Focus On Healthspan NOT Lifespan: Shootin' It Straight With Stan
Welcome to Shooting it Straight with Stan. I'm your host Stan The Annuity Man. America's annuity agent, licensed in all 50 states. Writing this one from my main office in Las Vegas, Nevada. Someone asked me the other day, "Well, I don't know if I would ever live in Las Vegas." I'm like, "Listen, people that live in Orlando..." And I lived in Orlando for a long time, where I went to school at the University of Central Florida. Go, Knights. "People who live in Orlando don't always go to Disney. People living in Las Vegas don't always go to the strip."
All right, today's topic is Focus On Healthspan Not Lifespan. Now, I know that runs contrary to the annuity message, which is that I've been pounding the table; annuities are transfer of risk products that primarily solve for lifetime income. It's the only product on the planet that is your own personal pension that you can buy, and it's going to pay as long as you're breathing. If you set it up joint with your spouse, as long as one of you is breathing. And we can set it up contractually so that the evil annuity company never keeps a penny, regardless of how long you live. If you live to 150, it's going to pay. If you live to day two, whatever money is left in the account can be structured to go 100% to the list of beneficiaries. So, one of the dumb things you've ever heard, or think is true about annuities, "I've never bought a lifetime income because the annuity company keeps money," that's one of the dumbest things of all time.
Most really bad accidents in the South happen after this statement. When the person says, "Hold my beer." When they say, "Hold my beer, " they're going to do something stupid. Do you know what I'm saying? And that's one of my legacies before my Learjets hits the mountain, that I'm leasing with another person to cut costs, is that no one says, "The money goes poof." No one says that anymore because that's crazy. But let's talk about the focus. Even though annuities were put on the planet during the Roman times, they can be traced back to the Roman times and then into Europe for lifetime income and transfer of risk. I always tell people, "There's no ROI until you die because we don't know what the return on investment is until you die." At that point in time, we'll know to the penny, and we'll know to the actual decimal point of the percentage. Up until then, it's a transfer of risk. So don't come at me and go, "What's my return on that?" It's not an investment; it's a transfer of risk contract, lifetime income.
Live For the Day
Lifetime income is great, but we all know someone or have a family member that lingered and lingered, and they didn't have a good life those last few years. I was talking to a good friend of mine recently who I played basketball with in college, and he was talking about how his mother-in-law's last three years were just horrific. "Old age stinks." As he and I say, we've got to live life for the day. And both he and I are pushing each other to go after those bucket list items before we can't function anymore because it's all about health span. In fact, I told him recently. He called, and I'm like, "We lived hard, and we put a lot of miles on our body athletically, that there will come a point in time that our health span..." To me, feeling good and healthy is what health span means, "Is going to be less than lifespan. And that last few years probably will stink." So our focus has to be on health span.
My lovely wife Christine, who's been with me 35 years, what a martyr, wonderful person, and masochist, right? We're focusing on our health, wellness, eating better, exercising more, going to the doctor and listening, and trying to find out if we can be proactive. That's focusing on your healthspan.
Now, in combination with lifetime income streams, you can do the combo. You focus on healthspan while guaranteeing income for your lifespan. It has to be a combo. It has to be both. And I talked to a guy the other day, and this is a sad story. He had been diagnosed with a really serious illness. And so, healthspan is not really his focus anymore, but it's his wife's focus now. He was setting up the lifetime income stream to take him as far as he can go, as long as he's going to live, but make sure that there's a continuation of income for his spouse so it's uninterrupted and unchanged after he passes away. I told him, "Hey, let's put that lifespan guarantee in place for both you and your spouse. Now that you have that in place, now that you have that in combination with the other annuity, your own social security..."
He also had a second annuity, which is a company pension, and he literally had a third annuity. A lot of people argue with me on this, but please don't because I'm right, is the RMDs on your IRA, which is coming every year, it's a payment. He had all these income sources for his income floor, and I asked him, "Does this cover the monthly nut? The monthly bogey?" He's like, "Yeah, it does. In spades. We can travel, we can do what we want. We never have to worry about income ever, ever again." Of which I just paused. And I literally said to him slowly, "Okay, it's now time to focus on healthspan. I don't care what the doctor says. I don't care what the diagnosis says. Focus. Focus right here. That's all you have to do."
And for all of you out there, you know I'm right. There's got to be a day in your life where you pivot, put your foot in the ground, and say, "I'm going to get healthy again. I'm not going to eat all this crap and all this dense carb food. I'm going to get myself in order, period. I'm going to do things that need to be done."
I'm getting ready to turn 60. I know what you're saying, "There's no way he's turning 60." Yeah, I'm going to be 60 in the next round. That's not middle age. You can't call 60 middle-aged because I'm not living to 120. 60 is rounding the corner on four laps of life's mile. I'm heading into lap three or halfway through lap three. Who knows? But the lifespan has to be in place contractually so that we can focus on healthspan.
Moshe Milevsky always talks about this, and that's where I got the idea. If you haven't seen that podcast, go to my Fun With Annuities podcast. There's a YouTube video there you can watch with Moshe Milevsky and myself. He's one of the smartest people in the room in the annuity business, actually in the investment business. Forget annuity. He does annuities a good service for commentating and writing books on this area. But he's talking about health span, and he is right.
And in the future, you will see annuity products and life insurance companies that issue annuities start issuing specific types of annuities based on your health and who you are. They'll be more customizable as opposed to a general product right now. And I think that's going to happen. It has to happen.
Right now, at the time of this blog, there are 11,000 baby boomers hitting age 65 every single day. That has not escaped the attention of CEOs of life insurance companies and hedge fund people buying life insurance companies because they want to get in front of that demographic tidal wave of people looking for guarantees, period. It's pure capitalism. They want to do that, but they have to. In a contractual world where annuities are contracted, you buy them for what they will do, not what they might do, not for the hypotheticals, theoreticals, or projections; you buy them for the contractual guarantee.
What the Future Holds
So, what are the annuity industries going to do? They're going to focus on lifespan, lifetime income products that reward you for the healthspan efforts that you're giving. Until then, you've just got to focus on your healthspan. You got to focus on your health. You got to focus on your wellness. You got to focus on your family. You got to focus on chapter two. You need to pivot hard, turn the TV off, stop caring about the markets, put the contractual guarantees in place, and do something different. Watching the Andy Griffiths show, the state show of North Carolina. You've seen every episode. Stop watching Law and Order. You've seen every episode. Stop watching games and sports. Who cares? And stop watching political commentary. Do what you need to do healthspan wise to get your life in order. Put the lifetime income or principal protection guarantees in place to cover that.
Now, there are four different types of lifetime income products with annuities currently at the time of this taping. Single Premium Immediate Annuities, Deferred Income Annuities, Qualified Longevity Annuity Contracts, and Income Riders attached to Deferred Annuities like Variable or Indexed Annuities. Now, based upon the two answers you gave me to the two questions I asked, what do you want the money to contractually do? And when do you want those contractual guarantees to start? Then we will line you up with the product that will provide the highest contractual guarantee. People always ask me, "What's your favorite annuity company?" The one that provides the highest contractual guarantee for you based on your specific situation in the two answers to your questions. We're going to use as little amount of money as humanly possible to solve for that, period, end of story.
But I find myself, as I'm getting older, talking to you and talking to my clients and talking to everybody about healthspan and lifespan. Cover both bases. And the first base is you cover the lifespan. The other way, digressing just a tad, to income, at these current levels of interest rates for interest rate products like Multi-Year Guarantee Annuities, the annuity industry's version of a CD. There are some great guarantees of which you don't have to touch the principal, and you can peel off the interest, take the interest off the top, as an income source as well. In other words, you have to come up with the income floor you're trying to achieve, that lifespan floor, that social security, the annuity you already own that increases with inflation, thank goodness, the best one on the planet. Pension, if you own that, if your company offers that, or wherever you work, that's annuity number two. RMDs through IRAs, regardless of what anyone says, that's an annuity type payment number three when you turn 73 at the time of this taping.
What’s the Point?
The point is, you've put all these things in place for income; now it's time for lifespan. Now it's time to go focus on health span. I just want to put that in your head so you can focus on health. If COVID didn't teach us anything, it taught us this. Well, it taught us please don't print any more money. But the real thing it taught us is life is fleeting; it's ugly. I had three friends my age die of COVID, which was a shocker because they looked like me; they had the same habits as me. It just hit them the wrong way, and it was over. And so, for me, it made me pivot to some of the messaging out here that I do to people and say, "Hey, healthspan, lifespan, got to do both. Do lifespan first with lifetime income products, transfer risk products, which allows you to go focus on your healthspan." And I will guarantee you this, male or female, it doesn't matter. There's somebody here that's reading this that is interested in the family's finances, and the other spouse typically is not.
My wife is that person. She could care less about any of this stuff. I mean, I was with Dean Witter, Paine Webber, UBS, Morgan Stanley, and none of those times she cared about any of that. And that's fine. She was a great mom and speaker, and she does her own thing. But somebody, your spouse or someone involved with you, doesn't care at all about this stuff. Do them a favor as well. Put the lifespan guarantees in place so you can focus on healthspan.
I'm high-fiving Moshe Milevsky right now. He's in Canada. Smart guy, love that guy. I need him on my podcast again. Again, Fun with Annuities. Check that out because we do have guests on that are very, very smart, and I throw softballs to them to educate you on what they do.
So, it's not all about annuities, but this is about annuities, and it's also about your health, and it's also about your wellness. It's also about chapter two of your life, which I want you not to miss. I don't want you to be like some of the clients that call me every month and say, "Stan, I wish I'd listened to you. I would give a million dollars to feel better. I would give 5 million to feel better." But it's too late. They focused on the wrong thing. Put those lifespan lifetime income guarantees in place, and then go focus on your healthspan. My name is Stan The Annuity Man. That's Shooting it Straight With Stan. We'll see you next time.
Never forget to live in reality, not the dream, with annuities and contractual guarantees! You can use our calculators, get all six of my books for free, and most importantly book a call with me so we can discuss what works best for your specific situation.