Author, economist and retirement solutions expert Tom Hegna kicked off the Advisor Network Summit in Las Vegas on Wednesday with a keynote address revealing that the real secret to a long and happy retirement is… having a guaranteed lifetime income.
Speaking to an audience of mostly independent advisors, Hegna cited some studies from sources like Towers Watson and Freakonomics that illustrate people who had guaranteed lifetime income were happier and live longer than people who don’t. Then he directed the audience: “You [need to] secure guaranteed lifetime income for yourself and you [need to] recommend it to all your clients.”
Hegna’s address was loosely based on his new public television special, “Don’t Worry, Retire Happy: Seven Steps to a Secure Retirement,” and he presented his most comprehensive retirement plan yet with innovative retirement planning concepts like achieving hybrid retirement, maximizing Social Security, securing guaranteed lifetime income, and planning for long-term care.
Here are a few other nuggets from Hegna’s presentation:
• “How much money do you want to give to your kids? Let’s do that first for pennies on the dollar (with life insurance), and then set it up so you can spend everything else in retirement.”
• Next time somebody tells you, “I hate annuities” – such as someone influenced by the Ken Fisher ads, Tom Hegna wants you to act like Kramer on Seinfeld – absolutely shocked! “Why on earth would anybody hate annuities?” Then you can go into all the positives about annuities, and what they can do that no other product can match.
• Longevity is the No. 1 risk in retirement, hands down. Why? Because it is not just a risk – it is a risk multiplier of the other risks (market risk, withdrawal rate risk, long-term care risk, etc.). You must take longevity risks off the table – nothing else can do it like an annuity.
• There is no stock, bond or real estate that can pay out like an annuity does. Anything can give you principal; anything can give you interest. But only an annuity can give you longevity credits.
• If you don’t have good stories or examples, borrow some. Hegna mentioned a story he used in one of his books from Dick Austin. The story was about a family from Boston had never been to desert before, so they booked a vacation to the desert in July. Sure enough, as they are driving through the middle of Death Valley, the gas gauge is getting low and it soon becomes apparent they will run out of gas before making it to a gas station. How can you go into the desert without enough gas? They knew they were going to run out, they just didn’t know when. That’s why you need a lifetime annuity. It’s like having a bottomless tank of gas so you can never run out.
The three-day conference continues through Friday at The Venetian, with speakers including Joe Jordan, new NAFA Executive Director Chip Anderson, Jason Jenkins and Van Mueller, among others.