TrustTalk. Given the ups and downs of the market, your. Keeping Your Retirement. Savings on Track. Summer concerning your retirement savings

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1 TrustTalk Summer 2009 Current news concerning your retirement savings Keeping Your Retirement Savings on Track Given the ups and downs of the market, your retirement savings may have lost some ground. But that doesn t mean you should panic. While you may need to put forth some extra effort, you can stay on track. Here are three steps you can take to protect your retirement savings. Step 1: Review Your Investments As painful as it might be, revisit your goals and strategies and then figure out how you can get your retirement savings back on track. This step isn t fun, but it is necessary. Open up your investment statements and take a long, hard look. Check your retirement savings balance on Your Benefits Resources (YBR) at halliburtonbenefits under Your Account Summary on the home page. Take a good look at where your money is invested today. Is your portfolio over-weighted in any areas, given recent losses? Where have you been making gains? Stay on track by rebalancing your portfolio; see the article A Little Rebalancing Can Go a Long Way on page 6. Step 2: Be Careful of Taking Additional Risks to Catch Up Depending on your risk tolerance and how close you are to retirement you may be comfortable with more risk (or less) than the investor sitting next to you. But even taking into account personal investment strategies and risk tolerances, don t bite off more than you can chew when it comes to playing catch-up. Risky investments can keep you up at night or even worse, cause your retirement savings to lose value. Step 3: Continue Investing in the Halliburton Plan Whatever you do, continue to participate in the Plan. You may be thinking about cutting back your contributions because you re worried about your investments. Don t. You are giving up tax benefits and you may miss out on some or all of the company match. Not taking full advantage of the company match is like leaving free money Inside This Issue behind, which is never a wise investment strategy! You can contribute any amount you wish, from 1% up to 50% of your salary, to the IRS limit of $16,500 (or $22,000 if you are age 50 or over), for To maximize the company match, you need to contribute at least 6% of your salary. Automatic payroll deductions make it easy to save. Keeping Your Retirement Savings on Track 1 The Life of Your Halliburton Plan 2 Myth or Fact: Investing Rules of Thumb 4 A Little Rebalancing Can Go a Long Way 6 Reminder: Halliburton Stock Fund Closing 7 Market Update 8 Retiree Corner 9 Fund Performance Update 10

2 The Life of Your Halliburton Plan No matter how old you were when you began contributing, your Halliburton Plan is designed to help you reach your retirement goals. As a vital part of your retirement savings, you need to understand the stages of your account and what you need to think about during its development. Initial Stage You can start making contributions with your first paycheck. Your contributions are deducted on a before-tax basis every pay period. This means your contributions are taken from your income before taxes are applied. This benefits you because you do not pay income taxes on your contributions. On top of your contribution, Halliburton makes a matching contribution. Each pay period, Halliburton will match every dollar you contribute up to the first 4% of your pay and will match an additional 50 eligible cents on every dollar contributed from 4% to 6% of your pay. Further, if eligible, Halliburton provides additional contributions to your Plan account equal to 4% of your annual eligible pay, even if you don t contribute anything to the Plan, as long as you are employed on the last day of the year (or terminate employment due to retirement, death or disability, as defined by the Plan). During this initial stage is when you should determine your portfolio mix, taking into account your investment strategy, retirement goals and risk tolerance. Accumulation Stage Initially, your retirement savings balance may seem small; however, as you continue to contribute, it begins to grow. It is up to you to choose the investment fund(s) to invest your money. Go to Your Benefits Resources (YBR) at to see a list of all your investment options and the associated risk and return levels. During this accumulation stage, you should continue to make adjustments to your portfolio. Take the time to rebalance your account regularly (see the article A Little Rebalancing Can Go a Long Way on page 6), to make sure it s on track. Retirement creeps up on you faster than you realize and proper financial planning early on will be a key factor to the lifestyle you will be able to lead during retirement. Staying the Course Now that your balance has grown, you are more apt to notice the dramatic effect market fluctuations have on your account balance. You may also notice that the performance of the funds you are invested in has more impact on your balance than your contributions. However, you should not stop your contributions you have been doing a good job of saving to reach this point and need to keep it up. Continue to assess your risk tolerance and tweak your asset allocation accordingly. Trust Talk is published quarterly by the Halliburton Trust Investments Department. It is designed to provide Halliburton Retirement and Savings Plan and the Halliburton Savings Plan (the Plan ) participants with conventional wisdom on saving and investing. The information included in Trust Talk is not intended as financial advice. You may want to consult a financial advisor before making any investment decisions. Suggestions or comments about Trust Talk can be sent to Sharon Parkes or Maria Bacaling, Trust Investments Department, Bellaire Blvd., Houston, Texas

3 Once your retirement savings has grown into a sizeable amount, it may be tempting to tap into the balance. You can take loans from your retirement savings in accordance with Plan rules while you are an active employee or on approved leave of absence. You have to repay the amount of the loan, plus interest, to your account through payroll deduction. If you leave the company, you must repay the loan, or the unpaid balance will be considered a taxable distribution and may be subject to Federal, state and local income taxes, as well as early with drawal penalties if you are under age 55 when you terminate employment. If you are considering a loan, it s wise to consult with a financial advisor first. Did You Know? Halliburton Plan assets are invested in the Master Trust. State Street Bank acts as trustee and custodian for the Master Trust. Most of the investment options are structured using institutionally managed accounts that invest in stocks, bonds and other investments. Your account is administered by Hewitt Associates, who acts on your behalf to direct your contributions to your selected investment options. Retirement You ve made it! You are ready to retire and looking forward to the pleasures of leisure. When you retire, you still have to decide when you want your retirement savings distributed. You can leave your investments in the Halliburton Plan, elect a direct rollover into an IRA (or other eligible retirement plan), or receive your account in a lump-sum distribution. If you terminate employment due to retirement (as defined by the Plan), you may also request withdrawals from your account when needs arise. While in the Plan, your money continues to grow tax deferred, and your existing investments remain intact. If you decide to roll over and reinvest the assets from your account into an IRA, your money also continues to grow tax deferred. Additional investment options become available and you gain the flexibility to control and consolidate other retirement accounts. Always weigh fees charged by the investments you hold outside of the Plan. These are likely to be higher, so do your homework and consult with your financial advisor. Whether you leave your account intact or roll it over to an IRA, you have to take the minimum required distributions when you reach age 70½. Whichever option you select, you are prepared for your Golden Years! 3

4 Myth or Fact: Investing Rules of Thumb When it comes to investing, sometimes it is difficult to decide what is myth or fact, especially when it comes to rules of thumb. A rule of thumb aims to break down a complex financial choice into a quick sound-bite, such as always pay off debt with the highest interest rate first. While rules of thumb often have basis in sound investing advice, depending on your individual situation, some may be more helpful than others. They can offer guidelines that may be outdated or impractical. Let s evaluate a few rules of thumb are they myth or fact? Fact: Spread Your Risk Over Multiple Assets You have heard it time and again don t put all of your eggs in one basket. And for a good reason it s a sound rule of thumb to follow. Focused investments can generate higher returns (such as placing the majority of your assets in the hot investment of the year or the decade), but it takes a lot of work and extra risk. When you spread your investments across a number of different asset classes, you also spread out your risk. One tactic to consider is dollar-cost averaging. Rather than moving a big chunk of your money all at once, you spread out your buying and selling over a longer period. That means you are less likely to sell when the market is at its lowest and buy when it s at its highest. Myth: Have an Emergency Fund of Three Months of Expenses Everyone should have an emergency fund on hand this is a fact. The standard rule of thumb is that you should have at least three months of expenses that are safe and accessible (such as in a high-yield savings account). Three months is a wise minimum to have on hand, but may not be enough, depending on your current lifestyle, outstanding debts (like a mortgage, car payments and student loan payments) and your spouse s income. Also take into consideration your current career and how long it may take to find a similar job. You may need more than the three-month guideline. Take some time to sit down and do the math. Calculate honestly your monthly expenses, including luxury items, such as fancy coffees and dinners out. Now, will three months of expenses be enough to keep you comfortable, or do you need more? Once you decide how much you need, start building up that emergency fund. One of the best ways to save is via direct deposit. Have a portion of your paycheck direct deposited into your savings account. It s always easier to save when it s automatic. Fact: Set Aside 10% of Your Gross Income in Savings This is a rule of thumb everyone should follow or exceed. You should be setting aside at least 10% of your gross income each month. Think of 10% as more of a starting point than as an end goal, because what you really want to do is get into the habit of saving a portion of your gross income every month, without fail. If you re just starting out and can t yet afford saving 10% of your income, get as close to 10% as you possibly can. When you get a raise or a promotion, save more until you hit 10%, and then keep going. Remember that saving 10% of your gross income doesn t guarantee you a secure retirement. You still have to take into account the returns your money can earn, how long you have to build a nest egg and the lifestyle you want to maintain while saving and during retirement. 4

5 Myth: The Percentage of Stock in Your Retirement Portfolio Should Equal 100 Minus Your Age Why could this be considered a myth? Because for many, this guideline is too conservative, especially considering current life expectancies and inflation rates. If you retire at 65 and live to be 85, you need to make sure you have enough savings to sustain you through those 20 years of retirement. Kiplinger experts suggest considering the following scenario. A couple retires at age 65. With only 35% of their portfolio in stocks, their assets could have a tough time keeping up with inflation. At least 50% in stocks at that age would be better. For a more aggressive guideline, modify the rule to subtract your age from 110, and then multiply that figure by Using that formula, the 65-year-old couple would keep 56% of their portfolio in stocks. This is a more realistic balance for a retired couple in their mid- 60s. Remember that your ideal investment mix is based on your individual goals and will vary depending on your age and risk tolerance. Fact: You Need at Least 80% of Your Working Income to Retire Comfortably You do likely need at least 80% of your income to retire comfortably and experts caution that many need more up to over 100%. How much money you will need during retirement depends on your life expectancy (and that of your spouse), your health, the market and your spending habits. Living a jet-set lifestyle requires a lot more money than staying home and tending to the garden. If you don t save enough, you may be giving up activities that will make your retirement years more enjoyable. Work with a financial advisor to determine a realistic percentage for you be it 80%, 90% or 115% of your current income. Setting your goal now means that when you retire you can avoid drawing down too much of your assets too early, and then be in the position where you outlive your assets. Myth: Never Buy a House that Costs 2.5 Times More than Your Annual Income The real fact is that in many major cities, finding a suitable house that costs less than 2.5 times your annual income may be difficult. If you re in this situation, rather than focusing on the price, take a look at the monthly house payment. If you live in a part of the country with high home prices, a better rule of thumb is to make sure your monthly mortgage obligation and don t forget that this includes the principal, interest, taxes and insurance doesn't exceed 30% of your monthly gross income. Your house payment is going to be affected by how much of a down payment you have, and the terms of your home loan. Fact: The Rule of Thumb You Should Always Obey Ultimately, there is only one solid rule of thumb you can count on year after year, no matter your financial situation and goals: there is no onesize-fits-all answer to most financial decisions. You must take the time to consider your personal investment goals and priorities, and create your own personal rules that will help you reach them. Source: Kiplinger.com 5

6 A Little Rebalancing Can Go a Long Way It should be no surprise to you that the investments in your retirement savings portfolio perform according to the market. But did you know that as time goes on, your asset allocation can move away from your original target? Over time, your portfolio can become too risky or too conservative if left unchecked. You can get your retirement savings back in line by rebalancing. The goal of rebalancing is to make adjustments to the current asset allocation to get it back in line with your planned asset allocation based on your risk tolerance, time horizon and financial goals. Or think of it this way rebalancing your portfolio means returning it to the mix of stocks, bonds and cash you intended before your retirement savings mix shifted due to market fluctuations. Why Rebalance? Once you ve moved away from your ideal asset allocation, you may be exposed to more or less risk than is acceptable to you. It is tempting to leave your portfolio alone; however, the purpose of establishing an allocation is to achieve returns with an acceptable level of risk. Doing nothing violates that premise and can expose you to unacceptable levels of risk. Financial experts suggest that when your assets drift 5% or more away from your allocation, you should rebalance. The drifting of your assets can occur naturally over time or following an abrupt rise or decline in the market. When to Rebalance If you have a set rebalancing schedule, you can avoid emotional decisions, which can be easy to make when the markets are volatile. A regular rebalancing plan helps instill discipline in your investing process. If you don t want to rebalance often, consider investing in the Aggressive, Moderate or Conservative Premixed Portfolio. These investment options are diversified and are automatically rebalanced for you. However, this doesn t mean you can turn a blind eye you will still need to rebalance if your situation changes and as you near retirement. Growth Growth and Income Bon B 6

7 ds What is the price of doing nothing? If you are risk adverse, a portfolio that becomes more heavily weighted in one asset class will keep you up at night. If the market takes a dip in a particular asset class, you could take a hard hit. On the other hand, if you are playing it too safe, you may not have enough saved when you are ready to retire. alanced Glossary Term: Rebalancing is adjusting your portfolio asset allocation to keep it in sync with your risk level. YBR Makes it Easy to Rebalance Portfolio rebalancing is an important part of sticking to your game plan. You can rebalance your portfolio once a quarter, using the YBR rebalancing feature. To auto rebalance on YBR, go to the YBR Web site at com/halliburtonbenefits/. From the home page select Your Next Rebalance Date, which is on the left side of the screen. From here you can choose your rebalancing date and it will automatically be done for you each quarter. It s as easy as that! If You Already Rebalance If you are already signed up for rebalancing, are you making sure your target allocation is still appropriate? Do you still have the same investment goals as when you started? Over time your allocation might need to change. Do you have a lower or higher tolerance for risk? Just because you picked a certain allocation in the past doesn't mean it suits you now. So even if you are already rebalancing, don t forget to adjust your asset allocation too, as needed. Reminder: Halliburton Stock Fund Closing On January 1, 2007, the Halliburton Stock Fund (HSF) was closed and participants were asked to transition their funds out of HSF. The HSF will be closing in December 2009, the end of the sunset period, so you have less than six months to move your funds into another investment option. Any balance in the HSF at the end of the sunset period will be transferred to an investment option chosen by the company. To move your balance, you can go to the YBR Web site at halliburtonbenefits/ and choose the Transfer Money option on the Manage Investments portion of the Retirement and Savings page. The YBR Web site has information on all of your fund choices and makes it easy to make the transfer. Or, you can call the Benefits Center at (800) to make transfers out of the HSF to a fund of your choice. If you are 59½ or older or if you are no longer an active Halliburton employee you have a few other options. You can take a full withdrawal of your vested account balance. Also, you can roll over your account balance to another qualified retirement plan or IRA and continue to defer taxes. Finally, if you d prefer to hold onto your HSF shares, you can request that certificates be issued for the shares in your account. Talk to your financial planner about the right option for you. Don t delay transferring your HSF funds into another investment option. The December 2009 deadline will be here before you know it. 7

8 Newsstand Market Update Signs of Stabilization on the Horizon The story of the second quarter of 2009 was one of relief that the economic outlook had stopped deteriorating. The market s rally during the second quarter was a result of improved economic indicators and strong government stimulus programs. Economic signs began to emerge that seemed less negative not that the economy was improving, but that the pace of the recession may be slowing. The unemployment rate rose to almost 10% during the quarter, even as overall job losses decreased. The housing market started to show signs of stabilization and decreases in consumer spending began to stabilize. As it became clear that conditions were not likely to get worse, most markets rallied strongly, removing the doomsday pricing that had crept into certain markets. Those markets that would have taken the most significant hit from a global depression, such as financial stocks, emerging markets and high-yield bonds, rallied the strongest. Despite signals of stabilization, the global economy remains a long way from recovering to its previous levels. Individuals and business are and will continue to be cautious. Investors are hesitant to take on additional risk or spend money when they are unsure of their future income and revenue. The U.S. equity market posted strong returns for the quarter with the S&P 500 Index return of almost 16%. This strong performance resulted in a positive 2009 yearto-date return of over 3% but the trailing one-year return was still -26%. For the quarter, U.S. small cap stocks outperformed large cap stocks by a healthy margin, but there was little difference between growth and value styles. The financial sector had a strong rally and returned more than 35% for the quarter, making it the strongest sector of the market followed by industrials and consumer discretionary. Bank of America was the strongest performer in the S&P 500 Index with a 93% return for the quarter. International stock markets followed the same upward trends as the U.S. market. The MSCI EAFE Index, which includes the stock exchanges of developed nations, was up more than 25% for the quarter and 8% year-to-date. Singapore was the top-performing country in the index with a 46% return. The MSCI Emerging Markets Index, which includes stocks traded in emerging markets, was up almost 35% for the quarter and 36% year-to-date. India was the top-performing country for the quarter returning 60%. Relative to other major currencies, the U.S. dollar declined 7.8% during the quarter, benefiting U.S. investors in overseas markets. The Australian dollar and British pound posted double digit gains against the U.S. dollar during the second quarter. The U.S. fixed-income market continued to see reversals during the quarter as investors sought out higher yielding securities. The U.S. Treasury market declined as the high-yield corporate bond market became the top performing sector of the market, returning 23% for the quarter. The commercial mortgagebacked sector and the investment-grade corporate sectors of the market also saw double digit rebounds during the quarter after struggling for much of One of the driving factors of the volatility and underperformance of the Treasury market is the surge of new Treasury offerings. The estimated Treasury supply by the end of September 2009, is expected to be in excess of $3 trillion, which could mean future devaluation of the U.S. dollar. 8

9 Newsstand Retiree Corner Consider Phased Retirement The closer you get to retirement, the more exciting the prospect becomes. Years of leisure time stretch out in front of you, with endless possibilities for relaxation, travel, hobbies and family visits. However, today s retirement horizon is a lot different than it was 20, or even 10 years ago. With increased longevity and higher standards of living, the perceived retirement age is shifting. While it is ideal to retire on time, it may not be the best idea or even possible for some of us. Saving more now is a good way to make sure you can retire when you want to; another option to consider is phased retirement. Phased retirement simply means working for a few more years past your expected original retirement date or reducing your hours and working part-time. While this may not be what you planned, it does have its benefits. As more Americans are working longer either because of financial necessity or just because they want to explore a new career or interest a set retirement date is becoming a thing of the past. This has impacted the nature of retirement; many people do not want to suddenly stop working and begin full-time retirement immediately. Instead, many workers would rather ease into retirement, transitioning out of the workforce with a reduced workload or a different, part-time career. Some retirees are setting up their own shops and others are changing jobs or even careers. As you prepare and plan for retirement, think of it as a choice: you can work longer if you want and/or need to, but you can do it on your own terms. Working past normal retirement age boosts your retirement income in two ways. First, if you continue working at Halliburton, you can contribute to your retirement savings longer, adding to your nest egg. Second, every extra year of work means one less year you have to live off your savings. When you do retire, you can take bigger retirement withdrawals because you re spreading your savings over fewer years. Not only can delaying retirement bring you into a new career, you can also delay dipping into retirement savings. A recent study by T. Rowe Price found that by working an additional six years, you can boost your retirement account withdrawals by 28% and that assumes you don t contribute anything else to your savings during those six years. Those extra withdrawals can go a long way when you re planning vacations after you finally do retire. Fast Facts When Will You Retire? As the baby boomers approach retirement, researchers have kept busy conducting polls and surveys, asking retirees and soon-to-be retirees their thoughts on retirement age. Here are some findings: According to a 2008 analysis of Social Security data, from 2000 to 2005, the average age at retirement was 61.6 for men and 60.5 for women. The estimated average age at retirement for 2005 to 2010, based on projected data, indicates no change for men, but a change for women from age 60.5 to age A 2008 Pew Research Center survey found that the average worker expects to retire at age 61, while the average retiree actually retired at According to a 2008 report on the impact of a slowing economy by AARP, 24% of workers aged 45 to 54 expected to postpone retirement, versus 19% of workers aged 55 to 64 and 5% of workers over 65. The 2009 Retirement Confidence Survey states 28% of workers say the age at which they expect to retire has changed in the past year. Eighty-nine percent say that they have postponed retirement with the intention of increasing their financial security. Sixty-nine percent of the older workers responding to a recent 2009 Conference Board Survey who said that they plan to continue to work for at least five years reported that their financial needs strongly affect their decisions about continuing to work. 9

10 Fund Performance Update Halliburton Company Employee Benefit Master Trust for the period ended June 30, 2009 General Investment Policy Index Composite Balanced Aggressive Moderate Conservative U.S. stocks 65.0% 70.0% 43.0% 26.0% Russell 3000 Index Non-U.S. stocks 22.5% 14.0% 9.0% MSCI EAFE Index Emerging market stocks 7.5% 5.0% 3.0% MSCI Emerging Market Free Index U.S. broad market bonds 35.0% 33.0% 20.0% Barclays U.S. Aggregate Bond Index U.S. high yield bonds 5.0% 4.0% Merrill Lynch High Yield Bond Index imoneynet Money Market Fund Average 38.0% Performance 10 Years* 5 Years* 3 Years* 1 Year 2nd Quarter Premixed Portfolios Stable Value Premixed Portfolio 5.5% 5.1% 5.1% 4.5% 1.0% imoneynet Money Market Fund Average 2.9% 2.9% 3.1% 0.9% 0.0% Conservative Premixed Portfolio (CPP) 4.0% 3.7% 1.3% -7.6% 10.0% CPP Index Composite 2.8% 2.8% 0.2% -9.1% 8.5% Moderate Premixed Portfolio (MPP) 3.2% 3.0% -1.7% -16.7% 16.3% MPP Index Composite 2.5% 2.4% -2.1% -15.8% 14.0% Aggressive Premixed Portfolio (APP) 0.8% 1.3% -6.5% -28.5% 20.7% APP Index Composite 0.0% 0.4% -7.3% -27.6% 20.1% Single Focus Funds Bond Index Fund 5.8% 5.0% 6.4% 6.1% 1.8% Lehman Aggregate Bond Index 6.0% 5.0% 6.4% 6.0% 1.8% Balanced Fund 4.2% 3.3% -0.6% -13.6% 13.1% Balanced Fund Index Composite 1.4% 0.8% -3.0% -15.7% 11.5% Large Cap Value Equity Fund 0.3% -1.4% -10.0% -28.6% 16.7% Russell 1000 Value Index -0.1% -2.1% -11.1% -29.0% 16.7% S&P 500 Index Fund -2.3% -2.3% -8.2% -26.1% 15.8% S&P 500 Index -2.2% -2.2% -8.2% -26.2% 15.9% Large Cap Growth Equity Fund -4.0% -2.2% -7.4% -31.1% 15.6% Russell 1000 Growth Index -4.2% -1.8% -5.5% -24.5% 16.3% Non-U.S. Equity Fund 3.4% 5.7% -4.4% -32.3% 26.2% MSCI ACWI ex U.S. Index ** 2.1% 4.2% -5.8% -30.9% 27.6% Mid Cap Equity Index Fund 4.6% 0.3% -7.6% -28.0% 18.6% S&P MidCap 400 Index 4.6% 0.4% -7.5% -28.0% 18.7% Small Cap Equity Fund 2.4% -2.5% -9.8% -19.3% 24.5% Russell 2000 Index 2.4% -1.7% -9.9% -25.0% 20.7% Halliburton Stock Fund 0.2% 7.1% -16.8% -60.4% 33.4% * Annualized. ** Returns prior to January 1, 2005, include MSCI EAFE Index, the previous fund benchmark. 10

11 Performance Notes The Mid Cap Equity Index Fund was not in existence until January 1, The Conservative Premixed Portfolio was introduced January 1, In order to provide comparative historical returns, the managers return of their Halliburton Trust account is shown. If the Halliburton Trust had not employed a manager for the periods presented, the firm s composite account return was added. All rates of return are net of expenses. Your rate of return may vary depending on your account activity (e.g., contributions, withdrawals, transfers, loans, etc.) and your plan s administration expenses. To help you better understand how your funds are performing, the funds are compared with composite returns or with appropriate indexes. The composites are created by blending together index returns in proportion to the investment policy of each fund (see chart). Because there are no indices comparable to the Stable Value Premixed Portfolio s investments, we compare its return with money market funds tracked by imoneynet. Performance data represents past performance; no assurance can be made regarding future results. For account information, go to Your Benefits Resources at or call the Benefits Center automated telephone system at (800) Index Definitions* imoneynet Money Market Fund Average is an index of over 700 money market funds. Barclays U.S. Aggregate Bond Index is an index of U.S. bonds, including government, corporate, mortgage-backed and asset-backed securities. Merrill Lynch High Yield Bond Index is an index of U.S. corporate bonds that are rated less than investment grade but are not in default. MSCI (Morgan Stanley Capital International) All Country World Index (ACWI) ex. U.S. is an index of non-u.s. stock securities listed on the stock exchanges of developed and emerging markets. MSCI EAFE Index is an index of non-u.s. equity securities listed on the stock exchanges of Europe, Australasia and the Far East. MSCI Emerging Market Free Index is an index of non-u.s. stocks traded in emerging markets. Russell 1000 Growth Index focuses on the 1,000 largest companies in the Russell 3000 Index that have lower dividend yields and above-average growth rates. Russell 1000 Value Index focuses on the 1,000 largest companies in the Russell 3000 Index that have higher dividend yields and below-average growth rates. Russell 2000 Index measures the performance of the 2,000 smallest companies in the Russell 3000 Index. Russell 3000 Index measures the performance of the 3,000 largest U.S. companies based on total market capitalization. It is used as a general measure of U.S. stock market performance. Standard & Poor s 500 Index is a popular standard for measuring large-cap U.S. stock market performance. The index includes a representative sample of 500 leading companies in prominent industries. Standard & Poor s MidCap 400 Index is a popular standard for measuring mid-cap U.S. stock market performance. The index includes a representative sample of 400 leading companies in prominent industries with a market capitalization of approximately $1 $4 billion. * You cannot invest in any of these indices. Fund holdings will differ from index holdings. 11

12 Summer 2009TrustTalk Bellaire Blvd. Houston, TX PRSRT STD US POSTAGE PAID DALLAS, TX PERMIT 2650 We encourage you to call the Trust Investments Department at (281) with any suggestions or comments regarding Trust Talk. You can expect the next issue in November What's Inside Keep your Retirement Savings on track. Find out if an investment rule is myth or fact. Rebalance for enhanced investment performance. When will you retire? See the Fast Facts inside.