N-CSR

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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM N-CSR

CERTIFIED SHAREHOLDER REPORT OF REGISTERED MANAGEMENT
INVESTMENT COMPANIES

Investment Company Act file number: 811-05127

Advance Capital I, Inc.

(Exact name of registrant as specified in charter)

One Towne Square, Suite 444
Southfield, Michigan
(Address of principal executive offices) 48076
(Zip code)

Robert J. Cappelli, President

Advance Capital I, Inc.
One Towne Square, Suite 444
Southfield, Michigan 48076
(Name and Address of agent for service)

Registrant’s telephone number, including area code: (248) 350-8543

Date of fiscal year end: December 31

Date of reporting period: December 31, 2008

Form N-CSR is to be used by management investment companies to file reports with the Commission not later than 10 days after the transmission to stockholders of any report that is required to be transmitted to stockholders under Rule 30e-1 under the Investment Company Act of 1940(17 CFR 270.30e-1). The Commission may use the information provided on Form N-CSR in its regulatory, disclosure review, inspection, and policymaking roles.

A registrant is required to disclose the information specified by Form N-CSR, and the Commission will make this information public. A registrant is not required to respond to the collection of information contained in Form N-CSR unless the Form displays current valid Office of Management and Budget (“OMB”) control number. Please direct comments concerning the accuracy of the information collection burden estimate and any suggestions for reducing the burden to Secretary, Securities and Exchange Commission, 450 Fifth Street, NW, Washington, DC 20549-0609. The OMB has reviewed this collection of information under the clearance requirements of 44 U.S.C. 3507.

Item 1. Annual Report to Shareholders.

	AN INVESTMENT COMPANY                 WITH FOUR FUNDS
Annual Report December 31, 2008

	Table of Contents
1	A Letter to Our Shareholders
4	Discussion of Fund Performance
12	Financial Highlights
18	Equity Growth Fund
22	Balanced Fund
30	Retirement Income Fund
36	Core Equity Fund
37	Statements of Assets and Liabilities
38	Statements of Operations
39	Statements of Changes in Net Assets
41	Notes to Financial Statements
55	Report of Independent Registered Public Accounting Firm
56	Additional Information

Advance Capital’s Pledge:

We understand that investing in any mutual fund is a leap of faith. We recognize that trust, integrity and honesty are just a few of the attributes you should expect from any financial organization. Our commitment to you is to hold true to these standards by putting your interests first at all times. We will work hard each and every day to provide you with quality service as well as our best long-term investment advice. We pledge to maintain the highest standards of TRUST, INTEGRITY & HONESTY in all of our dealings with you.

Sincerely,
Advance Capital I, Inc. Board of Directors, Management, and Staff

Dear Shareholders,

Year in Review

The best part of 2008 is that it is finally over! The tumultuous events of the past year in the economy and the capital markets are forever ingrained in our memories. In time, we might know the full extent of the problems and details surrounding these events. For now, we are left with questions and bewilderment. Our country’s predicament is a stark reminder to future generations that everything comes at a price and nothing is free. History proves that combining hubris, greed and ignorance ends tragically. The consequences can last for years and forever change the economic and social landscape. The problems confronting our nation today are the culmination of years of excesses and are virtually all self-inflicted. From consumers, to Wall Street, to investors, we are all to blame. Consumers fell into the trap of easy money to justify a lifestyle that in truth was beyond their means. Interest-only and no-money-down mortgages along with zero interest on cars, furniture and credit cards led many to believe money was almost free. Wall Street made billions by perpetuating the game through the creation of new securities backed with consumer credit. The rating agencies handed out high, investment grade ratings on these new instruments based on low historical default rates of similar securities. Rating agencies and investors severely misjudged the investment risks and over estimated the ability of highly leveraged consumers to make good on their payments if the economy faltered.

When it arrived, it arrived quickly. The economic hurricane ravaged even the most ardent and historically-sound financial institutions and altered beliefs about government intervention in capitalism. To imagine a financial calamity so severe that it could wipe out the major brokerage firms on Wall Street and seize the U.S. banking system seemed implausible just months ago.

Through the use of massive amounts of leverage, this hypothetical was turned into a reality. The scenario played out like a game of musical chairs. When the music finally stopped, the most levered and riskiest financial institutions were left without chairs and collapsed. Problems surfaced early in the year as Bear Stearns, a major player in buying, selling and creating both standard and the riskier sub prime mortgages, was the first to fall. By March 2008, it was widely apparent that riskier mortgagees were over their heads and having trouble making their payments. With the help of the Federal Reserve, JP Morgan bought Bear Stearns which provided a temporary back-stop for the industry. In hindsight, this was the canary in the coal mine. As the financial tsunami gained momentum, it impacted nearly every domestic brokerage firm and bank. Lehman Brothers filed for bankruptcy, Merrill Lynch merged with Bank of America, Washington Mutual imploded and Fannie Mae and Freddie Mac were taken over by the Federal Government. Several other companies, along with just about every major bank in the country, needed handouts from the Government to forestall collapse.

Today, the ripple effects of the Wall Street fueled credit crisis are wreaking havoc throughout the economy. The unemployment rate has shot up to 7.6 percent from 4.9 percent at the end of 2007. The corresponding unemployment claims are the highest since the severe economic downturn of the early 1990s. The once hot housing market is now in shambles. New housing starts are the lowest on record amidst a glut of homes for sale. Commodities, which skyrocketed as worldwide demand accelerated, have fallen considerably. Perhaps the best example is the price per barrel of oil. The price per barrel of oil jumped from $70 in December 2007 to $140 in June 2008 and is about $40 today. Along the way, Gross Domestic Product (GDP),

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the sum total of all the “stuff” our entire economy produces, has turned negative in the third and fourth quarters of 2008. It is expected to remain weak throughout 2009.

Capital Market Performance

The capital markets have reacted violently to the unfolding credit crisis. The year 2008 began ominously as stocks declined for the first few days of the year. Through the first six months, stock returns were generally negative. The S&P 500 Index declined 11.9 percent, the NASDAQ Composite Index was off 13.2 percent and the S&P Mid Cap Index declined 3.9 percent. As investors shunned stocks and the economy faltered, many ran to the safety of U.S. Treasury bonds. The unusually strong demand for Treasury securities drove yields to unprecedented lows. The ten year U.S. Treasury bond yield dropped from 4.0 percent at the end of 2007, to 2.2 percent one year later. Declining Treasury yields typically produce correspondingly higher corporate bond prices. This year, however, as the credit crisis raged, corporate bond prices fell hard. Through June, corporate bond returns were off 1 to 2 percent. During the third and fourth quarters, the credit crisis reached its crescendo, which further depressed corporate bond prices. High yield bonds and riskier fixed income securities were hit even harder during this period. As fixed income investors exited corporate bonds, they rushed to the safety of cash and U.S. Treasury securities.

By the end of 2008, stocks had posted the worst annual results in modern history. The S&P 500 Index declined 37.0 percent, the NASDAQ Composite Index was off 39.9 percent and the S&P Mid Cap Index declined 36.2 percent. In the fixed income markets, investment grade corporate bonds posted declines of between 5 and 10 percent while riskier high yield bonds were off more than 20 percent. At the other end of the spectrum, the 10 year U.S. Treasury bond returned a positive 18.9 percent.

In this volatile environment, the results for the Advance Capital I Funds were generally below their respective benchmarks.

Some of the underperformance in the Equity Growth Fund and Balanced Fund was caused by problems related to the securities lending portfolio. The lending program is fairly common in the industry and involves lending certain securities for a period of time and receiving cash while the securities are on loan. The actual cash collateral investments at year end were invested primarily in corporate rate floating notes. Asset-backed securities, agency repurchase agreements and private mortgages were also held in the account at year end. The severe credit crisis negatively impacted many of these holdings in the securities lending portfolio during the year. While the funds have participated in the program for a few years, the program will soon be closed. For the year, the Equity Growth Fund retail shares declined 46.5 percent as compared to the Lipper Mid Cap Growth Index which declined 44.0 percent and the S&P 400 Mid-Cap Index which declined 36.2 percent. The Balanced Fund retail shares, with a mix of stocks and bonds declined 31.3 percent, compared to the Lipper Balanced Index which declined 26.2 percent. The Retirement Income Fund retail shares declined 16.0 percent, compared to the Lipper BBB Index which declined 10.2 percent. The absence of U.S. Treasury securities and the presence of high yield bonds proved detrimental to returns in the Retirement Income Fund relative to its benchmarks in 2008. The new Core Equity Fund retail shares, which began operations on January 2, 2008, declined 34.4 percent, modestly better than the S&P 500 Index decline of 36.1 percent for this period.

Year Ahead

After an unprecedented 2008, it is hard to imagine 2009 being much worse. First, the banking and financial services sectors have already gone through a complete revamp. The riskiest firms with too little capital have merged, declared bankruptcy or received money from the U.S. Government with more help still to come from Washington. In time, the remaining entities should return to profitability and viability. The U.S. and the world, however, still have much to do to shore up the over-extended financial systems worldwide. The risk is not all behind us. With this backdrop we expect the economy to

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remain very weak and likely get worse in 2009, before it finally starts to improve. Economists’ expectations are for negative growth through the first half of the year. The unemployment rate is quickly rising to high single digits and layoffs and hardships will remain with us for some time. At the same time, consumers have recoiled amidst an uncertain employment picture and years of excessive leverage. While this scenario appears bleak, a huge stimulus by the Federal Government, Federal Reserve and U.S. Treasury Department has already been pumped into the financial markets and the economy with more to come. The combination of historically low interest rates, huge stimulus and loans to cash-strapped banks and corporations should go a long way to repairing the damage caused by the credit crisis. This process will take time, but the spirit of our nation has always been to face a problem and fix it.

As the economy goes through its healing process and eventually stabilizes, the response and performance in the capital markets should improve. The massive efforts to stimulate growth, coupled with record low interest rates should provide a path to recovery. If that happens, the capital markets should respond positively in 2009 but probably well short of a record-setting pace. On the other hand, we are not out of the woods yet. If housing problems deepen and the unemployment rate climbs further, investors will remain wary and hesitant to invest. A tremendous amount of negative news has already been priced into the capital markets. Any rays of hope or better economic data would be well received by investors. We remind our investors to remain diversified and maintain a level head when contemplating changes to their investment portfolios. After this particularly difficult year, we sincerely thank you for your continued confi dence. We look forward to providing you with service and results designed to meet or exceed your long term investment objectives.

Robert J. Cappelli
President
Advance Capital I, Inc.

Christopher M. Kostiz
President
Advance Capital Management, Inc.

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EQUITY GROWTH FUND (Unaudited)

Seeks to provide investors with long-term growth of capital by investing primarily in stocks of small and medium-sized companies.

Top Equity Holdings*

Yum Brands	1.07	%
Robinson (C.H.) World Wide	0.93	%
Express Scripts	0.90	%
Apollo Group	0.83	%
Avon Products	0.83	%
Allergan	0.82	%
Fluor Corp.	0.80	%
Northern Trust	0.79	%
St. Jude Medical	0.79	%
American Tower	0.79	%

* Percentages based on Total Net Assets

MANAGEMENT’S DISCUSSION OF FUND PERFORMANCE (Unaudited)

2008 Results utilities

The economy and capital markets experienced a severe contraction, particularly during the last half of the year as a consequence of the unprecedented credit crisis. In this volatile environment the smallest and riskiest stocks were hit the hardest. The Equity Growth Fund declined 46.5 percent for the retail share class. In comparison, the Lipper Mid Cap Growth Index declined 44.0 percent and the S&P 400 Mid Cap Index declined 36.2 percent.

What helped the Fund

As the credit markets unraveled and equity investors exited stocks, there simply was no where to hide. The Fund’s allocation to higher quality, mid cap growth stocks with consistent records of earnings growth wasn’t enough to overcome the downward pressures in the stock market. Precious few mid cap growth sectors posted positive results for the year. The vast majority posted high double-digit declines for the year. Select few stocks had positive returns for the year and they were in diverse industries. One of the best performing stocks in the fund was the bakery café operator, Panera Bread (+45.8%). The company benefited from falling commodity prices, wheat in particular, which is a major input cost. Apollo Group, which provides higher education programs for working adults produced solid stock returns for the year (+9.2%). The uncertain economic environment has forced many workers to seek higher education and Apollo is a beneficiary of that demand shift. Ross Stores, a national chain of discount retail apparel turned in double-digit stock returns for the year (+17.6%). Myriad Genetics (+55.7%) and Vertex Pharmaceuticals (+30.8%), both involved in the Biomedical industry, produced stellar returns for the year. Other notable stock results in the fund included chewing gum manufacturer, Wrigley WM (+31.4%) and oil field servicing company Weatherford International (+12.1%).

What hurt the Fund

The credit crisis and economic slowdown impacted most other industries during the year. Those hit the hardest with the biggest drag on fund returns included Materials, Energy, Information Technology, Financials and, of course, Construction. The dramatic worldwide slowdown in activity severely impacted the prices of many commodities used in manufacturing and building. Oil, coal, copper, and aluminum prices dropped considerably in this environment. As this occurred, stocks in these sectors were hit hard. Foundation Coal and Massey Energy produce and sell coal to electricity producers. As coal prices fell, the stocks of these companies declined 73% and 80 percent, respectively. In energy, the price of oil services provider, Smith International, fell about 69 percent as the price per barrel of oil was cut by two-thirds from its

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peak. In other commodity related industries, Carpenter Technology which manufactures and distributes steel products declined 72 percent. Other notable declines include Las Vegas Sands, Clear Channel, McDermott International and Intuitive Surgical. Finally, the fund’s participation in the securities lending program negatively impacted returns as the credit crisis punished the high quality bonds in the lending portfolio which caused further declines in the fund. The securities lending program will soon be closed.

Outlook

After a brutal 2008, investors remain concerned with the continued negative effects of housing, energy prices and the low level of expected economic growth over the next year. When the economy begins slowly to get back on its feet, stocks should begin to make a slow and steady recovery. The high quality stocks with consistent earnings, solid margins, high quality products and experienced management should outperform in the year ahead. Further, if economic conditions improve later in the year, stock returns could end mildly positive for 2009. The style and structure of the Equity Growth Fund and concentration in higher quality mid cap stocks should produce solid results relative to the peer group in 2009.

PERFORMANCE SUMMARY (Unaudited)

$10,000 investment made December 31, 1998. Past performance should not be used to attempt to predict future performance. Returns shown do not reflect the deduction of taxes that a shareholder would pay on fund distributions or the redemption of fund shares.

Average Annual Returns for Periods Ended December 31, 2008

	Past 1			Past 5			Past 10			Value of
	Year			Years			Years			$10,000
S&P 400 Mid-Cap Index		-36.23	%		-0.09	%		4.45	%	$	15,472
Consumer Price Index (CPI)		-0.13	%		2.64	%		2.51	%	$	12,814
Equity Growth Fund (Retail Class)		-46.53	%		-3.78	%		1.78	%	$	11,925
Lipper Mid-Cap Growth Index		-44.04	%		-1.18	%		0.49	%	$	10,499

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BALANCED FUND (Unaudited)

Seeks to provide capital appreciation, current income and preservation of capital by investing in a diversified portfolio of common stocks and bonds.

Top Equity Holdings*

Exxon Mobil	0.69	%
Verizon Communications	0.64	%
Wells Fargo	0.64	%
General Electric	0.63	%
Johnson & Johnson	0.63	%

Top Fixed Income Holdings*

International Business Machines 7.50% 2013	1.13	%
Time Warner, Inc. 9.15% 2023	1.07	%
Comcast Cable 10.63% 2012	1.06	%
DTE Energy 6.40% 2013	1.04	%
Thomas & Betts 7.25% 2013	1.03	%

* Percentages based on Total Net Assets

MANAGEMENT’S DISCUSSION OF FUND PERFORMANCE (Unaudited)

2008 Results

The combination of rising unemployment, dramatically falling home prices and an abrupt slowdown in consumer buying habits produced a severe contraction in economic growth during 2008. The year began with optimism that the worst of the credit crisis was over and growth would remain positive. The news quickly turned negative as Wall Street and the nation’s banking system seized up. For the year, the Balanced Fund declined 31.3 percent while the Lipper Balanced Fund Index declined 26.2 percent. In addition, the S&P 500 Index fell 37.0 percent while the Lehman Aggregate Bond Index was up 5.2 percent in 2008.

What helped the Fund

In such a volatile environment, investors favored large stocks over small and mid cap stocks. While Consumer Staples and Health Care were the top two large cap sectors producing the best performance during the year, returns in these two sectors were still negative. The top performing stocks in the Consumer Staples sector were Wrigley, Wal-Mart Stores and Avon Products. Wrigley manufactures and sells chewing gum and benefited from the buyout from Mars at $80 per share. Wal-Mart Stores benefited as economic conditions worsened and consumers sought bargains. Avon Products was another beneficiary of a weak economy as consumers became more cost conscious. Other positive stock returns for the year included McDonalds, Family Dollar Stores and General Mills. In the utility sector, Southern Company, a generator and wholesaler of electricity in the south, produced small negative results for the year. In comparison to double-digit declines in most other sectors, these companies’ results helped support fund results for the year.

What hurt the Fund

On the other end of the spectrum small and mid cap stocks generally produced the worst results in the fund for the year. The worst sectors were Utilities, Materials and Financials. The massive problems in the finance and banking sectors led to dramatic declines in many of these stocks. The hardest hit in the sector were Citigroup, Morgan Stanley, Ambac Financial and Freddie Mac. Most of these companies were battered by excessive leverage and unprecedented losses related to mortgage investments. Many financial stocks fell more than 70 percent during the year.

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Several banks and brokerage firms faced bankruptcy without assistance by the Federal Government. In the Materials sector, international mining company stock Rio Tinto fell about 75 percent as worldwide demand for copper, gold and aluminum fell dramatically. The stocks of Alcoa and Carpenter Technology were also hit hard as the world economies fell into a recession and building activity subsided. Other negatives to fund returns were Energy, Telecommunication Services and Information Technology. In bond portion of the fund, finance and bank bonds were hit the hardest. The fund also held a few private mortgage bonds which were hit hard by the disarray in the mortgage markets. Finally, the fund’s participation in the securities lending program negatively impacted returns as the credit crisis punished the high quality bonds in the lending portfolio which caused additional declines in the fund. The securities lending program will soon be closed.

Outlook

Already, the U.S. Treasury, Federal Reserve and Federal Government have pumped billions into the economy using a variety of methods to revive economic growth. Consumers are strapped with too much debt at a time when home prices and financial asset prices have declined and jobs are scarce. Although stock and bond prices have already reacted to a substantial amount of weakness, many investors remain cautious. As the economy works through these issues, stocks are likely to remain volatile while bonds are expected to stabilize and hold up reasonably well. In this uncertain environment, we have shifted the Balanced fund’s allocation to a more conservative stance of about 50 percent bonds, 45 percent stocks and 5 percent cash. The fund’s mix of large and mid cap stocks along with investment grade corporate bonds should produce modest results relative to the benchmark in a volatile climate during 2009.

PERFORMANCE SUMMARY (Unaudited)

$10,000 investment made December 31, 1998. Past performance should not be used to attempt to predict future performance. Returns shown do not reflect the deduction of taxes that a shareholder would pay on fund distributions or the redemption of fund shares.

Average Annual Returns for Periods Ended December 31, 2008

	Past 1			Past 5			Past 10			Value of
	Year			Years			Years			$10,000
Consumer Price Index (CPI)		-0.13	%		2.64	%		2.51	%	$	12,814
Balanced Fund (Retail Class)		-31.33	%		-1.79	%		1.85	%	$	12,012
Composite Index*		-21.61	%		0.82	%		1.84	%	$	12,000
Lipper Balanced Index		-26.17	%		0.13	%		1.53	%	$	11,637

* Composite Index consists of 60% S&P 500 Index and 40% Lehman Aggregate Bond Index.

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RETIREMENT INCOME FUND (Unaudited)

Seeks to provide investors with current income and preservation of capital by investing in corporate, high-yield, mortgage-backed and agency securities.

Top Fixed Income Holdings*

Ginnie Mae 700767 6.50% 2038	1.22	%
Carolina Power & Light Co. 8.63% 2021	1.06	%
Statoil Hydro ASA 7.50% 2016	0.98	%
Sysco 6.50% 2028	0.95	%
Wyeth 6.00% 2036	0.94	%
Time Warner, Inc. 9.15% 2023	0.94	%
Wellpoint 5.88% 2017	0.93	%
Oracle 5.75% 2018	0.92	%
Ginnie Mae 699491 6.50% 2038	0.92	%
Detroit Edison Co. 6.40% 2013	0.91	%

* Percentages based on Total Net Assets

MANAGEMENT’S DISCUSSION OF FUND PERFORMANCE (Unaudited)

2008 Results

This past year marked the worst yearly performance for corporate bonds in modern history. The perfect storm of falling home prices, weakening economic growth and de-leveraging by large institutions led to a once-ina- generation credit crisis. Lower rated credits and those tied to the banking or financial services industries were hit the hardest. Many fixed income investors fled corporate bonds for the safety of U.S. Treasury securities. As demand skyrocketed, the yield on short maturing Treasury securities fell more than two percent during the year while longer dated Treasury bond yields decreased about 1.8 percent. For the year, U.S. Treasury securities posted the highest returns while investment grade corporate and high yield bonds produced the lowest returns. The Retirement Income Fund’s majority allocation to investment grade and high yield bonds produced below average returns for the year. The Fund declined 16.0 percent, compared to the Lipper BBB Index which declined 10.2 percent. The Lehman Corporate Bond Index declined 4.9 percent for the year.

What helped the Fund

As the credit problems grew larger throughout the year, we remained cautious and defensive relative to the fund’s historical allocation of investment grade, high yield and mortgage-backed securities. At the start of the year, the fund held about 50 percent of its assets in investment grade bonds, 20 percent in high yield bonds, 28 percent in mortgage-backed securities and the remaining 2 percent was invested in short-term assets. Throughout the year, as credit markets weakened, we sold bonds which appeared prone to further weakness. The bonds of Station Casino, a local casino operator in Las Vegas, declined about 90 percent after it was sold from the fund. The bonds of Washington Mutual, one of the largest mortgage companies which collapsed in October, fell another 70 percent after sale. Still other bonds like Ambac Financial, MBIA, Avis Budget and Appleton Papers fell dramatically after they were sold from the fund. In such a volatile environment, there were a select few bonds in the fund that produced positive results. The bonds of Rio Tinto, an international mining company, benefited as global growth remained strong through the first part of the year. The global reach of information technology giant IBM helped the company produce solid earnings which boosted the prices of their bonds. Another positive segment of the fund was the holding of Government mortgage-backed securities. Most of these mortgage securities produced modestly positive results for the year as investors searched for safe areas of the bond market.

What hurt the Fund

On the negative side, investment grade holdings in bank and financial services severely impacted returns.

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Toxic mortgage-related assets left these companies scrambling to raise more capital as their problems mounted. Security Benefit Life, a life insurer and annuity company in New York, along with insurance giant American International Group, which was saved by the government, had significant declines in their bond prices. Comerica Bank, Bank of America, Morgan Stanley and the bonds of others in banking and financial services areas fell in price during the year and hurt fund returns. The decision to hold high yield bonds and certain mortgage assets also hurt the fund’s return. Amidst investors’ desire to reduce risk, many high yield securities declined in price as investors fled this sector. High yield bonds tied to energy and economic sensitive industries were some of the hardest hit, including, Century Aluminum, AK Steel and Gulfmark Offshore. While we reduced the fund’s weighting of high yield bonds during the year, holding any or all was a negative for fund results. For the second consecutive year, the absence of U.S. Treasury bonds served as a significant disadvantage relative to more conservative funds. As the historic problems in the credit markets erupted, investors rushed to the safety of treasury securities, disregarding cash yield for perceived better conservation of capital.

Outlook

The current economic pressures are severe and are expected to get worse before a recovery begins. Amidst these problems, new stimulus programs by the Federal Government including tax breaks and support for business loans should start to repair the damage caused by the mortgage induced credit crisis of 2008. If the economy stabilizes, fixed income securities should produce adequate returns in 2009. If problems persist, investors will be conservative which could limit any upside in corporate bond prices. In the Retirement Income Fund, we have dramatically reduced the holding of high yield bonds, sold several of the underperforming investment grade bonds and mortgage related assets and increased the allocation to government backed mortgages and higher quality investment grade debt. We expect these actions to produce much better relative results in 2009.

PERFORMANCE SUMMARY (Unaudited)

$10,000 investment made December 31, 1998. Past performance should not be used to attempt to predict future performance. Returns shown do not reflect the deduction of taxes that a shareholder would pay on fund distributions or the redemption of fund shares.

Average Annual Returns for Periods Ended December 31, 2008

	Past 1			Past 5			Past 10			Value of
	Year			Years			Years			$10,000
Barclays Capital U.S. Corp. Bond Index		-4.94	%		2.13	%		4.56	%	$	15,626
Lipper BBB Index		-10.23	%		1.38	%		3.74	%	$	14,442
Retirement Income Fund (Retail Class)		-16.03	%		-0.30	%		2.83	%	$	13,224
Consumer Price Index (CPI)		-0.13	%		2.64	%		2.51	%	$	12,814

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CORE EQUITY FUND (Unaudited)

Seeks to provide investors with long-term growth of capital. The fund invests primarily in stocks of companies with market capitalizations of at least $1 billion that have improving fundamentals and whose stock is undervalued by the market.

Top Equity Holdings*

Conocophillips	3.82	%
Johnson & Johnson	3.79	%
Chevron Corp.	3.65	%
Liberty Media Corp-Ent Ser A	3.39	%
Check Point Software Tech	3.13	%
Time Warner, Inc.	3.05	%
Pfizer, Inc.	3.01	%
EMC Corp/Mass	2.99	%
Microsoft Corp	2.99	%
Ace Ltd.	2.90	%

* Percentages based on Total Net Assets

MANAGEMENT’S DISCUSSION OF FUND PERFORMANCE (Unaudited)

2008 Results

The fund began operations on January 2, 2008 with the objective of investing the majority of assets in large capitalized stocks. Through the unprecedented economic crisis and turmoil in the financial sector, the allocation to large, well-established company stocks held up well compared to smaller stocks. From inception through the end of the year, the fund declined 34.4 percent. This return was better than the S&P 500 Index, which declined 36.1 percent, and the Lipper Multi-Cap Growth Index which was off 37.5 percent for the period.

What helped the Fund

Through the credit market upheaval and unprecedented declines in the stock market, the stocks of many of the largest companies were negatively impacted. While the negative tone in stocks resonated during the year, a few sectors and stocks in the fund produced positive results. The stock in Wal Mart Stores, the largest department store chain in the world, was the top returning stock in the fund with low double-digit returns. The company benefited during the year as consumers opted for low cost goods during a sinking economy. The stock in Coca-Cola, one of the world’s largest soft drink companies, returned close to 10 percent in the fund. The energy company Apache, which explores and produces natural gas, along with HCC Insurance, were the next two largest contributors during the year with modest single-digit returns. From a sector perspective, consumer cyclical stocks produced the best returns for the fund, even though the average return was negative. Financials produced the next highest returns due to the fund’s relative concentration in insurance based companies. Again, the average returns in the sector were still negative.

What hurt the Fund

On the other end of the spectrum, industrial and energy sectors produced the worst results for the year as energy prices collapsed and manufacturing slowed. One of the hardest hit industrial stocks in the portfolio was General Electric. This diversified technology, media and financial services company was negatively impacted as orders declined and problems erupted in their financing subsidiary. The stock in Northrop Grumman, primarily a defense contractor, also slumped as investors feared orders would fall in the year ahead. Lastly, the stock of Boeing was hurt as the dramatic rise in oil prices slowed aircraft orders. In energy, oil and natural gas producer Chesapeake Energy along with the large integrated oil company, Conocophillips, were hit as economic conditions weakened and oil prices remained extremely volatile during the year. The stock prices of several large pharmaceutical and technology companies including Pfizer, Microsoft and EMC were

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also hit hard during the year and contributed to the negative fund returns.

Outlook

The proposed stimulus packages aimed at reviving economic growth is designed to turn around the economy and, if successful, will calm investors’ nerves. Although there is a long way to go, the new administration appears focused on propping up the banking system, forestalling further home foreclosures and maintaining a moderate interest rate environment.

These and other actions are expected to eventually stem the economic and financial slide and begin to rebuild confidence among investors. As prospects brighten, investors are expected to favor large, high quality stocks. The Core Equity Fund is highly concentrated in these types of stocks. Many companies represented typically hold leadership positions in their industries and have substantial financial flexibility. The fund should perform well during this market transition process and produce respectable returns relative to the category during 2009.

PERFORMANCE SUMMARY (Unaudited)

$10,000 investment made January 2, 2008. Past performance should not be used to attempt to predict future performance. Returns shown do not reflect the deduction of taxes that a shareholder would pay on fund distributions or the redemption of fund shares.

Average Annual Returns for Periods Ended December 31, 2008

				Value of
	1/2/08 - 12/31/08			$10,000
Consumer Price Index (CPI)		-0.15	%	$	9,985
Core Equity Fund (Retail Class)		-34.35	%	$	6,566
S&P 500 Index		-36.08	%	$	6,392
Lipper Multi-Cap Growth Index		-37.52	%	$	6,248

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ADVANCE CAPITAL I — EQUITY GROWTH FUND (Retail Shares)
FINANCIAL HIGHLIGHTS

SELECTED PER-SHARE DATA AND RATIOS
(For a Share Outstanding Throughout Each Period)				Years ended December 31
	2008			2007			2006			2005			2004
Net asset value, beginning of year	$	24.11	*	$	24.87		$	25.42		$	24.61		$	24.41
Loss from investment operations^
Net investment loss		0.00			(0.03	)		(0.03	)		(0.10	)		(0.14	)
Net realized and unrealized gain (loss) on investments		(11.22	)		3.05	*		2.43			2.56			3.67
Total from investment operations		(11.22	)		3.02			2.40			2.46			3.53
Less distributions
Net realized gain on investments		(0.02	)		(3.78	)		(2.76	)		(1.65	)		(3.33	)
Return of capital		0.00			0.00			(0.19	)		0.00			0.00
Total distributions		(0.02	)		(3.78	)		(2.95	)		(1.65	)		(3.33	)
Net asset value, end of year	$	12.87		$	24.11	*	$	24.87		$	25.42		$	24.61
Total Return		(46.53	%)		12.05	%*		9.39	%		9.94	%		14.45	%
Ratios and Supplemental Data
Net assets, end of year (in thousands)	$	83,981		$	220,726	*	$	210,179		$	196,254		$	174,704
Ratio of expenses to average net assets		1.06	%		1.01	%		1.01	%		1.00	%		1.00	%
Ratio of net investment loss to average net assets		(0.02	%)		(0.10	%)		(0.10	%)		(0.39	%)		(0.54	%)
Portfolio turnover rate		27	%		33	%		38	%		30	%		44	%

^	Per share amounts presented are based on average shares outstanding.
*	As restated. See Note 4 in the Notes to Financial Statements for information regarding the restatement.

See Notes to Financial Statements

12

ADVANCE CAPITAL I — BALANCED FUND (Retail Shares)
FINANCIAL HIGHLIGHTS

SELECTED PER-SHARE DATA AND RATIOS
(For a Share Outstanding Throughout Each Period)				Years ended December 31
	2008			2007			2006			2005			2004
Net asset value, beginning of year	$	17.66	*	$	18.38		$	17.92		$	17.96		$	18.45
Income from investment operations^
Net investment income		0.38			0.38			0.39			0.37			0.44
Net realized and unrealized gain (loss) on investments		(5.84	)		0.72	*		1.37			0.47			1.20
Total from investment operations		(5.46	)		1.10			1.76			0.84			1.64
Less distributions
Net investment income		(0.39	)		(0.38	)		(0.29	)		(0.37	)		(0.44	)
Net realized gain on investments		(0.01	)		(1.44	)		(0.90	)		(0.51	)		(1.69	)
Return of capital		0.00			0.00			(0.11	)		0.00			0.00
Total distributions		(0.40	)		(1.82	)		(1.30	)		(0.88	)		(2.13	)
Net asset value, end of year	$	11.80		$	17.66	*	$	18.38		$	17.92		$	17.96
Total Return		(31.33	%)		6.00	%*		9.91	%		4.79	%		9.05	%
Ratios and Supplemental Data
Net assets, end of year (in thousands)	$	200,199		$	400,214	*	$	397,635		$	377,837		$	345,349
Ratio of expenses to average net assets		1.04	%		0.97	%		0.93	%		0.93	%		0.94	%
Ratio of net investment income to average net assets		2.48	%		1.97	%		2.14	%		2.08	%		2.35	%
Portfolio turnover rate		41	%		36	%		35	%		30	%		39	%

^	Per share amounts presented are based on average shares outstanding.
*	As restated. See Note 4 in the Notes to Financial Statements for information regarding the restatement.

See Notes to Financial Statements

13

ADVANCE CAPITAL I — RETIREMENT INCOME FUND (Retail Shares)
FINANCIAL HIGHLIGHTS

SELECTED PER-SHARE DATA AND RATIOS
(For a Share Outstanding Throughout Each Period)	Years ended December 31
	2008			2007			2006			2005			2004
Net asset value, beginning of year	$	9.45	*	$	9.68		$	9.85		$	10.16		$	10.06
Income from investment operations^
Net investment income		0.52			0.54			0.54			0.53			0.56
Net realized and unrealized gain (loss) on investments		(1.98	)		(0.23)	*		(0.16	)		(0.30	)		0.10
Total from investment operations		(1.46	)		0.31			0.38			0.23			0.66
Less distributions
Net investment income		(0.53	)		(0.54	)		(0.54	)		(0.54	)		(0.56	)
Return of capital		0.00			0.00			(0.01	)		0.00			0.00
Total distributions		(0.53	)		(0.54	)		(0.55	)		(0.54	)		(0.56	)
Net asset value, end of year	$	7.46		$	9.45	*	$	9.68		$	9.85		$	10.16
Total Return		(16.03	%)		3.33	%*		3.97	%		2.28	%		6.78	%
Ratios and Supplemental Data
Net assets, end of year (in thousands)	$	340,834		$	406,932	*	$	402,076		$	408,458		$	401,610
Ratio of expenses to average net assets		0.83	%		0.78	%		0.76	%		0.74	%		0.76	%
Ratio of net investment income to average net assets		6.07	%		5.69	%*		5.57	%		5.34	%		5.58	%
Portfolio turnover rate		58	%		51	%		62	%		56	%		37	%

^	Per share amounts presented are based on average shares outstanding.
*	As restated. See Note 4 in the Notes to Financial Statements for information regarding the restatement.

See Notes to Financial Statements

14

ADVANCE CAPITAL I — CORE EQUITY FUND (Retail Shares)
FINANCIAL HIGHLIGHTS

SELECTED PER-SHARE DATA AND RATIOS
(For a Share Outstanding Throughout Each Period)	Years ended December 31
	2008
Net asset value, beginning of year	$	10.00
Income from investment operationsa
Net investment income		0.06
Net realized and unrealized loss on investments		(3.49	)
Total from investment operations		(3.43	)
Less distributions
Net investment income		(0.06	)
Total distributions		(0.06	)
Net asset value, end of year	$	6.51
Total Return		(34.35	%)
Ratios and Supplemental Data
Net assets, end of year (in thousands)	$	8,469
Ratio of expenses to average net assets		1.39	% b
Ratio of expenses to average net assets		1.28	% c
Ratio of net investment income to average net assets		0.66	%
Portfolio turnover rate		68	%

a	Per share amounts presented are based on average shares outstanding.
b	Before waivers
c	Net of waivers

See Notes to Financial Statements

15

ADVANCE CAPITAL I (Institutional Shares)
FINANCIAL HIGHLIGHTS

SELECTED PER-SHARE DATA AND RATIOS
(For a Share Outstanding Throughout Each Period)	Years ended December 31
	EQUITY GROWTH						BALANCED
	FUND						FUND
	2008			2007b			2008			2007b
Net asset value, beginning of period	$	24.16	a	$	27.28		$	17.66	a	$	19.43
Income from investment operationsc
Net investment income		0.06			0.02			0.42			0.29
Net realized and unrealized gain (loss) on investments		(11.39	)		0.64	a		(5.87	)		(0.33	)a
Total from investment operations		(11.33	)		0.66			(5.45	)		(0.04	)
Less distributions
Net investment income		0.00			0.00			(0.43	)		(0.29	)
Net realized gain on investments		(0.02	)		(3.78	)		(0.01	)		(1.44	)
Total distributions		(0.02	)		(3.78	)		(0.44	)		(1.73	)
Net asset value, end of year	$	12.81		$	24.16	a	$	11.77		$	17.66	a
Total Return		(46.89	%)		2.34	%a,e		(31.33	%)		(0.22	%)a,e
Ratios and Supplemental Data
Net assets, end of year (in thousands)	$	92		$	118	a	$	117		$	175	a
Ratio of expenses to average net assets		0.80	%		0.77	%a,d		0.79	%		0.74	%d
Ratio of net investment income to average net assets		0.31	%		0.12	%d		2.79	%		2.25	%a,d
Portfolio turnover rate		27	%		33	%		41	%		36	%

a	As restated. See Note 4 in the Notes to Financial Statements for information regarding the restatement.
b	For the period May 4, 2007, commencement of operations, to December 31, 2007.
c	Per share amounts presented are based on average shares outstanding.
d	Annualized
e	Not Annualized

See Notes to Financial Statements

16

ADVANCE CAPITAL I (Institutional Shares)
FINANCIAL HIGHLIGHTS

SELECTED PER-SHARE DATA AND RATIOS
(For a Share Outstanding Throughout Each Period)	Years ended December 31
	RETIREMENT INCOME						CORE EQUITY
	FUND						FUND
	2008			2007b			2008
Net asset value, beginning of period	$	9.45	a	$	9.71		$	10.00
Income from investment operationsc
Net investment income		0.55			0.36			0.07
Net realized and unrealized loss on investments		(1.99	)		(0.25	)a		(3.48	)
Total from investment operations		(1.44	)		0.11			(3.41	)
Less distributions
Net investment income		(0.55	)		(0.37	)		(0.08	)
Total distributions		(0.55	)		(0.37	)		(0.08	)
Net asset value, end of year	$	7.46		$	9.45	a	$	6.51
Total Return		(15.82	%)		1.19	%a,e		(34.14	%)
Ratios and Supplemental Data
Net assets, end of year (in thousands)	$	1,841		$	3,508	a	$	0	h
Ratio of expenses to average net assets		0.58	%		0.56	%d		1.16	%f
Ratio of expenses to average net assets		0.58	%		0.56	%d		1.05	%g
Ratio of net investment income to average net assets		6.26	%		5.92	%a,d		0.79	%
Portfolio turnover rate		58	%		51	%		68	%

a	As restated. See Note 4 in the Notes to Financial Statements for information regarding the restatement.
b	For the period May 4, 2007, commencement of operations, to December 31, 2007.
c	Per share amounts presented are based on average shares outstanding.
d	Annualized
e	Not Annualized
f	Before waivers
g	Net of waivers
h	Amount rounds to zero

See Notes to Financial Statements

17

ADVANCE CAPITAL I — EQUITY GROWTH FUND
PORTFOLIO OF INVESTMENTS
DECEMBER 31, 2008

Common Stock	Shares		Value
k
BASIC MATERIALS — 3.8%
Agnico-Eagle Mines Ltd^		10,400	$	533,832
Air Products & Chemicals		4,400		221,188
Albemarle Corp.		7,300		162,790
Carpenter Technology Corp.		9,300		191,022
CF Industries Holdings, Inc.		3,800		186,808
Cliffs Natural Resources, Inc.^		11,700		299,637
Ecolab, Inc.^		16,500		579,975
Intrepid Potash, Inc.*^		21,800		452,786
Sherwin-Williams Co.		5,400		322,650
Sigma-Aldrich Corp.^		5,600		236,544
COMMUNICATIONS — 9.4%
American Tower Corp.*^		22,600		662,632
Baidu, Inc. — ADR*		1,400		182,798
Cablevision Systems Corp.		10,300		173,452
Central European Media*^		4,300		93,396
Clear Channel Outdoor*^		17,000		104,550
Crown Castle International*^		23,200		407,856
CTC Media, Inc.*		16,800		80,640
Ctrip.com International Ltd — ADR		3,700		88,060
Digital River, Inc.*		6,100		151,280
Discovery Communications*		11,700		156,663
Expedia, Inc.*^		40,500		333,720
Factset Research Systems^		7,500		331,800
F5 Networks, Inc.*		8,400		192,024
JDS Uniphase Corp.*^		22,400		81,760
Juniper Networks, Inc.*^		36,600		640,866
Lamar Advertising Co.*^		5,600		70,336
Leap Wireless International*		11,000		295,790
McAfee, Inc.*^		11,900		411,383
McGraw-Hill Cos., Inc.^		17,500		405,825
MetroPCS Communications*^		18,600		276,210
NeuStar, Inc.*^		8,000		153,040
NII Holdings, Inc.*^		14,700		267,246
Omnicom Group, Inc.^		7,100		191,132
priceline.com, Inc.*^		5,800		427,170
SBA Communications Corp.*		39,900		651,168
Shaw Communications, Inc.		10,200		180,336
Sina Corp.*^		6,400		148,160
Symantec Corp.*^		18,900		255,528
VeriSign, Inc.*^		14,800		282,384
WPP PLC — ADR		6,285		185,973
CONSUMER, CYCLICAL — 11.3%
Advance Auto Parts, Inc.		6,500		218,725
AnnTaylor Stores Corp.*		6,900		39,813
Bed Bath & Beyond, Inc.*^		12,500		317,750

Common Stock	Shares		Value
CONSUMER, CYCLICAL — 11.3% (continued)
Centex Corp.*^		4,900	$	52,136
Chipotle Mexican Grill, Inc.*		2,300		131,767
Choice Hotels International^		10,500		315,630
Coach, Inc.*^		21,500		446,555
Copart, Inc.*		6,200		168,578
Dick’s Sporting Goods, Inc.*^		8,100		114,291
DreamWorks Animation*		7,400		186,924
Family Dollar Stores, Inc.^		12,100		315,447
Fastenal Co.^		7,800		271,830
International Game Tech.		22,800		271,092
KB Home^		5,300		72,186
Lennar Corp.^		8,500		73,695
Marriott International, Inc.		17,300		336,485
Mattel, Inc.		8,400		134,400
Men’s Wearhouse, Inc.^		6,337		85,803
O’Reilly Automotive, Inc.*^		8,100		248,994
PACCAR, Inc.		4,700		134,420
Panera Bread Co.*^		4,100		214,184
PetSmart, Inc.^		6,800		125,460
Pulte Homes, Inc.*^		6,300		68,859
Ross Stores, Inc.^		13,700		407,301
Royal Caribbean Cruises*^		10,300		141,625
Skywest, Inc.		10,100		187,860
Southwest Airlines Co.^		14,500		124,990
Staples, Inc.^		12,900		231,168
Starbucks Corp.*^		23,600		223,256
Starwood Hotels & Resorts^		7,000		125,300
Tiffany & Co.^		15,500		366,265
Tim Hortons, Inc.^		11,700		337,428
TJX Cos., Inc.^		24,800		510,136
Toll Brothers, Inc.*^		10,000		214,300
Tractor Supply Co.*^		4,400		159,016
Urban Outfitters, Inc.*		8,700		130,326
WABCO Holdings, Inc.		14,200		224,218
Williams-Sonoma, Inc.^		14,100		110,826
WMS Industries, Inc.*^		6,100		164,090
WW Grainger, Inc.		4,000		315,360
Wynn Resorts Ltd*^		6,500		274,690
Yum! Brands, Inc.		28,700		904,050
CONSUMER, NON-CYCLICAL — 22.7%
Alexion Pharmaceuticals*^		5,100		184,569
Allergan, Inc.		17,208		693,827
American Medical Systems*^		13,100		117,769
Amylin Pharmaceuticals, Inc.*^		9,700		105,245
Apollo Group, Inc.*^		9,129		699,464

See Notes to Financial Statements

18

ADVANCE CAPITAL I — EQUITY GROWTH FUND
PORTFOLIO OF INVESTMENTS
DECEMBER 31, 2008

Common Stock	Shares		Value
CONSUMER, NON-CYCLICAL — 22.7% (continued)
Arthrocare Corp.*^		6,300	$	30,051
Avon Products, Inc.^		28,900		694,467
Becton Dickinson and Co.		1,900		129,941
Biogen Idec, Inc.*^		3,800		180,994
BioMarin Pharmaceutical, Inc.*^		6,700		119,260
Brown-Forman Corp.		7,625		392,611
Cephalon, Inc.*^		4,100		315,864
Charles River Laboratories*		7,400		193,880
CIGNA Corp.		6,000		101,100
Clorox Co.^		5,800		322,248
Corporate Executive Board		7,900		174,274
Covance, Inc.*		3,500		161,105
Coventry Health Care, Inc.*		5,950		88,536
CR Bard, Inc.		7,200		606,672
DaVita, Inc.*		4,500		223,065
DENTSPLY International, Inc.^		9,900		279,576
DeVry, Inc.		7,900		453,539
Edwards Lifesciences Corp.*		3,500		192,325
Elan Corp PLC — ADR*^		19,700		118,200
Equifax, Inc.		6,200		164,424
Express Scripts, Inc.*^		13,800		758,724
Gen-Probe, Inc.*		4,400		188,496
Global Payments, Inc.		5,100		167,229
Health Net, Inc.*^		6,800		74,052
Henry Schein, Inc.*		7,500		275,175
Hershey Co.^		7,600		264,024
Hologic, Inc.*^		12,100		158,147
Humana, Inc.*		5,400		201,312
Idexx Laboratories, Inc.*		6,800		245,344
Illumina, Inc.*^		17,200		448,060
Intuitive Surgical, Inc.*^		3,200		406,368
Iron Mountain, Inc.*		11,900		294,287
ITT Educational Services, Inc.*		5,100		484,398
JM Smucker Co.		4,800		208,128
Laboratory Corp of America*		6,100		392,901
Life Technologies Corp.*		5,900		137,529
Lincare Holdings, Inc.*^		6,500		175,045
Lorillard, Inc.		8,300		467,705
Manpower, Inc.		5,500		186,945
Martek Biosciences Corp.*^		5,100		154,581
Masimo Corp.*^		4,500		134,235
McCormick & Co., Inc.^		14,200		452,412
McKesson Corp.		4,200		162,666
Millipore Corp.*		3,100		159,712
Monster Worldwide, Inc.*^		16,100		194,649
Moody’s Corp.^		13,700		275,233

Common Stock	Shares		Value
CONSUMER, NON-CYCLICAL — 22.7% (continued)
Myriad Genetics, Inc.*^		3,000	$	198,780
New Oriental Education — ADR*		3,600		197,676
Patterson Cos., Inc.*^		7,000		131,250
Paychex, Inc.		18,987		498,978
QIAGEN NV*^		11,000		193,160
Quanta Services, Inc.*^		15,700		310,860
Quest Diagnostics, Inc.		8,122		421,613
ResMed, Inc.*^		3,900		146,172
Ritchie Bros Auctioneers^		25,400		544,068
Robert Half International, Inc.^		11,300		235,266
St Jude Medical, Inc.*		20,200		665,792
Techne Corp.^		3,800		245,176
Varian Medical Systems*^		8,600		301,344
Vertex Pharmaceuticals, Inc.*		6,970		211,749
VistaPrint Ltd*^		8,700		161,907
Warner Chilcott Ltd*^		13,300		192,850
Western Union Co.		34,700		497,598
Zimmer Holdings, Inc.*		3,200		129,344
ENERGY — 9.0%
Arch Coal, Inc.		11,500		187,335
Baker Hughes, Inc.		4,800		153,936
Bill Barrett Corp.*^		11,100		234,543
BJ Services Co.^		26,500		309,255
Cabot Oil & Gas Corp.		13,000		338,000
Cameron International Corp.*^		24,400		500,200
Complete Production Svcs.*		11,800		96,170
Concho Resources, Inc.*^		19,400		442,708
Consol Energy, Inc.^		11,300		322,954
Core Laboratories NV		6,800		407,048
Diamond Offshore Drilling, Inc.^		5,800		341,852
FMC Technologies, Inc.*		15,300		364,599
Forest Oil Corp.*^		13,600		224,264
Foundation Coal Holdings		15,600		218,712
GT Solar International, Inc.*		35,400		102,306
Mariner Energy, Inc.*		14,600		148,920
Massey Energy Co.		7,900		108,941
Murphy Oil Corp.		14,400		638,640
Nabors Industries Ltd*^		21,100		252,567
Newfield Exploration Co.*		18,100		357,475
Peabody Energy Corp.^		6,200		141,050
SandRidge Energy, Inc.*		11,500		70,725
Smith International, Inc.^		22,800		521,892
Sunoco, Inc.		6,000		260,760
Tetra Technologies, Inc.*		16,000		77,760
Ultra Petroleum Corp.*^		13,500		465,885
Williams Cos., Inc.		17,600		254,848

See Notes to Financial Statements

19

ADVANCE CAPITAL I — EQUITY GROWTH FUND
PORTFOLIO OF INVESTMENTS
DECEMBER 31, 2008

Common Stock	Shares		Value
FINANCIAL — 5.4%
AON Corp.		4,900	$	223,832
Arch Capital Group Ltd*^		4,500		315,450
Assurant, Inc.		4,300		129,000
Axis Capital Holdings Ltd		9,200		267,904
BlackRock, Inc.^		3,000		402,450
CME Group, Inc.		800		166,488
Eaton Vance Corp.^		16,800		352,968
Federated Investors, Inc.		7,100		120,416
Franklin Resources, Inc.		3,500		223,230
HCC Insurance Holdings, Inc.^		9,400		251,450
Interactive Brokers Group*		8,800		157,432
IntercontinentalExchange*		5,600		461,664
Janus Capital Group, Inc.^		18,100		145,343
Lazard Ltd		5,900		175,466
Northern Trust Corp.		12,800		667,392
optionsXpress Holdings, Inc.^		11,200		149,632
RenaissanceRe Holdings		4,600		237,176
SVB Financial Group*^		4,500		118,035
INDUSTRIAL — 15.1%
Alliant Techsystems, Inc.*^		3,800		325,888
AMETEK, Inc.		11,200		338,352
Amphenol Corp.		9,200		220,616
CH Robinson Worldwide, Inc.^		14,200		781,426
Cogent, Inc.*		17,000		230,690
Cummins, Inc.		12,700		339,471
Cymer, Inc.*		6,500		142,415
Dolby Laboratories, Inc.*^		12,300		402,948
Donaldson Co., Inc.		10,400		349,960
Empresa Brasileira — ADR^		14,900		241,529
Expeditors International^		19,900		662,073
FLIR Systems, Inc.*^		5,600		171,808
Flowserve Corp.		3,800		195,700
Fluor Corp.		15,000		673,050
Foster Wheeler Ltd*^		18,100		423,178
General Cable Corp.*^		5,500		97,295
Gentex Corp.^		15,000		132,450
Goodrich Corp.		15,700		581,214
Graco, Inc.^		5,000		118,650
Harsco Corp.		5,000		138,400
IDEX Corp.^		7,325		176,899
II-VI, Inc.*^		4,500		85,905
Itron, Inc.*^		2,200		140,228
ITT Corp.		9,600		441,504
Jabil Circuit, Inc.^		22,700		153,225

Common Stock	Shares		Value
INDUSTRIAL — 15.1% (continued)
Joy Global, Inc.		17,100	$	391,419
Landstar System, Inc.^		14,500		557,235
McDermott International, Inc.*		19,200		189,696
Mettler Toledo International*		2,200		148,280
National Instruments Corp.		8,550		208,278
Pall Corp.		8,400		238,812
Precision Castparts Corp.^		9,900		588,852
Republic Services, Inc.		9,150		226,829
Rockwell Collins, Inc.		15,800		617,622
Roper Industries, Inc.^		7,900		342,939
Stericycle, Inc.*^		7,900		411,432
Terex Corp.*		7,800		135,096
Trimble Navigation Ltd*^		20,000		432,200
Valmont Industries, Inc.		4,200		257,712
Waters Corp.*		6,100		223,565
Zebra Technologies Corp.*^		9,300		188,418
TECHNOLOGY — 13.0%
Activision Blizzard, Inc.*^		24,708		213,477
Adobe Systems, Inc.*^		12,200		259,738
Altera Corp.^		27,700		462,867
American Reprographics Co.*		12,300		84,870
Analog Devices, Inc.		20,300		386,106
ANSYS, Inc.*^		10,600		295,634
Autodesk, Inc.*^		17,700		347,805
BMC Software, Inc.*		8,800		236,808
Broadcom Corp.*^		38,600		655,042
Check Point Software Tech.*		10,100		191,799
Citrix Systems, Inc.*		14,200		334,694
Cognizant Technology*^		27,312		493,255
Dun & Bradstreet Corp.		5,600		432,320
Electronic Arts, Inc.*^		20,600		330,424
Fairchild Semiconductor*		16,500		80,685
Fidelity National Information		7,300		118,771
Fiserv, Inc.*		3,900		141,843
Integrated Device Tech.*		19,600		109,956
Intersil Corp.^		11,900		109,361
Intuit, Inc.*		16,600		394,914
Jack Henry & Associates^		9,800		190,218
Kla-Tencor Corp.		7,700		167,783
Lam Research Corp.*^		7,300		155,344
Linear Technology Corp.^		15,300		338,436
Logitech International*^		13,500		210,330
Marvell Technology Group*^		56,900		379,523
Maxim Integrated Products		11,300		129,046
MEMC Electronic Materials*^		9,700		138,516

See Notes to Financial Statements

20

ADVANCE CAPITAL I — EQUITY GROWTH FUND
PORTFOLIO OF INVESTMENTS
DECEMBER 31, 2008

Common Stock	Shares		Value
TECHNOLOGY — 13.0% (continued)
Microchip Technology, Inc.^		13,057	$	255,003
National Semiconductor		18,000		181,260
NetApp, Inc.*^		24,200		338,074
ON Semiconductor Corp.*		38,800		131,920
Perot Systems Corp.*		20,500		280,235
QLogic Corp.*^		14,600		196,224
Red Hat, Inc.*^		32,000		423,040
Salesforce.com, Inc.*^		11,900		380,919
Seagate Technology		39,900		176,757

	Shares/
Common Stock	Principal		Value
TECHNOLOGY — 13.0% (continued)
SEI Investments Co.		8,700	$	136,677
Silicon Laboratories, Inc.*^		8,700		215,586
Synopsys, Inc.*		8,800		162,976
Teradyne, Inc.*		25,900		109,298
Varian Semiconductor*		7,100		128,652
Xilinx, Inc.^		23,400		416,989
TOTAL COMMON STOCK — 89.7%
(Cost $105,482,735)				75,416,690

Fixed Income Securities, Cash Collateral						Shares/
and Short-Term Investments	Coupon			Maturity		Principal		Value
INVESTMENT OF CASH COLLATERAL — 37.4%
Wachovia Asset Securitization, Inc.		0.61	%		12/25/11	$	1,358,703	$	514,697
Calyon NY		2.17	%		02/22/10		3,422,905		3,341,943
American International Group		1.09	%		06/16/09		748,159		673,343
Bear Stearns Co., Inc.		2.24	%		02/23/10		3,056,815		2,968,516
CAM US Finance SA		3.34	%		02/01/10		1,870,836		1,798,416
Citigroup Global Markets		3.31	%		11/02/09		3,397,458		3,318,423
General Electric Capital Corp.		2.45	%		05/10/10		3,337,480		3,143,886
Goldman Sachs Group, Inc.		2.23	%		11/16/09		3,003,026		2,876,418
HSBC Finance Corp.		2.43	%		11/16/09		651,537		619,312
Merrill Lynch & CO.		2.22	%		08/14/09		1,688,686		1,636,967
Morgan Stanley		2.61	%		08/07/10		3,143,424		2,941,858
SLM Corp.		3.68	%		07/27/09		1,102,230		1,038,956
KKR Atlantic		0.82	%		03/25/09		975,129		611,436
CSFB Repurchase Agreement		0.05	%		01/02/09		5,891,767		5,891,767
Dated 12/31/08, with a repurchase price of $5,891,783 (Collateralized by $6,041,154 Federal Farm Credit Bank, 0.47%, 6/17/10, market value $5,977,118)
TOTAL INVESTMENT OF CASH COLLATERAL — 37.4% (Cost $35,565,349)									31,375,938
SHORT-TERM INVESTMENTS — 11.9% Fifth Third Instl Money Market Fund (Cost $10,046,774)									10,046,774
TOTAL INVESTMENTS IN SECURITIES — 139.0% (Cost $151,094,858)									116,839,402
OTHER ASSETS LESS LIABILITIES — (39.0%)									(32,765,525	)
TOTAL NET ASSETS — 100.0%								$	84,073,877

*	Securities are non-income producing
^	A portion of these securities are on loan. At December 31, 2008, the total market value of the Fund’s securities on loan is $35,080,481.
ADR	— American Depository Receipt

See Notes to Financial Statements

21

ADVANCE CAPITAL I — BALANCED FUND
PORTFOLIO OF INVESTMENTS
DECEMBER 31, 2008

Common Stock	Shares		Value
BASIC MATERIALS — 2.1%
Agnico-Eagle Mines Ltd^		9,700	$	497,901
Air Products & Chemicals		5,200		261,404
Albemarle Corp.		2,200		49,060
Alcoa, Inc.^		22,500		253,350
BHP Billiton Ltd — ADR^		7,600		326,040
Carpenter Technology Corp.		11,500		236,210
CF Industries Holdings, Inc.		1,500		73,740
Cia Vale do Rio Doce — ADR^		22,800		276,108
Cliffs Natural Resources, Inc.		4,200		107,562
Ecolab, Inc.^		5,800		203,870
EI Du Pont de Nemours		6,200		156,860
International Flavors & Frag.^		4,100		121,852
Intrepid Potash, Inc.*^		7,400		153,698
Nucor Corp.		4,900		226,380
Potash Corp of Saskatch.^		4,900		358,778
Praxair, Inc.^		4,800		284,928
Rio Tinto PLC — ADR^		2,400		213,384
Sherwin-Williams Co.		4,700		280,825
Sigma-Aldrich Corp.^		1,800		76,032
COMMUNICATIONS — 3.9%
America Movil — ADR		6,300		195,237
American Tower Corp.*		8,400		246,288
AT&T, Inc.		39,600		1,128,600
Baidu, Inc. — ADR*		500		65,285
Cablevision Systems Corp.		3,500		58,940
Central European Media*^		2,600		56,472
Cisco Systems, Inc.*		20,100		327,630
Clear Channel Outdoor*^		6,000		36,900
Crown Castle International*^		7,000		123,060
CTC Media, Inc.*		4,900		23,520
Ctrip.com International Ltd — ADR		1,800		42,840
Digital River, Inc.*		1,800		44,640
Discovery Communications*		3,700		49,543
eBay, Inc.*^		11,300		157,748
Expedia, Inc.*^		14,100		116,184
Factset Research Systems^		2,300		101,752
F5 Networks, Inc.*		3,000		68,580
JDS Uniphase Corp.*^		9,800		35,770
Juniper Networks, Inc.*^		12,800		224,128
Lamar Advertising Co.*^		1,800		22,608
Leap Wireless International*^		3,900		104,871
McAfee, Inc.*		3,900		134,823
McGraw-Hill Cos., Inc.^		17,900		415,101
MetroPCS Communications*^		7,300		108,405
NeuStar, Inc.*^		3,900		74,607

Common Stock	Shares		Value
COMMUNICATIONS — 3.9% (continued)
NII Holdings, Inc.*		6,500	$	118,170
Nokia OYJ — ADR		14,900		232,440
Omnicom Group, Inc.		9,600		258,432
priceline.com, Inc.*^		1,900		139,935
SBA Communications Corp.*		13,800		225,216
Shaw Communications, Inc.		3,600		63,648
Sina Corp.*^		2,200		50,930
Symantec Corp.*^		19,900		269,048
Time Warner, Inc.		23,800		239,428
VeriSign, Inc.*^		5,200		99,216
Verizon Communications^		37,900		1,284,810
Walt Disney Co.^		17,800		403,882
WPP PLC — ADR		8,989		265,985
Yahoo!, Inc.*^		15,800		192,760
CONSUMER, CYCLICAL — 4.0%
Advance Auto Parts, Inc.		2,300		77,395
AnnTaylor Stores Corp.*		1,900		10,963
Bed Bath & Beyond, Inc.*		4,400		111,848
Carnival Corp.*		7,500		182,400
Centex Corp.*^		17,500		186,200
Chipotle Mexican Grill, Inc.*		800		45,832
Choice Hotels International^		3,700		111,222
Coach, Inc.*^		7,000		145,390
Copart, Inc.*		2,200		59,818
CVS Caremark Corp.^		8,200		235,668
Dick’s Sporting Goods, Inc.*^		2,400		33,864
DreamWorks Animation*^		2,600		65,676
Family Dollar Stores, Inc.^		13,700		357,159
Fastenal Co.^		2,800		97,580
Home Depot, Inc.		17,500		402,850
International Game Tech.		19,000		225,910
KB Home^		2,700		36,774
Lennar Corp.^		20,000		173,400
Marriott International, Inc.^		17,000		330,650
Mattel, Inc.		17,500		280,000
Men’s Wearhouse, Inc.^		1,775		24,034
O’Reilly Automotive, Inc.*		2,900		89,146
PACCAR, Inc.		9,600		274,560
Panera Bread Co.*^		1,900		99,256
PetSmart, Inc.		2,100		38,745
Pulte Homes, Inc.*^		2,500		27,325
Ross Stores, Inc.^		4,700		139,731
Royal Caribbean Cruises*^		3,900		53,625
Skywest, Inc.		3,300		61,380
Southwest Airlines Co.^		16,900		145,678

See Notes to Financial Statements

22

ADVANCE CAPITAL I — BALANCED FUND
PORTFOLIO OF INVESTMENTS
DECEMBER 31, 2008

Common Stock	Shares		Value
CONSUMER, CYCLICAL — 4.0% (continued)
Staples, Inc.^		16,800	$	301,056
Starbucks Corp.*		9,500		89,870
Starwood Hotels & Resorts^		12,100		216,590
Tiffany & Co.^		17,100		404,073
Tim Hortons, Inc.		4,200		121,128
TJX Cos., Inc.^		18,100		372,317
Toll Brothers, Inc.*		3,100		66,433
Tractor Supply Co.*^		1,700		61,438
Urban Outfitters, Inc.*		3,400		50,932
WABCO Holdings, Inc.		4,800		75,792
Walgreen Co.		8,300		204,761
Wal-Mart Stores, Inc.^		13,800		773,628
Williams-Sonoma, Inc.^		3,000		23,580
WMS Industries, Inc.*^		2,100		56,490
WW Grainger, Inc.^		5,200		409,968
Wynn Resorts Ltd*^		3,000		126,780
Yum! Brands, Inc.		15,700		494,550
CONSUMER, NON-CYCLICAL — 11.0%
Abbott Laboratories^		10,175		543,040
Alexion Pharmaceuticals*		1,700		61,523
Allergan, Inc.		5,840		235,469
Altria Group, Inc.		24,800		373,488
American Medical Systems*^		4,900		44,051
Amgen, Inc.*^		14,000		808,500
Amylin Pharmaceuticals, Inc.*^		4,200		45,570
Apollo Group, Inc.*		3,245		248,632
Arthrocare Corp.*^		2,000		9,540
AstraZeneca PLC — ADR		5,300		217,459
Automatic Data Processing		12,300		483,882
Avon Products, Inc.^		21,500		516,645
Becton Dickinson and Co.		900		61,551
Biogen Idec, Inc.*		1,400		66,682
BioMarin Pharmaceutical, Inc.*		2,100		37,380
Brown-Forman Corp.		8,125		418,356
Cephalon, Inc.*^		1,100		84,744
Charles River Laboratories*		2,200		57,640
CIGNA Corp.		9,500		160,075
Clorox Co.^		7,400		411,144
Coca-Cola Co.^		10,400		470,808
Colgate-Palmolive Co.		4,100		281,014
Corporate Executive Board		3,200		70,592
Covance, Inc.*		1,200		55,236
Coventry Health Care, Inc.*		2,350		34,968
Covidien Ltd		7,700		279,048
CR Bard, Inc.		2,500		210,650

Common Stock	Shares		Value
CONSUMER, NON-CYCLICAL — 11.0% (continued)
DaVita, Inc.*		1,450	$	71,877
DENTSPLY International, Inc.		3,500		98,840
DeVry, Inc.		2,800		160,748
Diageo PLC — ADR		10,600		601,444
Edwards Lifesciences Corp.*		1,200		65,940
Elan Corp PLC — ADR*^		5,000		30,000
Eli Lilly & Co.^		5,100		205,377
Equifax, Inc.		2,200		58,344
Express Scripts, Inc.*		4,400		241,912
General Mills, Inc.		5,400		328,050
Gen-Probe, Inc.*		1,800		77,112
GlaxoSmithKline PLC — ADR		5,400		201,258
Global Payments, Inc.		1,900		62,301
Health Net, Inc.*		3,100		33,759
Henry Schein, Inc.*		2,700		99,063
Hershey Co.^		8,200		284,868
Hologic, Inc.*^		5,400		70,578
Humana, Inc.*		2,400		89,472
Idexx Laboratories, Inc.*		2,400		86,592
Illumina, Inc.*^		5,900		153,695
Intuitive Surgical, Inc.*^		1,200		152,388
Iron Mountain, Inc.*		3,912		96,744
ITT Educational Services, Inc.*		1,800		170,964
JM Smucker Co.		1,700		73,712
Johnson & Johnson^		21,000		1,256,430
Kellogg Co.		4,000		175,400
Kimberly-Clark Corp.		10,600		559,044
Kraft Foods, Inc.^		9,694		260,284
Laboratory Corp of America*		1,800		115,938
Life Technologies Corp.*		1,700		39,627
Lincare Holdings, Inc.*^		2,400		64,632
Lorillard, Inc.		8,100		456,435
Manpower, Inc.		1,400		47,586
Martek Biosciences Corp.*^		1,700		51,527
Masimo Corp.*^		1,600		47,728
McCormick & Co., Inc.^		10,900		347,274
McKesson Corp.		6,600		255,618
Medtronic, Inc.		8,600		270,212
Merck & Co., Inc.		16,800		510,720
Millipore Corp.*		1,100		56,672
Monster Worldwide, Inc.*^		5,700		68,913
Moody’s Corp.^		13,500		271,215
Myriad Genetics, Inc.*		1,000		66,260
New Oriental Education — ADR*		1,100		60,401
Patterson Cos., Inc.*^		2,500		46,875
Paychex, Inc.^		17,793		467,600

See Notes to Financial Statements

23

ADVANCE CAPITAL I — BALANCED FUND
PORTFOLIO OF INVESTMENTS
DECEMBER 31, 2008

Common Stock	Shares		Value
CONSUMER, NON-CYCLICAL — 11.0% (continued)
PepsiCo., Inc.		8,100	$	443,637
Pfizer, Inc.		38,586		683,358
Philip Morris International^		26,800		1,166,068
Procter & Gamble Co.^		17,300		1,069,486
QIAGEN NV*^		3,900		68,484
Quanta Services, Inc.*		6,000		118,800
Quest Diagnostics, Inc.		7,688		399,084
ResMed, Inc.*		1,700		63,716
Ritchie Bros Auctioneers^		8,700		186,354
Robert Half International, Inc.^		4,100		85,362
Schering-Plough Corp.^		9,700		165,191
St Jude Medical, Inc.*		6,900		227,424
Sysco Corp.		7,800		178,932
Techne Corp.^		1,400		90,328
UnitedHealth Group, Inc.^		11,400		303,240
Varian Medical Systems*		3,000		105,120
Vertex Pharmaceuticals, Inc.*		2,550		77,469
VistaPrint Ltd*^		2,900		53,969
Warner Chilcott Ltd*^		4,700		68,150
WellPoint, Inc.*		8,600		362,318
Western Union Co.		12,200		174,948
Wyeth		13,200		495,132
Zimmer Holdings, Inc.*		4,800		194,016
ENERGY — 5.8%
Apache Corp.		2,800		208,684
Arch Coal, Inc.		3,900		63,531
Baker Hughes, Inc.^		8,800		282,216
Bill Barrett Corp.*^		3,200		67,616
BJ Services Co.^		30,600		357,102
BP PLC — ADR^		18,692		873,664
Cabot Oil & Gas Corp.		5,300		137,800
Chevron Corp.		13,742		1,016,496
Cameron International Corp.*^		8,200		168,100
Complete Production Svcs.*		5,000		40,750
Concho Resources, Inc.*		7,500		171,150
Consol Energy, Inc.^		8,500		242,930
Core Laboratories NV		2,100		125,706
Devon Energy Corp.^		5,100		335,121
Diamond Offshore Drilling, Inc.^		4,100		241,654
EOG Resources, Inc.		2,300		153,134
Exxon Mobil Corp.^		17,202		1,373,236
FMC Technologies, Inc.*		5,300		126,299
Forest Oil Corp.*^		22,600		372,674
Foundation Coal Holdings		5,100		71,502
GT Solar International, Inc.*		11,000		31,790

Common Stock	Shares		Value
ENERGY — 5.8% (continued)
Mariner Energy, Inc.*		5,700	$	58,140
Massey Energy Co.		2,000		27,580
Murphy Oil Corp.^		16,800		745,080
Nabors Industries Ltd*^		8,400		100,548
Newfield Exploration Co.*		14,100		278,475
Peabody Energy Corp.^		8,700		197,925
Petroleo Brasileiro SA — ADR^		7,800		159,198
Royal Dutch Shell PLC — ADR^		10,600		561,164
SandRidge Energy, Inc.*		4,500		27,675
Schlumberger Ltd^		7,660		324,248
Smith International, Inc.^		17,400		398,286
Sunoco, Inc.		7,000		304,220
Tetra Technologies, Inc.*		5,700		27,702
Total SA^		14,600		807,380
Ultra Petroleum Corp.*^		11,200		386,512
Weatherford International Ltd*		11,800		127,676
Williams Cos., Inc.^		19,200		278,016
XTO Energy, Inc.		8,400		296,268
FINANCIAL — 5.8%
ACE Ltd		4,400		232,848
Aflac, Inc.		8,300		380,472
American Express Co.		6,500		120,575
AON Corp.		6,100		278,648
Arch Capital Group Ltd*^		6,300		441,630
Assurant, Inc.		1,200		36,000
AvalonBay Communities, Inc.		3,000		181,740
Axis Capital Holdings Ltd		2,700		78,624
Bank of America Corp.		14,126		198,894
Bank of New York^		12,471		353,303
BB&T Corp.^		9,600		263,616
BlackRock, Inc.		1,000		134,150
Chubb Corp.		8,900		453,900
Citigroup, Inc.^		21,244		142,547
City National Corp.^		4,200		204,540
CME Group, Inc.		1,300		270,543
Eaton Vance Corp.^		6,700		140,767
Equity Residential		5,600		166,992
Federated Investors, Inc.^		9,800		166,208
Franklin Resources, Inc.		4,400		280,632
Goldman Sachs Group, Inc.		2,400		202,536
HCC Insurance Holdings, Inc.		3,000		80,250
Interactive Brokers Group*		3,100		55,459
IntercontinentalExchange*		2,000		164,880
Janus Capital Group, Inc.		6,000		48,180
JPMorgan Chase & Co.		36,300		1,144,539

See Notes to Financial Statements

24

ADVANCE CAPITAL I — BALANCED FUND
PORTFOLIO OF INVESTMENTS
DECEMBER 31, 2008

Common Stock	Shares		Value
FINANCIAL — 5.8% (continued)
Keycorp^		14,400	$	122,688
Lazard Ltd		2,000		59,480
Manulife Financial Corp.^		20,400		347,412
Northern Trust Corp.		15,200		792,528
optionsXpress Holdings, Inc.^		3,300		44,088
PNC Financial Services^		9,100		445,900
Progressive Corp.*		14,600		216,226
RenaissanceRe Holdings		6,900		355,764
Simon Property Group, Inc.		2,700		143,451
State Street Corp.^		7,300		287,109
SunTrust Banks, Inc.^		8,300		245,182
SVB Financial Group*^		1,600		41,968
Travelers Cos., Inc.		6,900		311,880
US Bancorp^		28,728		718,487
Wells Fargo & Co.^		43,560		1,284,149
INDUSTRIAL — 5.7%
3M Co.^		7,200		414,288
Agilent Technologies, Inc.*		8,900		139,107
Alliant Techsystems, Inc.*^		3,900		334,464
AMETEK, Inc.		4,000		120,840
Amphenol Corp.		3,200		76,736
Boeing Co.^		9,540		407,072
Caterpillar, Inc.		6,700		299,289
CH Robinson Worldwide, Inc.^		4,700		258,641
Cogent, Inc.*		4,600		62,422
CSX Corp.		6,100		198,067
Cummins, Inc.^		4,300		114,939
Cymer, Inc.*		2,900		63,539
Dolby Laboratories, Inc.*		4,300		140,868
Donaldson Co., Inc.		3,700		124,505
Emerson Electric Co.		9,200		336,812
Empresa Brasileira — ADR^		15,700		254,497
Expeditors International^		7,000		232,890
FLIR Systems, Inc.*^		2,000		61,360
Flowserve Corp.		1,300		66,950
Fluor Corp.		4,100		183,967
Foster Wheeler Ltd*^		5,300		123,914
General Cable Corp.*^		2,500		44,225
General Dynamics Corp.		6,900		397,371
General Electric Co.^		78,400		1,270,080
Gentex Corp.^		4,400		38,852
Goodrich Corp.		15,000		555,300
Graco, Inc.^		2,300		54,579
Harsco Corp.		2,400		66,432
Honeywell International, Inc.		8,500		279,055

Common Stock	Shares		Value
INDUSTRIAL — 5.7% (continued)
IDEX Corp.		2,625	$	63,394
II-VI, Inc.*^		2,300		43,907
Illinois Tool Works, Inc.		6,900		241,845
Itron, Inc.*^		900		57,366
ITT Corp.		10,200		469,098
Jabil Circuit, Inc.^		34,100		230,175
Joy Global, Inc.^		12,400		283,836
Landstar System, Inc.^		5,100		195,993
Lockheed Martin Corp.		5,600		470,848
McDermott International, Inc.*		7,400		73,112
Mettler Toledo International*		800		53,920
National Instruments Corp.		3,050		74,298
Northrop Grumman Corp.		4,100		184,664
Pall Corp.		2,300		65,389
Precision Castparts Corp.^		3,500		208,180
Republic Services, Inc.		3,950		97,921
Rockwell Collins, Inc.		5,500		214,995
Roper Industries, Inc.^		2,700		117,207
Stericycle, Inc.*^		2,600		135,408
Terex Corp.*		2,300		39,836
Trimble Navigation Ltd*		7,000		151,270
Union Pacific Corp.^		10,600		506,680
United Technologies Corp.^		7,800		418,080
Valmont Industries, Inc.		1,600		98,176
Waters Corp.*		2,000		73,300
Zebra Technologies Corp.*^		2,200		44,572
TECHNOLOGY — 3.0%
Activision Blizzard, Inc.*^		8,642		74,667
Adobe Systems, Inc.*^		4,300		91,547
Altera Corp.^		10,700		178,797
American Reprographics Co.*		4,400		30,360
Analog Devices, Inc.		13,600		258,672
ANSYS, Inc.*^		3,200		89,248
Autodesk, Inc.*^		6,800		133,620
BMC Software, Inc.*		2,900		78,039
Broadcom Corp.*^		13,500		229,095
Check Point Software Tech.*^		2,800		53,172
Citrix Systems, Inc.*^		5,000		117,850
Cognizant Technology*^		9,736		175,832
Dell, Inc.*^		19,000		194,560
Dun & Bradstreet Corp.		2,000		154,400
Electronic Arts, Inc.*		7,200		115,488
EMC Corp.*^		14,100		147,627
Fairchild Semiconductor*		5,400		26,406
Fidelity National Information		4,400		71,588

See Notes to Financial Statements

25

ADVANCE CAPITAL I — BALANCED FUND
PORTFOLIO OF INVESTMENTS
DECEMBER 31, 2008

Common Stock	Shares		Value
TECHNOLOGY — 3.0% (continued)
Fiserv, Inc.*		1,650	$	60,011
Integrated Device Tech.*		6,100		34,221
Intel Corp.		28,700		420,742
Intersil Corp.		4,100		37,679
Intuit, Inc.*		6,800		161,772
Jack Henry & Associates^		3,200		62,112
Kla-Tencor Corp.		2,200		47,938
Lam Research Corp.*^		2,600		55,328
Linear Technology Corp.^		11,000		243,320
Logitech International*^		4,300		66,994
Marvell Technology Group*^		21,600		144,072
Maxim Integrated Products		3,600		41,112
MEMC Electronic Materials*^		3,800		54,264
Microchip Technology, Inc.^		10,512		205,299
Microsoft Corp.^		27,100		526,824
National Semiconductor		20,500		206,435
NetApp, Inc.*^		8,500		118,745
ON Semiconductor Corp.*		13,700		46,580
Oracle Corp.*^		11,100		196,803
Perot Systems Corp.*		5,800		79,286
QLogic Corp.*^		3,100		41,664
Red Hat, Inc.*^		11,700		154,674
Salesforce.com, Inc.*^		3,800		121,638
Seagate Technology		39,300		174,099
SEI Investments Co.		2,900		45,559

Common Stock	Shares		Value
TECHNOLOGY — 3.0% (continued)
Silicon Laboratories, Inc.*^		2,800	$	69,384
Synopsys, Inc.*		3,900		72,228
Teradyne, Inc.*		9,200		38,824
Texas Instruments, Inc.^		11,400		176,928
Varian Semiconductor*		3,400		61,608
Xilinx, Inc.^		17,400		310,068
UTILITIES — 1.9%
Allegheny Energy, Inc.^		8,500		287,810
Ameren Corp.^		8,800		292,688
Duke Energy Corp.^		21,600		324,216
Entergy Corp.		2,700		224,451
Exelon Corp.^		3,950		219,660
FPL Group, Inc.		6,300		317,079
Integrys Energy Group, Inc.		4,900		210,602
Pepco Holdings, Inc.		10,500		186,480
Pinnacle West Capital Corp.		9,900		318,087
Progress Energy, Inc.		8,600		342,710
SCANA Corp.		11,000		391,600
Southern Co.^		10,800		399,600
TECO Energy, Inc.^		15,800		195,133
TOTAL COMMON STOCK — 43.2%
(Cost $112,619,200)			$	86,566,434

*	Securities are non-income producing
^	A portion of these securities are on loan. At December 31, 2008, the total market value of the Fund’s common stock securities on loan is $36,464,032.
ADR	— American Depository Receipt

See Notes to Financial Statements

26

ADVANCE CAPITAL I — BALANCED FUND
PORTFOLIO OF INVESTMENTS
DECEMBER 31, 2008

					Principal
Fixed Income Securities	Coupon		Maturity		Amount		Value
BASIC MATERIALS — 3.5%
Alcoa, Inc.^		5.375		01/15/2013	$	2,000,000	$	1,729,229
BHP Billiton Finance USA Ltd		7.250		03/01/2016		500,000		505,931
Carpenter Technology Corp.		7.625		08/15/2011		1,500,000		1,512,018
Ispat Inland ULC^		9.750		04/01/2014		2,000,000		1,711,844
Rohm and Haas Holdings Ltd		9.800		04/15/2020		287,500		342,119
Westvaco Corp.		7.650		03/15/2027		1,350,000		1,227,987
COMMUNICATIONS — 6.5%
CBS Corp.		8.625		08/01/2012		1,000,000		817,748
New Cingular Wireless Services		8.750		03/01/2031		1,000,000		1,250,085
Comcast Holdings Corp.		10.625		07/15/2012		2,000,000		2,124,124
COX Communications, Inc.^		6.850		01/15/2018		1,050,000		984,900
Deutsche Telekom International^		8.500		06/15/2010		1,900,000		1,957,141
Michigan Bell Telephone Co.		7.850		01/15/2022		1,000,000		1,032,949
TW, Inc.		9.150		02/01/2023		2,000,000		2,133,004
Viacom, Inc.		5.750		04/30/2011		1,000,000		908,188
Verizon New Jersey, Inc.		8.000		06/01/2022		650,000		614,954
Vodafone Group PLC		5.375		01/30/2015		1,500,000		1,412,844
CONSUMER, CYCLICAL — 2.9%
Best Buy Co., Inc.*		6.750		07/15/2013		2,000,000		1,867,138
CVS Caremark Corp.		5.750		06/01/2017		2,000,000		1,882,938
Macy’s Retail Holdings, Inc.		7.450		09/15/2011		1,000,000		785,599
Whirlpool Corp.		5.500		03/01/2013		1,500,000		1,186,773
CONSUMER, NON-CYCLICAL — 2.0%
Genentech, Inc.		4.750		07/15/2015		1,000,000		1,006,064
Kraft Foods, Inc.		6.125		02/01/2018		1,000,000		979,897
UnitedHealth Group, Inc.		5.500		11/15/2012		1,000,000		911,280
Wyeth		6.000		02/15/2036		1,000,000		1,072,906
ENERGY — 4.2%
Canadian Oil Sands Ltd*		5.800		08/15/2013		1,450,000		1,382,500
Marathon Oil Canada Corp.		8.375		05/01/2012		1,350,000		1,288,767
Noble Corp.		5.875		06/01/2013		1,000,000		974,578
Premcor Refining Group, Inc.		7.500		06/15/2015		1,000,000		900,415
StatoilHydro ASA		7.500		10/01/2016		1,000,000		1,111,216
TransCanada Pipelines Ltd		7.690		06/30/2016		1,100,000		1,142,964
Weatherford International, Inc.		6.350		06/15/2017		2,000,000		1,706,872
FINANCIAL — 11.1%
AIG Retirement Services, Inc.		8.125		04/28/2023		500,000		307,212
Allied Capital Corp.		6.000		04/01/2012		1,000,000		692,192
American Express Bank FSB		5.500		04/16/2013		2,000,000		1,894,480
BankAmerica Institutional*		7.700		12/31/2026		1,000,000		839,902
Bank of America Corp.		7.750		08/15/2015		1,250,000		1,278,326
Bank One Corp.		10.000		08/15/2010		750,000		790,319
Deutsche Bank Trust Corp.		7.500		11/15/2015		1,000,000		988,505
Barnett Capital III		1.795		02/01/2027		1,000,000		450,014

See Notes to Financial Statements

27

ADVANCE CAPITAL I — BALANCED FUND
PORTFOLIO OF INVESTMENTS
DECEMBER 31, 2008

					Principal
Fixed Income Securities	Coupon		Maturity		Amount		Value
FINANCIAL — 11.1% (continued)
CitiFinancial, Inc.		6.625		06/01/2015	$	1,250,000	$	1,159,154
Comerica Bank		7.125		12/01/2013		940,000		780,653
General Electric Capital Corp.		5.000		03/30/2019		1,000,000		910,193
Goldman Sachs Group, Inc.		6.875		01/15/2011		1,000,000		1,007,305
HSBC Finance Corp.		6.375		11/27/2012		1,000,000		978,380
Invesco Ltd		5.625		04/17/2012		1,000,000		914,975
Jefferies Group, Inc.		6.450		06/08/2027		2,000,000		1,169,256
Morgan Stanley		6.750		10/15/2013		1,000,000		826,386
Morgan Stanley		4.750		04/01/2014		1,000,000		761,889
Morgan Stanley		6.250		08/09/2026		500,000		406,619
Nationwide Life Global Funding*		5.450		10/02/2012		1,000,000		780,876
New York Life Global Funding*		5.250		10/16/2012		1,000,000		980,953
Ohio National Financial Services*		7.000		07/15/2011		1,000,000		989,098
Republic New York Corp.		7.000		03/22/2011		500,000		504,613
Santander Financial Issuances		6.375		02/15/2011		1,000,000		1,040,674
SLM Corp.^		4.000		01/15/2010		1,000,000		905,193
TIAA Global Markets, Inc.*		5.125		10/10/2012		1,000,000		985,650
INDUSTRIAL — 4.4%
Burlington Northern Santa Fe		5.750		03/15/2018		1,000,000		963,981
Clark Equipment Co.		8.000		05/01/2023		500,000		519,849
Federal Express Corp.		8.760		05/22/2015		1,500,000		1,495,148
Joy Global, Inc.		6.000		11/15/2016		700,000		588,603
Koninklijke Philips Electronics		7.250		08/15/2013		1,000,000		1,028,680
Northrop Grumman		6.250		01/15/2010		750,000		746,141
Thomas & Betts Corp.		7.250		06/01/2013		2,000,000		2,065,766
United Parcel Service of America		8.375		04/01/2020		1,000,000		1,326,147
MORTGAGE SECURITIES — 9.1%
Chase Mortgage Finance Corp.		6.500		05/25/2036		1,218,712		910,269
Countrywide Alternative		6.000		06/25/2037		1,742,709		484,485
Fannie Mae Pool		7.000		04/01/2033		718,088		758,040
Freddie Mac Gold Pool		6.500		06/01/2024		760,643		798,437
Freddie Mac Gold Pool		7.000		10/01/2031		1,039,682		1,094,213
Freddie Mac Gold Pool		6.500		02/01/2032		1,093,180		1,140,665
Freddie Mac Gold Pool		6.500		08/01/2032		875,153		913,168
Freddie Mac Gold Pool		6.500		12/01/2032		1,243,994		1,299,585
Freddie Mac Gold Pool		6.500		04/01/2033		549,441		573,994
Ginnie Mae I pool		6.000		06/15/2037		1,964,846		2,031,816
Ginnie Mae I pool		6.000		07/15/2038		1,975,201		2,041,537
Ginnie Mae I pool		6.500		10/15/2038		1,982,082		2,064,754
Ginnie Mae I pool		6.500		10/15/2038		1,995,804		2,079,048
Lehman Mortgage Trust		6.000		09/25/2036		1,201,925		516,076
MASTR Asset Securitization		6.250		05/25/2036		1,129,473		852,957
Residential Asset Securitization		6.500		06/25/2037		1,597,012		748,101
TECHNOLOGY — 2.0%
International Business Machines		7.500		06/15/2013		2,000,000		2,260,508
Samsung Electronics Co Ltd*		7.700		10/01/2027		1,615,000		1,685,690

See Notes to Financial Statements

28

ADVANCE CAPITAL I — BALANCED FUND
PORTFOLIO OF INVESTMENTS
DECEMBER 31, 2008

Fixed Income Securities, Cash Collateral						Shares/
and Short-Term Investments	Coupon			Maturity		Principal		Value
UTILITIES — 3.8%
Detroit Edison Co.		6.400			10/01/2013	$	2,000,000	$	2,078,418
Entergy Gulf States, Inc.		5.250			08/01/2015		1,750,000		1,493,392
Michigan Consolidated Gas Co.		8.250			05/01/2014		1,050,000		1,141,184
Northern States Power Co.		8.000			08/28/2012		1,000,000		1,054,589
PSEG Power LLC^		5.500			12/01/2015		2,000,000		1,787,340
TOTAL FIXED-INCOME SECURITIES — 49.5%
(Cost $110,335,442)									99,350,370
INVESTMENT OF CASH COLLATERAL — 18.2%
Wachovia Asset Securitization, Inc.		0.61	%		12/25/11		2,241,680		849,182
Calyon NY		2.17	%		02/22/10		3,924,658		3,831,828
American International Group		1.09	%		06/16/09		892,718		803,446
Bear Stearns Co., Inc.		2.24	%		02/23/10		3,563,770		3,460,827
CAM US Finance SA		3.34	%		02/01/10		2,194,602		2,109,649
Citigroup Global Markets		3.31	%		11/02/09		3,906,219		3,815,349
General Electric Capital Corp.		2.45	%		05/10/10		3,842,998		3,620,081
Goldman Sachs Group, Inc.		2.23	%		11/16/09		3,494,060		3,346,750
HSBC Finance Corp.		2.43	%		11/16/09		744,623		707,794
Merrill Lynch & CO.		2.22	%		08/14/09		1,955,541		1,895,649
Morgan Stanley		2.61	%		08/07/10		3,549,419		3,321,820
SLM Corp.		3.68	%		07/27/09		1,253,479		1,181,528
KKR Atlantic		0.82	%		03/25/09		1,174,861		736,674
CSFB Repurchase Agreement		0.05	%		01/02/09		6,757,537		6,757,537
Dated 12/31/08, with a repurchase price of $6,757,556 (Collateralized by $6,928,876 Federal Farm Credit Bank, 0.47%, 6/17/10, market value $6,855,430)
TOTAL INVESTMENT OF CASH COLLATERAL — 18.2%
(Cost $40,791,497)									36,438,114
SHORT-TERM INVESTMENTS — 7.7%
Fifth Third Institutional Money Market Fund
(Cost $15,179,129)									15,179,129
TOTAL INVESTMENTS IN SECURITIES — 118.6%
(Cost $278,925,268)									237,534,047
OTHER ASSETS LESS LIABILITIES — (18.6%)									(37,218,663	)
TOTAL NET ASSETS — 100.0%								$	200,315,384

*	Security exempt from registration under Rule 144A of the Securities Act of 1933. These securities are considered liquid and may be resold in transactions exempt from registration. At December 31, 2008, the aggregate market value of these securities amounted to $9,511,807 or 4.75% of net assets.
^	A portion of these securities are on loan. At December 31, 2008, the total market value of the Fund’s fixed income securities on loan is $3,698,265.

See Notes to Financial Statements

29

ADVANCE CAPITAL I — RETIREMENT INCOME FUND
PORTFOLIO OF INVESTMENTS
DECEMBER 31, 2008

					Principal
Fixed Income Securities	Coupon		Maturity		Amount		Value
BASIC MATERIALS — 5.1%
AK Steel Corp.		7.750		06/15/2012	$	2,000,000	$	1,560,000
Alcoa, Inc.		5.870		02/23/2022		3,000,000		2,126,924
Carpenter Technology Corp.		7.625		08/15/2011		2,295,000		2,313,388
Century Aluminum Co.^		7.500		08/15/2014		3,000,000		1,725,000
CRA Finance USA Ltd		7.125		12/01/2013		500,000		562,284
Ispat Inland ULC		9.750		04/01/2014		3,500,000		2,995,727
Placer Dome, Inc.		7.750		06/15/2015		1,500,000		1,507,407
Steel Dynamics, Inc.		7.375		11/01/2012		3,000,000		2,190,000
Westvaco Corp.		7.650		03/15/2027		2,700,000		2,455,974
COMMUNICATIONS — 10.4%
CBS Corp.		8.625		08/01/2012		750,000		613,311
CBS Corp.^		5.625		08/15/2012		2,000,000		1,646,022
Comcast Cable Communications		8.500		05/01/2027		1,000,000		1,126,896
Comcast Holdings Corp.		10.625		07/15/2012		1,500,000		1,593,092
COX Communications, Inc.		6.850		01/15/2018		1,250,000		1,172,500
COX Enterprises, Inc.*		7.375		07/15/2027		1,000,000		946,549
DirecTV Holdings LLC^		6.375		06/15/2015		3,000,000		2,767,500
GTE Corp.		8.750		11/01/2021		1,500,000		1,621,890
Lamar Media Corp.^		7.250		01/01/2013		3,000,000		2,392,500
Liberty Media LLC^		5.700		05/15/2013		3,000,000		1,966,731
Michigan Bell Telephone Co.		7.850		01/15/2022		2,000,000		2,065,898
News America Holdings, Inc.		8.500		02/23/2025		2,300,000		2,263,506
Pacific Bell Telephone Co.		7.250		11/01/2027		2,000,000		1,808,712
Qwest Corp.		8.875		03/15/2012		3,000,000		2,775,000
Rogers Wireless, Inc.		8.000		12/15/2012		3,000,000		2,872,500
Sprint Capital Corp.^		6.375		05/01/2009		1,000,000		993,750
TW, Inc.		9.150		02/01/2023		3,000,000		3,199,506
Verizon New Jersey, Inc.		8.000		06/01/2022		1,000,000		946,083
Viacom, Inc.		5.750		04/30/2011		3,000,000		2,724,564
CONSUMER, CYCLICAL — 5.8%
Best Buy Co., Inc.*		6.750		07/15/2013		3,000,000		2,800,706
Brown Shoe Co., Inc.		8.750		05/01/2012		1,000,000		740,000
CVS Caremark Corp.		5.750		06/01/2017		3,000,000		2,824,408
Home Depot, Inc.		5.875		12/16/2036		3,000,000		2,352,306
Macy’s Retail Holdings, Inc.		4.800		07/15/2009		1,500,000		1,421,756
Meritor Automotive, Inc.		6.800		02/15/2009		348,000		339,300
MGM Mirage		6.750		09/01/2012		3,000,000		2,100,000
Royal Caribbean Cruises Ltd		8.750		02/02/2011		3,000,000		2,310,000
Speedway Motorsports, Inc.^		6.750		06/01/2013		3,000,000		2,160,000
Toro Co.		7.800		06/15/2027		2,177,000		2,098,748
Wynn Las Vegas LLC		6.625		12/01/2014		1,000,000		755,000

See Notes to Financial Statements

30

ADVANCE CAPITAL I — RETIREMENT INCOME FUND
PORTFOLIO OF INVESTMENTS
DECEMBER 31, 2008

					Principal
Fixed Income Securities	Coupon		Maturity		Amount		Value
CONSUMER, NON-CYCLICAL — 10.0%
Altria Group, Inc.^		8.500		11/10/2013	$	3,000,000	$	3,107,231
Archer-Daniels-Midland Co.		8.375		04/15/2017		1,000,000		1,175,115
Campbell Soup Co.		8.875		05/01/2021		2,145,000		2,737,219
CIGNA Corp.		7.650		03/01/2023		1,500,000		1,327,491
CIGNA Corp.		7.875		05/15/2027		1,000,000		926,263
Corrections Corp of America^		7.500		05/01/2011		3,000,000		2,970,000
Diageo Capital PLC		5.750		10/23/2017		2,000,000		1,935,202
FBG Finance Ltd*		5.125		06/15/2015		2,000,000		1,648,566
Kraft Foods, Inc.		6.125		02/01/2018		3,000,000		2,939,691
Land O’ Lakes, Inc.		9.000		12/15/2010		3,000,000		2,985,000
Sysco Corp.		6.500		08/01/2028		3,000,000		3,243,018
UnitedHealth Group, Inc.		5.500		11/15/2012		3,000,000		2,733,840
WellPoint, Inc.^		5.875		06/15/2017		3,500,000		3,185,473
Wyeth		6.000		02/15/2036		3,000,000		3,218,718
DIVERSIFIED — 0.7%
Leucadia National Corp.		7.000		08/15/2013		3,000,000		2,385,000
ENERGY — 9.5%
ANR Pipeline Co.		9.625		11/01/2021		2,000,000		2,191,292
Burlington Resources, Inc.		9.125		10/01/2021		700,000		859,462
Canadian Oil Sands Ltd*		5.800		08/15/2013		2,000,000		1,906,895
Husky Energy, Inc.		6.200		09/15/2017		2,575,000		2,301,605
Kerr-McGee Corp.		6.875		09/15/2011		500,000		494,816
Louisiana Land & Exploration		7.650		12/01/2023		750,000		829,951
National Oilwell Varco, Inc.^		6.125		08/15/2015		2,500,000		2,171,553
Noble Corp.		5.875		06/01/2013		3,000,000		2,923,734
Plains Exploration & Production^		7.750		06/15/2015		2,500,000		1,887,500
StatoilHydro ASA		7.500		10/01/2016		3,000,000		3,333,648
Sunoco, Inc.		4.875		10/15/2014		2,000,000		1,682,208
Swift Energy Co.		7.625		07/15/2011		3,000,000		2,340,000
Transocean Ltd		7.375		04/15/2018		2,000,000		1,935,688
Ultramar Diamond Shamrock		7.200		10/15/2017		2,250,000		2,109,785
USX Corp.		9.375		02/15/2012		2,150,000		2,263,759
USX Corp.		9.375		05/15/2022		610,000		665,470
Weatherford International, Inc.		6.350		06/15/2017		3,000,000		2,560,308
FINANCIAL — 15.6%
AIG Retirement Services, Inc.		8.125		04/28/2023		2,000,000		1,228,848
Allied Capital Corp.		6.000		04/01/2012		2,000,000		1,384,383
American Express Bank FSB		5.500		04/16/2013		3,000,000		2,841,720
BankAmerica Capital II		8.000		12/15/2026		1,000,000		817,328
Caterpillar Financial Services		5.450		04/15/2018		2,000,000		1,872,570
Citigroup, Inc.		7.250		10/01/2010		1,000,000		992,413
Citigroup, Inc.		6.125		11/21/2017		2,000,000		2,021,080

See Notes to Financial Statements

31

ADVANCE CAPITAL I — RETIREMENT INCOME FUND
PORTFOLIO OF INVESTMENTS
DECEMBER 31, 2008

					Principal
Fixed Income Securities	Coupon		Maturity		Amount		Value
FINANCIAL — 15.6% (continued)
Comerica Bank		7.125		12/01/2013	$	1,500,000	$	1,245,723
Comerica Bank		8.375		07/15/2024		200,000		145,792
Deutsche Bank Trust Corp.		7.500		11/15/2015		2,500,000		2,471,263
Fairfax Financial Holdings Ltd^		7.750		04/26/2012		1,000,000		890,000
Farmers Insurance Exchange*		8.625		05/01/2024		2,000,000		1,336,564
Fifth Third Bank		5.200		03/01/2019		900,000		768,759
General Electric Capital Corp.^		5.250		10/19/2012		1,000,000		1,007,211
General Electric Capital Corp.		5.000		03/30/2019		3,000,000		2,730,579
Goldman Sachs Group, Inc.		6.750		10/01/2037		2,500,000		2,029,670
Hospitality Properties Trust		5.625		03/15/2017		1,000,000		461,139
Host Hotels & Resorts LP^		6.875		11/01/2014		2,000,000		1,540,000
HSBC America Capital Trust II*		8.380		05/15/2027		1,000,000		993,906
HSBC Finance Corp.^		6.375		11/27/2012		1,000,000		978,380
Icahn Enterprises LP^		7.125		02/15/2013		3,000,000		2,070,000
Invesco Ltd		5.375		02/27/2013		2,000,000		1,776,380
Invesco Ltd		5.625		04/17/2012		1,000,000		914,975
Jefferies Group, Inc.		6.450		06/08/2027		3,000,000		1,753,884
JPMorgan Chase & Co.		6.625		03/15/2012		500,000		512,199
MBNA Capital A		8.278		12/01/2026		2,000,000		1,659,856
Merrill Lynch & Co., Inc.		5.450		02/05/2013		1,500,000		1,441,869
Morgan Stanley		5.250		11/02/2012		1,000,000		909,474
Morgan Stanley^		5.950		12/28/2017		2,000,000		1,659,962
Nationsbank Corp.		10.200		07/15/2015		1,000,000		1,096,842
New England Mutual Life Ins.		7.875		02/15/2024		1,650,000		1,506,014
Ohio National Financial Services*		7.000		07/15/2011		2,000,000		1,978,196
Republic New York Corp.		9.125		05/15/2021		1,000,000		1,117,599
Santander Financial Issuances		6.375		02/15/2011		750,000		780,506
Security Benefit Life Insurance*		8.750		05/15/2016		2,000,000		700,000
SLM Corp.^		4.000		01/15/2010		3,000,000		2,715,579
Travelers Property Casualty		7.750		04/15/2026		2,000,000		2,119,678
Washington Mutual Finance		6.875		05/15/2011		1,000,000		955,719
INDUSTRIAL — 7.9%
Allied Waste North America, Inc.^		6.375		04/15/2011		2,000,000		1,900,000
Arrow Electronics, Inc.		7.500		01/15/2027		2,300,000		1,795,513
Burlington Northern, Inc.		8.750		02/25/2022		1,750,000		2,014,952
Canadian Pacific Railway Co.^		6.500		05/15/2018		3,000,000		2,645,826
Clark Equipment Co.		8.000		05/01/2023		500,000		519,849
Deere & Co.		8.500		01/09/2022		1,000,000		1,196,336
Federal Express Corp.		9.650		06/15/2012		1,047,000		1,099,345
Federal Express Corp.		7.630		01/01/2015		1,000,000		966,599
Federal Express Corp.		8.760		05/22/2015		1,000,000		996,765
Gulfmark Offshore, Inc.		7.750		07/15/2014		2,375,000		1,686,250
Ingersoll-Rand Co.		9.000		08/15/2021		305,000		337,369

See Notes to Financial Statements

32

ADVANCE CAPITAL I — RETIREMENT INCOME FUND
PORTFOLIO OF INVESTMENTS
DECEMBER 31, 2008

					Principal
Fixed Income Securities	Coupon		Maturity		Amount		Value
INDUSTRIAL — 7.9% (continued)
Joy Global, Inc.		6.000		11/15/2016	$	3,000,000	$	2,522,586
Koninklijke Philips Electronics		7.250		08/15/2013		2,000,000		2,057,360
Northrop Grumman		9.375		04/15/2021		1,000,000		1,421,993
Pactiv Corp.		7.950		12/15/2025		2,500,000		2,338,253
Stagecoach Transport Holdings		8.625		11/15/2009		500,000		525,477
Thomas & Betts Corp.		7.250		06/01/2013		3,000,000		3,098,649
MORTGAGE SECURITIES — 21.9%
Banc of America Alternative		6.000		11/25/2046		1,321,677		633,579
Banc of America Funding Corp.		6.000		03/25/2037		2,459,106		1,761,873
Banc of America Mortgage		6.000		05/25/2037		2,595,407		1,590,650
Chase Mortgage Finance Corp.		6.500		05/25/2036		2,155,663		1,610,088
Countrywide Alternative Loan		5.250		08/25/2035		955,076		746,728
Countrywide Alternative Loan		5.500		09/25/2035		1,792,794		1,030,856
Countrywide Alternative Loan		6.250		07/25/2036		840,279		551,206
Countrywide Alternative Loan		6.000		07/25/2036		453,831		220,720
Countrywide Alternative		6.000		12/25/2036		1,092,409		469,053
Countrywide Alternative		6.000		05/25/2037		2,321,685		730,793
Countrywide Alternative		6.000		05/25/2037		1,875,061		971,893
Countrywide Alternative		6.000		06/25/2037		2,614,063		726,727
Countrywide Home Loan		5.750		05/25/2037		1,977,020		902,553
Credit Suisse Mortgage Capital		6.500		03/25/2036		731,631		393,938
Credit Suisse Mortgage Capital		6.250		06/25/2036		2,003,465		878,395
Fannie Mae Pool		7.000		02/01/2032		1,492,501		1,580,607
Fannie Mae Pool		7.000		03/01/2032		1,411,721		1,493,870
Fannie Mae Pool		7.000		04/01/2033		1,123,163		1,185,652
First Horizon Alternative Mort.		6.000		08/25/2036		2,234,483		1,347,242
Freddie Mac Gold Pool		6.500		06/01/2024		1,774,833		1,863,020
Freddie Mac Gold Pool		7.000		10/01/2031		1,774,303		1,867,364
Freddie Mac Gold Pool		6.500		02/01/2032		1,750,799		1,826,849
Freddie Mac Gold Pool		7.000		05/01/2032		2,270,251		2,385,833
Freddie Mac Gold Pool		6.500		08/01/2032		1,166,870		1,217,556
Freddie Mac Gold Pool		6.500		04/01/2033		1,648,322		1,721,982
Freddie Mac Gold Pool		7.000		09/01/2033		507,862		532,041
Freddie Mac Gold Pool		6.500		10/01/2038		2,973,442		3,091,450
Ginnie Mae I pool		6.000		06/15/2037		2,947,269		3,047,724
Ginnie Mae I pool		6.000		07/15/2038		2,962,801		3,062,305
Ginnie Mae I pool		6.500		09/15/2038		2,945,417		3,068,269
Ginnie Mae I pool		6.500		09/15/2038		2,967,742		3,091,525
Ginnie Mae I pool		6.500		09/15/2038		2,963,751		3,087,368
Ginnie Mae I pool		6.500		10/15/2038		2,973,123		3,097,130
Ginnie Mae I pool		6.500		10/15/2038		2,994,657		3,119,563
Ginnie Mae I pool		6.500		10/15/2038		3,982,227		4,148,324
Ginnie Mae II pool		6.500		09/20/2038		2,962,737		3,081,690

See Notes to Financial Statements

33

ADVANCE CAPITAL I — RETIREMENT INCOME FUND
PORTFOLIO OF INVESTMENTS
DECEMBER 31, 2008

Fixed Income Securities and						Shares/
Cash Collateral	Coupon			Maturity		Principal		Value
MORTGAGE SECURITIES — 21.9% (continued)
Ginnie Mae II pool		7.000			10/20/2038	$	2,976,776	$	3,080,471
Lehman Mortgage Trust		6.480			04/25/2036		1,821,567		1,058,515
Lehman Mortgage Trust		6.000			09/25/2036		2,213,490		950,417
Lehman Mortgage Trust		6.682			06/25/2037		2,367,896		1,399,192
MASTR Alternative Loans Trust		6.500			12/25/2033		235,306		197,290
Merrill Lynch Mortgage Investors		6.250			10/25/2036		2,861,345		1,508,906
Residential Accredit Loans, Inc.		6.000			06/25/2037		2,535,164		1,500,850
Residential Asset Securitization		6.000			04/25/2036		3,000,000		2,082,157
Residential Asset Securitization		6.500			06/25/2037		2,874,621		1,346,582
TECHNOLOGY — 4.7%
Affiliated Computer Services		5.200			06/01/2015		3,000,000		2,160,000
Hewlett-Packard Co.^		5.500			03/01/2018		2,000,000		2,018,452
International Business Machines		8.375			11/01/2019		2,000,000		2,525,884
Lexmark International, Inc.		5.900			06/01/2013		3,000,000		2,364,966
Oracle Corp.		5.750			04/15/2018		3,000,000		3,137,904
Seagate Technology HDD		6.375			10/01/2011		3,000,000		2,070,000
Xerox Corp.		7.625			06/15/2013		2,760,000		2,303,482
UTILITIES — 5.9%
Carolina Power & Light Co.		8.625			09/15/2021		3,000,000		3,617,514
Commonwealth Edison Co.		6.150			09/15/2017		2,155,000		2,003,822
Delmarva Power & Light Co.		6.400			12/01/2013		3,000,000		3,076,035
Detroit Edison Co.		6.400			10/01/2013		3,000,000		3,117,627
Entergy Louisiana LLC		5.090			11/01/2014		2,500,000		2,163,688
PSEG Power LLC		5.500			12/01/2015		2,000,000		1,787,340
CenterPoint Energy Houston		9.150			03/15/2021		2,300,000		2,456,763
Southern Co Capital Funding		5.750			11/15/2015		2,000,000		2,040,130
TOTAL FIXED INCOME SECURITIES — 97.5% (Cost $386,683,640)									334,464,524
INVESTMENT OF CASH COLLATERAL — 8.0%
Wachovia Asset Securitization, Inc.		0.61	%		12/25/11		3,221,137		1,220,215
Calyon NY		2.17	%		02/22/10		2,652,436		2,589,698
American International Group		1.09	%		06/16/09		859,123		773,211
Bear Stearns Co., Inc.		2.24	%		02/23/10		2,379,414		2,310,682
CAM US Finance SA		3.34	%		02/01/10		1,534,560		1,475,157
Citigroup Global Markets		3.31	%		11/02/09		2,696,325		2,633,600
General Electric Capital Corp.		2.45	%		05/10/10		2,819,522		2,655,973
Goldman Sachs Group, Inc.		2.23	%		11/16/09		2,502,915		2,397,392
HSBC Finance Corp.		2.43	%		11/16/09		503,840		478,920
Merrill Lynch & CO.		2.22	%		08/14/09		1,355,771		1,314,248

See Notes to Financial Statements

34

ADVANCE CAPITAL I — RETIREMENT INCOME FUND
PORTFOLIO OF INVESTMENTS
DECEMBER 31, 2008

Fixed Income Securities, Cash Collateral and						Shares/
Short-Term Investments	Coupon			Maturity		Principal		Value
INVESTMENT OF CASH COLLATERAL — 8.0% (continued)
Morgan Stanley		2.61	%		08/07/10		3,307,157	$	3,095,095
SLM Corp.		3.68	%		07/27/09		1,044,290		984,345
KKR Atlantic		0.82	%		03/25/09		1,247,737		782,370
CSFB Repurchase Agreement Dated 12/31/08, with a repurchase price of $4,546,701 (Collateralized by $4,661,970 Federal Farm Credit Bank, 0.47%, 6/17/10, market value $4,612,553)		0.05	%		01/02/09		4,546,688		4,546,688
TOTAL INVESTMENT OF CASH COLLATERAL — 8.0% (Cost $27,445,858)									27,257,594
SHORT-TERM INVESTMENTS — 1.1%
Fifth Third Institutional Money Market Fund (Cost $3,643,539)									3,643,539
TOTAL INVESTMENTS IN SECURITIES — 106.6% (Cost $417,773,037)									365,365,657
OTHER ASSETS LESS LIABILITIES — (6.6%)									(22,690,309	)
TOTAL NET ASSETS — 100.0%								$	342,675,348

*	Security exempt from registration under Rule 144A of the Securities Act of 1933. These securities are considered liquid and may be resold in transactions exempt from registration. At December 31, 2008, the aggregate market value of these securities amounted to $14,411,382 or 4.21% of net assets.
^	A portion of these securities are on loan. At December 31, 2008, the total market value of the Fund’s securities on loan is $26,821,500.

See Notes to Financial Statements

35

ADVANCE CAPITAL I — CORE EQUITY FUND
PORTFOLIO OF INVESTMENTS
DECEMBER 31, 2008

Common Stock	Shares		Value
BASIC MATERIALS — 1.4%
Dow Chemical Co.		3,425	$	51,683
Freeport-McMoRan Copper*		2,765		67,577
COMMUNICATIONS — 15.0%
Cisco Systems, Inc.*		12,095		197,149
Google, Inc.*		250		76,913
Harris Corp.		5,085		193,484
Liberty Media Corp.*		12,625		59,464
Liberty Media Corp.*		16,400		286,672
Symantec Corp.*		14,430		195,094
Time Warner, Inc.		25,715		258,693
CONSUMER, CYCLICAL — 3.0%
Staples, Inc.		4,865		87,181
Target Corp.		2,250		77,693
Wal-Mart Stores, Inc.		1,600		89,696
CONSUMER, NON-CYCLICAL — 21.3%
Altria Group, Inc.		14,980		225,599
Biogen Idec, Inc.*		1,855		88,354
CIGNA Corp.		6,435		108,430
Coca-Cola Co.		1,950		88,277
Eli Lilly & Co.		2,450		98,662
Forest Laboratories, Inc.*		4,775		121,619
Johnson & Johnson		5,370		321,287
Pfizer, Inc.		14,415		255,290
Philip Morris International		3,065		133,358
Procter & Gamble Co.		2,925		180,824
ResMed, Inc.*		2,420		90,702
Zimmer Holdings, Inc.*		2,355		95,189
ENERGY — 12.2%
Anadarko Petroleum Corp.		2,125		81,919
Apache Corp.		1,100		81,983
Chesapeake Energy Corp.		9,560		154,585
Chevron Corp.		4,175		308,825
ConocoPhillips		6,250		323,750
Transocean Ltd*		1,775		83,869

Common Stock	Shares/
and Short-Term Investments	Principal		Value
FINANCIAL — 14.7%
ACE Ltd		4,645	$	245,813
American Express Co.		3,525		65,389
Berkshire Hathaway, Inc.*		46		147,844
HCC Insurance Holdings, Inc.		5,755		153,946
JPMorgan Chase & Co.		6,675		210,463
Travelers Cos., Inc.		5,240		236,848
US Bancorp		7,460		186,575
INDUSTRIAL — 12.3%
Boeing Co.		5,725		244,286
General Dynamics Corp.		3,265		188,031
General Electric Co.		10,380		168,156
L-3 Communications		2,770		204,371
Northrop Grumman Corp.		5,295		238,487
TECHNOLOGY — 14.5%
Check Point Software Tech.*		13,980		265,480
Computer Sciences Corp.*		6,740		236,844
EMC Corp.*		24,220		253,583
Microsoft Corp.		13,005		252,817
Oracle Corp.*		12,345		218,883
TOTAL COMMON STOCK — 94.4%
(Cost $11,384,415)				8,001,625
SHORT-TERM INVESTMENTS — 5.2%
Fifth Third Instl Money Market Fund	$	434,606		434,606
TOTAL INVESTMENTS IN SECURITIES — 99.6%
(Cost $11,819,021)				8,436,231
OTHER ASSETS LESS LIABILITIES — 0.4%				32,574
TOTAL NET ASSETS — 100.0%			$	8,468,805

* Securities are non-income producing

See Notes to Financial Statements

36

ADVANCE CAPITAL I, INC.
STATEMENTS OF ASSETS AND LIABILITIES
DECEMBER 31, 2008

	EQUITY			BALANCED			RETIREMENT			CORE
	GROWTH FUND			FUND			INCOME FUND			EQUITY FUND
ASSETS
Investments in securities at value (Cost $151,094,858;$278,925,268; $417,773,037;$11,819,021, respectively)	$	116,839,402		$	237,534,047		$	365,365,657		$	8,436,231
Cash		12,533			132,815			129,611			22,500
Receivables
Dividends and interest		59,807			1,779,423			5,117,996			16,092
Capital shares receivable		0			0			81,961			0
Securities lending income		30,862			30,416			25,839			0
From adviser (See Notes 4 and 6)		2,020,490			2,124,258			70,189			0
Interfund (See Note 4)		755,903			0			0			0
Money market interest		18,000			27,400			8,500			300
Prepaid expenses		13,980			22,641			26,942			3,810
Total assets		119,750,977			241,651,000			370,826,695			8,478,933
LIABILITIES
Interfund payable (See Note 4)		0			300,159			455,744			0
Payable for return of collateral received		35,565,349			40,791,497			27,445,858			0
Accounts payable and accrued expenses		14,430			33,747			56,224			2,005
Capital shares payable		97,321			200,760			148,071			0
Distributions payable		0			9,453			45,450			8,123
Total liabilities		35,677,100			41,335,616			28,151,347			10,128
Net assets	$	84,073,877		$	200,315,384		$	342,675,348		$	8,468,805
NET ASSETS
Retail shares
Net assets		83,981,410			200,198,545			340,834,039			8,468,763
Number of shares outstanding		6,526,653			16,960,176			45,708,771			1,300,813
Net asset value	$	12.87		$	11.80		$	7.46		$	6.51
Institutional shares
Net assets		92,467			116,839			1,841,309			42
Number of shares outstanding		7,218			9,924			246,935			6
Net asset value	$	12.81		$	11.77		$	7.46		$	6.51
Net assets consist of Paid-in capital		134,997,254			281,825,120			452,362,595			13,189,471
Accumulated undistributed net investment income		58,067			43,575			2,122			0
Accumulated undistributed net realized loss on investments		(16,725,988	)		(40,162,090	)		(57,281,989	)		(1,337,876	)
Net unrealized appreciation (depreciation) in value of investments		(34,255,456	)		(41,391,221	)		(52,407,380	)		(3,382,790	)
Net assets	$	84,073,877		$	200,315,384		$	342,675,348		$	8,468,805

See Notes to Financial Statements

37

ADVANCE CAPITAL I, INC.
STATEMENTS OF OPERATIONS
YEAR ENDED DECEMBER 31, 2008

	EQUITY			BALANCED			RETIREMENT			CORE
	GROWTH FUND			FUND			INCOME FUND			EQUITY FUND
INVESTMENT INCOME
Interest	$	0		$	6,757,957		$	26,411,039		$	0
Dividends		1,358,795			4,288,337			387,627			208,737
Securities lending income, net		370,185			350,706			102,690			0
Total investment income		1,728,980			11,397,000			26,901,356			208,737
EXPENSES
Investment advisory fees		1,197,630			2,301,370			1,954,445			85,918
Distribution fees — Retail Class		427,417			821,523			965,366			26,329
Transfer agent and shareholder reporting costs		68,000			125,040			160,430			15,913
Custodian fees		21,075			38,122			26,550			11,230
Directors fees and expenses		16,717			33,714			43,974			1,254
Professional fees		14,486			36,823			65,503			1,918
Registration and filing fees		6,952			7,899			8,047			6,315
Other operating expenses		4,099			7,745			8,416			333
Total expenses		1,756,376			3,372,236			3,232,731			149,210
Less: Waiver from Adviser		0			0			0			(11,610	)
Net expenses		1,756,376			3,372,236			3,232,731			137,600
NET INVESTMENT INCOME (LOSS)		(27,396	)		8,024,764			23,668,625			71,137
NET REALIZED AND UNREALIZED GAIN (LOSS) ON INVESTMENTS
Net realized loss on investments		(16,695,215	)		(40,006,995	)		(40,944,950	)		(1,337,876	)
Net change in unrealized loss on investments		(78,434,706	)		(85,864,337	)		(49,723,953	)		(3,382,790	)
NET LOSS ON INVESTMENTS		(95,129,921	)		(125,871,332	)		(90,668,903	)		(4,720,666	)
NET DECREASE IN NET ASSETS RESULTING FROM OPERATIONS	$	(95,157,317	)	$	(117,846,568	)	$	(67,000,278	)	$	(4,649,529	)

See Notes to Financial Statements

38

ADVANCE CAPITAL I, INC.
STATEMENTS OF CHANGES IN NET ASSETS
YEARS ENDED DECEMBER 31, 2008 AND 2007

	EQUITY GROWTH FUND						BALANCED FUND
				As Restated*						As Restated*
	2008			2007			2008			2007
INCREASE IN NET ASSETS
Operations:
Net investment income (loss)	$	(27,396	)	$	(215,222	)	$	8,024,764		$	8,049,337
Net realized gain (loss) on investments		(16,695,215	)		30,235,714			(40,006,995	)		30,306,347
Net change in unrealized loss on investments		(78,434,706	)		(4,979,614	)		(85,864,337	)		(14,527,766	)
Net increase (decrease) in net assets resulting from operations		(95,157,317	)		25,040,878			(117,846,568	)		23,827,918
Distributions to Shareholders:
Net investment income
Retail shares		0			0			(8,077,935	)		(8,089,674	)
Institutional shares		0			0			(4,364	)		(2,858	)
Net realized gain on investments
Retail shares		(131,227	)		(29,946,591	)		(135,076	)		(30,194,635	)
Institutional shares		(147	)		(15,934	)		(79	)		(14,311	)
Total distributions to shareholders		(131,374	)		(29,962,525	)		(8,217,454	)		(38,301,478	)
Share Transactions:
Retail shares
Net proceeds from sale of shares		10,579,930			21,416,436			24,858,434			44,519,616
From adviser (See Notes 4 and 6)		2,020,399			0			2,124,247			0
Reinvestment of distributions		129,469			29,755,964			8,095,915			37,938,997
Cost of shares reacquired		(54,260,586	)		(35,717,954	)		(109,092,577	)		(65,422,603	)
Net change		(41,530,788	)		15,454,446			(74,013,981	)		17,036,010
Institutional shares
Net proceeds from sale of shares		49,700			115,284			10,000			192,682
From adviser (See Notes 4 and 6)		91			0			11			0
Reinvestment of distributions		144			15,934			145			0
Cost of shares reacquired		0			0			(6,434	)		0
Net change		49,935			131,218			3,722			192,682
Net increase (decrease) derived from share transactions		(41,480,853	)		15,585,664			(74,010,259	)		17,228,692
NET ASSETS
Beginning of year		220,843,421			210,179,404			400,389,665			397,634,533
End of year	$	84,073,877		$	220,843,421		$	200,315,384			$400,389,665
ACCUMULATED UNDISTRIBUTED NET INVESTMENT INCOME		$58,067		$	0		$	43,575		$	0
NUMBER OF SHARES
Retail shares
Sold		536,237			807,359			1,609,904			2,347,751
Shares issued from reinvestment of distributions		10,534			1,227,556			552,680			2,111,198
Reacquired		(3,174,033	)		(1,332,405	)		(7,866,419	)		(3,434,264	)
Net change		(2,627,262	)		702,510			(5,703,835	)		1,024,685
Institutional shares
Sold		2,330			4,219			593			9,917
Shares issued from reinvestment of distributions		12			657			10			0
Reacquired		0			0			(596	)		0
Net change		2,342			4,876			7			9,917
Net increase (decrease) in shares outstanding		(2,624,920	)		707,386			(5,703,828	)		1,034,602
Outstanding:
Beginning of year		9,158,791			8,451,405			22,673,928			21,639,326
End of year		6,533,871			9,158,791			16,970,100			22,673,928

* See Note 4 in the Notes to Financial Statements for information regarding the restatement.

See Notes to Financial Statements

39

ADVANCE CAPITAL I, INC.
STATEMENTS OF CHANGES IN NET ASSETS (Continued)
YEARS ENDED DECEMBER 31, 2008 AND 2007

	RETIREMENT INCOME FUND
				As Restated*			CORE EQUITY FUND
	2008			2007			2008
INCREASE IN NET ASSETS
Operations:
Net investment income	$	23,668,625		$	22,841,372		$	71,137
Net realized loss on investments		(40,944,950	)		(3,985,649	)		(1,337,876	)
Net change in unrealized loss on investments		(49,723,953	)		(5,557,715	)		(3,382,790	)
Net increase (decrease) in net assets resulting from operations		(67,000,278	)		13,298,008			(4,649,529	)
Distributions to Shareholders:
Net investment income
Retail shares		(23,498,704	)		(23,045,181	)		(71,136	)
Institutional shares		(296,931	)		(72,240	)		(1	)
Total distributions to shareholders		(23,795,635	)		(23,117,421	)		(71,137	)
Share Transactions:
Retail shares
Net proceeds from sale of shares		87,120,122			49,345,936			15,171,510
From adviser (See Notes 4 and 6)		68,873			0			0
Reinvestment of distributions		23,076,657			22,526,900			63,014
Cost of shares reacquired		(86,646,005	)		(57,219,846	)		(2,136,903	)
Net change		23,619,647			14,652,990			13,097,621
Institutional shares
Net proceeds from sale of shares		4,788,239			3,743,891			250,000
From adviser (See Notes 4 and 6)		1,316			0			0
Reinvestment of distributions		7,763			204			0
Cost of shares reacquired		(5,385,450	)		(213,606	)		(158,150	)
Net change		(588,132	)		3,530,489			91,850
Net increase derived from share transactions		23,031,515			18,183,479			13,189,471
NET ASSETS
Beginning of year		410,439,746			402,075,680			0
End of year	$	342,675,348		$	410,439,746		$	8,468,805
ACCUMULATED UNDISTRIBUTED NET INVESTMENT INCOME	$	2,122		$	0		$	0
NUMBER OF SHARES
Retail shares
Sold		10,454,190			5,141,731			1,579,011
Shares issued from reinvestment of distributions		2,708,489			2,353,234			9,680
Reacquired		(10,499,646	)		(5,969,143	)		(287,878	)
Net change		2,663,033			1,525,822			1,300,813
Institutional shares
Sold		511,957			393,632			25,000
Shares issued from reinvestment of distributions		947			22			0
Reacquired		(637,114	)		(22,509	)		(24,994	)
Net change		(124,210	)		371,145			6
Net increase in shares outstanding		2,538,823			1,896,967			1,300,819
Outstanding:
Beginning of year		43,416,883			41,519,916			0
End of year		45,955,706			43,416,883			1,300,819

* See Note 4 in the Notes to Financial Statements for information regarding the restatement.

See Notes to Financial Statements

40

NOTES TO FINANCIAL STATEMENTS

Note 1. ORGANIZATION OF THE COMPANY

Advance Capital I, Inc. (the “COMPANY”) is a Maryland Corporation organized on March 6, 1987 that commenced operations on August 5, 1987. The COMPANY is registered under the Investment Company Act of 1940, as amended, as an open-end, diversified management investment company (a mutual fund) offering shares in the following portfolios: Equity Growth Fund, Balanced Fund, Retirement Income Fund and the Core Equity Fund (collectively the “Funds”). Advance Capital Management, Inc. (“MANAGEMENT” or “Adviser”) (a wholly owned subsidiary of Advance Capital Group, Inc.) is the COMPANY’s investment adviser.

The Funds offer Retail Class shares and Institutional Class shares, each of which has equal rights and voting privileges with respect to the Fund in general and exclusive voting rights on matters that affect that class alone. The two share classes have different fees and expenses (“class-specific fees and expenses”), primarily due to different arrangements for distribution. Differences in class-specific fees and expenses will result in differences in net investment income and, therefore, the payment of different per-share dividends by each class.

Under the COMPANY’s organizational documents, its officers and directors are indemnified against certain liabilities arising out of the performance of their duties to the Funds. In addition, in the normal course of business, the Funds enter into contracts with their vendors and others that provide for general indemnifications. The Funds’ maximum exposure under these arrangements is unknown, as this would involve future claims that may be made against the Funds. However, based on experience, the Funds expect that risk of loss to be remote.

Note 2. ACCOUNTING POLICIES

The preparation of financial statements in accordance with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect reported amounts and disclosures in the financial statements. Actual results could differ from these estimates.

The following is a summary of significant accounting policies followed by the COMPANY.

Security Valuation

Equity securities for which exchange quotations are readily available are valued at the last quoted market price at the time the valuations are made and debt securities are valued using prices furnished by an independent third party pricing service. The independent third party pricing service may use a matrix, formula or other objective method that considers the effect of market indices, yield curves and other specific adjustments to determine market price. When reliable market quotations are not readily available or are considered unreliable, securities are priced at their fair value, determined according to procedures adopted by the Board of Directors, which may include using an independent pricing service. Fair value procedures may also be used if the COMPANY determines that a significant event has occurred between the time at which a market price is determined but prior to the time at which a fund’s net asset value is calculated. Money market instruments or short-term debt held by the Funds with a remaining maturity of sixty days or less are valued at amortized cost which approximates value.

41

Note 2. ACCOUNTING POLICIES (Continued)

Fair Value Measurement

In September 2006, the Financial Accounting Standards Board issued Statement of Financial Accounting Standards No. 157, Fair Value Measurements (“FAS 157”). This standard established the definition of fair value, sets out a framework for measuring fair value and expands disclosure about fair value measurements. FAS 157 is effective for the Funds’ fiscal year beginning January 1, 2008.

The three levels of the fair value hierarchy under FAS 157 are described below:

Level 1 —	quoted prices in active markets for identical securities
Level 2 —	other significant observable inputs (including quoted prices for similar securities, interest rates, prepayment speeds, credit risk, etc.)
Level 3 —	significant unobservable inputs (including the Funds’ own assumptions in determining the fair value of investments.)

The inputs or methodology used for valuing securities are not necessarily an indication of the risk associated with investing in those securities.

The following is a summary of the inputs used to value the Fund’s investments in securities as of December 31, 2008:

	Equity		Balanced		Retirement		Core
Valuation Inputs	Growth Fund		Fund		Income Fund		Equity Fund
Level 1 - Quoted Prices	$	85,463,464	$	101,745,563	$	3,643,539	$	8,436,231
Level 2 - Other Significant Observable Inputs		30,764,502		135,051,810		360,239,748		0
Level 3 - Significant Unobservable Inputs		611,436		736,674		1,482,370		0
Total Market Value of Investments	$	116,839,402	$	237,534,047	$	365,365,657	$	8,436,231

     The following is a reconciliation of the Level 3 investments in securities for the year ended December 31, 2008:

	Equity			Balanced			Retirement			Core
Valuation Inputs	Growth Fund			Fund			Income Fund			Equity Fund
Balance as of 12/31/07	$	1,402,065		$	1,584,919		$	949,703		$	0
Accrued discounts/premiums		0			0			0			0
Realized gain/loss		0			0			0			0
Change in unrealized appreciation (depreciation)		(790,629	)		(848,245	)		(617,333	)		0
Net purchases (sales)		0			0			0			0
Transfers in to (out of) Level 3		0			0			1,150,000			0
Balance as of 12/31/08	$	611,436		$	736,674		$	1,482,370		$	0

42

Note 2. ACCOUNTING POLICIES (Continued)

Allocation of Income, Expenses, Gains and Losses

Income, fees and expenses (other than class-specific fees and expenses) and realized and unrealized gains and losses are allocated on a daily basis to each class of shares based upon their relative net assets. Class-specific fees and expenses are charged directly to the respective share class.

Federal Income Taxes

It is each Fund’s policy to meet the requirements to qualify each year as a registered investment company under Subchapter M of the Internal Revenue Code. Each Fund intends to distribute all of its taxable income to its shareholders. Therefore, no federal income tax provision is provided. Capital losses are available to offset future capital gains, if any.

Effective June 29, 2007, the COMPANY adopted Financial Accounting Standards Board Interpretation No. 48, Accounting for Uncertainty in Income Taxes (“FIN 48”). FIN 48 provides guidance for how uncertain tax positions should be recognized, measured, presented and disclosed in the financial statements. FIN 48 requires the affirmative evaluation of tax positions taken or expected to be taken in the course of preparing the Fund’s tax return to determine whether it is more-likely-than-not (i.e., greater than 50-percent) that each tax position will be sustained upon examination by a taxing authority based on the technical merits of the position. A tax position that meets the more-likely-than-not recognition threshold is measured to determine the amount of benefit to recognize in the financial statements. Differences between tax positions taken in a tax return and amounts recognized in the financial statements will generally result in an increase in a liability for taxes payable (or a reduction of a tax refund receivable), including the recognition of any related interest and penalties as an operating expense.

The implementation of FIN No. 48 included a review of tax positions taken from January 1, 2005 through December 31, 2008 at the federal level. While the statue of limitations remains open to examine the COMPANY’s U.S. tax returns filed for the past four fiscal years, no examinations are in progress or anticipated at this time.

As of December 31, 2008, management of the COMPANY has reviewed all open tax years and major jurisdictions and concluded that the adoption of FIN 48 resulted in no effect to the Fund’s tax liability, financial position or results of operations. There is no tax liability resulting from unrecognized tax benefits related to uncertain tax positions taken or expected to be taken in future tax returns. The Fund is also not aware of any tax positions for which it is reasonably possible that the total amounts of unrecognized tax benefits will significantly change in the next twelve months.

New Accounting Pronouncements

In March 2008, FASB Statement No. 161, Disclosures about Derivative Instruments and Hedging Activities (the “Statement”) was issued, and is effective for fiscal years and interim periods beginning after November 15, 2008. This Statement provides for additional disclosures related to derivative instruments and their impact on fund performance. Management is evaluating the application of the Statement to the Funds, and believes the impact will be limited to expanded disclosures resulting from the adoption of this Statement on the Funds financial statements.

In September 2008, FASB Staff Position No. FAS 133-1 and FIN 45-4, Disclosures about Credit Derivatives and Certain Guarantees: An Amendment of FASB Statement No. 133 and FASB Interpretation No. 45; and is effective for fiscal years and interim periods ending after November 15, 2008. This Staff Position amends FASB Statement No. 133 to require disclosures by sellers of credit derivatives, including credit derivatives embedded in a hybrid instrument and amends FASB Interpretation No. 45 to require additional disclosure about the current status of the payment/performance risk of a guarantee. Management has evaluated the application of this Staff Position to the Funds, and has determined that there is no impact to the Funds’ financial statements and no additional disclosure is required.

43

Note 2. ACCOUNTING POLICIES (Continued)

Dividends

Income dividends in the Balanced Fund and Retirement Income Fund are declared daily, except on Saturdays, Sundays and holidays and are paid monthly on the last business day of the month. Income dividends in the Equity Growth Fund and the Core Equity Fund, if any, are declared annually and paid on the last business day of the year. Capital gain distributions, if any, are declared annually and paid in December.

The amount of distributions from net investment income and net realized gains are determined in accordance with federal income tax regulations which may differ from generally accepted accounting principles. These “book/tax” differences are either considered temporary or permanent in nature. To the extent these differences are permanent in nature, such amounts are reclassified within the composition of net assets based on their federal tax-basis treatment; temporary differences do not require a reclassification.

Other

Security transactions are accounted for on the trade date, the date the order to buy or sell is executed. Interest income is recorded on the accrual basis. Dividend income is recorded on the ex-dividend date. Premium and discount on fixed income securities are amortized using the effective interest method. Realized gains and losses on security transactions are determined on the specific identification method for book and tax purposes. Paydown gains and losses on mortgage-backed and asset-backed securities are recorded as adjustments to interest income in the Statement of Operations. Net investment losses, for which no carryover is permitted, are offset against paid in capital.

Note 3. SECURITIES LENDING

The Funds may, from time to time, lend securities from their portfolio to broker-dealers, banks, financial institutions and other institutional borrowers approved by the Board of Directors. Each fund will limit its securities lending activity to 33 1/3% of its total assets. Credit Suisse, New York Branch, serves as the lending manager for the Funds pursuant to a Securities Lending Management Agreement (the “Lending Agreement”), for which they receive a fee. Credit Suisse’s fee is computed monthly in arrears and is based on 30% of the sum of all interest, dividends and other distributions earned from the investment of collateral in investments, as approved by the Board of Directors, net of rebates paid by Credit Suisse to borrowers and net of brokerage commissions, if any, incurred in making or liquidating the investments. For the year ended December 31, 2008 Credit Suisse received $288,993 in total from the Funds for its services as lending manager. Under guidelines established by the Board of Directors, the Funds must maintain loan collateral with Fifth Third at all times in an amount equal to at least 100% of the current market value of the loaned securities, to secure the return of the loaned securities. Initial value of loan collateral shall be no less than 102% of the market value of the loaned securities plus the accrued interest of debt securities.

Credit Suisse is authorized, under guidelines established by management, to invest the cash collateral received from borrowers in a variety of securities including asset-backed, agency securities, commercial paper, corporate notes and other types of securities (“Collateral Securities”). Among other guidelines, these securities must be rated at least A- by Standard & Poor’s or A3 by Moody’s at the time of purchase. The actual investments in the collateral portfolio at December 31, 2008 included corporate floating rate notes, asset-backed securities, agency repurchase agreements and private mortgage-backed securities. The market values of these securities fluctuate daily based on normal market variables which resulted in unrealized and realized losses to the Funds during the current year and could result in additional losses in future periods. There is credit risk to the Funds should the underlying security price fall dramatically or if the issuer files for bankruptcy. Any cash shortfall as a consequence of these actions is funded by cash in the Funds. The Funds are required to pay the full amount of cash collateral due back to the counterparty of the loaned securities. There is a risk of delay in receiving collateral or in receiving the securities loaned or even a loss of rights in the collateral should the borrower of the securities fail financially. By lending its securities, a Fund can increase its income by continuing to receive interest or dividends on the loaned securities as well as investing the cash collateral. The cash collateral or Collateral Securities is recorded as assets of the Funds, offset by a corresponding liability to return all collateral as cash at the termination of the securities loan(s). Loans are subject to termination by the Funds or the borrower at any time.

44

Note 3. SECURITIES LENDING (Continued)

The following Funds loaned securities and received cash collateral with the following values as of December 31, 2008:

			Value of Cash						Income Received
	Value		Collateral		Value		Average Loan		by Credit Suisse
	of Loaned		Received from		of Collateral		Outstanding		from Securities
	Securities		Borrower		Securities		During the Year		Lending
Equity Growth Fund	$	35,080,481	$	35,565,349	$	31,375,938	$	71,569,956	$	135,537
Balanced Fund (Fixed Income)		3,698,265		3,781,388		3,377,827		1,557,284		2,328
Balanced Fund (Common Stock)		36,464,032		37,010,109		33,060,287		70,586,443		126,356
Retirement Income Fund		26,821,500		27,445,858		27,257,594		14,260,877		24,772

Note 4. RESTATEMENTS OF PRIOR YEAR FINANCIAL STATEMENTS

During October of 2008, the COMPANY determined it had incorrectly valued the Collateral Securities purchased with cash collateral received from securities lending at amortized cost rather than fair market value since April of 2007. The COMPANY revalued the Collateral Securities at fair market value using prices furnished by independent third party pricing services or other fair value procedures in accordance with its security valuation policies, and determined that the investments in securities as shown on an aggregate basis for the Equity Growth Fund, Balanced Fund and Retirement Income Fund were overstated at December 31, 2007 as follows:

Security Type	Security Name	Value As Previously Reported		Value As Restated
Asset Backed Security	Bear Stearns		4,208,105		3,653,157
Asset Backed Security	Countrywide Financial		4,185,151		3,800,639
Asset Backed Security	Countrywide Financial		3,475,606		3,223,625
Asset Backed Security	Wachovia Bank		7,175,328		6,534,033
Asset Backed Security	Commodore CDO LTD		7,443,173		7,303,614
Certificate of Deposit	Deutsche Bank NY		9,000,000		9,000,000
Floating Rate Note	American International Group		2,498,936		2,449,550
Floating Rate Note	Bear Stearns Co., Inc.		8,998,142		8,444,070
Floating Rate Note	CAM US Finance SA		5,601,048		5,506,838
Floating Rate Note	Calyon NY		9,979,768		9,971,000
Floating Rate Note	CIT Group, Inc.		8,998,043		8,235,000
Floating Rate Note	Citigroup Global Markets		10,003,510		9,986,000
Floating Rate Note	General Electric Capital Corp.		9,988,868		9,903,600
Floating Rate Note	Goldman Sachs Group, Inc.		9,000,795		8,819,190
Floating Rate Note	HSBC Finance Corp.		1,906,001		1,862,000
Floating Rate Note	Lehman Brothers Holdings		10,000,000		9,610,300
Floating Rate Note	Merrill Lynch & Co.		5,002,286		4,891,000
Floating Rate Note	Morgan Stanley		10,000,000		9,757,600
Floating Rate Note	SLM Corp.		3,399,479		3,228,980
Floating Rate Note	Washington Mutual Bank		7,996,478		7,408,288
Commercial Paper	KKR Atlantic		4,086,668		3,936,687
Repurchase Agreement	Barclays Capital Markets		30,000,000		30,000,000
Repurchase Agreement	Deutsche Bank Securities, Inc.		12,221,337		12,221,337

45

Note 4. RESTATEMENTS OF PRIOR YEAR FINANCIAL STATEMENTS (Continued)

The restatement of the value of collateral for securities shown in the preceding table by fund on amounts previously reported as of December 31, 2007, is as follows:

	Value of
	Collateral		Value of
	As Previously		Collateral
	Reported		As Restated
Equity Growth Fund	$	94,819,418	$	92,236,400
Balanced Fund (Fixed Income)		3,168,000		3,071,299
Balanced Fund (Common Stock)		76,427,738		74,094,838
Retirement Income Fund		10,753,566		10,343,971

The COMPANY has reprocessed shareholder transactions and calculated the amounts due to the Funds impacted by this error. Additionally, the COMPANY has calculated the amount of excess management and distribution fees incurred by these Funds (plus interest) resulting from this overstatement in net assets to be reimbursed by the Adviser (See Note 6 — Note Receivable from Adviser). Accordingly, the financial highlights, investments in securities, net assets, number of shares outstanding, net asset value, net unrealized appreciation (depreciation) in value of investments, and federal income tax information for the Equity Growth Fund, Balanced Fund and Retirement Income Fund and have been restated for 2007. The amounts calculated to be reimbursed by the Adviser for 2007 are $69,674 for the Equity Growth Fund, $61,830 for the Balanced Fund and $651 for the Retirement Income Fund. The amounts calculated to be reimbursed by the Adviser for 2007 representing reimbursement for excess management and distribution fees are $4,625 for the Equity Growth Fund, $4,140 for the Balanced Fund and $640 for the Retirement Income Fund.

In connection with the error correction and reprocessing of shareholder transactions, certain amounts of realized gains/losses from the sales of Collateral Securities during 2008 were reallocated among the Equity Growth Fund, Balanced Fund and Retirement Income Fund. The net impact of the reallocations are reflected as interfund receivables or payables on the Statements of Assets and Liabilities. These amounts will be settled in cash movements among the funds.

The principal effects of this restatement on amounts previously reported as of or for the year ended December 31, 2007, are as follows:

Financial Highlights:

ADVANCE CAPITAL I — EQUITY GROWTH FUND (Retail Shares)
FINANCIAL HIGHLIGHTS
DECEMBER 31, 2007

	As Previously
	Reported			As Restated
Net realized and unrealized gain on investments	$	3.38		$	3.05
Net Asset Value, end of year	$	24.44		$	24.11
Total Return		13.38	%		12.05	%
Net Assets, end of year (in thousands)	$	223,307		$	220,726

ADVANCE CAPITAL I — BALANCE FUND (Retail Shares)
FINANCIAL HIGHLIGHTS
DECEMBER 31, 2007

	As Previously
	Reported			As Restated
Net realized and unrealized gain on investments	$	0.84		$	0.72
Net Asset Value, end of year	$	17.78		$	17.66
Total Return		6.67	%		6.00	%
Net Assets, end of year (in thousands)	$	402,643		$	400,214

46

Note 4. RESTATEMENTS OF PRIOR YEAR FINANCIAL STATEMENTS (Continued)

ADVANCE CAPITAL I — RETIREMENT INCOME FUND (Retail Shares)
FINANCIAL HIGHLIGHTS
DECEMBER 31, 2007

	As Previously
	Reported			As Restated
Net realized and unrealized gain on investments		($0.22	)		($0.23	)
Net Asset Value, end of year	$	9.46		$	9.45
Total Return		3.43	%		3.33	%
Net Assets, end of year (in thousands)	$	407,339		$	406,932
Ratio of net investment income to average net assets		5.62	%		5.69	%

ADVANCE CAPITAL I — EQUITY GROWTH FUND (Institutional Shares)
FINANCIAL HIGHLIGHTS
DECEMBER 31, 2007

	As Previously
	Reported			As Restated
Net realized and unrealized gain on investments	$	0.95		$	0.64
Net Asset Value, end of year	$	24.47		$	24.16
Total Return		3.47	%		2.34	%
Net Assets, end of year (in thousands)	$	119		$	118
Ratio of expenses to average net assets		0.76	%		0.77	%

ADVANCE CAPITAL I — BALANCED FUND (Institutional Shares)
FINANCIAL HIGHLIGHTS
DECEMBER 31, 2007

	As Previously
	Reported			As Restated
Net realized and unrealized gain on investments		($0.21	)		($0.33	)
Net Asset Value, end of year	$	17.78		$	17.66
Total Return		0.41	%		(0.22	%)
Net Assets, end of year (in thousands)	$	176		$	175
Ratio of net investment income to average net assets		2.22	%		2.25	%

ADVANCE CAPITAL I — RETIREMENT INCOME FUND (Institutional Shares)
FINANCIAL HIGHLIGHTS
DECEMBER 31, 2007

	As Previously
	Reported			As Restated
Net realized and unrealized gain on investments		($0.24	)		($0.25	)
Net Asset Value, end of year	$	9.46		$	9.45
Total Return		1.30	%		1.19	%
Net Assets, end of year (in thousands)	$	3,510		$	3,508
Ratio of net investment income to average net assets		5.83	%		5.92	%

47

Note 4. RESTATEMENTS OF PRIOR YEAR FINANCIAL STATEMENTS (Continued)

Statement of Assets and Liabilities:

ADVANCE CAPITAL I — EQUITY GROWTH FUND
STATEMENT OF ASSETS AND LIABILITIES
DECEMBER 31, 2007

	As Previously
	Reported		As Restated
Investments in securities at value (Cost $271,730,704)	$	318,492,972	$	315,909,954
Total Assets		318,763,515		316,180,497
Net Assets	$	223,426,439	$	220,843,421
Retail Shares
Net Assets		223,307,372		220,725,639
Number of shares outstanding		9,136,630		9,153,915
Net asset value	$	24.44	$	24.11
Institutional shares
Net Assets		119,067		117,782
Number of shares outstanding		4,866		4,876
Net asset value	$	24.47	$	24.16
Net unrealized appreciation (depreciation) in value of investments		46,762,268		44,179,250

ADVANCE CAPITAL I — BALANCED FUND
STATEMENT OF ASSETS AND LIABILITIES
DECEMBER 31, 2007

	As Previously
	Reported		As Restated
Investments in securities at value (Cost $433,712,160)	$	480,614,877	$	478,185,276
Total Assets		482,869,606		480,440,005
Net Assets	$	402,819,266	$	400,389,665
Retail Shares
Net Assets		402,642,978		400,214,495
Number of shares outstanding		22,651,508		22,664,011
Net asset value	$	17.78	$	17.66
Institutional shares
Net Assets		176,288		175,170
Net asset value	$	17.78	$	17.66
Net unrealized appreciation (depreciation) in value of investments		46,902,717		44,473,116

48

Note 4. RESTATEMENTS OF PRIOR YEAR FINANCIAL STATEMENTS (Continued)

ADVANCE CAPITAL I — RETIREMENT INCOME FUND
STATEMENT OF ASSETS AND LIABILITIES
DECEMBER 31, 2007

	As Previously
	Reported			As Restated
Investments in securities at value (Cost $418,443,971)	$	416,170,139		$	415,760,544
Total Assets		421,917,748			421,508,153
Net Assets	$	410,849,341		$	410,439,746
Retail Shares
Net Assets		407,339,151			406,931,628
Net asset value	$	9.46		$	9.45
Institutional shares
Net Assets		3,510,190			3,508,118
Net asset value	$	9.46		$	9.45
Net unrealized appreciation (depreciation) in value of investments		(2,273,832	)		(2,683,427	)

Statement of Operations:

ADVANCE CAPITAL I — EQUITY GROWTH FUND
STATEMENT OF OPERATIONS
DECEMBER 31, 2007

	As Previously
	Reported			As Restated
Appreciation (depreciation), End of year	$	46,762,268		$	44,179,250
Net change in unrealized gain (loss) on investments		(2,396,596	)		(4,979,614	)
Net gain (loss) on investments		27,839,118			25,256,100
Net increase in net assets resulting from operations	$	27,623,896		$	25,040,878

ADVANCE CAPITAL I — BALANCED FUND
STATEMENT OF OPERATIONS
DECEMBER 31, 2007

	As Previously
	Reported			As Restated
Appreciation (depreciation), End of year	$	46,902,717		$	44,473,116
Net change in unrealized gain (loss) on investments		(12,098,165	)		(14,527,766	)
Net gain (loss) on investments		18,208,182			15,778,581
Net increase in net assets resulting from operations	$	26,257,519		$	23,827,918

49

Note 4. RESTATEMENTS OF PRIOR YEAR FINANCIAL STATEMENTS (Continued)

Statement of Operations:

ADVANCE CAPITAL I — RETIREMENT INCOME FUND
STATEMENT OF OPERATIONS
DECEMBER 31, 2007

	As Previously
	Reported			As Restated
Appreciation (depreciation), End of year		($2,273,832	)		(2,683,427	)
Net change in unrealized gain (loss) on investments		(5,148,120	)		(5,557,715	)
Net gain (loss) on investments		(9,133,769	)		(9,543,364	)
Net increase in net assets resulting from operations	$	13,707,603		$	13,298,008

Statement of Changes In Net Assets:

ADVANCE CAPITAL I — EQUITY GROWTH FUND
STATEMENT OF CHANGES IN NET ASSETS
DECEMBER 31, 2007

	As Previously
	Reported			As Restated
Net change in unrealized gain (loss) on investments		($2,396,596	)		($4,979,614	)
Net increase in net assets resulting from operations		27,623,896			25,040,878
Net assets, End of year		223,426,439			220,843,421
Number of Retail shares sold		806,561			807,359
Number of Retail shares issued from reinvestment of distributions		1,211,069			1,227,556
Net change in number of Retail shares		685,225			702,510
Number of Institutional shares sold		4,218			4,219
Number of Instl shares issued from reinvestment of distributions		648			657
Net change in number of Institutional shares		4,866			4,876
Net increase in shares outstanding		690,091			707,386
Outstanding shares, End of year		9,141,496			9,158,791

50

Note 4. RESTATEMENTS OF PRIOR YEAR FINANCIAL STATEMENTS (Continued)

ADVANCE CAPITAL I — BALANCED FUND
STATEMENT OF CHANGES IN NET ASSETS
DECEMBER 31, 2007

	As Previously
	Reported			As Restated
Net change in unrealized gain (loss) on investments		($12,098,165	)		($14,527,766	)
Net increase in net assets resulting from operations		26,257,519			23,827,918
Net assets, End of year		402,819,266			400,389,665
Number of Retail shares sold		2,346,941			2,347,751
Number of Retail shares issued from reinvestment of distributions		2,099,505			2,111,198
Net change in number of Retail shares		1,012,182			1,024,685
Net increase in shares outstanding		1,022,099			1,034,602
Outstanding shares, End of year		22,661,425			22,673,928

ADVANCE CAPITAL I — RETIREMENT INCOME FUND
STATEMENT OF CHANGES IN NET ASSETS
DECEMBER 31, 2007

	As Previously
	Reported			As Restated
Net change in unrealized gain (loss) on investments		($5,148,120	)		($5,557,715	)
Net increase in net assets resulting from operations		13,707,603			13,298,008
Net assets, End of year		410,849,341			410,439,746

Federal Income Tax Information:

At December 31, 2007, the restated gross unrealized net appreciation and depreciation of securities for federal income tax purposes consisted of the following:

	EQUITY GROWTH FUND						BALANCED FUND						RETIREMENT INCOME FUND
	As Previously						As Previously						As Previously
	Reported			As Restated			Reported			As Restated			Reported			As Restated
Unrealized Depreciation		($12,109,623	)		(14,692,641	)		(18,664,321	)		(21,093,922	)		(8,976,105	)		(9,385,699	)
Net Unrealized
Appreciation/(Depreciation)*	$	46,778,898		$	44,195,880		$	46,805,157		$	44,375,556			($2,273,832	)		($2,683,426	)

*      The differences between book basis and tax basis unrealized appreciation is attributable primarily to tax deferral of losses on wash sales.

51

Note 5. TRANSACTIONS WITH AFFILIATES

T. Rowe Price Associates, Inc. (“TRPA”) serves as sub-adviser for that portion of the portfolio of assets of the Equity Growth Fund and Balanced Fund which are determined by MANAGEMENT to be invested in common stocks. Seizert Capital Partners, LLC (“Seizert”) serves as sub-adviser for the Core Equity Fund. Advance Capital Services, Inc. (“SERVICES”) (also a wholly owned subsidiary of Advance Capital Group, Inc.) is the distributor of the COMPANY’s shares. Advance Capital Group, Inc. (“GROUP”) is the COMPANY’s Administrator, Transfer Agent and Dividend Disbursing Agent. For services provided by MANAGEMENT, the COMPANY pays a fee on an annual basis equal to .70% of the average daily net assets for the first $500 million and .65% of the average daily net assets exceeding $500 million of the Equity Growth and Balanced Funds and .50% of the average daily net assets for the first $500 million and .45% of the average daily net assets exceeding $500 million of the Retirement Income Fund and .80% of the average daily net assets of the Core Equity Fund. For its services, TRPA is paid a fee by MANAGEMENT on an annual basis equal to .20% of the average daily net assets of the Equity Growth Fund and that portion of the Balanced Fund invested in common stocks for the first $100 million of assets managed and .15% of the average daily net assets exceeding $100 million. For its services, Seizert is paid a fee by MANAGEMENT on an annual basis equal to .40% of the average daily net assets of the Core Equity Fund. GROUP provides administrative, transfer agent and dividend disbursing agent services to the COMPANY. The COMPANY will compensate SERVICES for expenses incurred in connection with the distribution of Retail Class shares of the Equity Growth, Balanced Retirement Income and Core Equity, at .25% of each fund’s average daily net assets.

The COMPANY was charged investment advisory fees of $5,539,363 by MANAGEMENT for 2008. The COMPANY was charged distribution fees of $2,240,635 by SERVICES for Retail Class shares for 2008.

Certain officers and directors of GROUP, MANAGEMENT, and SERVICES, are also officers and directors of the COMPANY. Director’s fees are only paid to independent directors and consist of a $16,400 annual retainer. The Chairman of the Board receives an additional 50% in compensation.

Note 6. NOTE RECEIVABLE FROM ADVISER

As described in Note 4, reimbursement to the Equity Growth Fund, Balanced Fund and Retirement Income Fund for 2007 and 2008 were added to the funds as a receivable from the Adviser with the offset as a contribution to paid-in capital. The receivable is comprised of four components: reimbursement for redemptions at an overstated net asset value, additional shares issued, management and distribution fees and interest on the reimbursement amounts. These receivable amounts are $2,020,490, $2,124,258 and $70,189 for the Equity Growth Fund, Balanced Fund and Retirement Income Fund, respectively. The amounts representing reimbursement for excess management and distribution fees are $33,104 for the Equity Growth Fund, $34,279 for the Balanced Fund and $3,603 for the Retirement Income Fund. In consideration of the best interests of the shareholders, the Board of Directors of the Funds has determined that the receivable should be established as an unsecured promissory note from the Adviser as the Adviser does not have the resources to immediately repay amounts due in full. The terms of the notes include payment over 7 years at an interest rate of 3.5% above the prime rate, reset from time to time as the prime rate changes, with interest and principal payable over 84 monthly installments. The effective date of the notes is January 1, 2009. The notes may be repaid in full or in part at any time without penalty.

Note 7. INVESTMENT PORTFOLIO TRANSACTIONS

The cost of purchases and proceeds from sales of investments, other than short-term obligations and U.S. Government securities, for 2008 were as follows:

	Equity				Retirement		Core
	Growth Fund		Balanced Fund		Income Fund		Equity Fund
Purchases	$	45,257,574	$	133,109,902	$	241,803,886	$	19,206,079
Sales		119,503,397		242,598,553		218,154,684		6,483,788

52

Note 7. INVESTMENT PORTFOLIO TRANSACTIONS (Continued)

The cost of purchases and proceeds from sales of U.S. Government securities excluded above were as follows:

	Equity		Retirement		Core
	Growth Fund	Balanced Fund	Income Fund		Equity Fund
Purchases	None	None	$	3,939,375	None
Sales	None	None	$	3,858,125	None

At December 31, 2008, the gross unrealized net appreciation and depreciation of securities for federal income tax purposes consisted of the following:

	Equity						Retirement			Core
	Growth Fund			Balanced Fund			Income Fund			Equity Fund
Unrealized Appreciation	$	7,818,126		$	7,220,483		$	3,894,008		$	22,895
Unrealized Depreciation		(42,109,361	)		(48,645,496	)		(56,301,388	)		(3,405,685	)
Net Unrealized Appreciation/(Depreciation)*		(34,291,235	)		(41,425,013	)		(52,407,380	)		(3,382,790	)
Tax Cost	$	151,130,637		$	278,959,060		$	417,773,037		$	11,819,021

* The differences between book basis and tax basis unrealized appreciation is attributable primarily to tax deferral of losses on wash sales.

Note 8. FEDERAL INCOME TAX INFORMATION

The tax characteristics of distributions paid to shareholders during the years ended December 31, 2008 and 2007 were as follows:

	Distributions						Total
	Paid from		Long Term		Return of		Distributions
2008	Ordinary Income		Capital Gain		Capital		Paid
Equity Growth Fund	$	95,028	$	36,346	$	0	$	131,374
Balanced Fund		8,217,754		0		0		8,217,754
Retirement Income Fund		23,797,706		0		0		23,797,706
Core Equity Fund		71,137		0		0		71,137
	Distributions						Total
	Paid from		Long Term		Return of		Distributions
2007	Ordinary Income		Capital Gain		Capital		Paid
Equity Growth Fund	$	3,969,309	$	25,993,216	$	0	$	29,962,525
Balanced Fund		9,958,712		28,330,567		0		38,289,279
Retirement Income Fund		23,061,094		0		1,749		23,062,843

53

Note 8. FEDERAL INCOME TAX INFORMATION (Continued)

As of December 31, 2008 the components of accumulated earnings/(deficit) on a tax basis was as follows:

											Total
	Undistributed				Accumulated			Unrealized			Accumulated
	Ordinary		Distributions		Capital and			Appreciation/			Earnings/
	Income		Payable		Other Losses			(Depreciation)			(Deficit)
Equity Growth Fund	$	58,067	$	0		($16,690,209	)		($34,291,235	)		($50,923,377	)
Balanced Fund		43,574		0		(40,128,297	)		(41,425,013	)		(81,509,736	)
Retirement Income Fund		2,122		0		(57,281,989	)		(52,407,380	)		(109,687,247	)
Core Equity Fund		0		0		(1,337,876	)		(3,382,790	)		(4,720,666	)

At December 31, 2008, capital loss carryovers and their expiration dates were as follows:

	Equity				Retirement			Core
	Growth Fund		Balanced Fund		Income Fund			Equity Fund
December 31, 2009	$	0	$	0	$	2,466,325		$	0
December 31, 2010		0		0		4,730,077	*		0
December 31, 2011		0		0		0			0
December 31, 2012		0		0		0			0
December 31, 2013		0		0		0			0
December 31, 2014		0		0		4,753,678			0
December 31, 2015		0		0		4,259,949			0
December 31, 2016		16,690,209		40,128,297		41,071,960			1,377,876
Total	$	16,690,209	$	40,128,297	$	57,281,989		$	1,337,876

Capital loss carryover of $1,368,651 for the Retirement Income Fund expired on December 31, 2008.

* $918,058 of capital loss carryovers which expire in 2010 are limited as a result of prior year ownership change.

Note 9. AUTHORIZED SHARES

The COMPANY has one billion authorized shares of common stock, par value of $.001 per share. Each of the COMPANY’s three portfolios has 150 million shares authorized for Retail Class shares and 100 million shares authorized for Institutional Class shares.

Note 10. SUBSEQUENT EVENT

As of March 4, 2009, all Collateral Securities held by the Funds have been sold. The COMPANY notified Credit Suisse to recall all outstanding loans and begin the process of exiting the Securities Lending Program.

54

Report of Independent Registered Public Accounting Firm

To the Board of Directors and Shareholders of Advance Capital I, Inc:

In our opinion, the accompanying statements of assets and liabilities, including the portfolios of investments, and the related statements of operations and of changes in net assets and the financial highlights present fairly, in all material respects, the financial position of the Equity Growth Fund, Balanced Fund, Retirement Income Fund, and Core Equity Fund (four funds constituting Advance Capital I, Inc., hereafter referred to as the “Funds”) at December 31, 2008, and the results of each of their operations, the changes in each of their net assets and the financial highlights for each of the periods presented, in conformity with accounting principles generally accepted in the United States of America. These financial statements and financial highlights (hereafter referred to as “financial statements”) are the responsibility of the Funds’ management; our responsibility is to express an opinion on these financial statements based on our audits. We conducted our audits of these financial statements in accordance with the standards of the Public Company Accounting Oversight Board (United States). Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements, assessing the accounting principles used and significant estimates made by management, and evaluating the overall financial statement presentation. We believe that our audits, which included confirmation of securities at December 31, 2008 by correspondence with the custodian and brokers, provide a reasonable basis for our opinion.

As disclosed in Note 4, the Funds have restated their 2007 financial statements.

PricewaterhouseCoopers LLP

Chicago, Illinois

March 17, 2009

55

ADDITIONAL INFORMATION (UNAUDITED)

MANAGEMENT OF THE FUND

Advance Capital I, Inc. is managed by a Board of Directors. The Directors are responsible for managing the company’s business affairs and for exercising all the company’s powers except those reserved for the shareholders. Officers and Directors of the COMPANY, their addresses, and principal occupations during the last five years, are as follows:

					Number of		Other
	Position(s) &	Year		Principal Occupations	Portfolios		Directorships
Name and Address	Office(s)	Elected*		During past 5 Years	Overseen		Held**
“INTERESTED” DIRECTORS***
Robert J. Cappelli One Towne Square Suite 444 Southfield, MI 48076 Age 57	President, Treasurer and Director		2004	President and Treasurer, Advance Capital I, Inc.; Vice President & Treasurer, Advance Capital Services, Inc.		4	None
“NOT-INTERESTED” DIRECTORS
Joseph A. Ahern One Towne Square Suite 444 Southfield, MI 48076 Age 50	Director Independent Chairman		1995 2005	Attorney; President and Shareholder; Stark, Reagan, P.C.		4	None
Susan E. Burns One Towne Square Suite 444 Southfield, MI 48076 Age 47	Director		2008	President, St. John Health Foundation since July 2008; President, Wayne State University Foundation and Vice President, Development and Alumni Affairs from prior to 2003 until July 2008		4	None
Dennis D. Johnson One Towne Square Suite 444 Southfield, MI 48076 Age 69	Director		2000	Retired; former Chief Operating Officer, Belgacom (Ameritech International); Management Consultant; Vice President — Human Resources, Ameritech Network Services		4	None

56

MANAGEMENT OF THE FUND (Continued)

					Number of		Other
	Position(s) &	Year		Principal Occupations	Portfolios		Directorships
Name and Address	Office(s)	Elected*		During past 5 Years	Overseen		Held**
Janice E. Loichle One Towne Square Suite 444 Southfield, MI 48076 Age 60	Director		2001	Retired; former Vice President, Chief Integration Officer and Chief of Local Exchange Operations, XO Communications, Inc. (formerly NEXTLINK Communications); President, NEXTLINK Solutions (Telecommunications)		4	None
Thomas L. Saeli One Towne Square Suite 444 Southfield, MI 48076 Age 51	Director		2000	Chief Executive Officer, Noble International, Ltd. (since March 2006); Vice President - Corporate Development, Lear Corporation (Automotive Suppliers) (from prior to 2000 until March 2006)		4	Noble International, Ltd.
OTHER OFFICERS
Christopher M. Kostiz One Towne Square Suite 444 Southfield, MI 48076 Age 40	Vice President		2003	Vice President, Advance Capital I, Inc.; President, Advance Capital Management, Inc.; Senior Portfolio Manager, Advance Capital Management, Inc.		4	None
Kathy J. Harkleroad One Towne Square Suite 444 Southfield, MI 48076 Age 56	Vice President, Chief Compliance Officer and Secretary		1996	Vice President, CCO and Secretary, Advance Capital I, Inc. and Advance Capital Group, Inc.; Marketing Director, Advance Capital Services, Inc.		4	None
Julie A. Katynski One Towne Square Suite 444 Southfield, MI 48076 Age 43	Vice President and Assistant Secretary		2003	Vice President & Assistant Secretary, Advance Capital I, Inc.; Vice President — Finance, Advance Capital Group, Inc.; Controller, Advance Capital Group, Inc.		4	None

*	There is no set term of office for Directors and Officers. The Independent Directors have adopted a retirement policy, which calls for the retirement of Directors in the year in which they reach the age of 70.
**	This column includes only directorships of companies required to register or file reports with the Commission under the Securities Exchange Act of 1934 (that is, “public companies”) or other investment companies registered under the 1940 Act.
***	Officers of the Funds are “interested persons” as defined in the Investment Company Act of 1940.

57

EXPENSE EXAMPLES:

As a shareholder of the Advance Capital I, Inc. Funds, you incur ongoing costs, including management fees; distribution (and/or service) 12b-1 fees; and other Fund expenses. This example is intended to help you understand your ongoing costs (in dollars) of investing in the Advance Capital I, Inc. Funds and to compare these costs with the ongoing costs of investing in other mutual funds.

The example is based on an investment of $1,000 invested at the beginning of the period and held for the entire period from July 1, 2008 through December 31, 2008.

ACTUAL EXPENSES

The table below provides information about actual account values and actual expenses. You may use the information below, together with the amount you invested, to estimate the expenses that you paid over the period. Simply divide your account value by $1,000 (for example, an $8,600 account value divided by $1,000 = 8.6), then multiply the result by the number in the table under the heading entitled “Expenses Paid During Period” to estimate the expenses you paid on your account during the period.

	Beginning		Ending		Expense Paid		Expense Ratio
	Account Value		Account Value		During Period*		During Period
	7/1/08		12/31/08		7/1/08 - 12/31/08		7/1/08 - 12/31/08
Equity Growth Fund
Retail shares	$	1,000.00	$	575.00	$	4.20		1.06	%
Institutional shares		1,000.00		570.00	$	3.16		0.80	%
Balanced Fund
Retail shares	$	1,000.00	$	741.10	$	4.55		1.04	%
Institutional shares		1,000.00		739.20	$	3.45		0.79	%
Retirement Income Fund
Retail shares	$	1,000.00	$	858.40	$	3.88		0.83	%
Institutional shares		1,000.00		859.50		2.71		0.58	%
Core Equity Fund
Retail shares	$	1,000.00	$	686.70	$	5.43		1.28	%
Institutional shares		1,000.00		687.50		4.45		1.05	%

* Expenses are equal to the average account value times the Fund’s annualized expense ratio multiplied by the number of days in the most recent fiscal half-year divided by the number of days in the fiscal year.

58

HYPOTHETICAL EXAMPLE FOR COMPARISON PURPOSES

The table below provides information about the hypothetical values and hypothetical expenses based on each Advance Capital I, Inc. Funds’ actual expense ratio and an assumed rate of return of 5% per year before expenses, which is not the Fund’s actual return. The hypothetical account values and expenses may not be used to estimate the actual ending account balance or expenses you paid for the period. You may use this information to compare this 5% hypothetical example with the 5% hypothetical examples that appear in the shareholder reports of other funds.

Please note that the expenses shown in the table are meant to highlight your ongoing costs only. Therefore, the table is useful in comparing ongoing costs only, and will not help you determine the relative total costs of owning different funds.

	Beginning		Ending		Expense Paid		Expense Ratio
	Account Value		Account Value		During Period*		During Period
	7/1/08		12/31/08		7/1/08 — 12/31/08		7/1/08 — 12/31/08
Equity Growth Fund
Retail shares	$	1,000.00	$	1,019.81	$	5.38		1.06	%
Institutional shares		1,000.00		1,021.11	$	4.06		0.80	%
Balanced Fund
Retail shares	$	1,000.00	$	1,019.91	$	5.28		1.04	%
Institutional shares		1,000.00		1,021.17	$	4.01		0.79	%
Retirement Income Fund
Retail shares	$	1,000.00	$	1,019.81	$	4.21		0.83	%
Institutional shares		1,000.00		1,021.11		2.95		0.58	%
Core Equity Fund
Retail shares	$	1,000.00	$	1,019.81	$	6.50		1.28	%
Institutional shares		1,000.00		1,021.11		5.33		1.05	%

* Expenses are equal to the average account value times the Fund’s annualized expense ratio multiplied by the number of days in the most recent fiscal half-year divided by the number of days in the fiscal year.

PROXY VOTING

The policies and procedures that Advance Capital I, Inc. uses to determine how to vote proxies relating to portfolio securities is available on the SEC’s website at www.sec.gov. Information on how the Funds voted proxies relating to portfolio securities during the 12 month period ended June 30, 2008 is available at (1) without charge, upon request, by calling (800) 345-4783, and (2) on the SEC’s website at www.sec.gov.

QUARTERLY PORTFOLIO SCHEDULE

The Advance Capital I, Inc. Funds file with the SEC a complete schedule of its portfolio holdings as of the close of the first and third quarters of its fiscal year, on “Form N-Q”. These filings are available on the SEC’s website at www.sec.gov and may be reviewed and copied at the SEC’s Public Reference Room in Washington, D.C. (Call 1-800-SEC-0330 for information on the operation of the Public Reference Room.) This information is also available without charge, upon request, by calling (800) 345-4783.

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BOARD OF DIRECTORS’ APPROVAL OF THE INVESTMENT ADVISORY AGREEMENTS

The Investment Company Act of 1940 requires that the Board of Directors, including a majority of the Independent Directors voting separately, annually approve the Company’s investment advisory agreement and any sub-advisory agreement (collectively, the “Agreements”). The Directors must determine that the terms of the Agreements are fair and reasonable and that renewal of the Agreements will enable the Funds to receive quality investment advisory services at a cost deemed reasonable and that renewal is in the best interests of the Advance Capital I, Inc. Funds (“the Funds”) and their shareholders.

Factors Considered

The Board specifically considered the renewal of these Agreements at its meeting on August 1, 2008. Each Director relied upon personal knowledge of the Advisor, its services and the Funds. In addition, the Directors considered a number of factors in renewing the Agreements including, among other things, (i) the nature, extent and quality of services furnished by the Advisors to the Fund; (ii) the investment performance of the Funds compared to relevant indices and the performance of peer groups of other open-end investment companies pursuing similar strategies, (iii) the advisory fees and other expenses paid by the Funds compared to those of similar funds managed by other investment advisors; (iv) the profitability of the Advisors as they relate to their investment advisory relationship with the Funds, (v) the extent to which economies of scale would be realized as the Funds grow and whether fee levels reflect these economies, (vi) the record of compliance with the Funds’ investment policies and restrictions, (vii) the Funds’ Code of Ethics as well as the structure and responsibilities of the Advisor’s compliance department, and (viii) the disclosures included in the Company’s reports to shareholders.

Deliberative Process

To assist the Directors in their evaluation of the quality of the Advisor’s services and the reasonableness of the Advisor’s fees under the Agreements, the Directors received information from independent legal counsel outlining the factors appropriate for consideration when evaluating investment advisory contracts as well as the duties of directors in approving such contracts. The Directors also requested and received various materials relating to the Advisor’s investment services under the Agreements. These materials included a report prepared by the Advisor comparing the Funds advisory fees and expenses to a group of several hundred funds determined to be similar to each of the funds (called the “peer group”). The Advisor’s report also included a performance comparison for the Funds against appropriate indexes. In addition, the Board received reports and presentations from the Advisors that described, among other things, the Advisor’s financial condition, profitability from their relationship with the Funds, soft dollar commission and trade allocation policies, organizational structure and compliance policies and procedures. The Board also considered information received from the Advisors throughout the year, including investment performance and expense ratio reports for the Funds.

The following summarizes matters considered by the Directors in connection with their approval of the Agreements. The decision to approve the Agreements was not based on any single factor and this summary does not detail all the matters which were considered. However, the Directors concluded that each of the factors outlined below favored such approval.

Nature, Extent and Quality of the Services Provided; Ability to Provide Services

The Directors received and considered various data and information regarding the nature, extent, and quality of services provided to the Funds by the Advisors under these Agreements. The Directors reviewed the background, education and experience of the Advisor’s key portfolio management and operational personnel and the amount of attention devoted to the Funds by the Advisors’ portfolio management personnel. Accordingly, the Directors were satisfied that the Advisors’ investment personnel devote a significant portion of their time and attention to the success of the Funds and their investment strategies. The Directors also considered the Advisor’s policies and systems designed to achieve compliance with each Funds’ investment objectives and regulatory requirements. Based on these factors, the Directors concluded that the nature, extent, and quality of the investment advisory services are satisfactory, and that the Advisors possess the ability to continue to provide these services to the Funds.

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Investment Performance

The Directors reviewed each Fund’s total return, yield and performance against their peer group as well as appropriate indexes for various periods of time. The Directors considered short-term fluctuations and periods of over or under-performance when assessing the investment performance of the funds. It was favorably noted that the Equity Growth and Balanced Fund’s long-term performance remained solid relative to their peer groups. The Equity Growth and Balanced Fund’s 10-year annualized return for the period ended June 30, 2008, ranked in the first quartile by Morningstar. The Core Equity Fund continued performing well relative to its peer group during its short tenure. The Directors also discussed the under-performance of the Retirement Income Fund relative its peer group noting that the majority of the under-performance has occurred during the most recent two years. (In all quartile rankings referred to throughout this discussion, first quartile is most favorable to the Funds’ shareholders. Thus, highest relative performance would be first quartile and lowest relative expenses also would be first quartile). The Directors discussed the Adviser’s plans for managing the Funds in extremely volatile market conditions and remain confident in the Adviser’s long-term experience and ability to successfully manage the Funds in the future. The Board of Directors concluded that the overall performance of the Funds as well as actions being taken by the Adviser fully supported the renewal of these Agreements

Costs of Services Provided and Profits Realized by the Advisers

The Directors considered each of the Funds’ expense ratios against those of a peer group of funds. The Equity Growth Fund, Balanced Fund and Retirement Income Fund’s expense ratios for the twelve months ended December 31, 2008 were in the first quartile as compared to their applicable peer group for the comparable period. The Core Equity Fund’s expense ratio for the comparable period ranked in the second quartile compared to its peer group. The Directors concluded that each of the Funds’ overall expense ratios were lower than those of comparable funds and as such, a benefit to shareholders. The Directors determined that the fees under these Agreements were reasonable and fair in light of both the nature and quality of services provided by the Advisor as compared to fees charged by funds in their respective peer groups.

The Directors also considered the level of the Advisor’s profits as it pertained to the management of the Funds. Consideration included a review of the Investment Advisor’s methodology for allocating certain of its costs to the management of each fund. The Directors also considered the financial results realized by the Investment Advisor in connection with the operation of the Funds and concluded that the Advisor’s profit from management of the Funds, including the financial results derived from the Funds, bear a reasonable relationship to the services rendered and are fair and reasonable for the management of the Funds in light of the business risks involved.

Economies of Scale

The Directors considered whether the Funds had appropriately benefited from any existing economies of scale and whether there was potential for any further reduction of fees. The Directors concluded that the existing fee structures reflected the appropriate economies of scale.

Approval

The Directors, in light of the Advisor’s overall performance, considered it appropriate to continue the management services of the Advisor. Based upon their evaluation of all material factors deemed relevant and the advice of counsel, the Directors concluded that the Agreements with the Funds are fair and reasonable and unanimously voted to approve the continuation of the Agreements for another year.

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Advance Capital I, Inc.
		Annual Report   December 31, 2008
Investment Advisor:
Advance Capital Management, Inc.
One Towne Square, Suite 444
Southfield, Michigan 48076
Sub-Advisor:
(Equity Growth and Balanced Funds)
T. Rowe Price Associates, Inc.
100 East Pratt Street
Baltimore, Maryland 21202
(Core Equity Fund)
Seizert Capital Partners, LLC
185 West Oakland
Birmingham, MI 48009
Distributor:
Advance Capital Services, Inc.
P.O. Box 3144
Southfield, Michigan 48037
		AN INVESTMENT COMPANY
Administrator and Transfer Agent:		WITH FOUR FUNDS
Advance Capital Group, Inc.
P.O. Box 3144		Equity Growth Fund
Southfield, Michigan 48037		Balanced Fund
		Retirement Income Fund
Custodian:		Core Equity Fund
Fifth Third Bank
38 Fountain Square Plaza
Cincinnati, Ohio 45263
Independent Registered Public
Accounting Firm:
PricewaterhouseCoopers LLP
One North Wacker Drive
Chicago, IL 60606
Officers:
Robert J. Cappelli, President & Treasurer
Christopher M. Kostiz, Vice President
Kathy J. Harkleroad, Vice President,
Chief Compliance Officer & Secretary
Julie A. Katynski, Vice President & Assistant Secretary
Board of Directors:
Joseph A. Ahern
Susan E. Burns
Robert J. Cappelli
Dennis D. Johnson
Janice E. Loichle
Thomas L. Saeli

Item 2. Code of Ethics.

The registrant, as of the end of the period covered by this report, has adopted a code of ethics that applies to its principal executive officer, principal financial officer, principal accounting officer or controller, or persons performing similar functions, regardless of whether these individuals are employed by the registrant or a third party. During the period covered by this report, there have been no amendments to such code of ethics nor were any waivers to such code of ethics granted. A copy of the code of ethics is filed as an exhibit to this Form N-CSR.

Item 3. Audit Committee Financial Expert.

The registrant’s Board of Directors has determined that independent directors Janice Loichle and Thomas Saeli qualify as Audit Committee financial experts. The designation of a person as an “Audit Committee financial expert” does not mean that the person has any greater duties, obligations, or liability than those imposed on the person without the “Audit Committee financial expert” designation. Similarly, the designation of a person as an “Audit Committee financial expert” does not affect the duties, obligations, or liability of any other members of the Audit Committee or Board of Directors.

Item 4. Principal Accountant Fees and Services.

a) Audit Fees: The aggregate fees billed for each of the last two fiscal years for professional services rendered by PricewaterhouseCoopers (“PwC”), the principal accountant for the audit of the registrant’s annual financial statements or services that are normally provided by the accountant in connection with statutory and regulatory filings or engagements for those fiscal years were $270,000 for year ended December 31, 2008 and $51,946 for year ended December 31, 2007.

b) Audit-Related Fees: The aggregate fees billed in each of the last two fiscal years for assurance and related services by PwC that are reasonably related to the performance of the audit of the registrant’s financial statements and are not reported under paragraph (a) of this item were $0 for year ended December 31, 2008 and $0 for year ended December 31, 2007.

c) Tax Fees: The aggregate fees billed in each of the last two fiscal years for professional services rendered by PwC for tax compliance, tax advice and tax planning were $65,855 in the year ended December 31, 2008 and $10,300 in the year ended December 31, 2007. Such services include review of excise distribution calculations (if applicable), preparation of the Funds’ federal, state and excise tax returns and routine tax consulting.

d) All Other Fees: The aggregate fees billed in each of the last two fiscal years for products and services provided by PwC, other than the services reported in paragraphs (a) through (c) of this item were $0 for year ended December 31, 2008 and $0 for year ended December 31, 2007.

e) (1) Audit Committee Pre-Approval Policies and Procedures

ADVANCE CAPITAL I, INC.
PRE-APPROVAL POLICIES AND PROCEDURES

As adopted by the AUDIT COMMITTEE of the Board of Directors of the
Advance Capital I, Inc. Funds (“Funds”)

The Sarbanes-Oxley Act of 2002 (“Act”) and rules adopted by the Securities and Exchange Commission (“SEC”) (“Rules”) require that the funds’ audit Committee of the Board of Directors (“Audit Committee”) pre-approve all audit and non-audit services provided to the fund by its independent accountant (“Auditor”). It also covers any non-audit services provided by the Auditor to the Funds’ investment adviser or affiliates of the adviser that provide ongoing services to the Fund (“Service Affiliates”) IF these services directly impact the Funds’ operations and financial reporting.

The following policies and procedures govern the ways in which the Audit Committee will pre-approve audit and non-audit services provided by the Auditor to the funds and Service Affiliates. These policies and procedures do not apply to audit services provided to Service Affiliates by the Auditors, nor do they apply to services provided by another audit firm.

These policies and procedures comply with the requirements for pre-approval and provide a mechanism by which management of the Fund may request and secure pre-approval of audit and non-audit services with minimal disruption to normal business operations. Pre-approval of non-audit services may be achieved through a combination of the procedures described in Sections C and D below.

A. GENERAL

1. The Audit Committee must pre-approve all audit and non-audit services that the Auditor provides to the Fund.

2. The Audit Committee must pre-approve any engagement of the Auditor to provide non-audit services to any Service Affiliate during the period of the auditor’s engagement IF the non-audit services directly impact the fund’s operations and financial reporting.

B. PRE-APPROVAL OF AUDIT SERVICES TO THE FUND

1. The audit Committee shall approve the engagement of the auditor to certify the fund’s financial statements for each fiscal year (the “Engagement”). The approval of the Engagement shall not be delegated to a Designated Member (see Section D below). In approving the Engagement, the Audit Committee shall obtain, review and consider sufficient information

concerning the proposed Auditor to enable the Audit Committee to make a reasonable evaluation of the Auditor’s proposed fees for the engagement, in light of the scope and nature of the audit services that the fund will receive.

2. The Audit Committee shall report to the Board of Directors (the “Board”) its approval of the Engagement and the proposed fees for such Engagement, as well as the basis for such approval.

3. Unless otherwise in accordance with applicable law, the Engagement shall require that the Auditor be selected by a vote, cast in person, of a majority of the members of the Fund’s Board who are “not interested” persons of the Board (as defined in Section 2(a)(19) of the Investment Company Act of 1940) (“Independent directors”).

C. Pre-Approval of Non-Audit Services to the Fund and to Service Affiliates—by Types of Services

1. The Audit Committee may pre-approve certain types of non-audit services to the Fund and its Service Affiliates pursuant to this Section C.

2. Annually, when the Audit Committee considers the Engagement of the Auditor, management of the Fund shall provide to the Audit Committee, for its consideration and action, the following: (a) a list of non-audit services that the Fund may request from the Auditor during the fiscal year; and (b) a list of non-audit services directly impacting the funds’ operations and financial reporting that Service Affiliates may request from the Auditor during the fiscal year.

3. Lists submitted to the Audit Committee shall describe the types of non-audit services in reasonable detail and shall include an estimated budget (or budgeted range) of fees where possible and such other information as the Audit Committee may request.

4. The Audit committee’s pre-approval of non-audit services submitted pursuant to this Section C shall constitute authorization for management of the fund to utilize the Auditor for the types of non-audit services so pre-approved, if needed during the fiscal year.

5. A list of the types of non-audit services pre-approved by the Audit Committee pursuant to this Section C will be distributed to management of the Service Affiliates and the appropriate partners of the auditor. Periodically, the Auditor will discuss with the Audit committee those non-audit services that have been or are being provided pursuant to this Section C.

D. Pre-Approval of Non-Audit Services to the Fund and to Service Affiliates—on a Project -by-Project Basis

1. The Audit Committee also may pre-approve non-audit services on a project-by-project basis pursuant to this Section D.

2. Management of the Fund may submit either to the Audit Committee or to their Designated Member a pre-approval request for one or more non-audit projects. The request shall describe

the project(s) in reasonable detail and shall include an estimated budget (or budgeted range) of fees and such other information as the Audit Committee or Designated Member shall request.

3. The Audit Committee shall designate one or more of its members who are “not interested” Directors (each a “Designated Member”) to consider any non-audit services to the Fund or any Service Affiliate, which have not been pre-approved by the Audit Committee. The Designated Member shall review, on behalf of the Audit Committee any proposed material change in the nature or extent of any non-audit services previously approved. The fund’s management, in consultation with the Auditor, shall explain why such non-audit services or material change in non-audit services are necessary and appropriate and the anticipated costs thereof.

4. The Designated Member will review the requested non-audit services or proposed material change in such services and will either:

a) Pre-approve, pre-approve subject to conditions, or disapprove any such requested services, or any proposed material change in services, whether to the Fund or to a Service Affiliate; or

b) Refer such matter to the full Audit Committee for its consideration and action.

In considering any requested non-audit services or proposed material change in such services, the Designated Member shall take into account all relevant matters.

5. The Designated Member’s pre-approval (or pre-approval subject to conditions) of the requested non-audit service or proposed material change in service pursuant to this Section D shall constitute authorization for management of the Fund or Service Affiliate to utilize the auditor for the non-audit services which have been pre-approved. Any action by the Designated Member in approving a requested non-audit service shall be presented for ratification by the Audit Committee not later than at its next scheduled meeting. If the Designated Member does not approve the Auditor providing the requested non-audit service, the matter will be presented to the full Audit Committee for its consideration and action.

E. AMENDMENT; ANNUAL REVIEW

1. The Audit Committee may amend these procedures from time to time.

2. These procedures shall be reviewed annually by the Audit Committee.

F. RECORD KEEPING

1. The Fund shall maintain a written record of all decisions made by the Audit Committee or the Designated Member pursuant to these procedures, together with appropriate supporting material.

2. A record of the approval of any non-audit service pursuant to the de minimis exception provided in the Rules shall be made indicating that each of the conditions for this exception, as set forth in the Rules, has been satisfied.

3. A copy of these Procedures and any amendments shall be permanently maintained in an easily accessible place. Written records referred to in paragraphs 1 and 2 of this Section F shall be maintained for six years from the end of the fiscal year in which the actions were taken. They will be maintained in an easily accessible location for the first two years.

(e)(2) PERCENTAGE OF SERVICES REFERRED TO IN 4(B) — (4)(D) THAT WERE APPROVED BY THE AUDIT COMMITTEE:

100% of services described in each of paragraphs (b) through (d) of this Item were approved by the Audit Committee pursuant to paragraph (c)(7)(i)(C) of Rule 2-01 of Regulation S-X.

f) Percentage of hours expended on PwC’s engagement to audit the registrant’s financial statements for the most recent fiscal year that were attributed to work performed by persons other than PwC’s full-time, permanent employees.

Not applicable.

g) Non-Audit Fees: The aggregate non-audit fees billed by the registrant’s accountant for services rendered to the registrant, and rendered to the registrant’s investment adviser, and any entity controlling, controlled by, or under common control with the adviser that provides ongoing services to the registrant for each of the last two fiscal years of the registrant were $0 for year ended December 31, 2008 and $0 for year ended December 31, 2007.

h) Not applicable.

Item 5. Audit Committee of Listed Registrant.

Not applicable because registrant’s shares are not listed for trading on a national securities exchange.

Item 6. Schedule of Investments.

Schedule I — Investments in securities of unaffiliated issuers is included as part of the report to shareholders filed under Item I of this Form.

Item 7. Disclosure of Proxy Voting Policies and Procedures for Closed-end Management Investment Companies.

Not applicable for open-end investment companies.

Item 8. Portfolio Managers of Closed-End Management Investment Companies.

Not applicable for open-end investment companies.

Item 9. Purchases of Equity Securities by Closed-End Management Investment Company and Affiliated Purchasers.

Not applicable for open-end investment companies.

Item 10. Submission of Matters to a Vote of Security Holders.

Not applicable.

Item 11. Controls and Procedures.

(a) The Company maintains a system of disclosure controls and procedures that are designed to provide reasonable assurance that information required to be disclosed in its reports filed or submitted under the Investment Company Act of 1940, as amended (the “1940 Act”), is recorded, processed, summarized and reported within the time periods specified in the SEC’s rules and forms, and that such information is accumulated and communicated to management to allow timely decisions regarding required disclosures. The Company’s principal executive officer and principal financial officer, or persons performing similar functions, have concluded that the registrant’s disclosure controls and procedures (as defined in Rule 30a-3(c) under the 1940 Act) are effective, based on their evaluation of the disclosure controls and procedures as of December 31, 2008, a date that is within 90 days of the filing date of this report.

(b) As discussed below, there were changes in the Company’s internal control over financial reporting that occurred during the last fiscal quarter of the period covered by this report that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting. During October 2008, we identified a material weakness in our internal control over financial reporting with respect to the application of fair valuation to the securities acquired by our mutual funds with the cash collateral received from the lending of the mutual funds’ portfolio securities. Specifically, effective controls did not exist to ensure that the fair valuation procedures required by generally accepted accounting principles were applied properly with respect to such acquired securities. Failure to apply proper valuation procedures to these securities resulted in material overstatements of the per share net asset value for three of our mutual funds for an extended period of time beginning in approximately the second quarter of 2007 up to October 2008.

Effective October 2008, management has revised its internal control over financial reporting to improve the effectiveness of the controls to ensure that securities acquired by our mutual funds with the cash collateral received from the lending of the mutual funds’ portfolio securities are fair valued appropriately in accordance with the mutual funds’ existing valuation policy approved by the Board of Directors of the Company.

As a result of this weakness, the statements of assets and liabilities, including the portfolios of investments as of December 31, 2007, the related statement of operations and statement of changes in net assets and financial highlights for the year then ended were restated in order to appropriately account for the fair valuation of the securities acquired by our mutual funds with the cash collateral received from the lending of the mutual funds’ portfolio securities.

Management has evaluated the operational effectiveness of these changes in our internal control over financial reporting and has concluded that as of December 31, 2008, the Company has remediated this weakness. With the exception of the foregoing, there have been no changes in our internal control over financial reporting during the second quarter of the period covered by this report that have materially affected or are reasonably likely to materially affect our internal control over financial reporting.

Item 12. Exhibits.

(a)(1) Code of Ethics (filed herewith).
(a)(2) Certification pursuant to Rule 30a-2(a) under the 1940 Act and Section 302 of the
Sarbanes-Oxley Act of 2002 (filed herewith).
(a)(3) Not applicable.
(b) Certification pursuant to Rule 30a-2(b) under the 1940 Act and Section 906 of the
Sarbanes-Oxley Act of 2002 (filed herewith).

SIGNATURES

     Pursuant to the requirements of the Securities Exchange Act of 1934 and the Investment Company Act of 1940, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

ADVANCE CAPITAL I, INC.
By:	/s/ Robert J. Cappelli
	Robert J. Cappelli, President & Treasurer

Date: March 17, 2009

     Pursuant to the requirements of the Securities Exchange Act of 1934 and the Investment Company Act of 1940, this report has been signed below by the following persons on behalf of the registrant and in the capacities on the dates indicated.

By:	/s/ Robert J. Cappelli
	Robert J. Cappelli, President & Treasurer

Date: March 17, 2009

By:	/s/ Christopher M. Kostiz
	Christopher M. Kostiz, Vice President

Date: March 17, 2009

EX-99.CODE ETH

EXHIBIT 12(a)(1)

Ex-99. Code

ADVANCE CAPITAL COMPANIES
CODE OF ETHICS

GENERAL PRINCIPLES

Advance Capital I, Inc. (the Funds), Advance Capital Group, Inc., Advance Capital Management, Inc. and Advance Capital Services, Inc. (the “Advance Capital Companies” or “Advance Capital”) operate under this Code of Ethics (the “Code”) which applies to all Directors, Officers and employees of Advance Capital. This Code of Ethics has been adopted by Advance Capital and is designed to comply with Rule 204A-1 of the Investment Advisors Act of 1940 as well as provide a general guideline for ethical behavior throughout the Advance Capital companies and all the services provided to clients on behalf of the firm.

This code establishes rules of conduct for all employees of Advance Capital and is designed to, among other things, govern personal securities trading activities in the accounts of employees. The Code is based upon the principle that Advance Capital and its employees owe a fiduciary duty to Advance Capital’s clients to conduct their affairs, including their personal securities transactions, in such a manner as to avoid serving their own personal interests ahead of clients, taking inappropriate advantage of their position with the firm and any actual or potential conflicts of interest or any abuse of their position of trust and responsibility. Pursuant to section 206 of the Investment Advisors Act of 1940, both Advance Capital and its employees are prohibited from engaging in fraudulent, deceptive or manipulative conduct.

The Code is designed to ensure that the high ethical standards long maintained by Advance Capital continue to be applied. The purpose of the Code is to preclude activities which may lead to or give the appearance of conflicts of interest, insider trading and other forms of prohibited or unethical business conduct. The excellent name and reputation of our firm continues to be a direct reflection of the conduct of each employee. Strict compliance with the provisions of the Code shall be considered a basic condition of employment with Advance Capital.

FIDUCIARY DUTY OF EMPLOYEES

The actions of Advance Capital employees and the firm’s standards of conduct must reflect our fiduciary duty to clients at all times. Advance Capital’s reputation for fair and honest dealing with its clients has taken considerable time to build. This standing could be seriously damaged as the result of even a single securities transaction being considered questionable in light of the fiduciary duty owed our clients. Client initiated requests or actions undertaken with the intent to satisfy client needs will be deemed a violation of fiduciary duty, if the request violates Advance Capital internal policies and procedures, Federal or Self Regulatory Organization (SRO) securities laws, rules or sections under the Code. All Advance Capital employees, as part of fulfilling their fiduciary duty, have an obligation to promptly notify the Chief Compliance Officer (CCO) of Advance Capital in the event that violations of Advance Capital internal policies and procedures, Federal or SRO securities laws or rules or sections under the Code are

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discovered. Any employee who knowingly does not report a violation described in this paragraph, or those described in the Code, will be deemed to be in violation of the Code, and therefore open to sanctions described in the Code.

Any employee who reports a violation described in this section, or those described in the Code will be protected from retaliation by the firm. Anonymous reporting is encouraged for those individuals who still fear retaliation in light of the protection guaranteed by Advance Capital. Advance Capital, in compliance with federal securities laws, will keep records of all violations of the Code, but will not maintain records on the individuals who report such violations.

DEFINITIONS

“Fund” means any of the investment portfolios comprising the Advance Capital I, Inc. mutual funds.

“Access person” means any person identified on the access person list who makes recommendations concerning client accounts or the Advance Capital I funds, or who in the course of their duties while employed at Advance Capital obtains information regarding recommendations concerning client accounts or the Advance Capital I funds. In addition, any officer of the Funds is considered an access person by virtue of their position within the firm.

“Advisory person” means any employee who is not deemed to be an access person or identified on the access person list.

A security is “being considered for purchase or sale” when a recommendation to purchase or sell a security has been made and communicated and, with respect to the person making the recommendation, when such person seriously considers making such a recommendation.

“Beneficial ownership” shall be interpreted in the same manner as it would be in determining whether a person is subject to the provisions of Section 16 of the Securities Exchange Act of 1934 and the rules and regulations hereunder, except that the determination of direct or indirect beneficial ownership shall apply to all securities which an access person has or acquires.

“Compliance officer” shall mean either Kathy Harkleroad or Mark Wayton. Compliance officers will not necessarily be deemed officers of Advance Capital I, Inc., unless the individual is listed as “Officer” on page 9 of the Code of Ethics.

“Control” shall have the same meaning as that set forth in Section 2(a) (9) of the Investment Company Act.

“Outside director” means a director of the Funds who is not an “interested person” of the Funds within the meaning of Section 2(a) (19) of the Investment Company Act.

“Purchase or sale of a security” includes, inter alia, the writing of an option to purchase or sell a security.

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“Security” shall have the meaning set forth in Section 2(a)(36) of the Investment Company Act, except that it shall not include shares of registered open-end investment companies (including the “Funds”), securities issued by the government of the United States or its agencies, bankers acceptances, bank certificates of deposit, commercial paper, and other money market instruments.

“Material, nonpublic information” is defined as information that has not been broadly disseminated to investors in the marketplace that has a substantial likelihood that a reasonable investor would consider the information important in making investment decisions. This definition is also applicable to the market for a company’s securities, such as the information about a significant order to purchase or sell securities.

EMPLOYEE OWNED BROKERAGE ACCOUNTS

Every officer, employee and director (except Outside Directors), must notify a compliance officer of Advance Capital in writing upon opening a brokerage account. This notification must include the firm/financial institution at which the account is held, names under which the account is held, the account number, and whether or not duplicate confirmations have been requested to be sent to a compliance officer. Access persons who open a brokerage account are required to have duplicate confirmations and statements sent to a compliance officer of Advance Capital.

GIFTS AND ENTERTAINMENT

Giving, receiving or soliciting gifts in a business setting may create the appearance of impropriety or may raise a potential conflict of interest. Advance Capital has adopted the policies set forth below to guide supervised persons in this area:

• Employees should not accept or provide any gifts or favors that might influence the decisions the employee or the recipient must make in business transactions involving Advance Capital, or that others might reasonably believe would influence those decisions.

• Any employee who accepts, directly or indirectly, anything of value from any person, entity or client that does business with or on behalf of Advance Capital, or, could possible do business with Advance Capital must inform the CCO or the Compliance Manager before accepting such gift (does not apply to bona fide dining or entertainment, if, during such bona fide dining or entertainment the employee is accompanied by the person or representative of the entity that does business with Advance Capital). Gifts must not exceed $100 in value, and a maximum of $100 in gifts may be accepted by an employee from a particular person, entity or client. Employees are also prohibited from giving gifts in excess of $100 to anyone within a calendar year.

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INSIDER TRADING

No officer, employee or director of an Advance Capital company may trade, either personally or on behalf of others while in the possession of material, nonpublic information, nor may any personnel of Advance Capital communicate material, nonpublic information to others in violation of the law. Before executing any trade for themselves or others, including investment funds or private accounts managed by Advance Capital, the employee must determine whether they have access to material, nonpublic information. Employees who think they have access to material, nonpublic information, should take the following steps:

• Report the information and the proposed trade to a compliance officer.

• Restrict purchase or sale of securities on behalf of employees or others, including investment funds or private accounts managed by the firm.

• Refrain from communicating the information inside or outside the firm, other than to a compliance officer.

• After a compliance officer has reviewed the issue, the firm will determine whether the information is material and nonpublic and, if so, what action the firm will take.

BOARD MEMBERSHIP BY EMPLOYEES

No advisory person or access person shall serve on a board of directors of a publicly traded company.

EXEMPTED TRANSACTIONS

Access persons will be exempt from the prohibitions and reporting requirements associated with the following purchases or sales:

• Purchases or sales effected in any account over which the access person has no direct or indirect influence or control.

• Purchases or sales which are non-voluntary on the part of the access person, including securities acquired as a result of a gift or an inheritance.

• Purchases which are part of an automatic dividend reinvestment plan.

• Purchases effected upon the exercise of rights issued by an issuer pro rata to all holders of a class of its securities, to the extent such rights were acquired from such issuer, and sales of such rights so acquired.

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• Purchases which are the result of participation in any retirement or employee benefit plan.

• Certain activities of Outside Directors as hereafter described.

• Purchases or sales of any shares of registered open-end investment companies (including the “Funds”), securities issued by the government of the United States or its agencies, bankers acceptances, bank certificates of deposit, commercial paper, and other money market instruments.

RESTRICTED AND PROHIBITED ACTIVITIES

Access persons are prohibited from engaging in the following activities:

• Acquiring beneficial ownership in any securities issued in connection with an initial public offering or private placement of securities.

• Purchasing or selling, directly or indirectly, any security in which he has any direct or indirect beneficial ownership and which to his actual knowledge at the time of such purchase or sale:

• is being considered for purchase or sale for a Fund or any other client account; or

• is being purchased or sold in a Fund or any other client account.

• Purchasing any security without requesting and receiving, both in writing, the prior approval of a Compliance Officer or any Vice President of the Funds. Neither a Compliance Officer nor any Vice President shall grant approval for any transaction involving any security known to be considered for sale or purchase in any client account or within three days of any actual trade of a security in any client account. (Outside Directors are access persons, but because of their limited access to current information regarding any Client’s investments, Outside Directors are exempt from this pre-clearance provision unless the director, at the time of that transaction, knows, or in the ordinary course of fulfilling the official duties as a director of the Funds, should know, that during the 3-day period immediately preceding the date of the anticipated transaction by the director, such security was purchased or sold by the Funds or was being considered by the Funds or its investment advisor for purchase or sale by the Funds).

• No access person shall reveal to any other person (except in the normal course of his or her duties on behalf of clients or the Adviser) any information regarding securities transactions made, or being considered, by or on behalf of clients.

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REPORTING REQUIREMENTS

Initial Holdings Reports:

Every access person, except Outside Directors, must provide to a compliance officer an initial holdings report, listing all securities beneficially owned no later than 10 days after becoming an access person. The report must include the title and type of the security, number of shares held, principal amount, name of the broker, ticker symbol and date the report was submitted. The report must also reflect the access person’s holdings within the last 45 days.

Annual Certification of Brokerage Accounts:

Annually, all access persons must re-sign the “Advance Capital Code of Ethics Account Notification” form to ensure that all duplicate confirmations are being forwarded to the compliance department for any new brokerage accounts that may have been opened during the year.

Disclosure of Holdings:

In addition to initial holdings reports and quarterly transaction reports each access person, except Outside Directors, must submit to a compliance officer an annual holdings report that is current within 45 days. The report must include the title and type of the security, number of shares held, principal amount, name of the broker, ticker symbol and date the report was submitted.

Duplicate Confirmations and Statements:

Every access person, except Outside Directors, must arrange for their brokers or financial institutions to provide to a compliance officer, on a timely basis, duplicate confirmations of all transactions in securities and commodities accounts in which they have a beneficial interest. Such access persons shall also notify a compliance officer of each such account, indicating the name of the firm or financial institution held, and the name under which, the account is registered.

Approval of Trades:

Every access person, except Outside Directors, must request permission from a compliance officer BEFORE engaging in a securities transaction, if the transaction involves a security not mentioned in the “EXEMPTED TRANSACTIONS” SECTION ABOVE.

Disclosure of Trades:

Every access person shall report to a compliance officer within 30 days of the end of a quarter whether or not a transaction occurred during the previous calendar quarter to which the access person has, or by reason of such transaction acquires, any direct or indirect beneficial ownership in the security. Every access person shall report to a compliance officer within 30 days of the end of a quarter the following information:

• The date of the transaction, the title exchange ticker symbol or CUSIP number, interest rate and maturity date, number of shares, and principal amount of each security.

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• The nature of the transaction (i.e., purchase, sale or any other type of acquisition or disposition;)

• The price at which the transaction was effected.

• The name of the broker, dealer or bank with or through whom the transaction was effected.

• The date the access person submits the report.

Quarterly Report to the Board of Directors:

A compliance officer shall review all securities transactions and holdings reports and shall report to the Board of Directors of the Funds, at each quarterly meeting, the security transaction activity reported to a compliance officer during the preceding quarter. In addition, the compliance officer shall report to the Board of Directors the completion of the annual certifications of adherence to the code by all access and advisory persons. The compliance officer shall report to the Board of Directors any material code or procedural violations and sanctions imposed on any individuals in response to those material violations.

Requirement to Have Trades Pre-Approved (for Outside Directors only):

An Outside Director of the Funds need only report a transaction in a security if such director, at the time of that transaction, knew, or in the ordinary course of fulfilling the official duties as a director of the Funds, should have known, that during the 3-day period immediately preceding the date of the transaction, such security was purchased or sold by the Funds or was being considered by the Funds or its investment advisor for purchase or sale by the Funds.

SENIOR FINANCIAL OFFICERS

Senior Financial Officers of Advance Capital, as part of the Corporate Leadership Team, are responsible for and have the authority to protect, balance and preserve the interests of all shareholders, clients and employees. They fulfill this responsibility by directing and enforcing the policies and procedures employed in the daily operation of the business. Senior Financial Officers will exhibit and promote the highest standards of honest and ethical conduct through the establishment and operation of policies and procedures that:

• Encourage and reward professional integrity by eliminating barriers to responsible behavior, such as coercion, fear of reprisal, or alienation from the organization.

• Prohibit and eliminate the appearance or occurrence of conflicts between any activity that could result in material personal gain for an officer.

• Provide a mechanism for members of the organization to inform senior management of deviations in practice governing honest and ethical behavior.

• Demonstrate their personal support for such policies and procedures through periodic communication.

• Establish and manage transactions and procedures to ensure such transactions are properly authorized and accurately reported.

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• Ensure that financial communications and reports to clients will be provided in a manner which facilitates the highest degree of clarity of content and meaning.

• Identify, report and correct any detected deviations from applicable laws or statutes in a timely manner.

Officers, Directors and people acting under their direction are prohibited from coercing, manipulating, misleading or fraudulently influencing the auditor of the Fund’s financial statements when the Officer, Director or other person knew or should have known that the action, if successful could result in rendering the financial statements materially misleading. No Officer, Director or person acting under their direction shall:

• Make or cause to be made a materially false or misleading statement to an accountant in connection with; or

• Omit to state, or cause another person to omit to state, any material fact necessary to make statements made, in light of the circumstances under which such statements were made, not misleading, to an accountant in connection with:

• Any audit, review or examination of the financial statements of the Funds required to be made pursuant to this subpart; or

• The preparation or filing of any document or report required to be filed with the Securities and Exchange Commission pursuant to this or any other subpart.

ANNUAL CERTIFICATION

Each Director, Officer and Employee is required to read the Code and sign and return the attached Acknowledgment Form to the Compliance Officer of the Funds upon commencement of employment or other services and on an annual basis thereafter. The Form confirms that the person signing it has received, read and asked any questions necessary to understand the Code, evidences the person’s agreement to conduct himself or herself in accordance with the Code and confirms that the person has complied with the Code during such time as the person has been associated with the Advance Capital Companies.

SANCTIONS

Upon discovering a violation of this Code, the Compliance Officer may impose sanctions as deemed appropriate. Sanctions may include, but are not limited to the following: inter alia, a letter of censure or suspension, monetary fines, restrictions on certain job duties or responsibilities or termination of the employment of the violator.

Amended -	October 27, 2000, May 2, 2003, October 22, 2004, January 16, 2007, December 18, 2007, July 7, 2008
Approved -	January 26, 2001, January 25, 2002, January 23, 2003, January 23, 2004, October 22, 2004, January 27, 2005, February 3, 2006, January 26, 2007, January 25, 2008

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Advance Capital I, Inc.

Access Persons and Reason(s)

1.)	Robert Cappelli — Officer, Director, makes investment recommendations, aware of trading activity
2.)	Kathy Harkleroad — Officer
3.)	Christopher Kostiz — Officer, makes investment recommendations, aware of trading activity
4.)	Julie Katynski — Officer, routinely aware of trading activity
5.)	Steve LaPoint — Senior Accountant, routinely aware of trading activity
6.)	Terra Hantz — (added 12/07) Junior Accountant, routinely aware of trading activity
7.)	Greg MacKenzie — Research Analyst, makes investment recommendations, aware of trading activity
8.)	Lou Salazar — (added 1/07) CIO, unlimited access to all database and files company wide
9.)	Robin Murphy — (added 1/07) Workstation Support, has access to all databases and files company wide
10.)	John Shoemaker — (added 10/08) Consulting Partner, makes investment recommendations, aware of trading activity
11.)	Jennifer Wayton — (added 10/08) Jr. Rep, owns joint accounts with Mark Wayton and lists Mark Wayton as beneficial owner on accounts holding Advance Capital I Funds.
12.)	Mark Wayton — (added 7/08) Compliance Manager, has access to fund holdings through reviews of investment company trades

Mark LaBlance — Removed 11/6/2006
Katie Grodzki — Removed 11/30/2007

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01/07

Advance Capital Code of Ethics Account Notification

Date of this notification:                                                                                     

Name of employee or access person:                                                               

Please mark one of the following:

o I have no outside brokerage accounts (if this choice is selected, sign form where indicated).

o I do have outside brokerage accounts (if this choice is selected, complete entire form).

Firm or Financial Institution at which account is held:                                            

Name(s) under which account is held:                                                                        

Account Number:                                                                                                            

Duplicate confirms: Have                        Have not                        been requested to be forwarded to the Compliance Officer. Access persons must have duplicate confirmations forwarded to Advance Capital.

Signature:

Duplicate confirmations must be sent as follows:

Advance Capital
One Towne Square
Suite 444
Southfield, MI 48076
Attn: Kathy Harkleroad

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Advance Capital Code of Ethics Request for Approval of Trading

Date of this request:

Name of Access Person:

Security:

Purchase, sale or other (describe other):

Proposed Transaction Date:

Quantity or Amount:

Broker/Dealer or Distributor:

Public Float of Class of Security:

Current Holdings in any Client Account:

Most Recent Transaction in any Client Account:

By his or her signature below, the Access Person identified above hereby confirms that no element of the Code of Ethics will be violated by reason of the transaction(s) described above.

Signature of Access Person:

Authorized by Compliance Officer:

Date of Authorization:

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Advance Capital Code of Ethics Transaction Notification

Name of Access Person:

Date of Transaction:

Title and Number of securities, or aggregate principal amount, of securities purchased and/or sold

Nature of the transaction (i.e. purchase, sale or other type of acquisition or disposition).

Price at which the transaction was effected.

Name of broker, dealer or bank with or through which the transaction was effected.

Signature:

Date of this notification:

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Advance Capital Code of Ethics Notification

Name:                                                          

Period covered by this report: October 1, 2006 through December 31, 2006

During the period covered by this report I made no transactions (excluding Advance Capital I, Inc. mutual fund transactions) requiring notification or disclosure under the Code of Ethics of Advance Capital.

Signature:

Date of this report:

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Advance Capital Code of Ethics Certification

STATEMENT OF OFFICERS, DIRECTORS, EMPLOYEES

I hereby acknowledge that I am an employee, officer and/or director of Advance Capital I, Inc. or one of its affiliates and 1) am an “access person” or an “advisory person” with respect to the Advance Capital I, Inc. (the “Company”) mutual funds or 2) have access, on occasion, to information pertaining to the purchase and sale of securities in the funds. I further acknowledge that I have read and fully understand the meaning and intent of the Code of Ethics (the “Code”) adopted by the Company.

I certify that I have not made or been the beneficial owner of any transactions which require disclosure under the Code or, if said disclosure is required, that I have made same in compliance with the Code. I also certify that I have not been in possession of material, nonpublic information nor have I traded securities or recommended transactions or communicated nonpublic information to others in violation of federal securities laws.

Signature

Date

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EX-99.CERT

EXHIBIT 12(a) (2)

Ex-99.302CERT

CERTIFICATION

I, Robert J. Cappelli, certify that:

1. I have reviewed this report on Form N-CSR of Advance Capital I, Inc.;

2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations, changes in net assets, and cash flows (if the financial statements are required to include a statement of cash flows) of the registrant as of, and for, the periods presented in this report;

4. I am responsible for establishing and maintaining disclosure controls and procedures (as defined in Rule 30a-3(c) under the Investment Company Act of 1940) and internal control over financial reporting (as defined in Rule 30a-3(d) under the Investment Company Act of 1940) for the registrant and have:

a)	Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under my supervision, to ensure that material information relating to the registrant, including any consolidated subsidiaries, is made known to me by others within those entities, particularly during the period in which this report is being prepared;
b)	Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under my supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
c)	Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report my conclusions about the effectiveness of the disclosure controls and procedures, as of a date within 90 days prior to the filing date of this report based on such evaluation; and
d)	Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the second fiscal quarter of the period covered by this report that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting: and

5. I have disclosed to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):

a)	all significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize, and report financial information; and
b)	any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

Date: March 17, 2009	/s/ Robert J. Cappelli
	Robert J. Cappelli
	President & Treasurer

EX-99.906CERT

EXHIBIT 12(b)

Ex-99.906CERT

SECTION 906 CERTIFICATION

In connection with this report on Form N-CSR for the Registrant as furnished to the securities and Exchange Commission on the date hereof (the “Report”), the undersigned hereby certifies, pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that:

(1) the Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934, as applicable; and

(2) the information contained in the Report fairly presents, in all material respects, the financial condition and the results of operations of the Registrant.

By:	/s/ Robert J. Cappelli
	Robert J. Cappelli, President & Treasurer

Date: March 17, 2009

A signed original of this written statement required by Section 906 has been provided to the Registrant and will be retained by the Registrant and furnished to the Securities and Exchange Commission or its staff upon request.