There’s probably no bear market better known than the Great Depression, though the current bear market which began in 2008 is a close runner up. Recently the market has given way to a partial recovery, but it could take a while for your

investment portfolio to recoup from the devastating losses.

The recent bear market is illustrated by the chart above, which shows the Dow Jones Industrial Average (DJIA) at a peak of 14,078 in October 2007, followed by a drop in value that reached a low of 6,547 in March 2009 and rebounded to 10,428 in December 2009.

While there are a number of ways to define “bear market,” one generally accepted definition is a stock price decline of 20% or more for an extended period (as measured by a stock market index such as the Dow or S&P 500). The chart above demonstrates this point as well.

The causes of a bear market vary, but most financial analysts agree that economic cycles and investor sentiment play a role. According to an article by streetauthority.com, a weak economy — indicated by high unemployment, low disposable income and declining business profits — ushers in a bear market. The article goes on to say that declining

TrustTalk Current news concerning your Retirement Plan

Winter 2010

Lessons Learned From This And Other Bear Markets

investor confidence can be even more powerful than economic indicators as investors feel pressured to sell because of panic and fear.

According to a study published in the Journal of Financial Planning, using the S&P 500 Index, there have been 23 separate bear and bull markets dating back to 1926. An average bear market lasts 11 months, while the average bull market lasts 32 months. Some of the most notable bear markets include:

Great Depression (1937) – lasted 13 monthsOil embargo (1974) – lasted 24 monthsDot-Com bubble (2002) – lasted 25 months

As investors continue to debate the strength of the current equity market recovery, data for the last twelve bear markets indicates that, on average, it took three to four years for the market to reach its previous highs following a bear market.

Diversify Your Holdings

To ensure you are well positioned to take advantage of a market recovery, financial analysts agree you’re better off creating a diversified mix of stocks and bonds within your 401(k) and, aside from periodic rebalancing, largely sticking

Source: Big Charts.com

10/2007 3/2009 12/2009

Recent Bear Market Dow Jones Industrial

Average (DJIA)

Trust Talk is published quarterly by the Halliburton Trust Investments Department. It is designed to provide members of the Halliburton Savings Plan and Halliburton Retirement and Savings Plan (referred to collectively as the retirement plan) 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, 10200 Bellaire Blvd., Houston, Texas 77072.

with it regardless of what the market is doing. This way, the equity portion of your portfolio will allow you to participate in the long-term growth the stock market has to offer, while your bond stake can provide a cushion during downturns.

The key to this strategy is setting an appropriate mix. Generally, that means a higher percentage of stocks when you’re younger so you have more time to rebound from setbacks, and moving more of your assets to bonds and cash as you near retirement since you have to be more careful about holding onto your capital. But don’t forget to rebalance your portfolio as needed.

Halliburton’s retirement plan investment options offer Premixed Portfolios that provide a simple alternative to selecting and managing your own asset allocation. The Premixed Portfolios, ranging from aggressive to very conservative, offer diverse investments based on your risk tolerance and investment goals. There are also a variety of Single Focus funds available for investors who like to build and diversify their own portfolio. Visit Your Benefit Resources™ at http://resources.hewitt.com/

halliburtonbenefits or refer to the Investment Highlights brochure for more information about your investment fund options.

Increase Your Contributions

There is another method you can use to get your portfolio back on track after a bear market — contribute more. If your budget permits, increase your contributions to 10% or more of your eligible pay up to the $16,500 annual limit ($22,000 limit for age 50 and over). By investing a few extra dollars now, you can take advantage of market upswings and compounding growth, helping to increase the growth of your retirement savings.

Build Your Cash Reserves

In addition to your retirement savings, make sure you have enough personal savings to last through another market downturn. As mentioned above, a bear market can last as long as two years. Financial advisors suggest you have cash in the bank to cover expenses if forced to ride out another downturn.

DiD

Yo

u K

no

w?

Visit Your Benefit Resources™ at http://resources.hewitt.com/halliburtonbenefits to make adjustments to your portfolio.

2

The beginning of a new year is when many families review their financial plans, investments and insurance coverage and make adjustments and tweaks. It’s a good idea to include estate planning with these financial “house cleaning” activities.

One key asset in any estate plan includes retirement savings. Since you have a Halliburton retirement plan account, you should understand how your beneficiaries may receive payment from the plan in the event of your death. Your designated beneficiary will only receive a distribution from the plan if you have a vested account balance in the plan.

Your designated beneficiary may elect from the following distribution options:

• Lump-sum distribution. Your beneficiary may elect a lump sum payment of your remaining account balance. Any account balance of $1,000 or less will automatically be paid in a lump sum, unless you roll over the balance to another qualified plan. The Company is required to withhold federal income taxes equal to 20% of the taxable portion of the payment.

• Roll over to another qualified plan or IRA. Your surviving spouse will have the same direct rollover rights as a participant (e.g., direct rollover to another eligible employer’s plan or an IRA). A beneficiary other than your spouse will only be allowed a direct rollover into a non-spouse beneficiary IRA.

• Periodic installment payments. Your beneficiary may elect may elect to receive distributions in the form of periodic installment payments. The Company is required to comply with rules set forth under the Internal Revenue Code (IRC) and its regulations regarding payment term. Any balance remaining after your beneficiary’s death will be paid in one lump-sum payment to his or her designated beneficiary.

• Leave the account in the plan. After you die, your beneficiary can defer distribution for a certain period of time. Again, the Company is required to comply with IRC and its regulations regarding the length of time your beneficiary may defer payments from the plan. As with periodic installments, any balance remaining after your beneficiary’s death will be paid in one lump-sum payment to his or her designated beneficiary.

How Survivor Benefits Are Distributed

DiD

Yo

u K

no

w?

If you are married, your spouse is automatically your primary beneficiary. Your spouse must consent in writing if you want to name a beneficiary other than or in addition to your spouse. For more information or to designate a beneficiary, visit Your Benefit Resources™ at http://resources.hewitt.com/halliburtonbenefits or call the number above.

For married participants who had an account balance in the plan prior to June 1, 1998, and whose designated beneficiary is a surviving spouse, your surviving spouse has an additional distribution option. Unless they elect otherwise (as described above), your vested account balance will be used to purchase a commercial annuity that will pay benefits over one of the following periods:

» A fixed period with payments to continue to your surviving spouse’s beneficiary if your spouse dies before the end of the period; or

» Your surviving spouse’s lifetime.

For more details, call the Halliburton Benefits Center at (800) 535-8130. If outside the U.S., call (866) 373-3422 (toll-free using the AT&T access code) or (847) 883-0702 (not a toll free number).

3

The 2009 tax season is already underway, and it’s a good reminder to start thinking about how to maximize your 2010 tax savings. Did you know that contributing to the Halliburton retirement plan can help? As a participant in the retirement

plan, your contributions to your retirement account are made on a before-tax basis.

The Benefit of Before-Tax Contributions

Your contributions are deducted from your paycheck before taxes are withheld, and therefore are not subject to federal and state income tax withholding, though they are subject to social security, Medicare and federal unemployment tax. That reduces the amount of taxes you pay and thereby increases your spendable pay.

Any earnings on your contributions along with the Company contributions grow tax deferred. You pay taxes on the money when you withdraw it, presumably at retirement when your tax bracket may be lower.

Are You Maximizing Your Tax Savings?

As you can see from the example below, with a 6% employee contribution rate, Ron saves $4,950 with before-tax contributions to his retirement plan account. However, his pay is only reduced by $3,960. That means he’s saving $990 by making before-tax contributions to his retirement savings. Plus, Ron receives the full Company match of 5%. Likewise, if Ron were to put 6% of his salary in a traditional savings account, his spendable pay is reduced by $990.

Increase Your Retirement Plan Contribution Rate

As you increase your contribution rate in the plan, you need to be careful not to reach the IRS annual limit of $16,500 too soon in the year. The plan allows you to contribute up to 50% of your pay, however, in order to maximize the Company match and not exceed the IRS limit requires some planning. This is because the Company match is contributed each pay period. If you do not make any contributions during a payroll cycle, you will not receive

Following is an example of how you save money on your tax bill.

Example: Ron, an unmarried employee, earns $82,500 a year and is paid monthlyLet’s see how Ron can save with before-tax contributions to his retirement plan account.

Tax Effect with 6% Before-Tax Contribution to

Retirement Account

Tax Effect with 6% After-Tax Contribution to

Retirement AccountEligible Annual Pay $82,500 $82,500

Total Annual Before-Tax Contribution -$4,950 -0

Annual Taxable Pay $77,550 $82,500

Federal Income/Social Security Taxes* -$15,510 -$16,500

Spendable Pay $62,040 $66,000

Total Annual After-Tax Contribution 0 -$4,950

Spendable Pay $62,040 $61,050

Amount You Save with Before-Tax Contribution $990

Assumes a 20% federal tax rate.

4

How to Determine Your Contribution Rate

Using the same example, we will help Ron determine how much he should be contributing to his retirement plan account to maximize the Company match.

CalculationsIRS Annual Limit ÷ Annual Salary

$16,500 ÷ $82,500 = 20%

Now, if Ron changes his contribution rate to 6% he will maximize the Company match, but if he increases his contribution rate to 20%, he will maximize both his before-tax contributions and the Company match!

You can increase your contribution amount at any time by visiting Your Benefits Resources™ at http://resources.hewitt.com/halliburtonbenefits or by calling the Benefits Center automated telephone system at (800) 535-8130.

any matching contributions for that payroll cycle. Using the example on the previous page, let’s see what happens if Ron were to increase his contribution rate to 25%.

Tax Effect with Increased Before-Tax Contribution

Increased Annual Contribution

$82,500 x 25% = $20,625

Monthly Contribution $20,625 ÷ 12 = $1,718.75

Number of Months to Reach IRS Limits

$16,500 ÷ $1,718.75 = 9.6

As you can see, Ron would reach the IRS annual limit of $16,500 in less than 10 months. When Ron reaches the $16,500 limit, he can no longer contribute to his retirement account, and the Company matching contributions cease as well. Therefore, Ron would be losing the Company matching contributions for the remaining two months of the year.

Benefit Facts for 2010

DiD

Yo

u K

no

w?

• Annual 401(k) Deferral Limit: $16,500• Catch-up (age 50 and over)

Contributions Limit: $5,500• Social Security Full Retirement Age: 66• Social Security Taxable Wage Base: $106,800

Ron reaches the $16,500 IRS limit in about 10 months, meaning Ron loses the Company match for the last two months of the year.

As a participant in

the retirement plan,

your contributions

to your retirement

account are made on

a before-tax basis.

5

Are you curious to know where you stand on your retirement planning journey? Are you just getting started or are you right on track? Let’s find out.

Using the following scale, how much do you agree or disagree with the following questions?

Strongly agree = 5 points Somewhat agree = 4 points Neutral = 3 points Somewhat disagree = 2 points Strongly disagree = 1 point

Quiz Time: Your Retirement Journey

1.I am comfortable with my level of knowledge and understanding about retirement and finances.

2.Based on my replacement ratio (income required after retirement ÷ income before retirement), I have enough money to live comfortably in retirement.

3.If needed, I could pay off my credit cards every month and stay out of debt.

Points

30-34 You Need a Financial Pit Crew. It may be time to have a professional look under the hood — consider making an appointment with a financial advisor and doing some serious maintenance.

35-39 A Few Stops Short of Achieving Your Goals. Feel yourself getting off track every now and then? Maybe you should brush up on investing basics and apply them to your financial plan or talk to a financial advisor.

Total points

Below 30 You Need a Kick-start. Whoa — you’re stuck in neutral. It’s time to get going, but the good news is that it’s never too late to start investing. Don’t know where to start? Check out the resources at Your Benefits Resources™ at http://resources.hewitt.com/halliburtonbenefits.

6

4.I have appropriate insurance (life insurance, disability insurance, etc.) to protect against financial losses.

5.I have a thorough plan that addresses my short- and long-term financial goals.

6.I am actively taking steps to make sure I achieve my financial goals.

7.I have at least 3 to 6 months worth of living expenses saved in case of emergency.

Points Points

Total Points

Need a Kick-start?

Check out the resources at Your Benefits Resources™

at http://resources.hewitt.com/halliburtonbenefits.

8.I am confident I will achieve the financial goals that I have set for myself and my family.

9.I have developed a plan to ensure my savings/assets are protected should I or a family member need long-term care.

10.I review my progress compared to my financial plan at least annually, or as my financial situation changes.

40-44 On the Road, but Don’t Get Sidetracked. You’re making good choices and heading in the right direction — remember to stay focused on your ultimate destination: retirement.

45-50 On Track to a Secure Future. Congrats! You know where you’re going and how to get there.

7

Signs of Recovery Bloom in Q4 of 2009, but Unemployment Concerns LingerInvestors continued to show their growing risk appetite and emerging confidence during the last quarter of 2009 as the equity market, high yield and emerging markets posted strong fourth quarter results. The S&P 500 returned 6.0% for the quarter resulting in a 26.5% return for the year and a 42.0% return since March. A positive turn in GDP growth during the third quarter and stronger than expected retail sales and corporate earnings during the holiday season showed growing consumer confidence as well. Initial estimates of GDP growth for the fourth quarter are for growth of 2.7% anualized. While this is relatively low growth after a recession, it is seen as positive indicator of a financial stability. The Fed kept rates at rock bottom levels of 0-25 basis points throughout the quarter. The major negative sign in the market which continues to be a focus of consumers and the government is the double digit unemployment rate which topped out at 10% at the end of the 2009.

The US equity market posted strong results across all market caps and equity styles for the quarter and the trailing year. Growth stocks outperformed value stocks across all market caps for the fourth quarter and the year. Large cap stocks outperformed small cap stocks for the quarter and the year. The best performing asset class in 2009 was mid cap growth which showed a return of 46.3%. Only the financial sector posted negative results for the fourth quarter, while all sectors posted

strong returns for the year. The top three performing sectors for the year were the technology, materials and consumer sectors. All three struggled during 2008, so the increases are encouraging. Also encouraging is that the strong results for the equity market were the best annual returns since 2003.

Many of the trends in the U.S. economy were also seen in foreign countries such as higher than expected corporate earnings, low interest rates and stronger consumer confidence. Returns for U.S. investors were dampened in the quarter due to a slight strengthening in the U.S. dollar versus most major currencies. The international equity market posted strong results for the fourth quarter and all of 2009 as well. The developed international equities returned 2.2% for the quarter and 32.5% for the year. The MSCI Emerging Markets Index returned 8.6% for the quarter and 79.0% for the year. International mining and

energy stocks led the index for the quarter, though banking stocks lagged.

The U.S. fixed income market, as measured by the Barclays Capital Aggregate Index, returned 0.2% for the quarter and 5.9% for the year. Returns within fixed income varied dramatically for the last quarter

and the entire year of 2009. In 2009 the sectors of the market that fell the most during

2008 posted the strongest results. High yield investments were the top performing area of the

fixed income market — they saw returns of 6.2% for the quarter and 58.2% for the year. Treasury

bonds were the worst performing sector returning -1.3% for the quarter and -3.5% for the year.

Treasury bonds suffered from an increase in interest rates due to the improving economic news.

Like most of us, your tax refund is likely spent before you receive it. Have you ever considered trying to save some of your tax refund for a rainy day? Well, the IRS

is making it easier to hang on to some of your tax refund by allowing you to split your tax refund among two or three different accounts using direct deposit.

This is a great way to build up your emergency fund or add to an IRA. So why not consider depositing a portion of your

refund by direct deposit into an account other than your checking account? You can make the deposit to any bank, credit union, brokerage or mutual fund account.

Plus, direct deposit, is a faster, safer and more dependable way to get your refund!

Make the Most of It — Split Up Your Tax Refund

Market Update

Newsstand

8

Beware: Free Investment Advice Could Cost YouInvestment seminars are popping up all over the country offering participants a free lunch for listening to a short presentation. You’ve probably received an invitation or two yourself. “Beware,” cautions AARP, “there are no free lunches!” A recent AARP survey showed that many people over the age of 55 invited to free seminars were pitched investments that were unsuitable for them or were asked to provide information that could expose them to financial fraud. The report went on to say that presenters often did not appropriately disclose risks. So those free lunches could wind up costing you a bundle in the end.

If you decide to attend free seminars, you just need to be selective, do some research and follow these tips by the North American Securities Administrators Association (NASAA):

• Don’t give out personal financial information, and don’t sign or purchase anything during a seminar. Take some time to consider whether the investment is right for you.

• Make sure you understand the details of an investment and ask questions if you don’t. Ask for details in writing so you can study them on your own.

• Before you attend a seminar, check to make sure the sellers have appropriate licenses. Contact your state securities or insurance regulator or go to the NASAA’s website at www.nasaa.org to research investment advisors or to report concerns.

• Schedule any follow-up meetings at the salesperson’s office instead of agreeing to an appointment at your home.

Check out some of the information and tools provided by the AARP and NASAA through a new Free Lunch Monitor program available at www.aarp.org/nofreelunch.

Newsstand

Retiree Corner

$Free Investment Seminar Today

“Beware, there are no free lunches!”

9

Halliburton Company Employee Benefit Master Trust for the period ended December 31, 2009

Performance 10 Years* 5 Years* 3 Years* 1 Year 4th Quarter

PReMixed PoRTfoLios Stable Value Premixed Portfolio 5.4% 5.0% 5.0% 4.2% 1.0%iMoneyNet Money Market fund Average 2.6% 2.8% 2.3% 0.2% 0.0%Conservative Premixed Portfolio (CPP) 4.7% 4.8% 3.0% 19.8% 2.8%CPP index Composite 3.3% 3.7% 1.1% 15.0% 2.3%Moderate Premixed Portfolio (MPP) 4.3% 4.8% 0.9% 31.1% 4.2%MPP index Composite 3.3% 3.9% -0.2% 24.8% 3.6%Aggressive Premixed Portfolio (APP) 2.0% 3.4% -3.3% 34.7% 5.5%APP index Composite 1.0% 2.6% -4.4% 32.6% 5.3%

siNgLe foCUs fUNds Bond Index Fund 6.2% 4.9% 6.1% 5.9% 0.2%Lehman Aggregate Bond index 6.3% 5.0% 6.0% 5.9% 0.2%Balanced Fund 6.1% 4.8% 0.9% 22.2% 4.4%Balanced fund index Composite 2.4% 2.5% -1.1% 20.6% 3.9%Large Cap Value Equity Fund 4.0% 0.2% -7.6% 23.1% 3.3%Russell 1000 Value index 2.5% -0.3% -9.0% 19.7% 4.2%S&P 500 Index Fund -1.0% 0.4% -5.7% 26.4% 6.0%s&P 500 index -0.9% 0.4% -5.6% 26.5% 6.0%Large Cap Growth Equity Fund -3.1% 0.4% -3.9% 31.8% 7.4%Russell 1000 growth index -4.0% 1.6% -1.9% 37.2% 7.9%Non-U.S. Equity Fund 4.1% 7.7% -1.7% 40.5% 5.0%MsCi ACWi ex U.s. ** 2.3% 5.8% -3.5% 41.4% 3.7%Mid Cap Equity Index Fund 6.3% 3.2% -2.0% 37.0% 5.5%s&P MidCap 400 index 6.4% 3.3% -1.8% 37.4% 5.6%Small Cap Equity Fund 3.6% 0.4% -4.6% 41.3% 5.0%Russell 2000 index 3.5% 0.5% -6.1% 27.2% 3.9%Halliburton Stock Fund 5.3% 10.0% 0.4% 65.0% 11.3%* Annualized.** Returns prior to January 1, 2005, include MSCI EAFE Index, the previous fund benchmark.

General Investment Policy Index (Benchmark) Composite Balanced Aggressive Moderate ConservativeU.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 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%

Fund Performance Update

10

Performance NotesThe Mid Cap Equity Index Fund was not in existence until January 1, 2005. The Conservative Premixed Portfolio was introduced January 1, 2006.

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.

Index Definitions*

iMoneyNet Money Market Fund Average is an index of over 700 money market funds.

Barclays 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.

For account information, go to Your Benefits Resources™ at http://resources.hewitt.com/halliburtonbenefits or call the Benefits Center automated telephone system at (800) 535-8130.

11

10200 Bellaire Blvd.

Houston, TX 77072

PRSRT STDUS POSTAGE

PAIDDALLAS, TX

PERMIT 2650

We encourage you to call the Trust Investments Department at (281) 575-3316 with any suggestions or comments regarding Trust Talk. You can expect the next issue in May 2010.

What's Inside

Lessons Learned From This And Other Bear Markets

How Survivor Benefits Are Distributed

Are You Maximizing Your Tax Savings?

Quiz Time: Your Retirement Journey

1 3 4 6Tr

ustTa

lk

Winter 2010