Executive Committee Minutes

FROM THE SPJST Executive Committee

September 29, 2022, Minutes of the Special Called Meeting of SPJST Executive Committee held at the SPJST Home Office Temple, Texas

PRESIDING The meeting was called to order by Chair of the Board of Directors John Engelke on Thursday, September 29, 2022, at 10 a.m.

ATTENDING Board of Directors—Donnie Victorick District One/Vice Chair of the Board of Directors; John Engelke - District Three/Chair of the Board of Directors; Bobby Davis - District Four; Bradley Stavinoha - District Five; Annie Vahalik - District Six; Regina House - District Seven.

Executive Officers—Brian Vanicek, President/CEO; Delisle Doherty, Vice President of Sales and Marketing; Melanie Zavodny, Vice President of Communications; Leonard Mikeska, Chief Financial Officer; Roy Vajdak, Controller.

Recording Secretary—Linda Hill, Executive Assistant to the Chief Financial Officer.

ABSENT Board of Directors—Jesse Pospisil - District Two.

OPENING OF MEETING The meeting was opened by Chair of the Board of Directors Engelke with a welcome to all.

Director Jesse Pospisil was absent due to being in the hospital with pneumonia. The Pledge of Allegiance was recited, and a moment of silence was observed in respect for our departed members. Vice President of Sales and Marketing Doherty led the Executive Committee in an opening prayer with an extra blessing for SPJST Home Office Staff Member Ann Paruzinski, who passed away on September 28.

CZECH HERITAGE MONTH A motion was made by Director House to proclaim the month of October as “Czech Heritage Month,” with a second by Director Vahalik. Motion carried unanimously.

GUIDELINES FOR SCHOLARSHIPS A motion was made by Director Vahalik, seconded by Director Victorick, to add the following language in the scholarship guidelines to read as: “SPJST Scholarships may be applied to accredited colleges, universities, and technical schools. Trade schools will be considered on a case-by-case basis. In every case, scholarship monies shall be made payable to the institution and not directly to the student.” The motion carried unanimously.

A motion was made by Director Victorick, seconded by Director House, to add the following language in the scholarship guidelines to read as: “ Military Service: In the event that the SPJST Scholarship recipient opts to enter military service in lieu of college pursuit, the SPJST scholarship shall be forfeited and funds reassigned to an “SPJST Freedom Fund” to be earmarked in the name of the student and available for reassignment or withdrawal on the basis of need or upon honorable discharge.” The motion carried unanimously.

2022 STRATEGIC PLANNING The Executive Committee then proceeded to the 2023 SPJST Strategic Planning Meeting. The Executive Officers presented oral and written remarks.

ADJOURNMENT With no further business, Chair of the Board of Directors Engelke adjourned the meeting at 4 p.m.

The next regular meeting of the Executive Committee will begin at 8 a.m. on October 18, 2022. Fraternally submitted by, Linda R. Hill Recording Secretary Leonard Mikeska Chief Financial Officer —SPJST—

From the Desk of Delisle L. Doherty SPJST Vice President of Sales and Marketing It’s Your Life

Just wait. You will get it all back . . . But when?

I want to give great thanks to Chris Liebum, our new north territory manager, for doing the legwork and putting this article together.

Just Wait. You Will Get It All Back . . . But When?

If you have been invested in the stock market over this past year, you have seen a significant decline in the value of your accounts. There may be some of you reading this today that are afraid to open the mail from your investment company! With the S&P 500 being down about 20 percent right now for the year, and if your account value let’s say was $100,000 at the beginning of the year would now be worth about $80,000.

In general, an investment portfolio depending on your level of risk has about 60 percent stocks and about 40 percent bonds. In the past, bonds were not as correlated with stocks as they are now. What does that mean? Bonds in the past would go up in value when the stock market went down to help your portfolio hold some value through times like we have had this past year. However, during this downturn, bond values are declining along with stocks and due to this correlation has increased the losses in your account.

Now, who knows how long it could take for your account to return to the original value – nobody knows. Your investment professional might be telling you things like, “It’s just a paper loss,” or “It will come back someday.” The problem with those two explanations is that a paper loss is not a paper loss if you were to cash out your account. And, the second part of that – they will come back someday . . . but how many days before that someday arrives? With a 20 percent loss, you will need a 25 percent gain just to get back to even!

In the past, we have had market conditions that were called “lost decades.” In the 1970s, with inflation being high, the increase in value of your accounts was minimal over a 10-year period. And then again in the 2001 Dotcom crash, it took about seven years to regain the value of your account. So just as you recouped the value of your account, the market turned over again in 2008 and dropped by about 50 percent. It took another five years for your account to go back to the same value that you had in 2008.

We do not know how long the market may be down or if it might go down further. Or who knows? It could recover quickly like March 2020. However, with the high inflation and interest rates, it will certainly be a challenge.

One thing that we could do right now is to take a portion of our account that is in the bond portfolio and place that into a fixed annuity to provide safety and growth in your account.

Currently, our Flexible Premium Fixed Annuity is crediting 3.5 percent per year. In the fixed annuity, you are protected from the downside of the market. So even when the market is going down, your account is still getting credited at the current declared interest rate.

So, for example, going back to the $100,000 portfolio. If you had 40 percent in bonds, that would be $40,000. Let’s say that portion of your portfolio went down 20 percent just like your stock portfolio, and the new value is $32,000. If we took that $32,000 and placed it into a Flexible Premium Fixed Annuity and it maintains the current credited rate of 3.5 percent, you would regain the full value of your account in a little over six years. Now, that sounds like a long time. But it does offer one thing. It is more of a “sure thing” than a “maybe.” If you place the same $32,000 in the CD that pays 3.5 percent, at the end of six years, you would have a little over $37,000. One of the big differences is that a CD is taxed

Financial Calculator: Fixed Annuity Calculator (aarp.org)

each year, and the annuity is taxed when you pull the funds out.

Now, let’s hypothetically look at a “What if” – what if you had already put the 40 percent portion in the Flexible Premium Fixed Annuity before the market went down so $40,000 was protected from the downturn and your 60 percent or $60,000 in stocks went down 20 percent to $48,000. Also assume that this is another “lost decade” and the $48,000 stays flat over 10 years while the $40,000 in the Flexible Premium Fixed Annuity continues to grow at 3.5 percent over the next 10 years. Being that the annuity was protected from the volatility in the market, it would grow to about $56,000. So with the stock portion that never regained value in this example plus the value of the annuity at $56,000, your account value could be about $104,000.

Remember the five key points of owning an annuity:

1) Protected from creditors 2) Bypasses the estate 3) Tax deferral so you have compounded growth 4) Never loses value and provides a more consistent return in volatile markets (guaranteed to have more today than tomorrow) 5) Lifetime income

To learn more about how an SPJST Flexible Premium Fixed Annuity could work in your portfolio, please reach out to one of the agents or myself so we can prepare a personalized Annuity Summary Illustration and provide you with an annuity buyer’s guide.

My door is always open; figuratively and literally. Stay blessed, Delisle L. Doherty Vice President of Sales and Marketing 832-232-2049 —SPJST—

• • • • • • • JOB POSTING • • • • • • • Assistant Controller

Job Type: Full-time

SPJST is a fraternal life insurance company based in Temple, Texas. Since our founding in 1897, our mission has been Insuring and Enriching Lives. SPJST is an equal opportunity employer.

The Assistant Controller assists the Controller to ensure accounting and finance activities are performed in accordance with Statutory Principles and other Company practices, policies, and procedures. This position also supervises the work of others in the accounting department. Duties and Responsibilities

The Assistant Controller performs all duties under the guidance and supervision of the Controller. The duties and responsibilities of this position include:

• Assists in the completion of financial statements. • Works with external auditors in the preparation of the annual audit report and with the Texas Department of Insurance in the preparation of their audit report. This necessitates the preparation of multiple supporting schedules. • Assists in maintaining accounting records and transactions for local lodges. This includes automated and manual procedures. • Maintains accurate account of all receipts and disbursements. Prepares all monthly reports, statements, and supplements. • Assists in establishing business plan and expense budget for Information Technology department. As such, consults with users to discuss their needs for new programs or changes to existing programs. Reviews and analyzes new products and technology. • Manages general banking activities and reconciles all bank statements. Downloads monthly bank statements and account activity. Transmits ACH payments to lodges and youth leaders. Drafts annuity payments and medical reimbursements. • Files all necessary reports with the Texas Department of Insurance. • Maintains exact information of all members of every lodge. This includes paid to dates, amount of insurance and all general information pertaining to each individual certificate.

• Receives payment of premiums from certificate holders. • Complies with federal, state and company policies, procedures, and regulations. • Files reports with A.M. Best, American Fraternal Alliance, and NAIC. • Assists in the preparation of an annual budget for the Society. • Works with actuary on various reports to establish reserves. • All other duties assigned by the Controller.

Skills

The skills of the SPJST Assistant Controller include:

• Excellent planning and organizational skills. • A good understanding of accounting and finance activities, as well as mathematics. • A good knowledge about the rules governing preparation of various types of financial statements is required. • The ability to work within deadlines and to be able to prioritize self and staff to meet the Company’s expected delivery times. • Excellent analytic and observation skills. • Excellent verbal and written communication skills. • Approachable and willingness to help employees both inside and outside of accounting.

• The ability to effectively interpret and communicate financial results to non-financial managers and owners.

Education, Qualifications, Experience, Knowledge • Bachelor of Science degree in business, accounting, finance, or economics. MBA preferred. • CPA designation preferred. • Five years of experience in the accounting industry highly recommended. • Strong information technology background and the capacity to develop and implement a variety of internal programs. • Familiarity with fraternal benefit societies a plus. Physical Requirements

The physical demands described here are representative of those that must be met by an employee to successfully perform the essential functions of this job. • Reasonable accommodations may be made to enable individuals with disabilities to perform the essential functions. • Stand for brief periods of time. • Sitting for extended periods of time. • Use hands to finger or handle documents. • Reach with hands and arms periodically. • Stoop, kneel, or crouch periodically. • Must be able to communicate orally and hear to assist clients and coworkers. • Must be able to lift to 25 pounds periodically. • Must have the ability to review written documents and read information on the computer.

Application

Apply online at spjst.org. —SPJST—