PG&E Employees: Here Are 10 Terms Every Investor Should Know

Healthcare Provider Update: Healthcare Provider for Pacific Gas & Electric The primary healthcare provider for employees of Pacific Gas and Electric (PG&E) is often covered under large insurance carriers that offer comprehensive plans, including offerings from Blue Cross Blue Shield and UnitedHealthcare; the exact provider may vary depending on the employee's specific plan and regional options available. Projected Healthcare Cost Increases in 2026 As we look ahead to 2026, healthcare costs are anticipated to rise significantly due to a combination of factors. Insurers are reporting average premium increases that could exceed 20%, driven largely by ongoing inflation in healthcare services and the potential expiration of enhanced subsidies provided under the Affordable Care Act. This perfect storm of rising medical costs and diminished financial support could shock many consumers, with estimates suggesting that out-of-pocket premiums might surge by as much as 75% for individuals reliant on marketplace plans. As such, both employees and employers within PG&E should prepare for heightened expenses, taking proactive steps now to mitigate potential financial impacts. Click here to learn more

For PG&E employees and retirees, understanding key investment terms like portfolio, stock, bond and mutual funds is important - and working with an expert like Paul Bergeron, a representative of The Retirement Group, a division of Wealth Enhancement Group, can help you tailor a plan that fits your Retirement goals,' he said.

'PG&E employees and retirees should understand risk, return and diversification in investing, and Tyson Mavar, a representative of the Retirement Group, a division of Wealth Enhancement Group, can help structure investments to achieve long-term financial security,' he said.

In this article we will discuss:

1. Typical investment components are stocks, bonds and cash.

2. Describe how mutual funds and ETFs diversify and reduce risk for investors.

3. Understand investment terms such as dividends, yield and market trends.

Just left PG&E and started investing? You may have heard unfamiliar terms. We therefore created this glossary to help PG&E employees and retirees become more confident investors.

Portfolio

The assets of someone or an organization are called a portfolio. A portfolio contains typically several asset classifications including stocks, bonds and cash. That includes your PG&E pension, 401(k), lump sum and annuity payments upon retirement. The asset allocation of a portfolio depends typically on investor risk aversion, time horizon and investment objectives.

Stock

Stocks are instruments that represent ownership in a business. Shares in the benefits package for most PG&E employees come with time in the workforce. Any shareholder can get a cut of the company's assets and profits. Shareholders are both beneficiaries and losers of their position - they win if the company succeeds and lose money if it fails.See how principal value and return on investment of stocks fluctuate with respect to market conditions. Shares transferred may have a value greater than or lower than their initial price.

Bond

The government agency or corporation is issuing a bond to raise money for current operations or new projects. Investors buying bonds become the issuer's creditors. Bondholders typically get interest payments periodically. Their amounts depend on the coupon rate, which is a fixed annual interest rate. These interest rates could also affect your PG&E settlement sum and annuity. Absent issuer default, bondholders should receive the full par value of the bond at the maturity date specified.The principal of bonds may change depending on market conditions. Prematurely redeemed bonds might be worth more or less than their face value.

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Cash

Another investment or asset is cash. It consists of low-risk and liquid alternatives to money and currency.Typical alternatives to currency include savings accounts, certificates of deposit/CDs, and U.S. Treasury bills.The FDIC insures certificates of deposit (CDs) and bank savings accounts with generally fixed interest rates up to USD 250,000 per depositor per insured institution.T-rex securities are backed to the full faith and credit of the government for timely principal and interest payments.

Mutual Fund

It is a grouping of stocks, bonds and / or other securities purchased and / or managed by an investment company on behalf of many investors. The net asset value (NAV) of the underlying securities determines the price at which shares are purchased from and sold back to the investing company at the end of each trading day. Employees of PG&E have access to mutual funds managed by competent people and a broad investment mix. Diversification reduces risk but does not ensure a profit or prevent investment loss. Understand diversity to ensure a stress-free PG&E retirement.

Exchange-Traded Fund

A portfolio of assets prepared by an investment firm is called an exchange-traded fund (ETF). Unlike mutual funds however, ETF shares can be traded throughout the day on stock exchanges just like individual equities and the price may be higher or lower than the NAV depending on supply and demand. ETFs usually have low expense ratios but you have to pay a commission to buy or sell them - and your overall costs may be higher if you trade frequently.

The return and principal value of mutual funds and ETFs changes with the market. Shares transferred may have a value greater than or lower than their initial price. Check prospectus carefully before investing to understand fund investment objectives, risks, fees and expenses. Read the document before investing.

Dividends

Dividends are distributions by a company of its earnings to its shareholders - typically quarterly - in cash or additional equity shares. The dividend per share is decided by the board of directors of the corporation. An important tax consideration for buyers of PG&E dividends with lump sum payments is often not thought of. Many investors consider dividend payments a sign of a company's health and future prospects.

The yield on a dividend investment is high. Lower volatility and more stable returns mean investors must be prepared for periods when dividend payers detract from a stock portfolio. Profitable economic, market and political factors may affect a company's dividend payout. Generally speaking, dividends are unsecured and can be changed or eliminated.

Yield

Usually, the yield on an investment represents the current income received. Yield for a stock equals the sum of all annual dividends divided by the current share price. Yield on a bond: divide the annual interest rate by the current pricing. The return is comprised of price appreciation and depreciation and is not related to yield. Investments with a higher yield target involve more risk.

Index

A statistical composite called an index tracks the long-term evolution of economic conditions (like inflation) or financial markets. Many different indices are available for assessing how an asset performed. The S&P 500 Index is considered representative of the U.S. equity market overall.An unmanaged index does not necessarily reflect investment performance. No one can own an index directly. Past performances do not indicate future results. The real results could be different.

Bear/Bull Market

Typically a bear market involves falling asset prices that drop 20% or more in several major market indexes over a period of months or more. A bull market is a period of rising prices and investor optimism that lasts for months or years. All these market fluctuations could affect investor attitudes and actions.

Added Fact:

PG&E employee or retiree looking to learn more about investing should know about required minimum distributions (RMDs). RMDs are the minimum amounts that people must take out of retirement accounts - 401(k)s and traditional IRAs - by age 72, the IRS said in 2023 (IRS, updated 2023). Withdrawing the RMD may be punishable. PG&E employees and retirees need to understand RMDs when planning investments and preparing for retirement to avoid IRS penalties and interest rates.

Added Analogy:

Knowing investment terms for PG&E employees and retirees is like having an organized toolbox for a craftsman. All terms are tools that help investors navigate the maze of financial markets. Just as a craftsman needs a hammer and a wrench to drive in nails and a wrench to tighten bolts, understanding terms like portfolio, stock, bond, cash, mutual fund, ETF, dividends, yield, index and bear/bull market provides investors with the tools to build a secure and prosperous financial future. Familiarizing themselves with these terms allows PG&E employees and retirees to invest like craftsmen - picking the right tool for the job and building a long-term portfolio (Author, Date).

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Sources:

1. Johns Hopkins University Human Resources.   Retirement Choice Glossary . 2019,  hr.jhu.edu/wp-content/uploads/2019/06/RetirementChoiceGlossary.pdf?utm_source=chatgpt.com .

2. Protective Life.  'Retirement Glossary: Terms You Should Know.'  Protective Life , 2023,  protective.com/learn/retirement-glossary-terms-you-should-know?utm_source=chatgpt.com .

3. Carbon Collective.  'Retirement Planning Glossary | 20 Retirement Terms You Should Know.'  Carbon Collective , 2023,  carboncollective.co/sustainable-investing/retirement-planning-glossary?utm_source=chatgpt.com .

4. Internal Revenue Service.  'Retirement Topics - Required Minimum Distributions (RMDs).'  IRS , 2023,  irs.gov/retirement-plans/plan-participant-employee/retirement-topics-required-minimum-distributions-rmds?utm_source=chatgpt.com .

5. Charles Schwab.  'IRA Withdrawals: Required Minimum Distributions.'  Charles Schwab , 2023,  schwab.com/ira/traditional-ira/withdrawal-rules/required-minimum-distributions?utm_source=chatgpt.com .