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SCC Financial Advisors Brave Markets

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By LAURA CONE

The Sun

Published: November 5, 2008

In the midst of a bear market, Tom Payant, the CEO and chairman of Payant Financial Plaza in Sun City Center, said he spends a lot of time on the phone easing his client's many fears. Meanwhile, Payant and other Sun City Center financial advisors continue to brave the financial jungle.

"This is one for the history books, no question about it," Payant said. "This is a time we will look back at and study. We have not seen some of the things we've seen in the last two months occur in generations. It's a worldwide phenomenon."

Payant, who lives in Velencia Lakes, said he does not think the financial storm is over. At the same time, he thinks the recent presidential election will create a positive shift in the economy. Payant said he thought the economy would improve if either candidate were elected, although the economy might feel worse in the short term.

"On plus side, we will have a new congress and president, and their job one will be to address the economy," Payant said. "I think they will be putting things in place that will improve employment and stimulate the economy."

In terms of his retired clients, most people express a tremendous amount of concern about their finances, according to Payant.

"We have been on the phone with all of our clients talking with them about their situations," he said. "My clients are asking questions such as how are we going to survive this? We are really in touch with them on an ongoing basis."

He said the country has gone through about 20 financial crises that have developed into bear markets.

"We will eventually crawl out of this and go back to living happily ever after," Payant said.

Many of his clients have two homes. Even though the economy has been difficult, most of Payant's clients indicate they will keep their winter and summer homes.

Between pensions, social security benefits and required distributions from their IRA accounts, most of his clients are able to maintain their present lifestyles.

"I have not see a real situation where people have said to me, I'm going to have to sell one of my properties to live on," said Payant, who puts in place income streams necessary to support their lifestyle.

He said some of his clients require as little as $2500 a month to live on; while others live at a rate of $25,000 a month.

"We maintain a certain amount of emergency funds, usually a minimum of six months of income and we look at any planned expenditures for the next year and keep a certain amount in cash," he said.

Gary Cotter, a certified financial planner in Sun City Center, said his clients have also been asking a lot of questions. But since he is not a fortune teller, Cotter can only give his best guess.

"The question on everyone's mind is will it keep going down and when it finally reaches bottom, how long will it take to come back?" Cotter said. "No one can answer those questions. If things have gone down more than you can stand, it's time to get more conservative."

Cotter said most people invest with their emotions. They tend to invest in the stock market when the prices have gone up and get frightened and sell when the prices are down.

"This will turn out in retrospect to be a great time to buy, not to sell," Cotter said. "You have to try to remove emotions from everything. One thing I think is a really good idea for people, is to turn off their televisions."

Cotter remains optimistic.

"Someone gave me a really good analogy," Cotter said. "If you have ever been on a cruise and hit rough seas, the worst thing you can do is look down at the waves. That's sure to make you sick. That's what people are doing when they turn on the television and see all these talking heads saying how awful everything in. It is not the end of the world. We are going to come back from it. That's something that seldom gets mentioned."

Editor Laura Cone may be reached at lcone@mediageneral.com.

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