AGE Edwards AG

Nest Egg Score Provides a Comprehensive Measure of Household Saving and Investing Behavior; Incorporates a Dozen Factors That Contribute to Americans' Ability to Build Their Nest Eggs Buoyed by rising home values and an improved stock market, Americans are doing a "fair" job of building their nest eggs, according to a new gauge of the nation's wealth-building performance unveiled today by the financial services firm A.G. Edwards (NYSE:AGE). Compiled from a dozen statistical factors, the quarterly A.G. Edwards Nest Egg Score is designed to be a comprehensive indicator of how well U.S. households are doing at building personal wealth. The Nest Egg Score goes beyond the traditional government savings measures to include other factors, such as changes in housing and investment values, participation in retirement plans, cost of living, and consumers' outlooks on their saving and investing prospects. All of these elements contribute to and affect Americans' ability to build wealth. The A.G. Edwards Nest Egg Score for the fourth quarter of 2005 was 648, giving it a strong "fair" rating based on the following scale: 450-549 - poor; 550-649 - fair; 650-749 - good; and 750-850 - excellent. The "fair" score reflects a number of economic crosscurrents during the period, such as the benefits of a rise in home values and the stock market, a favorable tax environment, a low unemployment rate and a high level of home ownership. These factors helped to offset a negative personal savings rate, rising inflation and a poor outlook on future saving prospects. "Given how important personal savings and investments are to the nation's economic future, we clearly needed a more comprehensive benchmark to assess the state of Americans' nest eggs," said Robert L. Bagby, chairman and chief executive officer of A.G. Edwards. "We developed the A.G. Edwards Nest Egg Score to give people a more thorough look at the nation's household financial picture." More About the Nest Egg Score The A.G. Edwards Nest Egg Score is a single, quarterly, three-digit numerical rating that represents a measure of the relative strength or weakness of Americans' wealth-building performance, similar to the scoring systems used to evaluate creditworthiness. A high Nest Egg Score indicates that households are having more success in building their nest eggs or that economic conditions are favorable for saving and investing. Conversely, a low score means that households are not taking advantage of opportunities to build their nest eggs or that economic conditions are not conducive to wealth accumulation. To create the Nest Egg Score, A.G. Edwards takes into account 12 statistical factors gathered from federal government data and proprietary research conducted for A.G. Edwards by Harris Interactive(R) that pertain to building wealth. Quarterly data for each factor is evaluated and scored on a scale of 450 to 850. The 12 individual scores are then combined and weighted to determine the Nest Egg Score. "The inaugural Nest Egg Score of 648 shows that Americans' nest eggs are getting a boost from real estate appreciation and stock and bond gains, but are being dragged down by poor savings behavior," said A.G. Edwards Financial Planning Specialist Sophie Beckmann, CFP(TM), CPA. "By taking just a few simple steps such as starting to save early in life, reducing debt and participating in employer-sponsored retirement plans, Americans can help ensure a more secure financial future." Other Findings The survey conducted by Harris Interactive for the A.G. Edwards Nest Egg Score also highlighted U.S. adults' lack of preparedness and the challenges they face in building their nest eggs. Among U.S. adults who have not yet retired but plan to, 58 percent said they do not know what size their nest egg will need to be to live comfortably in retirement. And of those nearing retirement (aged 55 or older), about two in five (41 percent) do not know how big their nest egg will need to be to support them when they retire. Possibly as a result, 69 percent of preretirement respondents who plan to retire are concerned about their ability to live comfortably in retirement, and among those already retired, nearly half - 49 percent - also expressed concern. The survey also found that when asked to identify the biggest obstacles to starting or building a nest egg, 55 percent of respondents, regardless of whether or not they are retired, said that the cost of covering day-to-day living expenses gets in their way. Other major obstacles noted by respondents included too little income (48 percent), too much debt (28 percent), the cost of raising children (24 percent) and medical expenses (21 percent). In addition, more than half of all U.S. adults (52 percent) listed reducing overall household expenses as a high priority in the next 90 days, followed by paying down credit card debt (47 percent) and paying more often with cash (45 percent). Only 35 percent of U.S. adults cited increasing their after-tax savings as a high near-term priority, and 17 percent said increasing their pretax savings in an employer-sponsored plan, such as a 401(k), was a priority. "Sensible spending and use of credit is important, but to build a nest egg, one of the strongest strategies may be to 'pay yourself first,'" Beckmann said. "If you divert even a few dollars from each paycheck before you pay your bills, you will be less likely to spend that money on items that don't fit in with your long-term plans." For a more detailed description of the A.G. Edwards Nest Egg Score and a list of the factors used to calculate it, visit www.nesteggscore.com. The A.G. Edwards Nest Egg Score complements the annual A.G. Edwards Nest Egg Index, which ranks the nation's states and cities on how well their residents are doing in building a nest egg based on a dozen similar statistical factors. Survey Methodology Harris Interactive(R) fielded the online survey on behalf of A.G. Edwards between March 14 and March 16, 2006, among a nationwide sample of 2,182 U.S. adults 18 years of age or older, of whom 1,013 are not retired but plan to retire, and 406 are retired. The data were weighted to be representative of the total U.S. adult population on the basis of region, age within gender, education, household income, race/ethnicity and propensity to be online. In theory, with a probability sample of this size, one can say with 95 percent certainty that the results for the overall sample of adults have a sampling error of plus or minus 3 percentage points. Sampling error for sub-sample results is higher and varies. This online sample is not a probability sample. Harris Interactive is responsible for fielding the online survey on behalf of A.G. Edwards. A.G. Edwards is responsible for the compilation of data from other sources and for computing the Nest Egg Score and the results reported. About A.G. Edwards & Sons, Inc. Drawn to the firm's client-first philosophy, individuals and businesses have turned to A.G. Edwards for sound advice and access to a wide array of investment products and services that can help them meet their financial goals and objectives. Founded in 1887, A.G. Edwards and its affiliates employ nearly 7,000 financial consultants in more than 700 offices nationwide and two European locations in London and Geneva. More information can be found on agedwards.com. How We Do Business A.G. Edwards generally acts as a broker-dealer but may act as an investment advisor on designated accounts, and the firm's obligations will vary with the role it plays. When working with clients, the firm generally acts as a broker-dealer unless specifically indicated in writing. To better understand the differences between brokerage and advisory services, please consult "Important Information About Your Relationship With A.G. Edwards" on agedwards.com/disclosures.