Partner s signature is required if not named as the sole (100%) no yes primary beneficiary. Spousal/Domestic Partner Waiver: I understand that I have not been named as the sole (100%) primary beneficiary and that in signing below, I have waived my right to receive the account balance or benefits payable from this Plan in the event of my spouse s or domestic partner s death. Signature of Spouse or Domestic Partner: Date Date CA-BEN_DES-1011 Page 1 of 2

19 CalPERS Supplemental Income 457 Plan California Public Employees Retirement System (CalPERS) CalPERS Supplemental Income 457 Plan (the Plan ) BENEFICIARY DESIGNATION FORM C P.O. Box 5166 Boston, MA COMPLETE ONLY IF YOU HAVE NOT CHOSEN TO NAME YOUR SPOUSE AS PRIMARY BENEFICIARY State of California County of On before me, Name & Title of Officer personally appeared, and personally known to me (or proved to me on the basis of satisfactory evidence) to be the person(s) whose name(s) is/are subscribed to the within instrument and acknowledged to me that he/she/they executed the same in his/her/their authorized capacity(ies), and that by his/her/their signature(s) on the instrument the person(s), or the entity upon behalf of which the person(s) acted, executed the instrument. I certify under penalty of perjury under the laws of the State of California that the foregoing paragraph is true and correct. Notary Seal Witness my hand and official seal Signature of Notary Public Date CA-BEN_DES-1011 Page 2 of 2

20 CalPERS Supplemental Income 457 Plan California Public Employees Retirement System (CalPERS) CalPERS Supplemental Income 457 Plan (the Plan ) ROLLOVER FORM P.O. Box 5166 Boston, MA For Rollovers Into the CalPERS Supplemental Income 457 Plan From Another Type of Plan [IRA, 401(a), 401(k), or 403(b)]* I. PARTICIPANT INFORMATION Last Name First Name Middle Initial CalPERS ID Social Security Number Birth Date Mailing Address (number and street) City State Zip Code Telephone Number (work) Telephone Number (home) Address II. EMPLOYER INFORMATION Employer Name: Agency Plan Number: 45 - III. ROLLOVER TYPE Check appropriate box for plan from which you are rolling money into the CalPERS Supplemental Income 457 Plan. (The Plan will accept rollover assets from the following types of tax-deferred plans): Individual Retirement Account (IRA) 401(a) Plan 401(k) Plan 403(b) Tax Sheltered Annuity Estimated Amount of Rollover $ Note: Please attach a copy of your most recent statement from the resigning trustee. NOTE: Your rollover cannot include any nondeductible (after-tax) employee contributions. To remain tax-deferred, the rollover to CalPERS must be made NO later than 60 days from the date you received distribution from your former plan. IV. INVESTMENT ALLOCATION OF ASSETS Enter the whole number percentage that you want allocated among the Plan s investments in the table below. Your rollover of assets will be invested according to the allocation percentages you enter. The total of all investment allocations must equal 100%. The Target Retirement Date Funds have been designated by the Board as the default investment fund under the Plan. In the absence of an investment selection by you, or if your instructions are not clear, your rollover will be invested in the appropriate Target Retirement Date Fund based on your date of birth most closely corresponding with your retirement date assuming you will retire at age 59, using the birth date ranges shown in the table shown on Page 3. Fund No. Fund Name CALPERS ASSET ALLOCATION FUNDS % Amt. Fund No. Fund Name CORE INVESTMENT FUNDS CalPERS Target Retirement Date Funds Fixed Income Funds 1A CalPERS Target Retirement Date Income Fund % 20 Short-Term Investment Fund % 1B CalPERS Target Retirement Date 2005 Fund % 47 PIMCO Short-Term Bond Fund % 1C CalPERS Target Retirement Date 2010 Fund % 37 CalPERS Total Return Bond Fund % 1D CalPERS Target Retirement Date 2015 Fund % 36 CalPERS Treasury Inflation Protected Securities Fund % 1E CalPERS Target Retirement Date 2020 Fund % Equity Funds 1F CalPERS Target Retirement Date 2025 Fund % 40 CalPERS S&P 500 Equity Index Fund % 1G CalPERS Target Retirement Date 2030 Fund % 41 CalPERS Small/Mid Cap Equity Index Fund % 1H CalPERS Target Retirement Date 2035 Fund % 54 The Boston Company Small/Mid Value Fund % 1I CalPERS Target Retirement Date 2040 Fund % 53 The Boston Company Small/Mid Growth Fund % 1J CalPERS Target Retirement Date 2045 Fund % 42 CalPERS International Index Fund % 1K CalPERS Target Retirement Date 2050 Fund % 56 Pyramis Select International Fund % CalPERS Risk Based Asset Allocation Funds 8G CalPERS Conservative Asset Allocation Fund % 8H CalPERS Moderate Asset Allocation Fund % 8I CalPERS Aggressive Asset Allocation Fund % TOTAL PERCENTAGE OF AMOUNT ALLOCATED (MUST EQUAL 100%) % This allocation will not affect any current or future investment elections. To make changes to your account such as fund transfers and asset allocation changes, you may access your account online at or call the toll-free Plan Information Line at V. SIGNATURES REQUIRED I certify that all of the assets to be invested as specified above are eligible for rollover to the CalPERS Supplemental Income 457 Plan. I understand that the CalPERS Supplemental Income 457 Plan will not be held responsible for any tax penalties that may occur because of an incomplete or late submission. % Amt. Participant s Signature Date REV1012 PR450001ROLL45N Page 1 of 3

21 CalPERS Supplemental Income 457 Plan California Public Employees Retirement System (CalPERS) CalPERS Supplemental Income 457 Plan (the Plan ) ROLLOVER FORM P.O. Box 5166 Boston, MA *See page 3 for instructions to complete the Rollover Process. CalPERS Supplemental Income 457 Plan INVESTMENT FUND DESCRIPTIONS Target Retirement Date Funds offer an automatically adjusting mix of investments designed to help build value in the early years and gradually becomes more conservative to protect that value as you approach retirement. Your investments stay tailored to your age and investment time horizon. Each maintains a diversified portfolio utilizing a fund of funds approach that helps reduce the impact of market volatility. They re easy to choose just select the fund with the date closest to when you anticipate retiring and indicate the percentage value where indicated. Please note that these funds assume a retirement age of 59. Target Retirement Date Funds are a series of diversified funds each of which has a pre-determined asset mix that will adjust over time until and often beyond the fund s target date (2005, 2010, ). The initial asset allocation is adjusted as a glidepath, or the manner in which the fund will slowly be reallocated over time, across all target retirement dates. This glidepath is designed to reduce the level of risk as the participant approaches retirement. The target date refers to the date the participant will reach retirement age, assuming a retirement age of 59. The CalPERS Supplemental Income 457 Plan offers 11 distinct Target Retirement Date Funds (the Fund or Funds ) as investment options under the Plan utilizing the concept of diversification through asset allocation. You may select the Fund that most closely matches the year you plan on retiring. The target strategies are a series of premixed investment options that focus on maturity and change as you approach retirement. The Table below shows the Target Retirement Date Funds, including associated birth date range and target retirement date for each fund. Fund No. Fund Name Birth Date Range Target Retirement Date 1A CalPERS Target Retirement Date Income Fund 01/01/ /31/1943 In Retirement 1B CalPERS Target Retirement Date 2005 Fund 01/01/ /31/ through 2007 (In Retirement) 1C CalPERS Target Retirement Date 2010 Fund 01/01/ /31/ through 2012 (In or Near Retirement) 1D CalPERS Target Retirement Date 2015 Fund 01/01/ /31/ through E CalPERS Target Retirement Date 2020 Fund 01/01/ /31/ through F CalPERS Target Retirement Date 2025 Fund 01/01/ /31/ through G CalPERS Target Retirement Date 2030 Fund 01/01/ /31/ through H CalPERS Target Retirement Date 2035 Fund 01/01/ /31/ through I CalPERS Target Retirement Date 2040 Fund 01/01/ /31/ through J CalPERS Target Retirement Date 2045 Fund 01/01/ /31/ through K CalPERS Target Retirement Date 2050 Fund 01/01/ /31/ or later Risk Based Funds offer varying asset allocations designed to suit three distinct risk profiles. They provide a mix of investments allocated among different investment classes in pre-established proportions suited to specific investor profiles. By self-identifying your risk tolerance, you can invest in the fund that best suits your profile as a conservative, moderate or more aggressive investor. The Table below shows the Risk Based Funds and associated risk level for each fund. Fund No. Fund Name Risk Level 8G CalPERS Conservative Asset Allocation Fund Conservative 8H CalPERS Moderate Asset Allocation Fund Moderate 8I CalPERS Aggressive Asset Allocation Fund Aggressive The Plan also offers a line-up of Core Investment Fund options for complete asset coverage and the opportunity for a well-diversified portfolio. These Core funds span the risk-return spectrum, without duplication, providing you with a clear-cut choice between investments representing different objectives, risk tolerances, and time horizons. These funds may be attractive for those who wish to more actively manage their portfolio. The Table below shows the Core Investment Funds, including the asset class, category, and risk level for each fund. Fund No. Fund Name Asset Class Category Risk Level 20 Short-Term Investment Fund Cash Equivalent Short-Term Fixed Income Conservative 47 PIMCO Short-Term Bond Fund Bond Short-Term Bond Conservative 37 CalPERS Total Return Bond Fund Bond Intermediate Bond Moderate 36 CalPERS Treasury Inflation Protected Securities Fund Bond Inflation Protected Bond Moderate 40 CalPERS S&P 500 Equity Index Fund Stock Large Cap Index Aggressive 41 CalPERS Small/Mid Cap Equity Index Fund Stock Small/Mid Cap Index Aggressive 54 The Boston Company Small/Mid Value Fund Stock Small/Mid Cap Value Aggressive 53 The Boston Company Small/Mid Growth Fund Stock Small/Mid Cap Growth Aggressive 42 CalPERS International Index Fund Stock International Equity Index Aggressive 56 Pyramis Select International Fund Stock International Equity Aggressive REV1012 PR450001ROLL45N Page 2 of 3

22 CalPERS Supplemental Income 457 Plan California Public Employees Retirement System (CalPERS) CalPERS Supplemental Income 457 Plan (the Plan ) ROLLOVER FORM P.O. Box 5166 Boston, MA Instructions to Complete the Rollover Process After receiving the check from your former plan or IRA, send the following to: CalPERS Supplemental Income 457 Plan P O Box 5166 Boston, MA Completed Rollover Form 2. Rollover check payable to CalPERS Supplemental Income 457 Plan, FBO ( Insert your name ) 3. Copy of the distribution request form you filed with your former plan or IRA and a copy of any confirmation you received with the distribution. 4. Please attach a copy of your most recent statement from the resigning trustee. REV1012 PR450001ROLL45N Page 3 of 3

23 Fund Fact Sheets CalPERS CalPERS Supplemental Supplemental Income Plans Income 457 Plan As of September 30, 2012

24 Asset Allocation (%) CalPERS Target Retirement Date Funds CalPERS Supplemental Income 457 Plan September 30, 2012 Overview Target Retirement Date Funds are a series of diversified funds, each of which has a pre-determined asset mix that will adjust over time until and often beyond the fund s target date (2005, 2010, ). The target date refers to the date the participant will reach retirement age, assuming a retirement age of 59. The initial asset allocation is adjusted as a glidepath, which describes the manner in which the fund will slowly be reallocated over time, across all target retirement dates. This glidepath is designed to reduce the level of risk as the participant approaches retirement. The CalPERS Supplemental Income Plans offer 11 distinct Target Retirement Date Funds (the Fund or Funds ) as investment options under the Plans, utilizing the concept of diversification through asset allocation. You may select the Fund that most closely matches the year you plan on retiring. The target strategies are a series of premixed investment options that focus on maturity and change as you approach retirement. Objective The strategic objective of the Funds is to provide a single fund approach, with an automatically adjusting mix of investments designed for growth in the early years and gradually becoming more conservative to protect value as you approach retirement. The targeted asset mixes are designed to reduce volatility through diversification. There is no guarantee the Fund will achieve its investment objectives. Advantages Many people don t have the time, interest or information to choose an appropriate asset mix for their situation and manage it over time. By selecting one of the Funds, you receive a portfolio that is diversified across a range of asset classes and investment styles based on your time horizon until retirement. The investment mix is adjusted to become more conservative as you move closer to retirement. You should carefully consider the investment objective, risks, and expenses of the Fund before investing. As always, you should consult with your financial representative to determine whether an investment fund option is appropriate for you. Target Retirement Date Funds Glidepath: Asset Allocations and Risk Scale Portfolios automatically adjust to a more conservative investment mix as you approach your target date. 100% 90% Real Estate Investment Trusts (REITs) Commodities U.S. Treasury Inflation Protected Securities (TIPS) 80% Emerging Market Equity 70% 60% Non-U.S. Equity U.S. Fixed Income 50% Small/Mid Cap Equity 40% 30% 20% 10% Large Cap Equity 0% 2050 Fund 2045 Fund 2040 Fund 2035 Fund 2030 Fund 2025 Fund 2020 Fund 2015 Fund 2010 Fund 2005 Fund Income Fund Higher Risk Moderate Risk Lower Risk

25 Target Retirement Date Funds Customized Strategy The Funds are actively managed and CalPERS uses a customized strategy to best optimize the fund s potential. Included in many of the funds are Commodities, Real Estate Investment Trusts (REITs) and Treasury Inflation Protected Securities (TIPS), adding a layer of sophisticated diversification and professional asset allocation oversight. CalPERS utilizes member information in developing the Funds to achieve a higher rate of total return within prudent levels of risk and liquidity. A blend of active and passive underlying investments allows the Plan to offer a well diversified portfolio at low cost. The performance of the Fund is measured against a customized benchmark. Fund Benchmarks The benchmark for each Fund is a composite of asset class benchmarks that are weighted according to each Fund s policy target weights. The asset class benchmarks are Russell 3000 Equity Index, FTSE Developed World ex US Index, FTSE Emerging Markets, Barclays Capital Aggregate Bond Index, Barclays Capital US TIPS Index, BofA Merrill Lynch 6-month T-Bill. S&P GSCI Commodities Index and FTSE EPRA/NAREIT Global REITs Index. Fund Allocation and Performance Income Fund Designed for an investor who has retired or has a very low risk tolerance. It is made up of primarily fixed income with a small percentage of stocks to allow the opportunity for additional growth potential. TIPS 15% Commodities 2% Large Cap Equity 20% Small/Mid Cap Equity 4% Returns Quarter Year to Date 1 Yr 3 Yrs 5 Yrs 10 Yrs Fund ITD (Inception to Date) Inception Date Fund Performance Net 3.05% 7.07% 11.17% 6.53% % 12/01/08 Fund Performance Gross 3.22% 7.47% 11.76% 7.11% % Benchmark Performance 3.02% 6.92% 11.32% 7.75% 4.60% 6.58% 9.98% U.S. Fixed Income 53% Non-U.S. Equity 6% Lower Risk Moderate Risk Higher Risk 2005 Fund Designed for an investor who retired by The Fund s asset allocation will become more conservative over time. It should provide capital appreciation and current income consistent with its current allocation. Returns Quarter Year to Date 1 Yr 3 Yrs 5 Yrs 10 Yrs Fund ITD (Inception to Date) Inception Date Fund Performance Net 3.36% 7.73% 12.47% 6.82% % 12/01/08 Fund Performance Gross 3.53% 8.19% 13.13% 7.44% % Benchmark Performance 3.39% 7.74% 12.84% 8.19% 3.56% 7.15% 11.11% TIPS 16% U.S. Fixed Income 45% Commodities 2% Large Cap Equity 24% Small/Mid Cap Equity 5% Non-U.S. Equity 8% Lower Risk Moderate Risk Higher Risk 2010 Fund Designed for an investor retiring between 2009 and 2012, with a mix of stock, bond and fixed income funds that seeks a more stable rate of growth than that of a broad investment in the stock market. Commodities 2% TIPS 15% REITs 2% Large Cap Equity 28% Returns Quarter Year to Date 1 Yr 3 Yrs 5 Yrs 10 Yrs Fund ITD (Inception to Date) Inception Date Fund Performance Net 3.76% 8.77% 14.35% 7.28% % 12/01/08 Fund Performance Gross 3.93% 9.17% 14.96% 7.88% % Benchmark Performance 3.88% 8.97% 14.96% 8.68% 3.28% 7.44% 11.78% U.S. Fixed Income 37% Small/Mid Cap Equity 6% Non-U.S. Equity 10% Lower Risk Moderate Risk Higher Risk CalPERS Supplemental Income 457 Plan CalPERS Target Retirement Date Funds

26 Fund Allocation and Performance 2015 Fund Designed for an investor retiring between 2013 and The Fund has a reasonable level of income and long-term growth of capital and income. It has a broadly diversified holding of stocks and bonds that will gradually become more conservative in its allocation as the investor approaches retirement. U.S. Fixed Income 33% TIPS 11% Commodities 3% REITs 3% Returns Quarter Year to Date 1 Yr 3 Yrs 5 Yrs 10 Yrs Fund ITD (Inception to Date) Inception Date Fund Performance Net 4.17% 9.46% 15.78% 7.59% % 12/01/08 Fund Performance Gross 4.35% 9.88% 16.41% 8.22% % Benchmark Performance 4.37% 9.85% 16.56% 9.01% 2.80% 7.86% 12.44% Emerging Equity 1% Non-U.S. Equity 11% Small/Mid Cap Equity 8% Large Cap Equity 30% Lower Risk Moderate Risk Higher Risk 2020 Fund Designed for an investor retiring between 2018 and 2022 seeking diversified investment with an asset allocation mix that becomes more conservative over time and combines the potential for long-term capital growth with income. Commodities 4% TIPS 6% REITs 3% Large Cap Equity 33% Returns Quarter Year to Date 1 Yr 3 Yrs 5 Yrs 10 Yrs Fund ITD (Inception to Date) Inception Date Fund Performance Net 4.61% 10.05% 17.03% 7.73% % 12/01/08 Fund Performance Gross 4.78% 10.57% 17.78% 8.40% % Benchmark Performance 4.84% 10.51% 17.85% 9.11% 1.84% 8.23% 13.02% U.S. Fixed Income 30% Emerging Equity 2% Non-U.S. Equity 13% Small/Mid Cap Equity 9% Lower Risk Moderate Risk Higher Risk 2025 Fund Designed for an investor retiring between 2023 and 2027 seeking both a reasonable level of income and long-term growth of capital and income. The Fund becomes more conservative over time. U.S. Fixed Income 23% Commodities 5% TIPS 2% REITs 4% Large Cap Equity 34% Returns Quarter Year to Date 1 Yr 3 Yrs 5 Yrs 10 Yrs Fund ITD (Inception to Date) Inception Date Fund Performance Net 5.13% 10.88% 18.91% 8.00% % 12/01/08 Fund Performance Gross 5.30% 11.41% 19.68% 8.67% % Benchmark Performance 5.50% 11.63% 19.90% 9.38% 1.12% 8.48% 13.53% Emerging Equity 3% Non-U.S. Equity 16% Small/Mid Cap Equity 13% Lower Risk Moderate Risk Higher Risk 2030 Fund Designed for an investor retiring between 2028 and 2032 seeking a diversified investment with an asset allocation mix with the potential for long-term capital growth and income. The Fund gradually becomes more conservative over time. U.S. Fixed Income 16% Commodities 5% REITs 5% Large Cap Equity 36% Returns Quarter Year to Date 1 Yr 3 Yrs 5 Yrs 10 Yrs Fund ITD (Inception to Date) Inception Date Fund Performance Net 5.52% 11.70% 20.70% 8.34% % 12/01/08 Fund Performance Gross 5.69% 12.24% 21.47% 9.01% % Non-U.S. Equity 18% Small/Mid Cap Equity 16% Benchmark Performance 5.98% 12.64% 21.74% 9.74% 0.47% 8.93% 14.43% Lower Risk Moderate Risk Higher Risk Emerging Equity 4% CalPERS Supplemental Income 457 Plan CalPERS Target Retirement Date Funds

27 Fund Allocation and Performance 2035 Fund Designed for an investor retiring between 2033 and 2037 seeking a diversified investment with an asset allocation mix with the potential for long-term capital growth and income. It corresponds to a volatile price fluctuation. The Fund gradually becomes more conservative over time. U.S. Fixed Income 8% Commodities 5% REITs 5% Large Cap Equity 40% Returns Quarter Year to Date 1 Yr 3 Yrs 5 Yrs 10 Yrs Fund ITD (Inception to Date) Inception Date Fund Performance Net 5.89% 12.36% 22.12% 8.55% % 12/01/08 Fund Performance Gross 6.06% 12.90% 22.91% 9.21% % Benchmark Performance 6.44% 13.57% 23.47% 10.05% 0.10% 9.30% 15.14% Emerging Equity 6% Non-U.S. Equity 19% Small/Mid Cap Equity 17% Lower Risk Moderate Risk Higher Risk 2040 Fund Designed for an investor retiring between 2038 and 2042 seeking a diversified investment with an asset allocation mix with the potential for long-term capital growth and income. It corresponds to a volatile price fluctuation. The Fund gradually becomes more conservative over time. U.S. Fixed Income 5% Commodities 5% REITs 5% Large Cap Equity 40% Returns Quarter Year to Date 1 Yr 3 Yrs 5 Yrs 10 Yrs Fund ITD (Inception to Date) Inception Date Fund Performance Net 6.03% 12.55% 22.57% 8.58% % 12/01/08 Fund Performance Gross 6.20% 13.09% 23.35% 9.26% % Benchmark Performance 6.61% 13.82% 23.92% 10.09% 0.12% 9.31% 15.16% Emerging Equity 7% Non-U.S. Equity 20% Small/Mid Cap Equity 18% Lower Risk Moderate Risk Higher Risk 2045 Fund Designed for an investor retiring between 2043 and 2047 seeking a diversified investment with an asset allocation mix with the potential for long-term capital growth and income. It corresponds to a volatile price fluctuation. The Fund gradually becomes more conservative over time. U.S. Fixed Income 5% Commodities 5% REITs 5% Large Cap Equity 40% Returns Quarter Year to Date 1 Yr 3 Yrs 5 Yrs 10 Yrs Fund ITD (Inception to Date) Inception Date Fund Performance Net 6.03% 12.55% 22.57% 8.59% % 12/01/08 Fund Performance Gross 6.20% 12.98% 23.24% 9.25% % Benchmark Performance 6.61% 13.82% 23.92% 10.09% 0.12% 9.31% 15.16% Emerging Equity 7% Non-U.S. Equity 20% Small/Mid Cap Equity 18% Lower Risk Moderate Risk Higher Risk 2050 Fund Designed for an investor retiring after 2048 seeking a diversified investment with an asset allocation mix with the potential for long-term capital growth and income. It corresponds to a volatile price fluctuation. The Fund gradually becomes more conservative over time. U.S. Fixed Income 5% Commodities 5% REITs 5% Large Cap Equity 40% Returns Quarter Year to Date 1 Yr 3 Yrs 5 Yrs 10 Yrs Fund ITD (Inception to Date) Inception Date Fund Performance Net 6.03% 12.56% 22.57% 8.57% % 12/01/08 Fund Performance Gross 6.20% 12.98% 23.23% 9.22% % Benchmark Performance 6.61% 13.82% 23.92% 10.09% 0.12% 9.31% 15.16% Emerging Equity 7% Non-U.S. Equity 20% Small/Mid Cap Equity 18% Lower Risk Moderate Risk Higher Risk CalPERS Supplemental Income 457 Plan CalPERS Target Retirement Date Funds

28 Asset Class and Strategy of the Underlying Portfolios Asset Class / Strategy Large Cap US Equity Large Cap US Equity Value Large Cap US Equity Growth Passive Large Cap US Equity SMID Cap US Equity Small-Mid Cap US Equity Growth Small-Mid Cap US Value Non-US Equity Active Non-US Equity Growth Passive Non-US Value Emerging Equity Emerging Market Equity US Fixed Income US Short Fixed Income US Core Fixed Income TIPS TIPS Commodities Commodities REITs Global REITs Underlying Portfolio AllianceBernstein Large Cap Value Turner Investment Partners Large Cap Growth CalPERS S&P 500 Index The Boston Company SMID Cap Growth The Boston Company SMID Cap Value Pyramis Select International Equity CalPERS International Index CalPERS Emerging Equity Index PIMCO Short-Term Bond CalPERS Total Return Bond CalPERS TIPS CalPERS Commodities CalPERS Global REITs Additional Disclosures Fees The annual asset management and administration fee of the Funds is 0.64%. Fees are netted out of the Funds performance daily. The CalPERS Board of Administration annually reviews the fees and operating expenses, and changes may be made if appropriate. Fund Performance Performance data shown represents post performance and is no guarantee of future results. The investment return and principal value of an investment will fluctuate so that an investor s units, when redeemed, may be worth more or less than their original cost. Current performance may be lower or higher than the performance data shown. For current performance information, including performance to the most recent month-end, please visit the Plan Web site at 0Hhttps://calpers.ingplans.com. Price The unit value of the Funds change daily, based upon the market value of the underlying securities. Just as prices in individual securities fluctuate, the Funds unit value changes with market conditions. Portfolio Manager Information The Funds are actively managed by CalPERS Investment Staff and external managers. They are responsible for all aspects of portfolio management and will manage to the objectives of each fund, as well as monitor and evaluate performances. Since the inception of the Public Employees Retirement Fund in the 1930s, investments by CalPERS have provided income (in the form of interest, dividends and capital gains) to meet the retirement and health needs of its members. The Funds have been offered under the Supplemental Income Plans since November What You Own You own units of the Funds portfolio that invest in stocks and bonds. You do not have direct ownership of the securities in the portfolio. A Note About the Funds Risk Investing in the Funds involves a number of investment risks, and it is possible to lose money while investing in the Funds. The Funds are subject to certain risks depending upon the type of securities held by the Funds and the management style of the Funds. Each Fund has its own level of risk. Please refer to the Risk Scale on page 1. Stocks or bonds each of these investments performs very differently. Stocks may go up and down more dramatically than bonds. When these investments go down you lose money, when they go up you gain money. This is what is meant when investors talk about risk. Since stocks may go up and down more than bonds, stocks are a riskier investment. It is important to understand the relationship between risk and reward. Over the long term, riskier investments have historically earned more than less risky investments stocks more than bonds. The key to successful investing is to understand the relationship between risk and reward and select a portfolio that does not fluctuate more than your comfort level, but provides enough opportunity for reward. Information Accessibility Since the Funds are not mutual funds, information is not available from a newspaper source. The record keeper will provide you access to your account information online by visiting the Plan Web site at and/or by calling the Plan Information line at (800) Expenses Expenses are an important aspect of investing. To pay for the administration and management of a fund, each investor is charged a fee, which is calculated as a percentage of the amount the investor has in the fund. Even if the fund loses money during a period, the fee is still charged. Although an annual expense fee may seem relatively small, its effect on performance over time may be substantial. Fees and expenses are only one of several factors that participants should consider when making investment decisions. Prospectus Information The Funds consist of assets managed by CalPERS in a separate account specifically for CalPERS Plans. Because it is not a mutual fund, a prospectus is not available. This summary is designed to provide descriptive information. Please read carefully before you invest. For more detailed information about the Funds, you may contact CalPERS at (800) CalPERS Supplemental Income 457 Plan CalPERS Target Retirement Date Funds

29 CalPERS Risk-Based Asset Allocation Funds CalPERS Supplemental Income 457 Plan September 30, 2012 Overview Risk-Based Asset Allocation Funds are a series of diversified funds, each of which has a pre-determined asset mix that will not vary over time, and is designed to reflect a personal investment strategy. This asset allocation is designed to reduce the level of risk by diversification. CalPERS Supplemental Income Plan offers three distinct investment options utilizing the concept of diversification through asset allocation so you may select the fund that closely matches your risk tolerance. Think of risk-based strategies as a premixed investment option that focuses on a diversified portfolio that is periodically rebalanced by CalPERS professionals. Advantages Many people don t have the time, interest or information to choose the right asset mix for their situation and manage it over time. With Risk-Based Asset Allocation Funds you receive a Fund that is well diversified across a range of asset classes and investment styles based on your personal investment risk tolerance. The investment mix is static, and each fund includes an allocation appropriate for aggressive, moderate or conservative style of investing. You should carefully consider the investment objective, risks, and expenses of the Fund before investing. As always, you should consult with your financial representative to determine whether an investment fund option is appropriate for you. Objective The strategic objective of the CalPERS Risk-Based Asset Allocation Funds is to provide a single fund solution, based on targeted asset mixes that offer diversification to provide asset growth with a level of volatility that is appropriate to the risk tolerance of the investor. There is no guarantee the Funds will achieve their investment objective. Asset Class, Strategy and Allocation to the Underlying Portfolio Asset Class / Strategy Underlying Portfolio Underlying Portfolio Allocation Conservative Moderate Aggressive Large Cap US Equity 20% 33% 40% Large Cap US Equity Value AllianceBemstein Large Cap Value Large Cap US Equity Growth Turner Investment Partners Large Cap Growth Passive Large Cap US Equity CalPERS S&P 500 Index SMID Cap US Equity 4% 10% 18% Small-Mid Cap US Equity Growth The Boston Company SMID Cap Growth Fund Small-Mid Cap US Value The Boston Company SMID Cap Value Fund Non-US Equity 6% 15% 20% Active Non-US Equity Growth Pyramis Select International Equity Passive Non-US Value CalPERS International Index Emerging Equity 2% 7% Emerging Market Equity CalPERS Emerging Equity Index US Fixed Income 53% 28% 5% US Short Fixed Income PIMCO Short-Term Bond US Core Fixed Income CalPERS Total Return Bond TIPS 15% 5% TIPS CalPERS TIPS Commodities 2% 4% 5% Commodities CalPERS Commodities REITs 3% 5% Global REITs CalPERS Global REITs

30 CalPERS Customized Strategy The Funds are actively managed and CalPERS uses a customized strategy to best optimize the funds potential. Included in many of the funds are Commodities, Real Estate Investment Trusts (REITs) and Treasury Inflation Protected Securities (TIPS), adding a layer of sophisticated diversification and professional asset allocation oversight. CalPERS utilizes member information in developing the Funds to achieve a higher rate of total return within prudent levels of risk and liquidity. A blend of active and passive underlying investments allows the Plan to offer a well diversified portfolio at low cost. The performance of the Funds is measured against a customized benchmark. Fund Benchmarks The benchmark for each Fund is a composite of asset class benchmarks that are weighted according to each Fund s policy target weights. The asset class benchmarks are Russell 3000 Equity Index, FTSE Developed World ex-us Index, FTSE Emerging Markets, Barclays Capital Aggregate Bond Index, Barclays Capital US TIPS Index, BofA Merrill Lynch 6-month T-Bill, S&P GSCI Commodities Index and FTSE EPRA/NAREIT Global REITs Index. Fund Allocation and Performance Conservative Asset Allocation Fund Designed for an investor with a conservative tolerance for risk and/or short time horizon. The Fund seeks a combination of current income and capital appreciation, with a greater emphasis on income. TIPS 15% Commodities 2% Large Cap Equity 20% Returns Quarter Year to Date 1 Yr 3 Yrs 5 Yrs 10 Yrs Fund ITD (Inception to Date) Inception Date Fund Performance Net 3.05% 7.08% 11.18% 6.52% % 12/01/08 Fund Performance Gross 3.22% 7.59% 11.89% 7.17% % Benchmark Performance 3.02% 6.92% 11.32% 7.75% 4.60% 6.58% 9.98% U.S. Fixed Income 53% Small/Mid Cap Equity 4% Non-U.S. Equity 6% Lower Risk Moderate Risk Higher Risk Moderate Asset Allocation Fund Designed for an investor with a moderate tolerance for risk and/or medium time horizon. The Fund seeks a combination of current income and capital appreciation, with a greater emphasis on appreciation. Returns Quarter Year to Date 1 Yr 3 Yrs 5 Yrs 10 Yrs Fund ITD (Inception to Date) Inception Date Fund Performance Net 4.77% 10.33% 17.58% 7.87% % 12/01/08 Fund Performance Gross 4.94% 10.76% 18.22% 8.48% % Benchmark Performance 5.03% 10.83% 18.38% 9.23% 2.27% 8.09% 12.84% Commodities 4% TIPS 5% U.S. Fixed Income 28% Emerging Equity 2% REITs 3% Non-U.S. Equity 15% Large Cap Equity 33% Small/Mid Cap Equity 10% Lower Risk Moderate Risk Higher Risk Aggressive Asset Allocation Fund Designed for an investor with an aggressive tolerance for risk and/or long time horizon. The Fund seeks a combination of current income and capital appreciation, with a greater emphasis on growth. It corresponds to an aggressive price fluctuation. Commodities 5% U.S. Fixed Income 5% REITs 5% Large Cap Equity 40% Returns Quarter Year to Date 1 Yr 3 Yrs 5 Yrs 10 Yrs Fund ITD (Inception to Date) Inception Date Fund Performance Net 6.02% 12.55% 22.57% 8.59% % 12/01/08 Fund Performance Gross 6.20% 13.09% 23.36% 9.27% % Emerging Equity 7% Non-U.S. Equity 20% Small/Mid Cap Equity 18% Benchmark Performance 6.61% 13.82% 23.92% 10.09% 0.12% 9.31% 15.16% Lower Risk Moderate Risk Higher Risk CalPERS Supplemental Income 457 Plan CalPERS Risk-Based Asset Allocation Funds

31 Additional Disclosures Fees The annual asset management and total expenses of the Risk-Based Asset Allocation Funds is 0.64%. Fees are netted out of the Funds performance daily. The CalPERS Board of Administration reviews the fees and operating expenses annually, and changes may be made if appropriate. Fund Performance Performance data shown represents past performance and is no guarantee of future results. The investment return and principle value of an investment will fluctuate so that an investor s units, when redeemed, may be worth more or less than their original cost. Current performance may be lower or higher than the performance data shown. For current performance information, including performance to the most recent month-end, please visit the Plan Web site at Price The unit value of the Funds change daily, based upon the market value of the underlying securities. Just as prices in individual securities fluctuate, the Funds unit value changes with market conditions. Portfolio Manager Information The Funds are actively managed by CalPERS Investment Staff and External Managers. They are responsible for all aspects of portfolio management and will manage to the objectives of each fund as well as monitor and evaluate performances. Since the inception of the Public Employees Retirement Fund in the 1930s, CalPERS investments have provided income (in the form of interest, dividends and capital gains) to meet the retirement and health needs of its members. The Funds are offered under the CalPERS Supplemental Income Plan as of November Information Accessibility Since the Funds are not mutual funds, information is not available from a newspaper source. The recordkeeper will provide you access to your account information online by visiting the Plan Web site at and/or by calling the Plan Information Line at (800) Expenses Expenses are an important aspect of investing. To pay for the administration and management of a fund, each investor is charged a fee, which is calculated as a percentage of the amount the investor has in the fund. Even if the fund loses money during a period, the fee is still charged. Although an annual expense fee may seem relatively small, its effect on performance over time may be substantial. Fees and expenses are only one of several factors that participants should consider when making investment decisions. Prospectus Information The CalPERS Risk-Based Asset Allocation Funds consist of assets managed by CalPERS in a separate account, specifically for the CalPERS Plans. Because it is not a mutual fund, a prospectus is not available. This summary is designed to provide descriptive information. Please read carefully before you invest. For more detailed information about the Funds, you may contact CalPERS at (800) What You Own You own units of the Funds portfolio that invests in stocks and bonds. You do not have direct ownership of the securities in the portfolio. A Note about the Funds Risk Investing in the Funds involves a number of investment risks, and it is possible to lose money while investing in the Funds. The Funds are subject to certain risks depending upon the type of securities held by the Funds and the management style of the Funds. Each Fund has its own level of risk. Please refer to the Risk Scale on page 1. Stocks or bonds each of these investments perform very differently. Stocks may go up and down more dramatically than bonds. When these investments go down you lose money, when they go up you gain money. This is what is meant when investors talk about risk. Since stocks may go up and down more than bonds, stocks are a riskier investment. It is important to understand the relationship between risk and reward. Over the long term, riskier investments have historically earned more than less risky investments stocks more than bonds. The key to successful investing is to understand the relationship between risk and reward and select a portfolio that does not fluctuate more than your comfort level, but provides enough opportunity for reward. CalPERS Supplemental Income 457 Plan CalPERS Risk-Based Asset Allocation Funds

32 Short-Term Investment Fund SUPPLEMENTAL INCOME PLANS SEPTEMBER 30, 2012 Objective The Short-Term Investment Fund (the Fund ) seeks to preserve principal, provide a high level of liquidity, and provide a competitive yield by investing in high quality short-term instruments. The Fund is not a money market fund registered with the Securities and Exchange Commission, and is not subject to the various rules and limitations that apply to such funds. Although the Fund may seek to maintain a stable unit value, there is no guarantee the Fund will achieve its objectives. Strategy Through active management, the Fund seeks to achieve its objectives by investing, under normal circumstances, most of its assets in U.S. government securities, repurchase agreements, and in money market mutual funds subject to SEC Rule 2a-7. The weighted average maturity will not normally exceed 60 days and the maximum expected average time to receipt of principal of any single security purchased by the Fund under this strategy will not normally exceed 397 days. What You Own You own units of the Fund s portfolio. You do not have direct ownership of the securities in the portfolio. An investment in the Fund is not a bank deposit, and it is not insured Nor guaranteed by the Federal Deposit Insurance Corporation (FDIC). Performance Returns Performance as of September 30, 2012 Past performance does not indicate future results Portfolio Net Returns Portfolio Composite Gross Returns Benchmark (Merrill Lynch 3-mo T-Bill) 3 Months -0.09% 0.04% 0.03% 1 Year -0.41% 0.10% 0.07% 3 Years % 0.11% 5 Years % 0.58% 10 Years % 1.78% Benchmark The performance of the Fund is measured against the Merrill Lynch 3-Month U.S Treasury Bill Index, which is an unmanaged index that measures returns of three-month U.S Treasury Bills. Prior to 2010, the Portfolio Composite used the Merrill Lynch 3-Month U.S. T-Bill Auction Average as the benchmark. Since Inception Date (9/01/10) -0.28% Consider Investing If: You are an investor who is interested in preserving your principal through an investment that minimizes volatility and offers a conservative rate of return. Notwithstanding, it is possible to lose money when investing in the Fund. In building a retirement portfolio, it is important to include a mix of equity (stock) and fixed income (bond) funds. Equity funds help build the value of your portfolio over the long term, while fixed income funds are intended to provide income and stability of principal. You should carefully consider the investment objective, risks, and expenses of the Fund before investing. As always, you should consult with your financial representative to determine whether or not an investment fund option is appropriate for you. Fees The annual asset management and administrative fee of the Fund is 0.50%. Fees are netted out of the Fund s performance daily. The CalPERS Board of Administration annually review the fees and operating expenses, and changes may be made if appropriate. Performance data shown represents past performance and is no guarantee of future results. The investment return and principal value of an investment will fluctuate so that an investor s units, when redeemed, may be worth more or less than their original cost. For current performance information, including performance to the most recent month-end, please visit our website at

33 Short-Term Investment Fund SUPPLEMENTAL INCOME PLANS Portfolio Manager Information The Fund is managed by State Street Global Advisors (SSgA), global leaders in providing investment management services to clients worldwide. Sector Allocation as of September 30, 2012 U.S. Agency 51.43% Repurchase Agreements 43.09% U.S. Treasury 5.48% Price The unit value of the Fund changes daily, based upon the market value of the underlying securities. Just as prices of individual securities fluctuate, the Fund s unit value changes with market conditions. Information Accessibility Since the Fund is not a mutual fund, information is not available from a newspaper source. The Supplemental Income Plans (SIP) record keeper will provide you access to your account information online by visiting our website at and/or by calling a plan participant service representative toll-free at (800) Expenses Expenses are an important aspect of investing. To pay for the administration and management of the Fund, each investor is charged a fee, which is calculated as a percentage of the amount the investor has in the fund. Even if the Fund loses money during a period, the fee is still charged. Although an annual fee may seem relatively small, its effect on performance over time may be substantial. However, fees and expenses are only one of the several factors that participant should consider when making investment decisions. Frequent Trading Policy CalPERS enforces a frequent trading policy to secure the investment performance of the Supplemental Income Plan funds for the benefit of all participants investing in the funds. As the funds are designed to achieve participants long-term retirement income goals, shortterm trading will be limited. Multiple round trip trades into and out of a fund may be subject to these restrictions. For more information on the Supplemental Income Plans Excessive Short-term Trading restrictions, please see the Supplemental Income Plans Policy at: SEPTEMBER 30, 2012 Prospectus Information The Fund consists of assets managed in a commingled account. Because it is not a mutual fund, a prospectus is not available. This summary is designed to provide descriptive information. Please read it carefully before you invest. For more detailed information about the Fund, you may contact CalPERS at (800) Characteristics Current 1 Day Average Yield 0.16% Average Credit Quality A1+P1 Weighted Average Maturity 40 days Risk Level Low Medium High A Note About the Fund s Risk The Fund s risk profile is extremely conservative due to the high credit quality and the very short maturities of its investments. Notwithstanding, investing in this Fund still involves a number of risks and it is possible to lose money while investing in this Fund. The Fund s return is generated from the income earned on each of the Fund s investments. There are risks involved with investing, including possible loss of principal. The Fund seeks to maintain a stable unit value, although there is no assurance that a stable unit value will be maintained. Risks associated with fixed income securities include, but are not limited to, interest rate risk and credit risk. In general, interest rate risk involves the risk that when interest rates decline, the market value of fixed income securities tends to increase. Conversely, when interest rates increase, the market value of fixed income securities tends to decline. Credit risk involves the risk that the issuer could default on its obligations, and the Fund will not recover its investment. The Fund has strict management standards in order to minimize this risk. Interest Rate Changes Debt and money market securities have varying levels of sensitivity to changes in interest rates. In general, the price of a debt or money market security may fall when interest rates rise and may rise when interest rates fall. Securities with longer maturities may be more sensitive to interest rate changes.

34 As of September 30, 2012 PORTFOLIO MANAGER Jerome Schneider PORTFOLIO STATISTICS Yield to Maturity 0.92 Average Quality AA- Effective Duration (yrs) 0.92 Effective Maturity (yrs) 1.02 SECTOR DIVERSIFICATION (%) Market Value Weighted Gov't Related 18% M ortgage 16% Invest. Grade Credit 47% Other 17% Net Cash Equivalents 2% Portfolio Assets $73,003,320 PIMCO Short-Term Bond Fund CalPERS 457 Plan PORTFOLIO DESCRIPTION The Short-Term portfolio is an alternative approach for money market investors who seek enhanced returns, principal stability and daily liquidity. The portfolio is an actively managed enhanced cash strategy that invests in high quality money market instruments and short-term fixed income securities. INVESTOR BENEFITS This portfolio offers investors a strategy that seeks to outperform money markets on a consistent basis while still providing liquidity and principal stability. Potential benefits of this portfolio include: Actively managed across the global fixed income market in an effort to enhance returns over money markets (e.g. CDs, money market funds, short-term investment funds, etc.) May provide a source of income for cash investors Prudently manage risk through diversified exposure to a broad opportunity set of short duration securities PORTFOLIO ADVANTAGE Inception Date 09/01/2010 The portfolio seeks to deliver consistent excess returns over money markets while protecting against downside risk. This diversified approach to enhancing returns over cash and money market strategies by expanding the fixed-income opportunity set beyond money markets may provide greater potential for consistent outperformance over the long term. VALUE OF CORE STRATEGIES An allocation to fixed-income strategies may be beneficial as a core part of a balanced portfolio. Bonds can provide a steady source of income and, as part of a total-return strategy, potentially produce capital gains as well. An allocation to a fixed-income strategy in a portfolio also can offer diversification and serve as a hedge against volatility and risks in other asset classes, particularly in times of economic uncertainty or deflation. Long-duration bonds can be used to diversify a broader core allocation to fixed income and help an overall portfolio s match to longer-term liabilities. Note: The PIMCO Short-Term Bond Fund is not a mutual fund as defined by the Investment Company Act of 1940, but is a separate portfolio that is managed by Pacific Investment Management Company on behalf of the CalPERS 457 Plan.

35 BASIC FACTS PERFORMANCE Total Annual Operating Expenses 0.55% Inception 5 Yrs. 3 Yrs. 1 Yr. 3 Mos. ABOUT THE BENCHMARK Merrill Lynch 6-Month Treasury Bill Index is an unmanaged index representing monthly return equivalents of yield averages of the last 6 month Treasury Bill issues. It is not possible to invest directly in an unmanaged index. Before Fees (%) After Fees (%) Benchmark (%) Performance data current to the most recent month-end is available at or by calling (800) ABOUT PIMCO PIMCO, founded in 1971, is a global investment solutions provider managing retirement and other assets for more than 8 million people in the U.S. and millions more around the world. Our clients include state, local and union pension and retirement plans whose beneficiaries come from all walks of life, including educators, healthcare workers and public safety employees. We also serve individual investors, working in partnership with financial intermediaries such as Registered Investment Advisors, broker/dealers, trust banks and insurance companies. We are advisors and asset managers to central banks, corporations, universities, foundations and endowments. PIMCO has offices in North America, Europe, Asia and Australia and is owned by Allianz Global Investors, a subsidiary of the Munich-based Allianz Group, a leading global insurance company. Past performance is no guarantee of future results. Performance figures are presented after management fees, commissions, other expenses, and the deduction of actual investment advisory fees; but do not reflect the deduction of custodial fees, if any. The "after fees" performance figures above also reflect the reinvestment of earnings. All periods longer than one year are annualized. Effective duration is the duration for a bond with an embedded option when the value is calculated to include the expected change in cash flow caused by the option as interest rates change. Gov't Related may include nominal and inflation-protected Treasuries, agencies, interest rate swaps, Treasury futures and options, and FDIC-guaranteed corporate securities. The credit quality of a particular security or group of securities does not ensure the stability or safety of the overall portfolio. PIMCO calculates a portfolio's Estimated Yield to Maturity by averaging the yield to maturity of each security held in the portfolio on a market weighted basis. PIMCO pulls each security's yield to maturity from PIMCO's Portfolio Analytics database. When not available in the PIMCO's Portfolio Analytics database, PIMCO pulls the security's yield to maturity from Bloomberg. When not available in either database, PIMCO will assign a yield to maturity for that security from a PIMCO matrix based on prior data. Investing in the bond market is subject to certain risks including market, interest-rate, issuer, credit, and inflation risk; investments may be worth more or less than the original cost when redeemed. Mortgage and asset-backed securities may be sensitive to changes in interest rates, subject to early repayment risk, and their value may fluctuate in response to the market s perception of issuer creditworthiness; while generally supported by some form of government or private guarantee there is no assurance that private guarantors will meet their obligations. Derivatives may involve certain costs and risks such as liquidity, interest rate, market, credit, management and the risk that a position could not be closed when most advantageous. Investing in derivatives could lose more than the amount invested. Diversification does not ensure against loss. No part of this material may be reproduced in any form, or referred to in any other publication, without express written permission. PIMCO Pacific Investment Management Company LLC, 840 Newport Center Drive, Newport Beach, CA This report was created for CalPERS.

36 CalPERS Total Return Bond Fund SUPPLEMENTAL INCOME PLAN SEPTEMBER 30, 2012 Objective The strategic objective of the CalPERS Total Return Bond Fund (the Fund) is to seek the highest total rate of return, consisting of income and capital appreciation, consistent with liquidity requirements and prudent investment management, and to outperform the designated benchmark, the Barclays Capital U.S. Aggregate Index. All sectors of the bond markets are utilized in an effort to add value while maintaining an overall risk level similar to the benchmark. There is no guarantee the Fund will achieve its investment objectives. Strategy The Fund is actively managed by CalPERS and is designed to identify opportunities across U.S. bond market sectors and invest where risks are both understood and manageable. The fund invests primarily in U.S. dollar-denominated fixed income securities and other debt instruments of domestic and foreign entities, including corporate bonds, foreign government bonds issued in U.S. dollars, U.S. government issued bonds, asset-backed, and mortgage-backed. Securities and sectors may receive a greater allocation than the benchmark should they have higher expected returns. The average duration of the Fund is expected to remain within 4 to 5 years. (See Additional Disclosures to learn more about the Fund s benchmark.) Consider Investing if: You are a long-term investor who is interested in investing in the U.S. bond market and is moderately conservative or seeking long-term growth through capital appreciation. You should carefully consider the investment objective, risks and expenses of the Fund before investing. As always, you should consult with your financial representative to determine whether an investment fund option is appropriate for you. Portfolio Manager Information Since the inception of the Public Employees Retirement Fund in the 1930s, investments by CalPERS have provided income (in the form of interest, dividends, and capital gains) to meet the retirement and health needs of its members. The Fund has been managed internally by CalPERS Investment Office staff for the CalPERS Supplemental Income Plans (SIP) since June Fees Performance as of September 30, 2012 Past performance does not indicate future results. Composition as of September 30, 2012 Credit (Primarily Corporates) 27.9% Government (Treasuries and Agencies) 33.6% Securitized (Primarily Mortgage-backed and Asset-backed) The annual asset management and administrative fee of the CalPERS Total Bond Fund is 0.55%. Fees are netted out of the Fund s performance daily. At least annually, the CalPERS Board of Administration reviews the fees and operation expenses, and changes may be made if appropriate. What You Own Portfolio Net Return Portfolio Gross Return Benchmark Barclays Capital Aggregate Bond Index 3 Months 2.02% 2.16% 1.58% 1 Year 6.18% 6.74% 5.16% 3 Years 6.38% 6.93% 6.19% 5 Years 5.97% 6.52% 6.53% Since Inception Date (6/1/2007) 6.03% 6.59% 6.61% * Fees of 0.55% have been deducted for investment management and administrative expenses. Performance data shown represents past performance and is no guarantee of future results. The investment return and principal value of an investment will fluctuate so that an investor s units, when redeemed, may be worth more or less than their original cost. Current performance may be lower or higher than the performance data shown above. For current performance information, including performance to the most recent month-end, please visit our website at % Cash 4.6% You own units of the Fund s portfolio that invests in bonds issued by corporations and government entities. You do not have direct ownership of the securities in the portfolio.

37 CalPERS Total Return Bond Fund SUPPLEMENTAL INCOME PLAN SEPTEMBER 30, 2012 Risk The Fund is subject to certain risks depending upon the type of securities held by the Fund and the management style of the Fund. (See Additional Disclosure to learn more about the Fund s risk.) Price The unit value of the Fund changes daily, based upon the market value of the underlying debt instruments. Just as prices in individual securities fluctuate, the Fund s unit value changes with market conditions. Information Accessibility Since the Fund is not a mutual fund, information is not available from a newspaper source. The SIP record keeper will provide you access to your account information online by our website at and/or by calling the Plan Information Line at (800) Prospectus Information The Fund consists of assets managed by CalPERS, specifically for CalPERS Plans. Because it is not a mutual fund, a prospectus is not available. This summary is designed to provide descriptive information. Please read carefully before you invest. For more detailed information about the Fund, you may contact CalPERS at (800) Fund Statistics Expense Ratio: 0.55% As of September 30, 2012, the total assets under management are $238,137,244. Asset Class: Intermediate Term Bond About the Fund s Benchmark Additional Disclosures Frequent Trading Policy CalPERS has a new frequent trading policy to secure the investment performance of the Supplemental Income 457 Plan funds for the benefit of all investing in the funds. As the funds are designed to achieve participants long-term retirement income goals, short-term trading will be limited. Multiple round trip trades into and out of a fund may be subject to these restrictions. For more information on the Supplemental Income Plans Excessive Short-term Trading restrictions, please see the Supplemental Income Plans Policy at: Expenses Expenses are an important aspect of investing. To pay for the administration and management of a fund, each investor is charged a fee, which is calculated as a percentage of the amount the investor has in the fund. Even if the fund loses money during a period, the fee is still charged. Although an annual expense fee may seem relatively small, its effect on performance over time may be substantial. However, fees and expenses are only one of several factors that participants should consider when making investment decisions. A Note About the Fund s Risk Investing in this Fund involves a number of risks, and it is possible to lose money while investing in this Fund. Bond fund values fluctuate in response to the financial condition of individual issuers, general market and economic conditions, and changes in interest rates. In general, when interest rates rise, bond fund values fall and investors may lose principal value. Active trading results in increased turnover and trading expenses, and may generate higher short-term capital gains. High yield, lower-rated securities generally entail greater market, credit/default and liquidity risks, and may be more volatile than investment grade securities. Risk Level The Barclays Capital U.S. Aggregate Index invests in mainly government, mortgage-backed and investment-grade corporate debt securities with a maximum of up to 25% in non-investment grade corporate debt securities. You may not invest directly in this index. Low Medium High

38 CalPERS Treasury Inflation Protected Securities (TIPS) Fund SUPPLEMENTAL INCOME PLANS SEPTEMBER 30, 2012 Objective The strategic objective of the CalPERS Treasury Inflation Protected Securities (TIPS) Fund (the Fund ) is to preserve capital, while protecting against inflation over the long term by using U.S. government issued Treasury securities and tracking closely to the Barclays Capital U.S. TIPS index. There is no guarantee the Fund will achieve its investment objective. Strategy The Fund is actively managed and is designed to identify opportunities between actual inflation and inflation expectations built into the value of the securities while managing the risks. The performance of the Fund is measured against the Barclays Capital U.S. TIPS index, which serves as the benchmark. The fund invests in U.S. government issued TIPS with a duration of one year or greater, and its holdings are chosen in order to replicate or exceed the returns on the benchmark. Therefore, securities in the Fund s portfolio may differ or receive a greater allocation than the securities held in the benchmark should they have higher expected returns. The average duration of the Fund is expected to remain within 10% of the duration of the benchmark. (See Additional Disclosures to learn more about the Fund s benchmark.) Consider Investing If: You are an investor near or at retirement who is interested in preserving capital through inflation protected securities and are moderately conservative. You should carefully consider the investment objective, risks, charges, and expenses of the Fund before investing. As always, you should consult with your financial representative to determine whether an investment fund option is appropriate for you. Performance as of September 30, 2012 Past performance does not indicate future results. Portfolio Net Return Portfolio Gross Return Benchmark: Barclays Capital US TIPS Index 3 Months 1.91% 2.05% 2.12% 1 Year 8.41% 9.00% 9.10% 3 Years 8.65% 9.29% 9.29% 5 Years 7.53% 8.14% 7.93% Since Inception Date (6/1/2007) 7.88% 8.48% 8.28% Fees of 0.55% have been deducted for investment management and administrative expenses. Performance data shown represents past performance and is no guarantee of future results. The investment return and principal value of an investment will fluctuate so that an investor s units, when redeemed, may be worth more or less than their original cost. For current performance information, including performance to the most recent month-end, please visit our website at Portfolio Manager Information: Since the inception of the California Public Employees Retirement Fund in the 1930 s, investments by CalPERS have provided income (in the form of interest, dividends, and capital gains) to meet the retirement and health needs of its members. The Fund is internally managed by the CalPERS Investment Office staff. Although the Fund has been managed internally by CalPERS since February 1997, it has only been offered under the CalPERS Supplemental Income Plans (SIP) since June What You Own You own units of the Fund s portfolio that invests in bonds issued by the U.S. government. You do not have direct ownership of the securities in the portfolio. Risk The Fund is subject to certain risks depending upon the type of securities held by the Fund and the management style of the Fund. (See Additional Disclosures to learn more about the Fund s risk.) Price The unit value of the Fund changes daily, based upon the market value of the underlying securities. Just as prices of individual securities fluctuate, the Fund s unit value changes with market conditions. Information Accessibility Since the Fund is not a mutual fund, information is not available from a newspaper source. The plan s record keeper will provide you access to your account information online by visiting the CalPERS Supplemental Income 457 Plan website at and/or by calling the Plan toll-free line to speak with a Participant Service Representative at (800) Prospectus Information The Fund consists of assets managed in a commingled fund, specifically for CalPERS programs. Because it is not a mutual fund, a prospectus is not available. This summary is designed to provide descriptive information. Please read it carefully before you invest. For more detailed information about the Fund, you may contact CalPERS at (800) Fund Assets As of September 30, 2012, the total assets under management are $859,051,598.

39 CalPERS Treasury Inflation Protected Securities (TIPS) Fund SUPPLEMENTAL INCOME PLANS SEPTEMBER 30, 2012 Fees The annual asset management and administrative fee of the Fund is 0.55%. Fees are netted out of the Fund s performance daily. The CalPERS Board of Administration annually reviews the fees and operating expenses, and changes may be made if appropriate. Additional Disclosures Frequent Trading Policy CalPERS has a new frequent trading policy to secure the investment performance of the Supplemental Income 457 Plan funds for the benefit of all investing in the funds. As the funds are designed to achieve participants long-term retirement income goals, short-term trading will be limited. Multiple round trip trades into and out of a fund may be subject to these restrictions. For more information on the Supplemental Income Plans Excessive Short-term Trading restrictions, please see the Supplemental Income Plans Policy at: A Note About the Fund s Risk Investing in this Fund involves a number of risks. Real interest-rate increases may cause bond prices to decline. The opposite is true when real interest rates decline. The real interest rate is the current market interest rate minus the market s inflation expectations. At any given time your shares may be worth less than the price you paid for them. The Fund s ability to achieve its investment objective depends in part on the managers skill in selecting and weighting the underlying securities. Risk Level Low Medium High About The Fund s Benchmark The Barclays Capital U.S. TIPS Index serves as the benchmark. You may not invest directly in this index. The fund invests in U.S. government issued TIPS with a duration of one year or greater. TIPS are backed by the full faith and credit of the U.S. Government and are designed to help protect investors from inflation. The inflation protection built into TIPS is designed to provide investors with predictable real returns and an explicit hedge against inflation. An investment in the Fund is not a bank deposit, and it is not insured or guaranteed by the Federal Deposit Insurance Corporation. Expenses Expenses are an important aspect of investing. To pay for the administration and management of a fund, each investor is charged a fee, which is calculated as a percentage of the amount the investor has in the fund. Even if the fund loses money during a period, the fee is still charged. Although an annual fee may seem relatively small, its effect on performance over time may be substantial. However, fees and expenses are only one of the several factors that participant should consider when making investment decisions.

40 CalPERS Small & Mid Cap Index Fund SUPPLEMENTAL INCOME PLANS Objective The strategic objective of the CalPERS Small and Mid Cap Index Fund (the Fund) is to obtain US small to mid-size company exposure by closely tracking the designated benchmark index, the Russell 2500 Index. There is no guarantee the Fund will achieve its investment objectives. Important Facts SEPTEMBER 30, 2012 Performance as of September 30, 2012 Past performance does not indicate future results. Portfolio Net Return Portfolio Gross Return Benchmark Russell 2500 Index Strategy The Fund is designed in a manner that is consistent with achieving the stated performance objective. This shall necessitate a broadly diversified portfolio managed in a passive index approach with risk characteristics closely resembling the benchmark index. The portfolio normally holds all 2500 securities in the Index. Since holding the exact number of shares in the benchmark can be expensive and cause constant rebalancing, an optimized index approach may be used to create a portfolio that closely resembles the benchmark characteristics. (See Additional Disclosures to learn more about the Fund s benchmark.) Consider Investing if: You are a long-term investor who is interested in investing in the U.S. stock market and is moderately aggressive or seeking long-term growth through capital appreciation. You should carefully consider the investment objective, risks and expenses of the Fund before investing. As always, you should consult with your financial representative to determine whether an investment fund option is appropriate for you. Portfolio Manager Information: The Fund is managed internally by CalPERS Investment Office staff for the CalPERS Supplemental Income Plans (SIP) since June Since the inception of the Public Employees Retirement Fund in the 1930s, investments by CalPERS have provided income (in the form of interest, dividends, and capital gains) to meet the retirement and health needs of its members. Fees The annual asset management and administrative fee of the CalPERS SMID Index Fund is 0.40%. Fees are netted out of the Fund s performance daily. The CalPERS Board of Administration annually reviews the fees and operation expenses, and changes may be made if appropriate. 3 Month 5.48% 5.58% 5.57% 1 Year 31.10% 31.61% 30.93% 3 Years 13.91% 14.34% 14.06% 5 Years 2.57% 2.97% 2.80% Since inception under SIP (June 2007) What You Own You own units of the Fund s portfolio that invests in stock of small and mid cap corporations. You do not have direct ownership of the securities in the portfolio. Price 1.53% 1.96% 1.79% * Fees of 0.40% have been deducted for investment management and administrative expenses. Performance data shown represents past performance and is no guarantee of future results. The investment return and principal value of an investment will fluctuate so that an investor s units, when redeemed, may be worth more or less than their original cost. Current performance may be lower or higher than the performance data shown above. For current performance information, including performance to the most recent month-end, please visit our website at Top 10 Holdings as of September 30, 2012 Government STIF 7 BPS ERISA 0.78% emini S&P 400 (CME) Dec % Mini Russell 2000 (NYF) Dec % Catamaran Corp. 0.36% HollyFrontier Corp. 0.31% SBA Communications Corp. 0.28% TransDigm Group Inc. 0.26% Alliance Data Systems Corp. 0.26% Ansys Inc. 0.25% Federal Realty Investment Trust 0.24% The unit value of the Fund changes daily, based upon the market value of the underlying securities. Just as prices in individual securities fluctuate, the Fund s unit value changes with market condition.

41 CalPERS Small & Mid Cap Index Fund SUPPLEMENTAL INCOME PLANS SEPTEMBER 30, 2012 Risk The Fund is subject to certain risks depending upon the type of securities held by the Fund and the management style of the Fund. (See the Additional Disclosure to learn more about the Fund s risk.) Information Accessibility Since the Fund is not a mutual fund, information is not available from a newspaper source. The plan s record keeper will provide you access to your account information online by visiting the CalPERS Supplemental Income 457 Plan website at and/or by calling the Plan Information Line at (800) Prospectus Information The CalPERS SMID Index Fund consists of assets managed in a separate account, specifically for CalPERS Plans. Because it is not a mutual fund, a prospectus is not available. This summary is designed to provide descriptive information. Please read carefully before you invest. For more detailed information about the Fund, you may contact CalPERS at (800) Fund Statistics Expense Ratio: 0.40% As of September 30, 2012, the total assets under management are $123,893,738. Asset Class: Domestic Stock Category: Small-Midcap Blend Number of Holdings: 2500 Additional Disclosures Frequent Trading Policy CalPERS has a frequent trading policy to secure the investment performance of the Supplemental Income 457 Plan funds for the benefit of all investing in the funds. As the funds are designed to achieve participants long-term retirement income goals, short-term trading will be limited. Multiple round trip trades into and out of a fund may be subject to these restrictions. For more information on the Supplemental Income Plans Excessive Short-term Trading restrictions, please see the Supplemental Income Plans Policy at: About the Fund s Benchmark The Russell 2500 Index measures the performance of the small to mid cap segment of the U.S. equity universe, commonly referred to as SMid Cap. The Russell 2500 Index is a subset of the Russell 3000 Index. It includes approximately 2500 of the smallest securities based on a combination of their market cap and current index membership. The Russell 2500 Index is constructed to provide a comprehensive and unbiased barometer for the small to mid-cap segment. The Index is completely reconstituted annually to ensure larger stocks do not distort the performance and characteristics of the true small to mid cap opportunity set. Expenses Expenses are an important aspect of investing. To pay for the administration and management of a fund, each investor is charged a fee, which is calculated as a percentage of the amount the investor has in the fund. Even if the fund loses money during a period, the fee is still charged. Although an annual expense fee may seem relatively small, its effect on performance over time may be substantial. However, fees and expenses are only one of several factors that participants should consider when making investment decisions. A Note About the Fund s Risk The Fund is subject to the following principal investment risks: Stock Market Volatility Stock markets are volatile and can rise or decline significantly in response to company, political, regulatory, market or economic developments. The Fund s total return, like stock prices generally, will fluctuate within a wide range, so an investor could lose money over short or even long periods. Stock markets tend to move in cycles, with periods of rising prices (bull markets), and periods of falling prices (bear markets). The Fund is also subject to investment-style risk, which is the chance that returns from small and midsized company stocks will trail returns from other asset classes (i.e. large company stocks or bonds) or the overall stock market. Smid cap stocks, as a group, have historically exhibited greater short-term volatility than that of the S&P 500 Index. Risk Level Low Medium High

42 CalPERS S&P 500 Index Fund SUPPLEMENTAL INCOME PLANS SEPTEMBER 30, 2012 Objective The strategic objective of the S&P 500 Fund (the Fund) is to obtain broad Large Company U.S. equity exposure by closely tracking the designated benchmark index, the S&P 500 Index. There is no guarantee the Fund will achieve its investment objective. Strategy The portfolio shall be constructed in a manner that is consistent with achieving the stated performance objective. This shall necessitate a broadly diversified portfolio managed in a passive index approach with risk characteristics closely resembling the benchmark index. The portfolio normally holds all 500 securities in the Index. Since holding the exact number of shares in the benchmark can be expensive and cause constant rebalancing, an optimized index approach may be used to create a portfolio that closely resembles the benchmark characteristics. (See Additional Disclosures to learn more about the Fund s benchmark.) Consider Investing If You are a long-term investor who is interested in investing in the U.S. stock market and is moderately conservative or seeking long-term growth through capital appreciation. The Fund may be appropriate for an investor seeking core large cap equity exposure with market-like risks. You should carefully consider the investment objective, risks and expenses of the Fund before investing. As always, you should consult with your financial representative to determine whether an investment fund option is appropriate for you. Price The unit value of the portfolio changes daily, based upon the market value of the underlying securities. Just as prices in individual securities fluctuate, the Fund s unit value changes with market conditions. Risk The Fund is subject to certain risks depending upon the type of securities held by the Fund and the management style of the Fund. (See Additional Disclosures to learn more about the Fund s risk.) Information Accessibility Since the Fund is not a mutual fund, information is not available from a newspaper source. The SIP record keeper will provide you access to your account information online by visiting our website at and/or by calling the Plan Information Line at (800) Performance as of September 30, 2012 Past performance does not indicate future results. Portfolio Net Return Portfolio Gross Return Benchmark S&P 500 Index 3 Months 6.27% 6.37% 6.35% 1 Year 29.80% 30.26% 30.20% Portfolio Manager Information Since the inception of the Public Employees Retirement Fund in the 1930s, investments by CalPERS have provided income (in the form of interest, dividends, and capital gains) to meet the retirement and health needs of its members. The Fund has been internally managed by CalPERS Investment Office staff since 1991, and has been offered under the CalPERS Supplemental Income Plans (SIP) since February Years Annualized 5 Years Annualized 10 Years Annualized Since Inception under SIP (Inception Date 02/01/95) 12.89% 13.26% 13.20% 0.86% 1.21% 1.05% 7.75% 8.11% 8.01% 7.95% 8.57% 8.54% What You Own You own units of a portfolio that invests in stocks of U.S. large companies. You do not have direct ownership of the securities in the portfolio. The Fund owns each of the stocks in the S&P 500 Index in the corresponding weight within the index. Full replication results in a portfolio that exhibits relatively low turnover and trading costs and tighter tracking to the index, the Fund will remain fully invested in equities at all times. * Fees of 0.35% have been deducted for investment management and administrative expenses. Performance data shown represents past performance and is no guarantee of future results. The investment return and principal value of an investment will fluctuate so that an investor s units, when redeemed, may be worth more or less than their original cost. Current performance may be lower or higher than the performance data shown above. For current performance information, including performance to the most recent month-end, please visit our website at

43 CalPERS S&P 500 Index Fund SUPPLEMENTAL INCOME PLANS Top 10 Holdings as of September 30, 2012 Apple Inc. 4.86% Exxon Mobil Corp. 3.28% General Electric Co. 1.86% Chevron Corp. 1.78% Microsoft Corp. 1.74% International Business Machines Corp. 1.73% AT&T Corp. 1.69% Google Inc. Cl A 1.55% Procter & Gamble Co. 1.48% Johnson & Johnson 1.47% Prospectus Information The Fund consists of assets managed by CalPERS, specifically for CalPERS Plans. Because it is not a mutual fund, a prospectus is not available. This summary is designed to provide descriptive information. Please read carefully before you invest. For more detailed information about the Fund, you may contact CalPERS at (800) Fund Statistics Expense Ratio: 0.35% As of September 30, 2012, the total assets under management are $299,053,748. Asset Class: Domestic Stock Category: Large Blend Number of Holdings: 500 Fees The annual asset management and administrative fee of the CalPERS S&P 500 Fund is 0.35%. Fees are netted out of the Fund s performance daily. At least annually, the CalPERS Board of Administration reviews the fees and operation expenses, and changes may be made if appropriate. About the Fund s Benchmark The S&P 500 Fund consists of 500 of the largest companies in the U.S. stock market. Large companies have historically provided a more stable return than small or medium sized companies. Additional Disclosures SEPTEMBER 30, 2012 Frequent Trading Policy CalPERS has a frequent trading policy to secure the investment performance of the Supplemental Income 457 Plan funds for the benefit of all investing in the funds. As the funds are designed to achieve participants long-term retirement income goals, short-term trading will be limited. Multiple round trip trades into and out of a fund may be subject to these restrictions. For more information on the Supplemental Income Plans Excessive Short-term Trading restrictions, please see the Supplemental Income Plans Policy at: Expenses Expenses are an important aspect of investing. To pay for the administration and management of a fund, each investor is charged a fee, which is calculated as a percentage of the amount the investor has in the fund. Even if the fund loses money during a period, the fee is still charged. Although an annual expense fee may seem relatively small, its effect on performance over time may be substantial. However, fees and expenses are only one of several factors that participants should consider when making investment decisions. A Note About the Fund s Risk The Fund is subject to the following principal investment risks: Stock Market Volatility Stock markets are volatile and can rise or decline significantly in response to company, political, regulatory, market or economic developments. The Fund s total return, like stock prices generally, will fluctuate within a wide range, so an investor could lose money over short or even long periods. Stock markets tend to move in cycles, with periods of rising prices (bull markets), and periods of falling prices (bear markets). The Fund is also subject to investment-style risk, which is the chance that returns from large company stocks will trail returns from other asset classes (i.e. small company stocks or bonds) or the overall stock market. Risk Level Low Medium High

44 CalPERS Supplemental Income Plans 457 Plan US Small Mid Cap Growth Equity Strategy Overview Key Facts Assets Under Management $1.7 billion Benchmark Russell 2500 Growth Index Inception April 2003 Investment Vehicles Separate Account, Commingled Vehicles Key Stats & Risk Management Typical Holdings Information Ratio* 0.31 Annualized Alpha* 2.01% Tracking Error* 5.90% *5 years as of 9/30/12 Performance Review Team Third Quarter 2012 B. Randall Watts, Jr., CFA, and Todd Wakefield, CFA, serve as lead portfolio managers for the strategy. Their team of seven investment professionals manages $3.7 billion in total assets. Objective The Boston Company Asset Management s US Small Mid Cap Growth Equity strategy seeks to outperform the Russell 2500 Growth Index over a long-term investment horizon. Strategy Highlights Experienced investment team with a demonstrated record of success. Dynamic approach to idea generation, leveraging a team-driven decision-making process with strict risk controls emphasized by automatic stop-loss trigger. Disciplined approach that seeks to generate consistent above-average risk-adjusted performance relative to peers and benchmark CalPERS Portfolio Performance Results* (%) Quarter YTD One Year Three Years Since Inception (12/1/08)** Composite Final Performance Results* (%) 5.2 CalPERS Portfolio (net-of-fees) Russell 2500 Growth Composite (gross-of-fees) *Returns greater than one year are annualized **Performance inception date of 12/01/2008 per the direction of CalPERS. Actual inception date for the CalPERS Supplemental Income Plans portfolio is 10/06/ Quarter YTD 1 Year 3 Years 5 Years Since Inception (4/1/03) Quarterly Review * Portfolio Characteristics Portfolio Index Price/Earnings Ratio** 19.1x 19.9x Long Term Growth Rate 16.5% 16.1% P/E to Growth Rate** 1.16x 1.23x Weighted Avg. Market Cap $4.2B $2.9B Debt/Capital 24% 36% ** NTM Based on IBES Five Largest Holdings Holding Name Sector Portfolio Urban Outfitters Inc. Consumer Discretionary 2.2 Akamai Technologies Inc. Information Technology 2.0 Jacobs Engineering Group Inc. Industrials 1.9 Aruba Networks Inc. Information Technology 1.8 Synopsys Inc. Information Technology 1.7 Total 9.6% Sector Weights (%) Consumer Discretionary Consumer Staples Energy Financials Health Care Industrials Information Technology Materials Telecomm Services Utilities Portfolio Russell 2500 Growth *Representative institutional account Where applicable, excludes cash and futures. ETFs are appropriately allocated according to their constituent exposure. All data is as of 9/30/12. There may be material differences between the representative account and other accounts managed with the same strategy. Because of these differences, the information based on the representative account should not necessarily be relied upon. Past performance is not a guarantee for future performance. No investment strategy or risk management technique can guarantee returns or eliminate risk in any market environment. Please refer to the back page for other important disclosures.

45 US Small Mid Cap Growth Equity Disclosure Period Gross-of- Fees Return Net-of-Fees Return Benchmark Return 3 Yr. Annualized Total Composite Total Firm Standard Deviation Number of Internal Assets Assets Composite Benchmark Portfolios Dispersion (USD Million) (USD Million) 2003* 53.56% 52.58% 51.14% < 3 Years 26.88% 1 N/M $8 $34, % 15.71% 14.59% < 3 Years 19.72% 1 N/M $9 $49, % 7.61% 8.18% < 3 Years 14.70% 2 N/M $28 $59, % 14.33% 12.26% 11.96% 13.44% 3 N/M $41 $72, % 20.57% 9.69% 11.38% 12.54% 4 N/M $115 $53, % % % 18.63% 20.93% 5 N/M $118 $26, % 25.14% 41.66% 21.02% 24.54% 7 N/M $584 $34, % 22.30% 28.86% 22.90% 27.21% 11 N/M $1,400 $39, % 5.68% -1.57% 18.77% 22.94% % $1,458 $37,484 *Partial period represents data from 4/1/2003 N/M = not meaningful Compliance Statement The Boston Company Asset Management, LLC (TBCAM) claims compliance with the Global Investment Performance Standards (GIPS ). TBCAM has been independently verified for the years Definition of the Firm The Boston Company Asset Management, LLC (TBCAM) is a registered investment adviser established in 1970 and a subsidiary of The Bank of New York Mellon Corporation. Composite Description The US Small Mid Cap Growth Equity Composite creation date is April 1, The Composite is composed of all fee-paying, discretionary accounts managed by TBCAM in this investment style. The US Small Mid Cap Growth Equity Composite represents an equity strategy that primarily invests in small and mid capitalization U.S. growth companies. Small and mid capitalization companies are those with a market capitalization within the same general range as the issuers included in the benchmark. The strategy can invest in American Depositary Receipts. The use of derivatives is permitted. Prior to March 1, 2007, the Composite was known as the Small/Midcap Growth Equity Composite. The performance presented prior to July 1, 2003 occurred while the investment personnel were employed at an affiliated firm. No material change in investment personnel responsible for the investment process occurred on July 1, 2003 when the investment personnel were integrated into TBCAM. The performance of the Composite is based in U.S. dollars. Benchmark The Composite s benchmark is the Russell 2500 Growth Index. The benchmark is used for comparative purposes only and is not covered by the Report of Independent Accountants. The Russell 2500 Growth Index measures the performance of the small to mid-cap growth segment of the U.S. equity market. Past performance is not an indication of future performance. The list of equity holdings should not be considered a recommendation to purchase or sell a particular security. Certain securities may not remain in the portfolio at the time that you receive this report. You should not assume that investments in the securities were or will be profitable or that decisions we make in the future will be profitable. This presentation or any portion thereof may not be copied or distributed without TBCAM s prior written approval. Statements are correct as of the date of the material only. There may be material differences between the representative account and other accounts managed with the same strategy. Because of these differences, the information based on the representative account should not necessarily be relied upon. This document may not be used for the purpose of an offer or solicitation in any jurisdiction or in any circumstances in which such offer or solicitation is unlawful or not authorized. To receive a complete list and description of TBCAM composites and/or a presentation that complies with the requirements of the GIPS standards, please contact marketing@tbcam.com. Contact For more information about our strategies, please contact: Global Head of Distribution Daniel J. McCormack mccormack.dj@tbcam.com (617) Director of Sales & Relationship Management John D. Havens havens.j@tbcam.com (617)

46 CalPERS Supplemental Income Plans 457 Plan US Small Mid Cap Value Equity Strategy Overview Key Facts Assets Under Management $661.0 million Benchmark Russell 2500 Value Index Inception September 2005 Investment Vehicles Separate Account, Commingled Vehicles Key Stats & Risk Management Typical Holdings Information Ratio* Annualized Alpha* -0.11% Tracking Error* 4.75% *5 years as of 9/30/12 Third Quarter 2012 Team Joseph M. Corrado, CFA, leads a portfolio team of seven investment professionals who manage $2.8 billion in total assets. Objective The Boston Company Asset Management s US Small Mid Capitalization Value Equity strategy seeks to outperform the Russell 2500 Value Index over a long-term investment horizon. Strategy Highlights Experienced investment team with a demonstrated record of success. Investment process focused on valuation, fundamentals, and catalyst identification as a cornerstone to successful value investing. Disciplined approach that seeks to generate consistent above-average risk-adjusted performance relative to peers and benchmark. Performance Review CalPERS Portfolio Performance Results* (%) Quarter YTD One Year Three Years Since Inception (12/1/08)** Composite Final Performance Results* (%) Quarter YTD 1 Year 3 Years 5 Years Since Inception (9/1/05) CalPERS Portfolio (net-of-fees) Russell 2500 Value Composite (gross-of-fees) *Returns greater than one year are annualized **Performance inception date of 12/01/2008 per the direction of CalPERS. Actual inception date for the CalPERS Supplemental Income Plans portfolio is 10/06/2008. Quarterly Review * Portfolio Characteristics Portfolio Index Price/Earnings FY1 14.3x 14.7x Price/Book Value 1.7x 1.3x Debt/Capital 34% 40% IBES Long Term Growth Rate 13% 10% Dividend Yield 1.3% 2.1% Weighted Avg. Market Cap $3.3B $2.7B Five Largest Holdings Holding Name Sector Portfolio Spirit AeroSystems Holdings Inc. Industrials 1.7 Mednax Inc. Health Care 1.7 Raymond James Financial Inc. Financials 1.7 City National Corp. Financials 1.7 Toll Brothers Inc. Consumer Discretionary 1.7 Total 8.5% Sector Weights (%) Cons Discretionary Cons Staples Energy Financials Health Care Industrials Info Technology Materials Telecom Services Utilities Portfolio Russell 2500 Value *Representative institutional account Where applicable, excludes cash and futures. ETFs are appropriately allocated according to their constituent exposure. All data is as of 9/30/12. There may be material differences between the representative account and other accounts managed with the same strategy. Because of these differences, the information based on the representative account should not necessarily be relied upon. Past performance is not a guarantee for future performance. No investment strategy or risk management technique can guarantee returns or eliminate risk in any market environment. Please refer to the back page for other important disclosures.

47 US Small Mid Cap Value Equity Disclosure Period Gross-of- Fees Return Net-of-Fees Return Benchmark Return 3 Yr. Annualized Total Composite Total Firm Standard Deviation Number of Internal Assets Assets Composite Benchmark Portfolios Dispersion (USD Million) (USD Million) 2005* 3.39% 3.09% 1.04% < 3 Years 12.81% 1 N/M $156 $59, % 17.10% 20.18% < 3 Years 10.85% 1 N/M $184 $72, % 1.40% -7.27% < 3 Years 11.03% 4 N/M $332 $53, % % % 17.12% 18.38% 4 N/M $271 $26, % 29.43% 27.68% 21.20% 24.61% 5 N/M $577 $34, % 19.06% 24.82% 23.97% 26.97% 5 N/M $616 $39, % -4.53% -3.36% 22.20% 24.23% 7 N/M $714 $37,484 *Partial period represents data from 9/1/2005 N/M = not meaningful Compliance Statement The Boston Company Asset Management, LLC (TBCAM) claims compliance with the Global Investment Performance Standards (GIPS ). TBCAM has been independently verified for the years Definition of the Firm The Boston Company Asset Management, LLC (TBCAM) is a registered investment adviser established in 1970 and a subsidiary of The Bank of New York Mellon Corporation. Composite Description The US Small Mid Cap Value Equity Composite creation date is September 1, The Composite is composed of all fee-paying, discretionary accounts managed by TBCAM in this investment style. The US Small Mid Cap Value Equity Composite represents an equity strategy that primarily invests in small and mid capitalization U.S. value companies. Small and mid capitalization companies are those with a market capitalization within the same general range as the issuers included in the benchmark. The strategy can invest in American Depositary Receipts. The use of derivatives is permitted. Prior to March 1, 2007, the Composite was known as the Small/Midcap Value Equity Composite. The performance of the Composite is based in U.S. dollars. Benchmark The Composite s benchmark is the Russell 2500 Value Index. The benchmark is used for comparative purposes only and is not covered by the Report of Independent Accountants. The Russell 2500 Value Index measures the performance of the small to mid-cap value segment of the U.S. equity market. Past performance is not an indication of future performance. The list of equity holdings should not be considered a recommendation to purchase or sell a particular security. Certain securities may not remain in the portfolio at the time that you receive this report. You should not assume that investments in the securities were or will be profitable or that decisions we make in the future will be profitable. This presentation or any portion thereof may not be copied or distributed without TBCAM s prior written approval. Statements are correct as of the date of the material only. There may be material differences between the representative account and other accounts managed with the same strategy. Because of these differences, the information based on the representative account should not necessarily be relied upon. This document may not be used for the purpose of an offer or solicitation in any jurisdiction or in any circumstances in which such offer or solicitation is unlawful or not authorized. To receive a complete list and description of TBCAM composites and/or a presentation that complies with the requirements of the GIPS standards, please contact marketing@tbcam.com. Contact For more information about our strategies, please contact: Global Head of Distribution Daniel J. McCormack mccormack.dj@tbcam.com (617) Director of Sales & Relationship Management John D. Havens havens.j@tbcam.com (617)

48 3Q 9/30/12 Supplemental Income Plans CalPERS 457 Plan AllianceBernstein Large Cap Value Portfolio Objective Long-term growth of capital Investment Strategy Targets a diversified range of companies whose long-term earnings power and dividend-paying capability do not appear to be reflected in their current share price Employs a disciplined investment philosophy and bottom-up approach to identify undervalued stocks Combines fundamental and quantitative research to increase the effectiveness of the portfolio The Portfolio s Advisor selects its top-ranked value stocks that help diversify the Portfolio risk, taking into account exposure to different economic sectors The Portfolio s performance is measured against the Russell 1000 Value Index which represents the performance of 1000 large-cap value companies within the US Primary Investments Invests primarily in US stocks, although it may invest in non-us stocks Manager Summary The Portfolio s Advisor is AllianceBernstein L.P. AllianceBernstein delivers preeminent investment services in key asset classes Alliance Growth Equities, Bernstein Value Equities, AllianceBernstein Blend Strategies, AllianceBernstein Fixed Income and AllianceBernstein Alternative Investments. In addition to defined contribution plans, our clients include pension plans, foundations and endowments, insurance companies, central banks, governments, high-net-worth and retail clients in 25 countries. Top Ten Holdings 1 Pfizer % Astrazeneca Wellpoint BP Citigroup Wells... Fargo 3.96 ExxonMobil Hewlett-Packard Kroger Cit Group 2.79 Sector Breakdown 2 Consumer... Discretionary 22.51% Health... Care Financials Energy Information... Technology Consumer... Staples 8.89 Industrials Utilities Telecommunication... Services 1.20 Materials 1.12 Actual allocations will change over time. General Information Inception Date 6/1/07... Portfolio Turnover Rate (as of 12/31/11) 82%... Total Number of Holdings 59 Annualized Returns* Since Total Qtr. 1 Year 3 Years 5 Years 10 Years Inception* Operating Expenses Large... Cap Value Portfolio 4.20% 20.70% 5.45% 3.78% 3.73% 0.90% Russell 1000 Value Index 6.51% 30.92% 11.84% 0.90% 1.33% *Performance is presented net of fees. The Portfolio s inception date is 6/1/07. Periods less than one year represent cumulative returns. Please see the next page for gross of fee returns for an Institutional Composite similar to this strategy. 1 Holdings are expressed as a percentage of total investments and may vary over time. They are provided for informational purposes only and should not be deemed as a recommendation to buy or sell the securities mentioned. Columns may not sum due to rounding. 2 Holdings are expressed as a percentage of total market value of the equity portion of the portfolio and may vary over time. Columns may not sum due to rounding. Past performance is no guarantee of future results. Investors cannot invest directly in indices. As of 9/30/12. Source: AllianceBernstein. State Street Investment Analytics provided the Large Cap Value Portfolio and Russell 1000 Value Index returns. A Word About Risk Market Risk: The market values of the portfolio s holdings rise and fall from day to day, so investments may lose value. Foreign (Non-US) Risk: Investing in non-us securities may be more volatile because of political, regulatory, market and economic uncertainties associated with such securities. These risks are magnified in securities of emerging or developing markets. Currency Risk: If a non-us security s trading currency weakens versus the US dollar, its value may be negatively affected when translated back into US dollar terms. Derivatives Risk: Investing in derivative instruments such as options, futures, forwards or swaps can be riskier than traditional investments, and may be more volatile, especially in a down market. Value Investing: Value investing does not guarantee a profit or eliminate risk. Not all companies whose stocks are considered to be value stocks are able to turn their business around or successfully employ corrective strategies which would result in stock prices that rise as initially expected. VALUE

49 3Q 9/30/12 Annualized Composite Returns* 1 Year 3 Years 5 Years 10 Years 20 Years Strategic... Value Composite 22.05% 6.45% 5.67% 5.78% Russell 1000 Value Index 30.92% 11.84% 0.90% *The Composite s inception date is 12/31/73. The returns are presented gross of fees. The returns do not include the deduction of investment management or other fees which would lower a participant s return. Source: AllianceBernstein Annual Composite Returns* Total Return % Composite Performance Disclosure Composite performance shown above is that of the institutional manager s US Strategic Value composite through September 30, 2012 and may not be indicative of results of the AllianceBernstein Large Cap Value Portfolio. Rates of return are asset weighted. Please refer to the Disclosures on this page. Performance is shown gross-of-fees, an investment in the Portfolio would experience higher fees, which would affect performance. The Portfolio has a limited operating history. Performance shown is presented for informational purposes only. Past performance is not indicative of future results. No representation or warranty is made as the efficacy of any particular strategy or the actual returns that may be achieved. AllianceBernstein manages discretionary tax-exempt accounts of institutional clients without significant client-imposed restrictions. Certain of these accounts (the Composite ) have substantially the same investment objectives and policies and are managed in accordance with essentially the same investment strategies and techniques as will be used by AllianceBernstein for the Portfolio. The Composite performance may not be indicative of future results of the Portfolio and, because of ongoing market volatility, the Portfolio s performance may be subject to substantial fluctuations. Bernstein Value Equities US Strategic Value Composite Supplemental Performance Information Period Composite Assets (US Dollar Millions) Composite Accounts at End of Period Gross Return (%) Net Return (%) Composite Dispersion (%) Total Firm Assets (US Dollar Billions) Russell 1000 Value Index Return (%) S&P 500 Index Return (%) , , , , , , , , , , Years* Years* Years* *annualized through most recent year-end 1) PRESENTATION OF THE FIRM AllianceBernstein L.P. ( ABLP ) is a registered investment advisor with the US Securities and Exchange Commission. AllianceBernstein Institutional Investments and AllianceBernstein Investments (collectively, the Firm ) is the institutional and retail sales, marketing and client service unit of ABLP. In February 2006, Alliance Capital Management L.P. changed its name to ABLP. 2) COMPLIANCE The Firm claims compliance with the Global Investment Performance Standards (GIPS ) and has prepared and presented this report in compliance with the GIPS standards. The Firm has been independently verified on an annual basis from 1993 through Verification assesses whether (1) the Firm has complied with all the composite construction requirements of the GIPS standards on a firmwide basis and (2) the Firm s policies and procedures are designed to calculate and present performance in compliance with the GIPS standards. The US Strategic Value (>=$5mm) Composite has been examined from 1993 through The verification and performance examination reports are available upon request. 3) COMPOSITE DESCRIPTION The performance results displayed herein represent the investment performance record for the institutional US Strategic Value Composite (the Composite ). The Composite includes all fee-paying institutional discretionary accounts and, when applicable, pooled investment vehicles, with assets over 5 million in US dollars. The Composite consists of accounts which invest in the US equity market and seek a long-term premium relative to the Russell 1000 Value index with little sensitivity to the benchmark. Prior to 2011, the Composite did not include pooled investment vehicles. Prior to December 31, 2010, the composite accounts sought a long-term premium relative to the S&P 500 and Russell 1000 Value indices. The change to the primary benchmark on December 31, 2010 from the S&P 500 index to the Russell 1000 Value index was made to more appropriately reflect the investment style of the service and has been applied retroactively since the inception of the Composite. There has been no change to the investment process or universe of securities from which the portfolio is constructed. Prior to August 2010, the value portion of blend accounts were managed as a stand alone account with its own cash balance and included in the composite. The creation date of this Composite is March A complete list with descriptions of all composites managed by the Firm and/or additional information regarding policies for valuing accounts, calculating performance, and preparing compliant presentations is available upon request via to CompositeRequests@AllianceBernstein.com. 4) TOTAL RETURN METHODOLOGY AND FEE STRUCTURE Performance figures in this report have been presented gross and net of investment-management fees. Net performance figures have been calculated by deducting the highest fee payable by an account of this type; 0.90% of assets, annually. Prior to January 2009, the Composite s net-of-fee return is the asset-weighted average of the actual after-fee returns of each account in the Composite. The current investment advisory fee schedule applicable for this Composite is as follows: 0.900% on the first 15 million in US Dollars; 0.500% on the next 35 million in US Dollars; 0.400% on the balance. 5) RATE OF RETURN No representation is made that the performance shown in this presentation is indicative of future performance. An account could incur losses as well as generate gains. Performance figures for each account are calculated monthly on a trade-date basis using a total rate-of-return calculation. Monthly fair values include income accruals, realized and unrealized gains and losses and reflect the daily weighting of cash flows. The Composite returns are calculated based on the asset-weighted monthly composite constituent account returns where the weight is the beginning fair value of the accounts. 6) DISPERSION Internal dispersion is calculated using the asset-weighted standard deviation of all accounts included in the composite for the entire year; it is not presented for periods less than one year or when there were fewer than two accounts in the composite for the entire year. The three-year annualized ex post standard deviation measures the variability of the composite and the benchmark returns over the preceding 36-month period; it is not presented for periods of less than three years. The benchmark, which is not covered by the report of independent verifiers, is the Russell 1000 Value Index. The Secondary Benchmark is a supplemental benchmark. CalPERS has a new frequent trading policy to secure the investment performance of the Supplemental Income 457 Plan funds for the benefit of all investing in the funds. As the funds are designed to achieve participants long-term retirement income goals, short-term trading will be limited. Multiple round trip trades into and out of a fund may be subject to these restrictions. For more information on the Supplemental Income Plans Excessive Short-term Trading restrictions, please see the Supplemental Income Plans Policy at: The Portfolio is a separately managed account that is not a registered mutual fund and is exempt from investment company registration under the Investment Company Act of Therefore no prospectus is available for this Portfolio and the Portfolio is not insured by the Federal Deposit Insurance Corporation. CALP AllianceBernstein and the AB logo are registered trademarks and service marks used by permission of the owner, AllianceBernstein L.P AllianceBernstein L.P.

50 CalPERS International Index Fund SUPPLEMENTAL INCOME PLANS SEPTEMBER 30, 2012 Objective The strategic objective of the CalPERS International Index Fund (the Fund) is to obtain broad international equity exposure by closely tracking the designated benchmark index, the Financial Times All World Developed Market ex-us Index. There is no guarantee that the Fund will achieve its investment objective. Strategy The Fund is designed in a manner that is consistent with achieving the stated performance objective. The performance of the Fund is measured against FTSE Developed World ex US Index, which serves as the benchmark. This shall necessitate a broadly diversified portfolio managed in a passive index approach with risk characteristics closely resembling the benchmark index. The portfolio normally holds the roughly 1300 securities in the Index. The index includes only developed market countries outside the U.S. Emerging market countries are not held. Since holding the exact number of shares in the benchmark can be expensive and cause constant rebalancing, an optimized index approach may be used to create a portfolio that closely resembles the benchmark characteristics. (See Additional Disclosures to learn more about the Fund s benchmark.) Consider Investing if: You are a long-term investor who is interested in investing in the international stock market and is moderately aggressive or seeking longterm growth through capital appreciation. You should carefully consider the investment objective, risks and expenses of the Fund before investing. As always, you should consult with your financial representative to determine whether an investment fund option is appropriate for you. Portfolio Manager Information: Since the inception of the Public Employees Retirement Fund in the 1930s, investments by CalPERS have provided income (in the form of interest, dividends, and capital gains) to meet the retirement and health needs of its members. The Fund has been managed internally by CalPERS Investment Office staff for CalPERS Supplemental Income Plans (SIP) since June Price The unit value of the Fund changes daily, based upon the market value of the underlying securities. Just as prices in individual securities fluctuate, the Fund s unit value changes with market conditions. What You Own You own units of the Fund s portfolio that invests in stock of mid and large capitalization international corporations. You do not have direct ownership of the securities in the portfolio. Prospectus Information The CalPERS International Index Fund consists of assets managed by CalPERS, specifically for CalPERS Plans. Because it is not a mutual fund, a prospectus is not available. This summary is designed to provide descriptive information. Please read it carefully before you invest. For more detailed information about the Fund, you may contact CalPERS at (800) Important Facts Fees Performance as of September 30, 2012 Past performance does not indicate future results. Portfolio Net Return Portfolio Gross Return Benchmark FTSE Developed World ex US Index 3 Months 7.63% 7.73% 7.68% 1 Year 14.41% 14.81% 14.64% 3 Years 2.61% 2.98% 2.99% 5 Years -4.72% -4.35% -4.16% Since Inception under SIP(6/1/07) -3.86% -3.49% -3.32% * Fees of 0.40% have been deducted for investment management and administrative expenses. Performance data shown represents past performance and is no guarantee of future results. The investment return and principal value of an investment will fluctuate so that an investor s units, when redeemed, may be worth more or less than their original cost. Current performance may be lower or higher than the performance data shown above. For current performance information, including performance to the most recent month-end, please visit our website at The annual asset management and administrative fee of the Fund is 0.40%. Fees are netted out of the Fund s performance daily. The CalPERS Board of Administration annually reviews the fees and operating expenses, and changes may be made if appropriate. Top 10 Holdings as of September 30, 2012 Nestle S.A. 1.71% Samsung Electronics Co. Ltd. 1.38% HSBC Holdings PLC 1.31% Novartis AG 1.24% Vodafone Group PLC 1.09% BP PLC 1.04% Roche Holding AG 1.02% Royal Dutch Shell PLC (CL A) 1.00% GlaxoSmithKline PLC.90% Sanofi S.A..87%

51 CalPERS International Index Fund SUPPLEMENTAL INCOME PLANS SEPTEMBER 30, 2012 Information Accessibility Since the Fund is not a mutual fund, information is not available from a newspaper source. The SIP record keeper will provide you access to your account information online by visiting the website at and/or by calling the Plan Information Line at (800) Sector Weighting as of September 30, 2012 Finance 24.07% Consumer Non-Durables 8.56% Health Technology 8.33% Energy Minerals 8.24% Producer Manufacturing 6.94% Non-Energy Minerals 6.35% Consumer Durables 4.80% Electronic Technology 4.57% Communications 4.51% Process Industries 4.04% Country Weighting: All countries not included and total will not equal 100% United Kingdom 18.01% Japan 15.91% Canada 9.13% France 8.01% Australia 7.74% Switzerland 7.28% Germany 7.13% South Korea 5.17% Hong Kong 3.66% Sweden 2.68% Spain 2.47% Netherlands 2.24% Italy 2.00% Expenses Expenses are an important aspect of investing. To pay for the administration and management of a fund, each investor is charged a fee, which is calculated as a percentage of the amount the investor has in the fund. Even if the fund loses money during a period, the fee is still charged. Although an annual fee may seem relatively small, its effect on performance over time may be substantial. However, fees and expenses are only one of the several factors that participant should consider when making investment decisions. Fund Assets As of September 30, 2012, the total assets under management are $33,413,610,945. Additional Disclosures Frequent Trading Policy CalPERS has a frequent trading policy to secure the investment performance of the Supplemental Income 457 Plan funds for the benefit of all investing in the funds. As the funds are designed to achieve participants long-term retirement income goals, short-term trading will be limited. Multiple round trip trades into and out of a fund may be subject to these restrictions. For more information on the Supplemental Income Plans Excessive Short-term Trading restrictions, please see the Supplemental Income Plans Policy at: About the Fund s Benchmark The FTSE All-World Developed Market ex-us Index serves as the benchmark. You may not invest directly in this index. The index comprises Large (83%) and Mid (17%) cap stocks providing coverage of Developed Markets excluding the US. The index is derived from the FTSE Global Equity Index Series (GEIS), which covers 98% of the world s investable market capitalization. The Index is designed to track the performance of the largest developed market equities (excluding the US), selected based on the following four fundamental measures of firm size: book value, income, sales and dividends. The 1000 equities with the highest fundamental strength are weighted according to their fundamental scores. A Note About the Fund s Risk Investing in this Fund involves a number of risks. Foreign securities are subject to the same market risks as US securities, however, foreign securities involve the additional risk of loss due to political, economic, legal, regulatory, operational uncertainties, differing accounting and financial reporting standards, limited availability of information and currency conversion and pricing factors affecting investment in the securities of foreign businesses or governments. An investor in the Fund should anticipate that the value of their shares will increase or decrease in value more or less in correlation with increases and decreases in the value of the Index. The investment return and principal value of an investment in FTSE Index will fluctuate so that shares, when sold, may be worth more or less than their original cost. The Index may include small and medium-sized companies. Investing in securities of these companies involves greater risk than is customarily associated with investing in more established companies. These stocks may have returns that vary, sometimes significantly, from the overall stock market. Often smaller and medium capitalization companies and the industries in which they are focused are still evolving, and while this may offer better growth potential than larger, more established companies, it may also make them more sensitive to changing market conditions. Risk Level Low Medium High

52 CalPERS Supplemental Income Plans Plan third Quarter 2012 Strategy description n A diversified large-cap growth portfolio holding approximately 60 to 90 stocks. n Buy range - stocks of companies with a market capitalization greater than $3 billion. Portfolio facts Inception date May 9, 2007* Performance benchmark Russell 1000 Growth Index Fee schedule 90 basis points Assets as of September 30, 2012* $45.6 million Why Turner Large Cap Growth Fund? n Sector and industry focused research: experienced team of accountable investment professionals. n Style purity: consistent exposure to large cap growth stocks and application of investment strategy. Approximate range of holdings Average cash position 0-5% Top ten security holdings** Company name % assets n Fully invested: minimal cash position. Lead portfolio manager Robert E. Turner, CFA n Chairman and chief investment officer n Co-founded Turner in 1990; covers the technology and telecommunications and producer durables sectors for all of our stock portfolios n 31 years of investment experience Apple Inc. 12.8% Google Inc. 3.7% Coca-Cola Co. 3.7% QUALCOMM Inc. 3.0% EMC Corp. 2.5% Schlumberger Ltd. 2.3% Monsanto Co. 2.2% Visa Inc. 2.2% Home Depot Inc. 2.1% Amazon.com Inc. 2.1% Percentage of overall portfolio 36.6% Cash 0.5% **subject to change Performance (net of fees) 3Q12 YTD 1 year 3 years (annualized) 5 years (annualized) Since inception (annualized) CalPERS Supplemental Income Plans Plan 5.41% 13.30% 21.95% 8.76% -2.05% -0.81% Russell 1000 Growth Index 6.11% 16.80% 29.19% 14.73% 3.24% 3.54% *Net of investment management fees and market weighted. Past performance is no assurance of future results. All returns are calculated and expressed in U.S. Dollars and reflect the reinvestment of dividends and other earnings. Performance inception date of June 1, 2007 per the direction of CalPERS. Actual inception date for the CalPERS Supplemental Income Plans portfolio is May 9, Dedicated CalPERS 457 website: Customer Call Center:

53 CalPERS Supplemental Income Plans Third Quarter 2012 Holdings-based characteristics CalPERS Supplemental Income Plans Russell 1000 Growth Index Number of holdings Weighted average market capitalization ($ billion) Weighted median market capitalization ($ billion) $125.1 $121.6 $38.2 $52.3 EPS growth 1 year forecast 18.5% 16.6% P/E ratio - 1 year forecast 15.0x 14.3x Sources: FactSet, Turner quantitative system Sector allocation CalPERS Supplemental Income Plans Russell 1000 Growth Index Consumer discretionary 21.64% 21.86% Consumer staples 6.69% 10.65% Energy 5.01% 4.03% Financial services 8.84% 7.36% Health care 11.59% 12.19% Materials and processing 3.29% 4.56% Producer durables 9.17% 10.35% Technology 30.67% 25.77% Utilities 2.60% 3.23% Cash and equivalents 0.50% 0.00% Source: FactSet Monthly returns (gross) Jan Feb Mar Apr May Jun Jul Aug Sept Oct Nov Dec 2012 CalPERS 6.60% 6.13% 3.53% -0.92% -7.99% 1.08% -0.51% 3.65% 2.45% Russell 1000 Growth 5.97% 4.78% 3.29% -0.15% -6.41% 2.72% 1.34% 2.69% 1.96% 2011 CalPERS 2.23% 5.21% -0.45% 2.23% -1.53% -2.09% -0.38% -7.44% -8.95% 10.34% -0.34% -1.91% Russell 1000 Growth 2.54% 3.27% 0.12% 3.35% -1.09% -1.43% -1.00% -5.28% -7.37% 10.97% -0.01% -0.32% 2010 CalPERS -6.43% 4.05% 6.82% 1.58% -8.20% -6.31% 6.50% -5.94% 10.59% 3.82% 2.24% 6.21% Russell 1000 Growth -4.36% 3.44% 5.78% 1.12% -7.63% -5.51% 7.13% -4.67% 10.65% 4.78% 1.16% 5.51% 2009 CalPERS -4.80% -6.11% 9.85% 10.10% 4.95% -0.18% 8.63% 1.12% 5.22% -2.74% 4.81% 4.52% Russell 1000 Growth -4.81% -7.52% 8.92% 9.60% 4.96% 1.12% 7.10% 2.07% 4.25% -1.35% 6.14% 3.09% 2008 CalPERS % -2.96% -1.43% 4.49% 3.33% -6.79% -4.10% -1.29% % % -9.59% 0.53% Russell 1000 Growth -7.80% -1.99% -0.61% 5.25% 3.67% -7.20% -1.90% 1.08% % % -7.95% 1.81% 2007 CalPERS -0.65% -1.65% 1.14% 7.70% 7.18% -4.04% 1.63% Russell 1000 Growth -1.49% -1.55% 1.59% 4.19% 3.40% -3.68% -0.36% Important Information Past performance is no guarantee of future results. All returns are calculated and expressed in U.S. Dollars and reflect the reinvestment of dividends and other earnings. Characteristics, holdings and sector weighting information are from the CalPERS Supplemental Income Plans, are subject to change, and should not be considered as recommendations. Forward earnings projections are not predictors of stock price or investment performance, and do not represent past performance. There is no guarantee that the forward earnings projections will accurately predict the actual earnings experience of any of the companies involved, and no guarantee that owning securities of companies with relatively high price-to-earnings ratios will cause the portfolio to outperform its benchmark or index. Total fees for the CalPERS Supplemental Income Plans portfolio are 90 basis points. This information is intended only for the residents of the United States and should not be considered a solicitation or an offer to provide any Turner service in any jurisdiction where it would be unlawful to do so under the laws of that jurisdiction. CalPERS has a new frequent trading policy to secure the investment performance of the Supplemental Income 457 Plan funds for the benefit of all investing in the funds. As the funds are designed to achieve participants long-term retirement income goals, short-term trading will be limited. Multiple round trip trades into and out of a fund may be subject to these restrictions. For more information on the Supplemental Income Plans Excessive Short-term Trading restrictions, please see the Supplemental Income Plans Policy at: Turner Investments is a registered service mark of Turner Investment, L.P.

54 INTERNATIONAL/GLOBAL I THIRD QUARTER 2012 PYRAMIS SELECT INTERNATIONAL STRATEGY CalPERS 457 Plan OBJECTIVE The principal investment objective of the Pyramis Select International Strategy is to seek long-term growth of capital primarily through investments in foreign securities. The Strategy defines foreign securities as securities of companies, wherever organized, which, in the judgment of Pyramis, have their principal business activities outside of the United States. STRATEGY The Strategy may invest in all types of securities (which may be denominated in foreign currencies) including common stock, shares issued by closed-end investment companies, securities convertible into common stock, and depository receipts for these securities; the Strategy may also invest in any type or quality of debt securities. The Strategy does not place any emphasis on dividends or interest income except when income may have a favorable influence on the market value of the security. Although it is permitted to do so, the Strategy currently does not expect to invest a significant part of its assets in securities of U.S. companies. The Strategy expects to invest most of its assets in securities of companies located in developed countries in these general geographic areas: the Americas (other than the United States), the Far East and Pacific Basin, and Western Europe. PRINCIPAL RISKS Stock markets are volatile and can decline significantly in response to adverse issuer, political, regulatory, market, or economic developments. Foreign investments involve greater risk than U.S. investments, including political and economic risks and the risk of currency fluctuations. Unit price, yield, and return will vary. Performance as of 9/30/2012 Past performance is no guarantee of future results. Current performance may be higher or lower than performance stated. *Net performance is shown as of the CalPERS 457 Plan inception date of December 1, 2008 and reflects the deduction of an annual administrative and management fee of.94% from gross performance. Net returns are for illustrative purposes only and do not reflect actual plan expenses. Taxes have not been deducted. Top Ten Holdings as of 9/30/2012 Asset Allocation as of 9/30/2012 Sectors as of 9/30/2012 (% of Total Net Assets) CUMULATIVE RET. (%) 3 Mo. YTD 1 Year 3 Year 5 Year 10 Year Equities 94.97% Cash & Other 5.03% Total 100% AVERAGE ANNUAL RET. (%) Since Inception* Pyramis Select Int'l (Net) Pyramis Select Int'l (Gross) Calpers FTSE Dev World Ex NESTLE SA (REG) 2.73% VODAFONE GROUP PLC 1.97% SANOFI 1.85% BRITISH AMER TOBACCO PLC (UK) 1.55% ROYAL DUTCH SHELL PLC 1.42% NOVO-NORDISK AS CL B 1.41% HSBC HOLDINGS PLC (UK REG) 1.39% BP PLC 1.32% AUSTRALIA & NZ BANKING GRP 1.30% COMMONWEALTH BK OF AUSTRALIA 1.29% Financials Consumer Staples Industrials Consumer Discretionary Health Care Materials Energy Telecommunication Services Information Technology Utilities 5.14% 4.65% 3.85% 11.60% 11.23% 10.53% 9.08% 8.85% 8.16% 22.08% The Top Ten Holdings, Asset Allocation, and Sectors are based on a representative account within the Strategy, and are presented to illustrate examples of securities in which the Strategy may invest, and may not be representative of current or future investments. The figures presented are as of the date shown, do not include the Strategy s entire investment portfolio and may change at any time.

55 INTERNATIONAL/GLOBAL I THIRD QUARTER 2012 PYRAMIS SELECT INTERNATIONAL STRATEGY CalPERS 457 Plan Pool Information as of 9/30/07 Portfolio Manager (Tenure on Portfolio): César Hernández (7/1989) Who May Want To Invest (This field intentionally left blank) Someone who wants to complement the performance of U.S. investments with that of investments overseas, which can behave quite differently. Someone who is comfortable with the high investment risks and potential rewards involved in investing overseas as well as with the investment risk involved in any growth option, and who understands that market, political, economic, and foreign currency exchange conditions may cause this investment to fluctuate more than a domestic growth investment. The performance of international strategies depends upon currency values, political and regulatory environments, and overall economic factors in the countries in which they invest. Foreign markets, particularly emerging markets, can be more volatile than the U.S. market due to increased risks of adverse issuer, political, regulatory, market, or economic developments and can perform differently from the U.S. market. The risks are particularly significant for strategies that focus on a single country or region. The business unit of Pyramis Global Advisors (Pyramis) consists of: Pyramis Global Advisors Holdings Corp.; Pyramis Global Advisors Trust Company, a New Hampshire limited purpose trust company (PGATC); Fidelity Management Trust Company, a Massachusetts trust company (FMTC); Pyramis Global Advisors, LLC, a U.S. registered investment adviser (PGA LLC); Pyramis Canada ULC, an Ontario registered investment adviser; Pyramis Global Advisors (UK) Limited, a U.K. research provider; Pyramis Global Advisors (Hong Kong) Limited, a Hong Kong registered investment adviser (Pyramis-HK); and Fidelity Investments Canada ULC (FIC). Investment services are provided by PGATC, FMTC, PGA LLC, Pyramis Canada ULC and/or Pyramis-HK. Past performance is no guarantee of future results. Please contact your service provider for management and administrative fee information. An investment in this Strategy may be risky and may not be suitable for a participant s goals, objectives and risk tolerance. The value of investments in this Strategy will vary day to day in response to many factors such as adverse issuer, political, regulatory, market or economic developments. Participants should be aware that an investment s value may be volatile and any investment involves the risk that you may lose money. Investments in this Strategy are not guaranteed by the manager, the plan sponsor, or insured by the FDIC. All numbers are un-audited. The Strategy may use futures, options, swaps, and exchange traded funds to enable the pool to remain fully invested, while being able to respond to participant cash flows and to take advantage of changes in interest rates, and other factors affecting value. PGATC has claimed an exemption from registration under the Commodity Futures Trading Commission rules as a commodity pool operator, and is not subject to registration or regulation under the Commodity Exchange Act. All trademarks and service marks included herein belong to FMR LLC or an affiliate, except third-party trademarks and service marks, which belong to their respective owners. Pyramis does not provide legal or tax advice and we encourage you to consult your own lawyer, accountant or other advisor before making an investment.