Open Forum in The Villages, Florida

Paving the Way to Financial Stability in Retirement

July 28, 2023 Mike Roth & Greg Panjian Season 4 Episode 4
Open Forum in The Villages, Florida
Paving the Way to Financial Stability in Retirement
Open Forum in The Villages, Florida
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Show Notes Transcript Chapter Markers

Picture this: you've spent your whole life working hard, and now retirement is on the horizon. But, the financial challenges seem overwhelming and you worry about running out of money. This is where Greg Panjian, an investment advisor with Edward Jones, steps in. Drawing on his experience as a small business owner, Greg has crafted unique strategies to help you manage your money better and ensure your golden years are truly golden. He truly understands the ins and outs of financial planning and how important it is to retirees.

Now, let's fast forward to the second half of our conversation, where things get a little more specific—Fixed Income vs. Stock market. It may sound like a complex topic, but Greg breaks it down. And just when you think the conversation couldn't get any more interesting, Greg shares a personal story about his Rolls Royce vehicle. How did he happen upon this luxury car, and what process did he go through to find the perfect vehicle? You'll have to tune in to find out! So, whether you're a retiree or planning for retirement, this conversation is packed with valuable nuggets of wisdom on how to manage your finances.

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Open Forum in The Villages, Florida is Produced & Directed by Mike Roth
A new episode will be released most Fridays at 9 AM
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Announcer :

This is season number 4. It marks several significant improvements clarification. We are now clarifying the podcast name as Open Forum in the not be caught before the transcript is published. However, this is a dramatic step forward. We will now include chapter markers for each show. The show's title will be one of the five titles generated by the AI. The show description will be AI generated. In fact, the show's announcers are now all AI voices, including me. Hope you enjoy.

Announcer 2:

yp tw Tis Open Forum in The Villages, Florida podcast. In this show we are going to talk to leaders in the community, leaders of clubs and interesting folks who live here in the villages to give perspectives of what is happening here in the villages. We hope to add a new T most Fridays at 9am. We have converted all of our shows to Buzzsprout. Of course, you can still listen to Apple podcast, Amazon music and about 20 other podcast platforms. Your favorite podcast player will still work. We are now a listener supported podcast. You can become a supporter for only $3 or you can choose to pay more per month. Go to openforminthevillages. com and click on Support in the black box. There will be a shout out for supporters in episodes. This is a shout out to supporters. Tweet Coleman, Dan Kapellan, Ed Williams, Alvin Stenzel and major supporter Dr Craig Curtis at K2 in The Villages. We will be hearing more from Dr Curtis with short Alzheimer's tips each week.

Mike Roth:

This is Mike Roth. I'm here today with Greg Panjian an investment advisor with Edward Jones. Thanks for joining me, Greg. Thanks, Mike. Why don't you tell our listeners a little bit about yourself and how long you've been here in the villages and how you got involved with Edward Jones?

Greg Panjian:

Okay, i started my career with Edward Jones 15 years ago, half in Connecticut and the second half here in the villages. I was a small business owner before that and I was looking for a new career at age 55 and they found my resume and career builder. When I explained, as I knew, that I didn't have any experience as a financial advisor, they actually preferred that. They said we prefer you didn't, but we'll teach you how to be a financial advisor. But what we can't teach you is the skills you've earned in running a business for 15 years.

Mike Roth:

What kind of a business did you have before getting into financial services?

Greg Panjian:

It was a great company. We manufactured Wall decor and basically made copies of the masters Monet, Renoir, van Go and toured the world with it and museums and it was a wonderful business. It was art. Yes, it was Okay When you said Wall decor, i thought of wallpaper.

Mike Roth:

Oh no, okay For sound absorbing acoustic tiles Which I had a long time convincing my wife it was going to be okay to put them up. It makes a big difference in the sound of the show, Greg, we have a lot of retirees here in the villages. We have 160,000 people. Most of them are already retired. Some are still working for the last few years before they retire. What are retirees asking you about today?

Greg Panjian:

Well, when they come in for the first time, they want to invest their money, but just don't know how to do it. So I offered them a few different ways. I mean, there isn't a cookie cutter for everybody. We actually have a brochure called Making Good Choices. They're all good, just that they're different. and they're different in this respect How much time do you want to help in the decision making and how do you want to? pay us.

Greg Panjian:

So that's what we try to do is offer them the choice of which way. Do you want to have Edward Jones manage the money, or do you want to work with me and we'll manage it together? So that's the choice they have.

Mike Roth:

For your clients. Now, what is the split between those people who want to manage it themselves, in conjunction with you, or the other choice we'd be having Edward Jones manage it for them?

Greg Panjian:

The majority is definitely people that want the professionals to do the management rather than do it themselves.

Mike Roth:

Majority means, about what percentage, would you say?

Greg Panjian:

Oh I would say in my branch it's about 80%.

Mike Roth:

Okay.

Greg Panjian:

Now, when I say Edward Jones manage it, that's also having other companies like mutual fund companies managing the money too. The people that do it themselves usually want to buy stocks and CDs and things like that.

Mike Roth:

So, Greg, at this point in the show I normally put a little joke in for my grandson, evan, and here's a little riddle for you. What did the left eye say to the right eye, Greg? I don't know, in us something smells. That's good, okay. That's for Evan. And instead of putting it at the front of the show, we put it hidden in the middle, so we make them listen to more of the show.

Announcer 2:

I saw them last week in New York.

Mike Roth:

Okay, Now why don't you tell our listeners how you work with retirees?

Greg Panjian:

Good question. We meet with them and we ask them a lot of questions. We of course get their assets that they have now. We analyze them. They're asked if they should just keep. But we do a comprehensive plan. We will ask them questions about how much their income is, what they spend a month for items that are necessary and items that are optional, vacations and such. We calculate inflation, We calculate raises in social security. We calculate how their living expenses will increase every year and how their investments will increase also. So we will work with a proprietary program that Edward Jones has that will predict 20 and 30 years out. It's really a great tool for us to work with them. Every time we meet them we'll update it, usually annually, sometimes semi-annually, print it out for them, post it on their account. They can review it. We can tweak it. It's a great program. What's the program called? It's an internal. what is the program called In our company? it's called Financial Foundation.

Mike Roth:

We're going to take a break here and we're going to hear from Dr Craig Curtis on an Alzheimer's tip. Dr Curtis, tell us about genetics and how important it is. Thank you, Mike.

Dr Craig Curtis:

So we know that approximately 60 to 70% of all cases of Alzheimer's disease do have a genetic link And, yes, Alzheimer's disease does run in families. So if you have a loved one or a family member generally what we call a first degree relative that have had Alzheimer's disease, your risk is increased And we'd like you to see your doctor and discuss the topic, discuss Alzheimer's disease, as it's always important to catch symptoms early.

Warren:

With over 20 years of experience studying brain health, Dr Curtis's goal is to educate the village's community on how to live a longer, healthier life. To learn more, visit his website craigcurtismd. com, or call 352-500-5252 to attend a free seminar There. Can you tell us?

Mike Roth:

About risk tolerance and how do you examine that with each client?

Greg Panjian:

Sure. The reason why we want to know their risk tolerance is so that we can invest their money that they will be comfortable with. As you know, the stock market is a volatile place. It goes up and down. In fact, i have a graph I like to show people. It shows the last 43 years of the stock. Now, even though it's positive 75% of the time. And I like to say if the stock market was a baseball player, they'd be batting 750. That's not bad. Not bad right, superstar is batting 300. But 100% of the time the market will be down sometime between the year. But it's like a rubber band. It's so resilient it finishes positive 75% of the time. As you may know also that the stock market over a long period of time does return on average over 10%. But many people cannot stand that volatility. Instead of people getting in the market, out of the market, everybody likes to buy when the market's up and they want to sell when the market's down.

Greg Panjian:

That's not a way to invest. You have to pick a.

Mike Roth:

That's a player.

Greg Panjian:

It is, it is. It's like playing Russian roulette. I say So. The way to invest is have a set amount of equities to fixed income and just stick through it and re-balance when the market's up and re-balance when the market's down. That's the way you buy high and buy low, so pick a ratio. I like to say America's portfolio is 2 thirds in the market, 1 third in fixed income. But many people have a much higher risk tolerance. They know the volatility, they know the neighborhood they hang out in, so to speak, and some people do cannot stand by. So I take people as they are. I will try to educate them. I do love educating my clients on the market and how it works, and that's what we use risk tolerance for. It ends up being six questions that are both informative and give us data on how we should invest their money.

Mike Roth:

Can you give us an example of one of the six questions?

Greg Panjian:

Sure I like this. Number five is there have been several periods in the market and history when the market has dropped 25% or more in a year. How would you react if your portfolio went from 200,000 to 150,000? So the four answers would be I would move my money. Second one is I consider moving my money if the losses continued. The third one is I would stick with my long-term plan. And the fourth one is I think it's an opportunity And if I had some money available, I'd be putting some money into the market.

Mike Roth:

Yeah, that last one sounds a lot like Jim Kramer, and for a lot of folks who've retired they're not going to have a lot more money to put in the market, so they can't buy it when it's on sale because they've already invested everything. So that's out of a question.

Greg Panjian:

Well, that makes it sound like they've lost all their money. Well no, but they have, let's pretend, every penny they have is, in the end, yeah, there's no money on the sideline, is what you're saying.

Mike Roth:

Right, there's no extra working capital to invest.

Greg Panjian:

Well, you see, that's why it's probably a good idea to have a ratio of stocks to bonds, stocks to fixed income, that you can then rebalance And when the market's down, you're buying some of those equities and selling some of that fixed income and bring it back to that starting point, that stock to bond ratio.

Mike Roth:

In the past couple of years, bonds have done rather poorly. Yes, they have, and I for one have kept all of my money out of bonds as much as I could. What do you think of the fixed incomes now, with these CDs paying 5.2 or 5.3 percent for a year?

Greg Panjian:

There's a lot of money going into CDs right now throughout the country And it's all being generated those rates because of the Fed trying to curb inflation and they've been dragged up. If you have noticed that, the ads that I put out there and others that the longer term rates are lower, there's a rate inversion going on. It's upside down Historically. The longer you go out, the higher the yield Right.

Mike Roth:

I noticed that the one year mark seems to be the peak interest rate And you go out to two years and they're giving you less.

Greg Panjian:

Right. So the reason for that is the financial markets are pretty sure that rates are going to go down in the future, so they don't want to give you that higher rate for two, three, four, five years. Even you look at the, the T-bill rate or the T-bonds rather, that are over 20, 30 years, they're very low compared to the one year.

Mike Roth:

So, Greg, we've talked a little bit about risk tolerance. We've had a lot of people here in the villages talk about annuity as a way for retirees to invest. What is the opinion of Edward Jones relative to annuities?

Greg Panjian:

like to say annuities come in four different flavors or four different colors, and they're as different as the colors of the rainbow. They're fixed annuities. Well, those are just as simple to understand as a CD. How long is it? What's the interest rate? The advantage to an annuit tha looks like a CD is that the interest is deferred and you can keep deferring it for quite a long tim an t get a tax bill on it until you decide to withdraw it. A lot like an.

Mike Roth:

<br> works right. Let's say you made $10,000 in interest and you withdraw it. Is that ordinary income or is that at a special rate?

Greg Panjian:

It's ordinary income. It's not taxed at preferred interest, dividends or long-term rate. Okay, so that's type one. Type two is. Type two would be a immediate annuity, that is, you would take a lump sum of money and turn it into an income stream for life, usually, and that could even include your spouse, and it has a guarantee of getting at least so much back. Unlike So, it almost is like taking a pension, like turning it a lump sum into a pension.

Mike Roth:

ok<br> I take my $200,000 and I would get a fixed amount back every month for as long as I live. Right, what happens to the leftover? if there is any, we'll go to your beneficiary. Okay, so that takes care of type two. What is type three?

Greg Panjian:

three is, By the way it's type two also ordinary income.

Mike Roth:

TIMINGS <br> <br> <br> all ordinary income. They're all ordinary income.

Greg Panjian:

So there's no real tax savings. No, there's no tax savings and annuity other than the tax deferral that we talked about.

Mike Roth:

A minute ago. Yeah, eventually you're going to pay the tax at the ordinary income rate, correct, so?

Greg Panjian:

Type three is a variable and that's usually talked. It's a lot like your investment account. It has stock and bond mutual funds in it and it has optional features to guarantee you income for life again. So it's another income producing product. And type four is. Type four is called an index annuity. Our firm has chosen not to sell those. They just don't think they're beneficial to clients.

Mike Roth:

I would tend to agree with you, Greg. could you tell our listeners what challenges clients and retirees here and there just face?

Greg Panjian:

Well, the challenges would be they want to make sure they don't run out of money, and that's why reliance rate is a important thing to talk about here.

Mike Roth:

So that's the first time I've heard an investment advice use the word reliance rate. I know what interest rate is. I'm sure many of our listeners want to know what is a reliance rate.

Greg Panjian:

So reliance rate is a percentage and we try not to have it above 50%. So let's say you need $40,000 a year to live on, yeah, and all you have is social security. So you're only and I meant to say it's only $10,000. Okay, you have a very high reliance rate of 75%. Your investments are contributing 75% of your money you need to live. Now, many people, many people, have both social security and a pension. Those are two things that would lower your reliance rate. So if you had that $40,000 need for income and you had 10 from social security and 10 from a pension, then your reliance rate is 50%. What would that mean for?

Mike Roth:

investments.

Greg Panjian:

So that means that you still want to have those investments invested in a diversified manner so that your investments will can take the hits of down markets and so on. The way of lowering your reliance rate would be to add an annuity. That's the only other thing that would lower your reliance rate. So if that $40,000 example that that's what you need to live on you're going to get 10, let's say 10 from social, 10 from a pension, 10 from an annuity, so they're guaranteed by A the government, b your pension company and C the annuity company. So your reliance rate is only it's a very low 25%. So it's really you don't have to rely on the stock and bond performance that you need to live on.

Mike Roth:

That's what reliance rate is. Is it okay if I ask you a question that I've had with the whole issue of annuities? Sure, an annuity really is a contract between you and a company, insurance company, insurance company generally. What guarantee do you have that if they go out of business, you're still going to have your money paid back to you? Great question, mike. You know a lot of CD were guaranteed for a quarter of a million dollars per institution by the FDIC Right right Federal government's not going out of business.

Greg Panjian:

No but the FDIC is an insurance company and who knows, I'm not going to get into what if that would ever to fail, but probably wouldn't.

Mike Roth:

The insurance company surely, have certainly failed.

Greg Panjian:

Well, there have been a few, but every state, because my main practice is here in Florida but I also have clients around the country. I have to be licensed in every state that I have an annuity in or the annuity was written in, And to every state. It's the states that regulate annuity salespeople. Annuity product.

Mike Roth:

I understand that you own a Rolls Royce vehicle. Why did a financial services advisor buy a Rolls Royce?

Greg Panjian:

Well, as you know, i'm a car guy because we met in the Mercedes club and living here for all these years, i really enjoyed going to the Spanish Springs cars on the third Saturday of the month and I decided I wanted to buy a car. Well, that car had to be at least 30 years old. So I started looking. I looked at muscle cars big old, gigantic Cadillac convertibles. I thought would be pretty cool. In fact I almost bought one.

Greg Panjian:

But I started noticing these Rolls Royce Corniches online and they seem fairly reasonably priced, about a third of the value of what when? they were new.

Greg Panjian:

So I started looking at one and found one on Facebook marketplace three hours south of here, went down to look at it. Boy, i really liked it, so I bought it and I've had it for a little over a year now. I love bringing it to car shows and talking to people about it. People even thank me for bringing it. They like seeing it. They want their picture taken with it. So it's a big hoot for me.

Mike Roth:

Has it turned into a prospecting tool for you?

Greg Panjian:

No, no it hasn't.

Mike Roth:

As you know, i used to train salespeople for 25 years. I would look at it as a great prospecting tool for financial services advisor. There's another one that I trained. I trained everyone at his company. His name was Mark Mattson, called or at the time was called Matric and he bought himself a DB9, which is a beautiful car, maybe not the car to drive for three or four or five miles to work every day, but certainly a showstopper.

Greg Panjian:

I only drive this to car shows mostly or to breakfast on a weekend or something. It's very low mileage. It's only good Now it has 21,000 miles on it. It only gets single digits miles per gallon.

Mike Roth:

I was getting at least a mile per gallon instead of gallons per mile.

Greg Panjian:

Yeah but it has been a bear to have service. I finally have the right people working on it.

Mike Roth:

But it's a little price. Where did you have to go to have it serviced?

Greg Panjian:

Well, there's a gentleman in Winter Park that I've been using and that's who's going to work on it for most of the time going forward The expenses in maintaining a 30-year-old car like a Rolls Royce significant Well yeah, it's got some odd things like the braking system is hydraulic and it doesn't use DOT brake fluid, it uses mineral oil and boy, it leaks pretty badly.

Greg Panjian:

So it's always leaking. But they use some GM parts. They have a GM transmission, a GM air conditioning compressor, so they've used parts from around the world, really to put that together And you'll probably be able to keep that on the road for a lot of time.

Greg Panjian:

I hope so. The best part about owning it is I joined the National Club. I just recently spent a week at the National Show where there were several hundred people there. I got to see some beautiful cars many worth seven figures found some great sources for parts and so on, found a lot of information about my car actually talking to some experts there. So I loved hanging out with some really nice people from Florida here in the Orlando area. I look forward to getting together with them with their monthly dinners and breakfast and stuff.

Mike Roth:

I understand you're trying to form a Rolls Royce Club here in the village.

Greg Panjian:

You're right, And I tried to form a Bentley and Rolls Royce Club but this district didn't think we had enough people And I know you had mentioned to me. It gave me some ideas to maybe.

Mike Roth:

It used to be. All you needed was five. Really Mm-hmm. That's all we needed when we founded the Mercedes Club, and if I were UIB attempting to form a club of exotic automobile, at least Rolls. Lamborghinis, ferraris even Austin Martins.

Greg Panjian:

That's a good idea, Mike.

Mike Roth:

Or you could include maybe even a Citrione, high-end Citriones, because we have people in the villages with these rather unusual and unique vehicles that don't fit into the typical Camaro, mustang, even Mercedes, category, and they're club orphans, right? Oh, that might be another name for your club Club orphans, the orphan brand, that's a good idea, car club, and you can probably come up with 30 members real fast. So, greg, if someone wants to ask you a financial question after the show, how should they do that?

Greg Panjian:

Well, my office is at Colony Plaza, right next to Bell's Outlet. If you go to EdwardJonescom and type in Greg Pangan, p-a-n-j-i-a-n, you can send me a question through our national website, or my email address is Greg Panjan at EdwardJonescom. My last name is Bell P-A-N-J-I-A-N Gr office telephone number is 352-750-9246.

Mike Roth:

Greg, thanks for joining us today And I'm sure all of us will enjoy the show. I'm sure you'll get a few telephone calls. Thank you, Mike. Thank you.

Announcer 2:

Remember our next episode will be released next Friday at 9 am. Should you want to become a major supporter of the show or have questions, please contact us at .. com. If you know someone who should be on the show, contact at c at mikeatrothvoice. com. We thank everyone for listening to the show. The content of the show is copyrighted by Rothvoice 2023, all rights reserved.

Mike Roth:

Few telephone calls. Thank you, Mike. Thank you.

Announcer 2:

Remember our next episode will be released next Friday at 9 am. Should you want to become a major supporter of the show or have questions, please contact us at mikeatrothvoicecom. If you know someone who should be on the show, contact us at mikeatrothvoicecom. We thank everyone for listening to the show. The content of the show is copyrighted by Rothvoice 2023, all rights reserved.

Villages, Florida Podcast Updates
Types of Annuities and Reliance Rates
Rolls Royce