Secure Your Retirement Dreams. Take Advantage of New IRA Rules

April 2002

Whether you invest in a Traditional IRA, Roth IRA, or combination of both, new tax laws make today a better time than ever to plan for a secure retirement.

You can benefit from the following changes:

Higher annual contributions. Beginning in 2002, IRA contribution limitsincreased from $2,000 to $3,000—and will continue increasing in future years

New "catch-up" contributions. If you are age 50 or older, you can now make additional IRA "catch-up" contributions that start at $500 annually and eventually grow to $1,000.

Increased income limits. The income limits for Traditional IRAs will increase dramatically in coming years, making it easier to qualify for tax-deductible contributions.

The combination of higher annual limits and "catch-up" contributions now enables you to shelter far more assets in a tax-advantaged IRA.

Here's how the new contribution limits can help you save more for retirement. For 30 years, Steven invests the pre-2002 contribution limit ($2,000) in an IRA earning 10% annually, while Rebecca invests the new maximum contribution each year and earns the same annual return. By age 60, she has accumulated $600,000 more than Steven for her retirement dreams.²

Northern Funds you may want to consider

	Overall Morningstar RatingTM as of 02/28/023
Northern Income Equity Fund	among 4,991 domestic equity funds
Northern Select Equity Fund	among 4,991 domestic equity funds
Northern Small Cap Value Fund	among 4,991 domestic equity funds

4 reasons to trust Northern as your IRA partner

1. Experience investment management.  With more than $330 billion in assets under management, Northern Trust—investment manager of Northern Funds—has been helping individuals like you invest with confidence, live with distinction, and retire with endless possibilities.

    

2. No loads or annual fees.  With a Northern Funds IRA, you'll pay no sale loads or annual IRA maintenance fees, meaning 100% of your investment goes to work for you.⁴

    

3. A wide selection of investments.  Choose from 19 muutal funds ideal for retirement investing, including equity, fixed income, domestic, and international investments.

    

4. Attractive long-term performance.  It's important to know that your investment manager has a time-tested, disciplied investment approach that can deliver attractive long-term performance.

Want more Information?
Please call the Northern Funds Center at 800/595-9111.

¹After 2008, indexed for inflation

²This is a hypothetical example intended to illustrate the benefits of making the maximum annual contributions each year and the principle of tax-deferred compounding. It assumes contribution amounts are indexed at a 3% inflation rate starting in 2009 for Rebecca. The example assumes no legislation changes that increase or decrease annual contribution limits, and does not represent the past or future performance of any specific Northern Funds investment.

³ Small-company stocks are generally riskier than large-company stocks due to greater volatility and less liquidity. Morningstar proprietary ratings reflect risk-adjusted performance and are subject to change every month. Past performance is no guarantee of future results. Visit Funds and Performance for the most up-to-date performance information on Northern Funds. Star ratings are based on total return in excess of 90-day U.S. Treasury bill returns with appropriate fee adjustments and a risk factor that reflects fund performance below 90-day Treasury bill returns. The overall rating is a weighted average of the 3-, 5-, and 10-year (if applicable) returns. 5 stars = top 10% of funds in an asset category; 4 stars = next 22.5% of funds; and 3 stars = next 35%. A fund must be in existence three years to be rated. 3-year ratings: Each of the funds in the table received 4 stars, except Select Equity Fund, which received 3 stars. 5-year ratings: Each fund in the table received 4 stars. For the 3-year period, the number of funds in each category is the same as the overall ratings. For the 5-year period, the number of funds in the domestic equity category was 3,257. ©2002 Morningstar, Inc. All Rights Reserved. Morningstar and/or its content providers are the proprietors of this information; do not permit its unauthorized copying or distribution; do not warrant it to be accurate, complete, or timely; and are not responsible for damages or losses arising from it use.

⁴ Although Northern Funds are no load, other fees and expenses do apply as described in the prospectus.