Tom Hegna: Don't Worry, Retire Happy! (From the Vault)

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[Music]

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Welcome to Fun with Annuities, where

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every single week I welcome a celebrity

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guest expert that can help you maximize

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chapter 2 of your life. Listen, learn,

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laugh, and love every minute of the most

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unique financial podcast on the planet.

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Let's get to it.

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[Music]

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Welcome to Fun with Annuities. I'm your

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host, Stan the Annuity Man, America's

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annuity agent, licensed in all 50

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states. I'm so glad you joined us.

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Whether you're listening on all major

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podcast platforms or on the Fun with

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Annuities YouTube channel, where you can

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see me and our special guest today, you

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can see our facial expressions and how

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we interact. Either way, I'm glad you

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joined us. Let me tell you a little bit

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about our guest today. I'm so happy he's

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with us. His name is Tom Hegna. Um he's

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an author, a speaker, an economist, and

1:00
an unbelievably incredible um incredibly

1:04
popular speaker um with the industry,

1:06
retirement industry, annuity industry,

1:08
lifetime income. That's his those are

1:10
the topics. That's his that's where he

1:13
is excels. Um, just like Stan the

1:16
Annuity Man is the undisputed annuity

1:17
expert and America's annuity agent, Tom

1:19
Hegna is known as the retirement income

1:22
expert. Um, he's a former senior

1:25
executive officer at New York Life and

1:28
also a retired lieutenant colonel from

1:31
the Army. So, he he's a tough dude. Um,

1:34
here's an unbelievable fact about Tom.

1:36
He's given over 5,000

1:39
seminars. I'm gonna say that again.

1:41
5,000. and is just so passionate about

1:45
helping baby boomers and seniors retire

1:47
in what he calls the optimal way. And

1:49
he's going to describe that. Tom

1:51
specializes in in creating very simple

1:55
and powerful retirement solutions that's

1:58
based on math and science, not some

1:59
opinion or sales pitch. That's what I

2:01
like about him. He's he's all about math

2:03
and annuities are all about math and

2:05
we're going to talk about that. Um his

2:07
skill I think personally is solving

2:10
complex financial solutions um and

2:13
problems using very easy to understand

2:15
language and words and stories that you

2:18
can understand. Um he has condensed a

2:20
large large chunk of his huge knowledge

2:24
base into five books. Um and let me tell

2:28
you a little bit about them. You should

2:29
go on they're on Amazon. paychecks and

2:31
playchecks, retirement solutions for

2:33
life, published in both the US and

2:35
Canada. Uh, don't worry, retire happy,

2:38
seven steps to retirement security, both

2:41
published in US and Canada. We're going

2:43
to talk about those seven steps to

2:44
retirement security. And he also did a

2:46
book on retirement income masters,

2:48
secrets of the pros. You might have seen

2:50
Tom uh on public television where he had

2:53
a special on retirement income that was

2:56
viewed um in over 80 million households

2:59
in the United States and Canada. Without

3:03
further ado, welcome to the Fun with

3:05
Annuities podcast, Tom Hegna. Welcome,

3:08
Tom.

3:09
Thank you, Stan. I didn't know my bio

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was going to take up the whole podcast.

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I

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knew I mean I didn't cover it all, Tom.

3:15
You know that. I was just I was just

3:17
synopsizing. So, hey, let's jump right

3:19
in. Um, let's get to the seven steps of

3:22
retirement. I know you covered this in

3:23
your book and and once again for

3:25
everybody out there, if you go to my

3:26
site, theanuityman.com, we're going to

3:28
have a page for Tom. You can get all of

3:29
his stuff and go to his site. If you

3:31
want to book him as a speaker, you can

3:32
do that as well. But let's cover those

3:34
seven steps to retirement, Tom.

3:37
Yeah. So, you know, step number one is

3:39
you got to have a plan. I mean, how are

3:41
you going to get anywhere if you don't

3:42
have a road map or a plan of how to get

3:44
there? I say you've got to work with a

3:46
financial professional. Retirement is

3:48
not a do-it-yourself project. I mean,

3:49
think about it. You don't do your own

3:50
dental work in your garage with your

3:52
drill set. And I don't think people

3:54
ought to be doing their own retirement

3:55
planning either. So, that that's step

3:57
one.

3:59
Well, and that's in a do-it-yourself

4:02
world, Tom, where everyone is trading

4:05
Bitcoin and trading cryptocurrency and,

4:07
you know, it's easy in a raging bull

4:09
market market to throw darts at things

4:11
and things go up. Me and you have been

4:12
around long enough to, as I say, we

4:14
probably have cowboy boots older than

4:16
most um agents and advisers out there

4:19
selling either annuities or financial

4:22
products in general. But um I agree with

4:25
you on you need a professional. It's

4:27
tough to find someone who's going to

4:29
shoot it straight and tell you the

4:30
truth, but you need to search and uh

4:33
interview people as well. What's number

4:34
two?

4:35
Number two is to maximize your social

4:37
security benefit. Most people uh the

4:39
largest retirement asset they have is

4:41
social security. And yet they're not

4:43
studying it. They're not finding out the

4:45
optimal age to to start it. They they

4:47
listen their buddies down to the coffee

4:48
shop to tell them to take it at age 62,

4:50
you know, and that's for most people

4:52
that's not the right age. For some

4:53
people it is because, you know, if if um

4:56
if they have short life expecties for

4:58
both the husband and wife, if um they

5:00
have minor children in the house, I mean

5:01
there are reasons why you might want to

5:03
take it early. What I say is in general

5:05
the bread winner should delay. So, so if

5:08
you have a husband and wife, uh, let's

5:10
say the husband made more money in Korea

5:11
than the wife, the wife can take her

5:12
social security early. I don't have a

5:14
problem with that. But the husband

5:16
should wait or whoever made the most

5:17
money should wait because that check

5:19
covers both lives because when he dies,

5:21
she's going to get his. If he took his

5:22
early, he locked her into a lower social

5:25
security survivor benefit. So, so just

5:27
look, there's social security

5:29
calculators out there. Another reason

5:31
why you should sit down with a financial

5:32
professional and just have them run that

5:33
calculator. It will show you the optimal

5:36
age based on your situation that you

5:39
should draw social security.

5:41
And I know Tom and I both laugh when

5:42
people say, "I hate all annuities." And

5:44
we're like, "Wait a minute, you already

5:45
own one. It's called Social Security."

5:47
And if you own a pension, you already

5:48
own one. So it's, you know, those are

5:50
annuities.

5:51
And you know what's so funny is people

5:52
love their social security and they love

5:54
their pensions. And and the people who

5:56
own annuities love their annuities. You

5:57
don't ever find people complaining that

5:59
they have these annuities. They they

6:00
love them. Those checks come every

6:01
single month. as long as they're

6:03
breathing those checks keep coming and

6:05
uh you know all the all the math and

6:07
science the PhDs and if you read Dr.

6:10
Michael Fingera Dr. Wade FA Dr.

6:12
Manakamari Dr. Moshmalki Dr. David

6:15
Babel. I mean it the list Robert C.

6:17
Merin Nobel Prize winner they all say

6:20
you must annuititize a portion of your

6:23
portfolio. Nobody's saying put all your

6:24
money in annuities. And remember Stan, I

6:26
don't sell any annuities. I don't get

6:28
compensated on the sale of any

6:29
annuities. I don't sell any of them. I

6:31
own 11 annuities. Okay? I don't sell

6:33
them. I don't really care if people buy

6:34
them or not if they don't want to. But

6:36
the math and science says that they

6:38
should. And and that's what I that's

6:40
what I write about.

6:41
And I agree I agree with that. And

6:43
people always, you know, ask me with

6:44
lifetime income annuities, um, they ask

6:47
me a question they never ask with their

6:48
pension and social security, which is

6:50
what's the return on investment, Stan

6:52
the annuity man? And I'm like, well, if

6:53
you tell me when you're going to die, I

6:55
can give it to you to the penny up until

6:56
that point is a pure transfer risk. But

6:58
I do think in a raging bull market where

7:00
there's fear of missing out, FOMO, and

7:02
people are always un unfortunately and

7:05
mistakenly trying to time annuity

7:07
purchases and once again there's many

7:09
types of annuities, but when we're

7:10
talking about lifetime income, the

7:12
primary pricing mechanism is your life

7:14
expectancy. Interest rates do play a

7:15
minor role, but people are hung up on

7:18
interest rates definitely. Can you can

7:20
you speak to that a little bit more

7:21
before we get to number three on just

7:24
the interest rate conundrum we're in

7:26
right now? Yeah. I mean, and and I I

7:28
posted a lot on it because I'm an

7:29
economist and everybody's saying, "Oh,

7:30
inflation, inflation, you know, lumber

7:32
price up, copper price is up, every oil

7:33
price up, gas price up, everything's

7:35
going up." And yet the the 30-year

7:36
Treasury is still under 2%. I mean,

7:38
that's unbelievable. The 30-year

7:39
government bond is under 2% when we're

7:42
when we're filming this. And so, it's

7:43
kind of a conundrum. The bond market

7:45
does not see inflation. You and I see

7:47
it. We see it every day, but I'm telling

7:48
you, the bond market says it's

7:50
temporary. And and they don't see it as

7:52
a long-term thing. And the number one

7:54
thing, as you said, is longevity. And

7:56
that also plays a role in social

7:57
security. See, what people don't realize

7:59
is that right now, today, the life

8:01
expectancy of a 65-year-old couple is

8:03
age 93. 50% of all 65-year-old couples

8:07
will have somebody live to be 93. 25% of

8:09
those 65 year old couples will have

8:11
somebody live to be 97. And when you

8:13
plug that type of longevity into social

8:15
security, into a calculator, or into

8:17
your annuity calculations, you're going

8:19
to find out that it's very, very, very

8:21
important to have something that will

8:23
pay you as long as you are living. as

8:25
long as you are breathing. Stocks can't

8:27
do that. Bonds can't do that. Real

8:29
estate can't do that. Bitcoin cannot do

8:30
that. But an annuity can do that,

8:32
right? And that's the monopoly that

8:34
annuities have. You know, the lifetime

8:37
income type annuities have that no other

8:39
product, like Tom said, can match.

8:41
That's not a sales pitch. That's a fact.

8:44
That's just a fact. So, you know,

8:46
lifetime income with 10,000 baby boomers

8:49
hitting age 65 every single day. Tom and

8:51
I both agree that's a that's called a

8:53
that's called a demographic title wave

8:55
of people that are looking for

8:58
guarantees. I think the hurdle with

9:00
annuities and the annuity industry has

9:01
done a poor job um explaining this. The

9:06
only person out there that is

9:07
consistently doing this right from a

9:09
from a presentation standpoint on a

9:12
national level um is Tom Hegma. He talks

9:15
about how these products work, work,

9:17
expectations, buying the contractual

9:19
guarantees of the policy, which is why

9:21
we have them on because you know this

9:23
the saying of this podcast is is living

9:26
the reality, not the dream. And the

9:28
reality is the contractual guarantees of

9:30
the policy. So what's number three? Are

9:32
we at number three yet on the

9:34
three is to consider a hybrid

9:35
retirement? Too many people are trying

9:37
to retire too early. They haven't saved

9:38
enough money. if they could just work a

9:40
couple extra years, even part-time,

9:41
doing something they love to do, it can

9:43
significantly help them uh retire more

9:45
successfully because they can have

9:47
increased earnings, increased savings,

9:49
increased social security benefits, and

9:50
you can keep them from tapping into that

9:52
portfolio for a couple years.

9:54
That's a tough pill to swallow for the

9:56
for the person that is going toward

9:59
retirement. But those are tough

10:01
conversations that I have every single

10:03
day for people that contact me. You can

10:05
go to my site at theanuityman.com and

10:06
book a call. And I'll be brutally

10:08
honest. If if you say there's a lot of

10:10
times that I I get a person, I say,

10:12
"Okay, I ask two questions. What do you

10:14
want the money to contractually do?" And

10:16
then when do you want those contractual

10:17
guarantees to start? And if they say

10:18
income, and I need it to start now or

10:21
two years from now, whatever. Then I

10:22
say, "Well, how much income?" And

10:24
sometimes, like you said, Tom, they

10:26
don't have enough money to contractually

10:28
pull that off. Unfortunately, that's

10:30
when the the charlatans and the grifter,

10:33
you know, salespeople step in and go,

10:34
"Well, this one will do that." No, you

10:36
buy it for the contractual guarantee.

10:38
And if the contractual guarantee doesn't

10:39
hit it, hit that number for you, then

10:41
Tom's right, you might want to either

10:44
have that side hustle or work a little

10:46
bit longer. But that's, you know, those

10:48
are those are retirement realities, Tom.

10:50
Yeah. And it it doesn't have to be like

10:53
terrible work. Like I I'm doing the

10:54
hybrid retirement. I'm still doing this,

10:56
but I'm not doing it like I was before.

10:58
I spent 200 days a year on the road

10:59
before. I'm not doing that. I'll do it

11:00
virtual. I'm not going to be I'm not

11:02
going to be on the road 200 days. Now,

11:04
my golf game and my my tennis uh

11:06
appointments and my my ra my pickle ball

11:08
appointments, they're more important to

11:09
me now. But I still do some work on the

11:11
side and it brings in revenue and that

11:13
it it helps. And so, you know, even even

11:15
somebody who likes to play golf, they

11:17
could be a marshall on a golf course two

11:18
days a week. Guess what? They get to

11:20
play for free the other five days a

11:21
week. So, I mean, it could reduce their

11:22
expenses. So, just be creative in doing

11:25
something that can help your retirement.

11:27
And by the way, Tom's book, Paychecks

11:30
and Playchecks, which I would advise you

11:32
to go to Amazon and buy uh immediately

11:36
because it's a great great book. I mean,

11:38
that's when I first kind of found out

11:40
about Tom a while back and we've been

11:42
friends ever since just because he just

11:44
I mean, he talks about lifestyle and him

11:46
and I we we both believe that annuities

11:48
can provide lifetime income annuities

11:50
can provide lifestyle, but as he said,

11:53
you know, everything you have doesn't

11:55
need to be in annuities. And certainly

11:56
the annuity industry frowns upon that

11:59
um as well. It just needs to be a tool

12:01
and I agree with the the um comment Tom

12:04
made that there's a lot of smart people.

12:06
You know, the guys that have the the

12:08
ascots on and the and the smoking

12:10
jackets with the elbows uh leather elbow

12:12
protectors, those smart guys are saying,

12:14
"Hey, you might want a lifetime income."

12:16
Tom and I, you know, he refers to it as

12:18
as kind of like I do as the income

12:20
floor. It's the income floor that's

12:22
going to hit your bank account every

12:24
single month. Um, and by the way, if you

12:27
have that in place contractually, you're

12:28
a better investor. I think Tom would

12:30
agree with that.

12:31
Yeah. I mean, I even put 1% of my

12:33
portfolio into Bitcoin and I put that on

12:35
social media and people said, "Oh, his

12:37
account must be hacked. He would never

12:38
talk about Bitcoin. He's all about

12:40
guarantees." And I said, "Yeah, but it's

12:41
because I have so much of my money

12:42
guaranteed. I can afford to take 1%."

12:45
That's all I've ever said, 1% of my

12:47
portfolio and do some very risky stuff

12:49
with it. And guess what? It's done very

12:50
well. I bought Bitcoin back when it was

12:52
$3,000 of Bitcoin. Okay? and and I just

12:54
put 1% of my portfolio in there and

12:56
that's grown up. But but because I have

12:58
so much of my income guaranteed, I'm

13:00
able to take more risk with some of my

13:02
other money if I want to.

13:04
And I think I think people just need to

13:06
remember that's how the lifetime income

13:08
annuity transfer of risk that helps that

13:12
helps as people say, "Well, how's it

13:14
going to make me a better investor?"

13:15
Because you know that you don't have to

13:16
do the 4% rule of taking 4% out of your

13:18
portfolio, disrupting it. You already

13:20
have that in place. What's number four?

13:22
Four is you got to have a plan to

13:24
protect yourself against inflation. And

13:26
and you know, for the last 30 years,

13:27
inflation has been dead. And now all of

13:29
a sudden, it's in the news all the time.

13:30
But even if we're in a deflationary

13:32
environment, there's stuff that goes up.

13:33
I mean, college education's going up,

13:35
nursing home prices are going up, uh,

13:37
healthc care is going up. So even in a

13:39
deflationary economy, there's pockets of

13:41
inflation. And that's why you can't just

13:43
have income for the rest of your life.

13:44
You really want to figure out how you're

13:45
going to have increasing income for the

13:47
rest of your life. And there's really

13:48
three ways to do it. Number one, you can

13:50
buy an annuity that automatically goes

13:52
up every single year by three or four or

13:54
5%. You can pick that up front or you

13:57
can um cover your basic living expenses

13:59
in retirement with guaranteed lifetime

14:01
income, then invest the rest of your

14:02
money into stocks and real estate and

14:04
other things that go up in times of

14:05
inflation. So, if we have inflation,

14:07
there's going to be more money to take

14:08
up more money. Or you can do what I've

14:09
done. I bought guaranteed lifetime

14:11
income that kicks in when I turned 60,

14:13
but I bought more that kicks in when I

14:15
turned 62. I bought more that kicks in

14:17
when I turned 65. I bought more that

14:19
kicks in when I turned 70. So, I am

14:21
guaranteed to have increasing income for

14:23
the rest of my life. And your listeners

14:25
can do that as well, of course.

14:26
And that's what I call lading income.

14:29
Um, and you can ladder lifetime income.

14:31
You can ladder the purchase date. You

14:33
can ladder the income start date like uh

14:35
like Tom's doing. And that is truly the

14:38
best way to address inflation using

14:41
lifetime income annuities. Tom mentioned

14:42
earlier the number one was you can buy

14:45
annuities that increase and that s

14:48
increase the income whether it's a cost

14:50
of living adjustment or an index or

14:52
whatever that sounds really good on face

14:54
but I want to remind our viewers and

14:55
listeners that annuity companies have

14:57
the big buildings for a reason and they

14:58
have the logos on the plane for the

15:00
reason and they and they are sponsoring

15:02
sports stadiums for a reason and that

15:03
reason is they don't give anything away.

15:06
So, anytime that you are looking at an

15:08
annuity type, regardless of the lifetime

15:10
income type of annuity,

15:12
if you're going to attach an increase to

15:14
that income stream, the annuity

15:16
company's going to significantly lower

15:19
that income amount to make up for that

15:22
increase. So, they're not just going to

15:23
give it away. Yes, they give it away

15:25
with social security because politicians

15:27
don't care. They're just trying to get

15:28
get votes. But people need to understand

15:31
that yes, you can have increasing um

15:35
income uh levels every year with

15:38
annuities, but those companies don't

15:40
give it away. I'm not saying don't buy

15:41
it. The way that we use that, Tom, is

15:44
you know, if people are buying um

15:46
multiple annuities, maybe one has the

15:48
inflation increase and one does not. Um

15:51
but again, it all comes down to

15:52
contractual guarantees. And if you're

15:54
interested in looking at inflation

15:57
versus non-inflation, say immediate

15:59
annuities, you know, go to my site, the

16:01
annuityman.com, schedule a call with me.

16:02
I'll run them real time and send it to

16:04
you and you can see how they the annuity

16:06
company prices that

16:09
totally agree with um with what Tom the

16:12
three things Tom said, which is buy an

16:14
annuity for and that has increased to

16:15
inflation. We just explained that. And

16:17
then the third one was, you know, have

16:19
income start at different intervals,

16:21
which I think is good. The second one I

16:23
think is very very important which is

16:25
put in the income floor knowing that

16:27
there will be inflation and then

16:30
investing the rest and then when

16:32
inflation hits at that point in time you

16:34
can always do what's what I call a

16:35
reverse engineer quote to solve for that

16:38
inflation amount using a single premium

16:40
immediate annuity. Do you agree with

16:42
that?

16:42
Absolutely.

16:44
But we just want them to have increasing

16:45
income over time because inflation is a

16:48
like a virus it gets worse every year.

16:49
And then step number five is you need to

16:51
secure more guaranteed lifetime income.

16:53
And that is a key part of retirement.

16:56
And it's key for a number of reasons.

16:57
Number one, the number one risk in

16:58
retirement is longevity. I mean, there's

17:00
a lot of risks. There's market risk.

17:01
There's withdrawal rate risk. There's

17:02
sequence of returns risk. You know, you

17:04
might have inflation, you might have

17:05
deflation, might raise your taxes, you

17:07
might die, you might need long-term

17:08
care. There's a lot of risks in

17:09
retirement. But the number one risk is

17:11
longevity that you live a long time. And

17:13
the annuity is the only product in the

17:15
world you can buy that can mitigate that

17:17
longevity risk. Because as long as

17:19
you're breathing or you and your spouse

17:20
are breathing if you have a joint

17:21
annuity, those checks are coming

17:23
guaranteed for the rest of your lives.

17:25
And and that is so important. And then

17:27
there's two additional reasons why it's

17:29
important. Number one, you're going to

17:30
be happier. You know, the Wall Street

17:32
Journal, the Wall Street Journal said

17:33
the secret to a happy retirement is

17:35
friends, neighbors, and a fixed annuity.

17:38
And and what they found is that the

17:39
happiest people in retirement were those

17:41
people who are surrounded by their

17:42
friends, surrounded by their families,

17:43
who had guaranteed paychecks every

17:45
single month. You know, I I would

17:47
encourage your listeners, who are your

17:48
fa who are your happiest friends in

17:50
retirement? I bet it's retired military,

17:52
retired government, retired teachers,

17:53
retired firefighters. It's people with

17:55
pensions. So happiness in retirement is

17:58
tied almost 100% to guaranteed lifetime

18:01
income, not assets. Who are the most

18:03
miserable people? You know, they're

18:04
loaded, but they're losing money in this

18:06
and they're losing money in this, and

18:07
they're losing money in this. And these

18:08
people are miserable. Assets make people

18:11
miserable in retirement. Guaranteed

18:12
lifetime income makes people happy. And

18:14
then the second thing is the research

18:16
now shows people of guaranteed income

18:18
tend to live longer. I'm not making this

18:20
stuff up. You can look it up on free

18:22
economics. The Journal for Financial

18:24
Service Professionals had an entire

18:25
article on uh you know longevity

18:28
insurance does long do do um does

18:31
longevity insurance increase longevity

18:33
and it's all about annuities. And what

18:35
they found is that the average

18:37
65year-old male

18:38
will live about 20% longer if they have

18:41
an annuity versus if they don't. Now it

18:43
doesn't mean that buying an annuity

18:44
automatically makes you live longer. I

18:46
mean maybe maybe people who have bad you

18:48
know life expectancy don't buy annuities

18:50
but having that guaranteed income has

18:53
been proven through through centuries

18:55
because remember annuities have been

18:56
around for thousands of years. The Roman

18:58
Empire issued annuities because running

19:00
out of money has been the number one

19:02
concern of people ever since there's

19:03
been people and there's been money. It's

19:05
not a new concern. But you're likely to

19:07
be happier and you're likely to live

19:09
longer if you have guaranteed lifetime

19:10
income. Tom, what's the what's your site

19:12
address?

19:14
tomhagna.com. Very easy.

19:15
tomheaggna.com. That's to mhea

19:19
y.com.

19:20
All one word. I would encourage you to

19:21
go there. There's a lot of good stuff

19:24
there um for you to take in. And if

19:26
you're looking for a good speaker for

19:28
your organization, um I recommend Tom

19:30
Hegna. He's fantastic. In fact, I I

19:32
kided Tom the last time we were

19:33
together. I was like, "We need to go on

19:35
like a world tour, like a US tour, and

19:37
do a co-headlining because, you know, my

19:40
my speaking style is a little bit more

19:41
abrasive than Tom, so that it's still

19:43
factual, but I think we'd knock the

19:45
cover off the ball." Definitely. I just

19:47
The problem is we're both just getting

19:48
older. One of the things that you

19:50
mentioned in there was just the

19:51
guaranteed income. But I wanted to make

19:54
sure that our listeners and our viewers

19:55
understand one thing. One of the biggest

19:57
misconceptions

19:59
about lifetime income type annuities,

20:01
and that would be immediate annuities,

20:03
deferred income annuities, qualified

20:04
longevity annuity contracts, and income

20:07
writers, of which I've written books on

20:08
all of those. You can go to my site at

20:10
thean annuityman.com, and I'll send them

20:11
to you. But what people need to

20:13
understand is that if your Learjet hits

20:16
the mountain, if you die, that's what

20:18
Tom, that's how I call people dying. If

20:20
your rented leerjet hits the mountain,

20:22
you can structure your annuity so that

20:25
100% of any unused money will go to your

20:29
family or listed beneficiaries or

20:31
charity of choice and the evil annuity

20:33
company doesn't keep a penny. I find one

20:36
of the biggest misconceptions, Tom, is

20:38
that people I'd never buy an annuity

20:40
because I don't want the annuity company

20:42
to keep the money. That's one of about

20:44
40 ways to structure a lifetime income

20:47
an annuity. What you need to tell a

20:50
professional, hopefully me, is that this

20:52
is what I wanted to do. You know, this

20:54
is how I want to structure it. Um, you

20:56
can have money coming back cash refund

20:58
when you die to the beneficiaries, or

21:00
you can structure it as a payment form

21:02
to the beneficiaries. Quick story, my

21:04
two daughters are one's a dancer, one's

21:06
a writer, which means they'll never make

21:07
any money. But I want to make sure that

21:09
with my annuities that they're not going

21:10
to get the lump sum because they'll

21:12
helicopter in to the funeral and then

21:14
drive away in a Ferrari. At least I want

21:16
them making payments. you can structure

21:17
it and handcuff those beneficiaries for

21:20
any unused money. But the other thing

21:22
before we get to the next point is that

21:25
remember when the account is drawn down

21:27
to zero, the annuity company is still on

21:29
the hook to pay and I that's truly the

21:33
value proposition of a lifetime income

21:35
stream annuity and with co did not

21:38
disrupt life expectancy as people

21:41
thought. It really did not if you look

21:42
at the stats and I do think that as a

21:45
country and as a as a as a world we're

21:47
going to have better medical care

21:49
because of this. I actually think life

21:50
expectancy tables will go up. Do you?

21:53
Well, yeah. And and and Mosh Malevki,

21:55
Dr. Malevki has done a lot of work on

21:56
this and he said like I don't remember

21:58
it was 1915 or 1920 whenever that last

22:01
Spanish flu was life expectancy went

22:03
down for like a year and then it spiked

22:05
up because all it really did was people

22:08
who were going to die anyway many of

22:10
them died a year earlier and then

22:13
everybody else ended up living longer

22:15
and so so I think we're going to see

22:17
that life expectancy is going to spike

22:18
again um but I just want to say one

22:21
thing on on this this guaranteed

22:22
lifetime income it's those mortality

22:24
credits and we could literally do an

22:25
entire show on mortality credits that

22:27
that guarantees you'll never run out of

22:28
money. But even when people pick life

22:30
only, because that's what you were

22:32
talking about, a life only where people

22:33
think the insurance company keeps the

22:35
money. The insurance company does not

22:37
keep the money. That money goes to the

22:39
other people that pick life only and

22:40
live. That's why the payout rate is

22:42
higher. But like people don't want that

22:44
to happen. You pick life with cash

22:46
refund. I've even been shown doing joint

22:48
life with a grandpa and his 5-year-old

22:50
granddaughter. Now he gets a check for

22:51
the rest of his life. When he dies, she

22:53
gets a check for the rest of her life.

22:54
that thing can pay for a hundred years.

22:56
That's what people don't understand

22:57
about this guaranteed lifetime income.

22:59
It's really an incredible product.

23:00
That strategy uh I deemed uh and I've

23:03
written about it. I call it the legacy

23:05
income monster. Um because I I had a

23:08
recent uh 82-year-old great-grandfather

23:11
did a joint lifetime income with a

23:13
5-year-old. And same same thing. Uh if

23:16
you really want legacy

23:18
um and have a have a monthly check hit

23:21
the bank account of your loved ones.

23:23
You'll be dead and gone and they'll be

23:25
looking lovingly on you and bringing

23:28
flowers to your grave

23:29
and they'll always remember you. I used

23:31
to I used to hand out a piece of paper

23:32
to people with four lines on the top and

23:34
eight lines on the bottom. I said, "Now

23:35
do me a favor. Jot down the first and

23:37
last name of your four grandparents."

23:38
Well, almost everybody can do that

23:40
because they know their grandparents.

23:41
And then I said, "Now, in these eight

23:42
lines, uh, just jot down the first and

23:44
last name of your eight

23:45
greatgrandparents. Go ahead. It should

23:47
just take a minute." Well, I've never

23:48
had anybody remember the first, last

23:50
name of their great great great

23:51
grandparents. And I said, "You know

23:52
what's so interesting? John D.

23:54
Rockefeller's great great great great

23:55
great grandkids, they all remember his

23:58
first and last name." You know why?

23:59
Because every year they get a check from

24:01
John D. Rockefeller. And we found if you

24:03
get a check from somebody, every year,

24:05
it helps your memory.

24:06
No, it No, it definitely does. Going

24:08
back to mortality credits, and I do want

24:10
to have you back on where we just dig

24:12
into that.

24:13
Yeah.

24:13
Can you spend a little bit of time there

24:15
and give people maybe the 30,000 foot

24:17
view of mortality credits with annuity

24:21
payments and why it why people need to

24:23
fully understand it?

24:25
Yeah. Well, see, like let's say there's

24:26
a thousand people out there. The

24:28
insurance company does not know when

24:30
each one of them is going to die, but

24:32
they do know for a fact that 500 of them

24:34
will die before the other 500. They just

24:36
don't know who they are. But because

24:37
they know that they can pay all a

24:39
thousand a higher payout rate because

24:41
they know they're really going to have

24:42
to pay that to half the people and and

24:44
and so so um in in I wrote this white

24:47
paper called retirement alpha. It's just

24:48
a little thing and in there uh

24:50
now where can they get that retirement

24:52
alpha held it out to the viewers but for

24:53
the podcast listeners it's called

24:55
retirement alpha. Where's that?

24:56
Yeah tomagnet.com. It's it's there. But

24:59
but but what's interesting about that is

25:01
one of the one of the advisers referred

25:03
to mortality credits as other people's

25:05
money. He said, "Look, I work with a

25:06
bunch of baby boomers. None of them have

25:08
enough money to retire. But if all put

25:10
them all together, and they all pick

25:11
life only, the payout rate is high

25:13
enough that they'll all make it. Now,

25:15
some of them are going to die early and

25:16
and and that that money would then go to

25:19
the ones who live longer." And he said,

25:20
"You don't have enough of your own money

25:21
to retire. I got to find you some other

25:23
people's money." And that's what he

25:25
called mortality credits was other

25:26
people's money. It's extra money from

25:28
the risk pool, the entire risk pool.

25:30
Uh it's it's it's like the opposite of

25:32
life insurance. How can an insurance

25:34
company afford to sell a million dollar

25:36
life insurance policy for 20 bucks a

25:38
month? A 20-year-old can buy a million-

25:39
dollar policy for 20 bucks a month.

25:41
Well, they know not many 20-year-olds

25:43
are going to die.

25:44
You see? And so, so they can keep that

25:46
premium low. And it's just like a

25:48
90-year-old can buy an annuity with a

25:50
guaranteed 20% payout rate. Well, how

25:52
can an insurance company guarantee 20% a

25:54
year for the rest of because they know

25:55
the 90-year-old's not going to live that

25:57
long? Probably. But if they do, they

25:58
they're on the hook to pay that as long

26:00
as they're living. And and people just

26:02
don't understand these mortality credits

26:04
are better the older you are and the

26:06
longer you live. So a 90-year-old is

26:09
going to get a lot more mortality

26:10
credits than a 40-year-old. But then the

26:12
40-year-old's going to get paychecks for

26:13
a lot longer than the 90-year-old. So,

26:15
but it's it's all based in math and

26:16
science because the people who set the

26:18
payout rates are called actuaries. Do

26:21
you know what actuaries have to study to

26:22
become actuaries? They have to study

26:24
math and science. Life insurance and

26:26
annuities are based in math and science.

26:28
Yeah. They're not studying like, you

26:29
know, social discourse.

26:33
Those the these are math dudes and math

26:35
dudets out there that are doing that. By

26:37
the way, going back to the um to the co

26:38
thing and we talked about, you know,

26:40
people passing away that were probably

26:42
going to pass away. You know, Tom and I

26:44
want to make sure that you understand

26:45
that we certainly our hearts go out to

26:48
all of you out there that's had people

26:50
pass away unexpected. That doesn't

26:52
lessen what you've gone through.

26:54
Certainly. And it's been a it's been a

26:55
roller coaster ride. What we were trying

26:57
to point out is that if you look at the

27:00
stats, um the people that did pass, a

27:03
lot of them were in their 80s, you know,

27:04
a lot of them have kind of surpassed

27:06
life expectancy or getting close to it

27:08
and a lot of them had pre-existing

27:10
conditions, but I don't know about you,

27:12
Tom, this has been a an interesting

27:14
moment in time, the whole CO thing. I

27:16
know that from a business standpoint, we

27:18
were talking about it earlier that

27:19
business was was I mean, we're

27:21
fortunate. I mean, we're blessed that

27:23
business was good during that time

27:24
period, but for a lot of people, it it

27:26
was not.

27:27
Yeah. And I was really talking about the

27:28
Spanish flu about people who were going

27:30
to die and and and I I wasn't really

27:32
talking about CO necessarily, but but

27:34
you know, CO did take out a a large

27:37
number of older people and people with

27:39
health problems and and that those are

27:41
facts, too. But I mean, there were some

27:42
young I know young people that just died

27:45
like that. And so, we still don't know

27:47
all the details on that. But uh but I

27:50
think you will see life expectancy spike

27:52
upwards. Now it has come down because of

27:54
COVID but I think what Dr. Malevki said

27:56
is that just like after the Spanish flu

27:58
then life expectancy spiked.

28:00
Do you expect life expectancy tables

28:03
from annuity companies to increase in

28:06
the next 5 years? Like are they going to

28:08
readjust those? What's your opinion? I'm

28:09
not I'm not going to hold it.

28:11
Absolutely. I think as people live

28:13
longer the payout rates are going to

28:14
have to come down in these on the new

28:16
sale annuities. That's why I think it's

28:18
so important to get them today. I I've

28:20
told people for the last 10 years, I'm

28:21
buying as many annuities as I can

28:23
because these are the highest uh

28:25
mortality credits I'm likely to see for

28:26
the rest of my life because as long as

28:28
people keep living longer and longer and

28:30
longer, they're going to have to lower

28:31
these payout rates because they're going

28:32
to have to pay it for longer and longer.

28:34
And so I would say get those annuities

28:36
as soon as you can. Yeah.

28:37
By the way, as a reminder, Tom Hegman

28:39
doesn't sell annuities. He's just an

28:41
expert. He doesn't sell anything. He's

28:42
just one of the best speakers on the

28:44
planet. His books sales are in the top

28:46
1% of all books sold. I mean, he's sold

28:49
that many. Um, and again, I I I would

28:52
encourage you to go and order his books.

28:54
One's called Don't Worry, Retire Happy,

28:57
and the other is Paychecks and

28:58
Playchecks. If you just type in those,

29:00
and we'll have links to those on my site

29:02
as well. But I encourage you if you're

29:03
if you're doing your research on

29:06
retirement, which you should, then those

29:08
books have to be on your shelf as part

29:11
of the foundational learning that um

29:14
that you need to do. And if you feel

29:15
like annuities might be something you

29:17
need to look at, then I'll send you my

29:19
books uh my seven books on annuities and

29:21
the annuity types, you just go to my

29:23
site, the annuityman uh.com. So, the

29:26
interesting part about that that comment

29:28
about life expectancy tables, Tom, is

29:31
everybody's worried about interest rates

29:33
and interest. Should should I buy it

29:35
now? If are interest rates too low, are

29:37
they going to move up? And I've been

29:39
saying this just like you, Tom. We might

29:40
be the only two people on the planet

29:41
saying the I think there's as much risk

29:45
on life expectancy tables changes

29:47
against you as there are interest rates.

29:49
Yeah.

29:50
Correct. And and for interest rates, I

29:52
look at the 30-year US government bond

29:54
because these are the bond market is a

29:55
strong 10 year. You look at the 30 the

29:58
30 because 30 inflation hurts the

30:01
30-year bond the most. And so like if

30:02
we're going to have inflation, if we're

30:04
going to have if interest rates are

30:05
going higher, you're going to see it

30:07
first in the 30-year bond because those

30:09
people are buying something for 30

30:11
years. Like would you want to lock in

30:12
your money right now for 1.9 I think

30:14
it's 1.96% today. for 30 years. That's

30:17
what the bond market, the smartest

30:19
people in the world are putting their

30:20
money for 30 years at 1.934%

30:24
interest. And and so that's telling me

30:26
that interest rates are not going up. I

30:29
mean, if interest rates were going up,

30:31
and if inflation was here, that 30-year

30:33
bond would not be at 1.9%, it would be

30:35
at four, five, six, seven, eight, nine%

30:37
because those people have the biggest

30:39
risk. If inflation hits and interest

30:41
rates spike, all those people who bought

30:43
annuities at one or bought um uh

30:46
government bonds at 1.94%.

30:48
They're they're all going to lose a ton

30:50
of money. Yeah, you can lose a ton of

30:52
money in US government bonds. If

30:53
interest rates go up, the value of bonds

30:55
goes down, but what that's telling me is

30:57
the smartest market in the world is

30:59
loading up on these bonds at 1.9

31:01
something%. And they don't see interest

31:03
rates going up for over 30 years. So,

31:06
you know, who am I to go against the

31:07
smartest market in the world? I don't

31:09
see interest rates moving much. I'm not

31:11
saying they couldn't go up. They go up

31:12
and down, but I don't see I I am on the

31:15
record saying the 10-year government

31:16
bond will go negative before it ever

31:18
hits 4%. And you can hold me to that.

31:20
I agree with you.

31:21
The world is still facing deflation, not

31:23
inflation, and people don't understand

31:25
that. They're reading the papers and

31:26
they, you know, we see prices going up,

31:28
but the world is still facing deflation

31:30
risk.

31:30
Well, also Tom, you know, we're in

31:32
bluewater strategy here. You know, blue

31:34
water means we've never seen it before.

31:36
So, um, the last time money was printed

31:38
like this was, I think, World War II.

31:41
And some people can say CO's the war. I

31:43
agree with that, but we've never seen

31:45
this. And there's no motivation for the

31:46
government to raise interest rates on

31:48
themselves. It'd be like me and Tom and

31:49
I raising our mortgage rate if we had

31:51
one on ourselves. So, I agree with Tom.

31:53
It does it could go negative. It could

31:55
go to zero. And if it does, they're just

31:57
going to print more money. So, people

31:58
that are waiting for that fouryear

32:00
10-year Treasury,

32:02
we might not see that, Tom, in our

32:04
lifetime. It's it's probably decades

32:06
before interest rates go up a lot. But

32:08
again, it's the life expectancy that

32:10
that really matters in the annuity. Um,

32:12
step number six is you must have a plan

32:14
for long-term care. No retirement plan

32:17
is complete without a plan for long-term

32:18
care. It's the one thing most people

32:20
forget about that can wipe out their

32:21
entire life's work. And this is very

32:23
personal to me because both of my

32:25
parents had Alzheimer's. Both of them

32:26
went into assisted living. Now, I made

32:29
them buy long-term care insurance 18

32:30
years ago. They didn't want to. It's too

32:32
expensive. We'll never need it. It's an

32:34
insurance company ripoff. My dad said

32:36
all those words to me. I made them buy

32:37
it.

32:38
Well, they were both in assisted living.

32:40
$10,000 a month. Both my parents were

32:42
teachers up in Minnesota, small towns.

32:44
There were years my my mom rarely made

32:47
over 10,000. There were many years my

32:48
dad didn't make over 10,000 a year and

32:51
10,000 a month. I can't imagine the

32:53
retirement of those policies. And for

32:55
people who say it's too expensive,

32:57
here's what I have to say. If you think

32:59
long-term care insurance is expensive,

33:00
man, you ought to try not having it.

33:03
Try paying for long-term care. Yeah. And

33:05
and um I'm a true believer in that. I do

33:07
not sell long-term care, but I do refer

33:09
people to the number one long-term care

33:11
expert in my opinion in the country. And

33:13
we had a podcast with him, Thomas, Jack

33:15
Lennenberg. And and what I like about

33:17
the new long-term care uh policies is a

33:20
lot of them are assetbased, meaning that

33:22
you're not throwing your money down a

33:24
rabbit hole. Another misconception about

33:25
long-term care is, well, I just don't

33:27
want to, you know, pay in, pay in, pay

33:28
in, pay in, pay in, and then I never use

33:30
it. Well, with the newer policies,

33:33
whether they're annuity based or life

33:35
insurance based, however you want to

33:36
look at them, and I can point you to

33:38
Jack Lindenberg's site if you go to my

33:40
site at theanuityman.com. Um, I mean, if

33:43
you don't use it, you're g your your

33:45
beneficiaries will get the money back.

33:46
So, things have changed in the long-term

33:48
care world. Now, obviously, you know,

33:51
annuity companies and and life insurance

33:53
companies and health insurance, they

33:54
want to ensure young, healthy people,

33:57
but there are some long-term care

33:59
products out there. And I think the

34:01
biggest thing with you mentioning that,

34:03
I appreciate you having that as number

34:04
six, is people just need to know it's

34:07
not what you think it is. Kind of like

34:08
when people say, "Well, I don't want to

34:09
buy an annuity because when I die, my

34:11
insurance company keeps the money." Uh,

34:14
no. I mean, Tom explained the details of

34:16
that and mortality credits and and how

34:18
that works, but the same thing applies

34:20
with long-term care. You can get the

34:21
coverage yet control the asset. Any

34:24
other thoughts on that?

34:25
Yeah, because um with the asset based

34:27
long-term care, the premiums are

34:28
guaranteed never to go up. That's nice.

34:30
Uh it can be an emergency fund. Most of

34:32
them have full money back guarantee. So,

34:34
if you need your money out, you get your

34:35
money out. If you don't use it and you

34:37
die, it it normally about doubles as a

34:39
death benefit taxree to your heirs. And

34:41
if you do need it, it's almost triple

34:43
the bucket of money for long-term care.

34:45
So it's it's an emergency fund, it's a

34:47
legacy fund for your family, and it's a

34:49
long-term care fund. Uh and it and it

34:52
all grows tax deferred. And so so those

34:54
are and the premiums are guaranteed

34:55
never to go up. So those would be, you

34:57
know, people are worried about their

34:58
long-term care insurance. That might be

34:59
a great option.

35:00
No, I totally agree. So what's number

35:02
seven? We got

35:03
seven. Yeah, seven is to use your home

35:05
equity wisely. Um you know, for people,

35:07
their house is normally one of their

35:09
largest assets. There are basically

35:10
three ways to do it. You can um sell

35:12
your home and downsize and move to

35:14
Arizona. That's where I live or Florida

35:15
where you live. You know, we can enjoy

35:17
our lives. Um and and if you're single,

35:19
you can capture up to $250,000 taxree in

35:22
capital gains. If you're married, you

35:23
can capture up to $500,000 taxree in

35:26
capital gains. That can help. You can

35:28
take a loan against the equity or you

35:30
can do a reverse mortgage. Now, let me

35:32
tell you where I come down on reverse

35:33
mortgages. Both in the book and the TV

35:34
show, here's what I say. I am not for

35:37
reverse mortgages, but I'm not against

35:39
reverse mortgages. They are a tool that

35:41
can be used in retirement. But my best

35:42
professional advice is this. Number one,

35:44
be very, very, very careful. Number two,

35:47
work with a reverse mortgage expert. But

35:50
having said that, your listeners are

35:51
going to read many more positive

35:53
articles written by very respected

35:54
sources like the American College, Dr.

35:57
Wade Fowl, Jamie Hopkins, uh, Mary Beth

36:00
Franklin, Don Graves. So, there's some

36:02
great material out there. Just be very

36:04
careful and work with a reverse mortgage

36:06
expert. Now, another step that I don't

36:08
have a number to is you should use life

36:10
insurance to pass wealth to your

36:12
children and grandchildren. I always

36:14
tell people, don't leave them any money.

36:16
You're supposed to spend your money. The

36:18
last check you ought to write out and go

36:19
to the undertaker and that baby had a

36:21
bounce. Okay? You're supposed to spend

36:23
your money. Leave them life insurance.

36:25
And you could do that for pennies on the

36:26
dollar. So, let me use me as an example.

36:28
We got four kids and one day we're

36:30
sitting around saying, "How much should

36:30
we leave the kids?" My wife said, "I

36:32
don't know. What do you think?" I said,

36:33
"Well, if we bought a $1 million

36:35
seconded eye life insurance policy, name

36:36
the four kids a beneficiary. When we're

36:38
both gone, they're going to get a

36:39
million dollars taxree." Um, so let

36:42
that's $250,000 a piece taxree plus

36:44
whatever's left over. Let's start there.

36:45
So, we bought a $1 million second and

36:47
die life insurance policy named four

36:48
kids beneficiary. That policy is

36:50
completely paid up. Do you know what the

36:52
total cost that million- dollar policy

36:53
was? $150,000. So, now think about this.

36:56
For 15 cents on the dollar, we get to

36:58
transfer a million dollars taxfree to

37:00
our kids. But here's the best part. Who

37:02
gets to spend all the rest of the money?

37:03
We do. See, you you're not getting any

37:06
younger. You don't get to take any of it

37:08
with you. What are you trying to be the

37:09
richest guy in the cemetery? You're

37:11
supposed to spend your money, leave them

37:13
life insurance for pennies on the

37:15
dollar. And if they just follow these

37:16
simple steps, any person can have a

37:19
happier and more successful retirement

37:22
than if they try to just wing it and do

37:23
it on their own in the stock market and

37:25
all that. That's not going to work

37:26
because a sequence of returns, risk, and

37:27
all these other things that we could do

37:29
a whole another show on. Well, and that

37:31
that's that's his book. Don't Worry,

37:33
Retire Happy. I you should get you

37:35
should get that book. I always tell

37:36
people that life insurance is the best

37:38
return on investment you'll never see

37:41
because you're dead. I mean, it it

37:43
really is. Um, and there's new I mean,

37:46
the other thing that I like what you

37:47
said, and I tell people this, and I I'm

37:49
from the deep south, so things come out

37:51
a little little uh corny sometimes, but

37:54
um you need to spend your money. You

37:55
need to go live your life. You need to

37:57
stop waiting and procrastinating because

37:59
as they say in the South, there's no

38:01
U-Hauls behind herses. Tom Haggna and um

38:04
and if you and if you see one, take a

38:07
picture and send it to me.

38:09
Well, and and and it has to do a lot

38:10
with psychonomics. So, I speak about

38:12
math, science, and economics, but I've

38:14
been speaking more about psychonomics

38:15
because think about it this way. You got

38:17
something from your company every two

38:19
weeks your entire working career. It was

38:20
called a paycheck. Now, what did you do

38:22
with that paycheck? You spent it. You

38:23
paid for your house, paid for your car,

38:24
you went on trips, you bought stuff. you

38:26
got and spent a paycheck every single

38:28
two weeks for your entire working

38:29
career. You never had a problem with

38:30
that. But when was the last time you

38:32
raided your 401k and to $200,000 out of

38:34
your IRA and 401k? Oh, no. We can't do

38:36
that. We got to save it. We got to grow

38:38
it. We got to protect it. We can't touch

38:39
it. Well, you do that for 45 years. Do

38:41
you honestly think on your 65th

38:43
birthday, you're going to wake up and

38:44
say, "By golly, I'm going to blow my

38:46
401k today." You can't do it. People

38:48
can't spend their assets. They've been

38:50
psychonomically programmed to never

38:52
touch them. And most people go to their

38:54
graves never touching their assets. And

38:57
so what the math and science says is you

38:59
should take a portion for most people

39:01
that'd be 20 to 40% of their portfolio

39:03
and put that into guaranteed lifetime

39:04
income. Now you got these paychecks and

39:06
paychecks coming in every single month.

39:08
You can spend them, spend them, spend

39:09
them, spend them, and and they just as

39:11
long as you're breathing those checks

39:12
never run out. And that's proven that

39:14
you're going to be happier in retirement

39:16
and you're likely going to live longer

39:17
in retirement. These are not my

39:19
opinions. This is the research of PhDs

39:22
all around the world on retirement.

39:24
What's a playch check, Tom? Tell people

39:25
what a I think they know, but I need you

39:27
to drive a play People know what

39:29
paychecks are. What's a paycheck?

39:31
A playch check allows me to go play golf

39:33
whenever I want to. I can go on trips

39:35
whenever I want to. If we want to go to

39:36
the casino and put a 100 bucks on red

39:38
and spin the wheel once or twice, we can

39:40
do that. That's a paycheck. It's things

39:42
that we want to do, not that we have.

39:45
See, a paycheck covers your mortgage,

39:47
your cell phone bill, your car

39:49
insurance, you know, your car payment,

39:51
whatever. Whatever your bills are,

39:52
that's the paycheck. The paycheck is all

39:54
the fun stuff. And that's what you want.

39:56
You want to get to a place where you got

39:58
these paychecks coming in is golly, we

40:00
really should spend this money cuz it it

40:02
just keeps coming. We got to spend it.

40:04
And that's when people are the happiest

40:05
and they tend to live. They you know, if

40:07
you know older people, their world

40:08
starts getting really small. Oh, when my

40:10
parents got really real and and if they

40:11
can live for one more paycheck, oh, I

40:13
think I can hang on for one more check.

40:14
Oh, I think I feel good. I'm going to

40:16
hang on for one more check. And these

40:17
checks cause them to hang on for longer

40:19
and they live longer. I mean, again,

40:21
these are not opinions. You can read the

40:23
research I've read. I put all the

40:24
research in my books, my my uh white

40:27
papers, you know, I I don't make this

40:29
stuff up. These are ma this is math and

40:31
science.

40:32
And once again, it's Tomm Hegna. H Egna.

40:35
So, to MHGNA.com.

40:38
I would encourage you to go there. He

40:40
has a lot of good stuff. But primarily

40:42
you need to start with his two books,

40:43
you know, don't worry, retire happy and

40:46
then paychecks and playchecks, which Tom

40:48
was just talking about, which you know

40:50
is kind of the uh retirement income

40:52
bible out there for a lot of not only

40:55
retirees but also advisors uh because

40:58
Tom speaks and educates and trains um if

41:02
they're listening, advisers and agents

41:04
as well on how to position lifetime

41:07
income transfer risk annuities. and and

41:09
he's doing yman's work. I mean, he

41:12
should be if there was a president of

41:14
the annuity industry, it should be Tom

41:17
Tom Hegna in my opinion. Um, when you

41:20
when you're speaking out there, Tom,

41:24
when people walk up to you after the

41:25
event, and you always have that because

41:27
I've been to a couple of your events and

41:28
they line up to talk with you, what's

41:30
the common theme you're hearing from

41:32
your not only your your listeners, but

41:33
your readers when they email you? What's

41:36
what's make what's keeping them up at

41:37
night? Well, I mean, people are worried

41:39
about social security. They're worried

41:40
about the stock market. They're worried

41:41
about inflation. Um, but I get a lot of

41:43
people that say, "Okay, Tom, what should

41:44
I do with my money?" Now, I don't even

41:46
know this person from holy ground. They

41:47
want me to tell them what to do. And I

41:48
say, "Well, look, uh, if you can answer

41:50
me these two questions, I might be able

41:51
to help you. What do you want your money

41:53
to do for you while you're alive? And

41:55
what do you want it to do when you die?"

41:56
And and it's just like you, Stan,

41:58
because you do work with people. If they

41:59
answer those two questions, you can

42:01
normally put them on a really good path

42:02
towards uh to towards happy retirement.

42:04
And one last thing, I'm not just talking

42:07
the talk. I'm walking the walk. So, I I

42:08
did a trial retirement two summers ago.

42:10
I wanted to see could I really get off

42:12
the road? Could I really do this? Would

42:13
I go would we drive each other crazy?

42:14
Would I get bored? Had the time of my

42:16
life. So, I did it again last year and

42:18
now I pretty much am in semi-retirement.

42:21
My my handicap is the lowest it's ever

42:23
been. I won the club championship of my

42:25
golf course. I'm the oldest club

42:26
champion in course history. See, that to

42:28
me now is more important than than doing

42:30
what I've been doing for the last 30

42:31
years. And so, I'm working on my golf

42:32
game, working on pickle ball, I'm

42:34
working on tennis, and that's what I'm

42:35
and we're having fun. We just went to

42:37
San Antonio on the Riverwalk for 4 days.

42:39
We're going to go to Hawaii for two

42:40
weeks. We want to do the Panama

42:41
Canalers. We got this bucket list of

42:43
stuff now that we want to work off

42:44
because look, I lost my dad two years

42:46
ago. I lost my mom this year. I lost my

42:48
best golfing buddy at age 56. You start

42:50
figuring this thing out. This is not a

42:52
forever deal.

42:53
And and and and I don't want to be the

42:55
richest guy in the cemetery, and I'm not

42:56
going to be. All right? I'm going to

42:57
live my life, and I'm not worrying, and

42:59
I'm retiring, and I'm happy. And I said,

43:01
what good would it be if the guy who

43:03
writes the book, Don't Worry, Retire

43:04
Happy, doesn't retire, and he's not

43:05
happy? that wouldn't be any good. So, I

43:07
am not just talking the talk, I'm

43:09
walking the walk.

43:10
I'm not sure how you can improve upon

43:13
those two books, but are you are you

43:14
still I know you're still speaking, but

43:16
are you still writing?

43:17
Yeah, and I've got one that I'm It's

43:19
just It's hard, you know, because I got

43:20
so much stuff going on, but I but this

43:22
one is for millennials. It's how to be

43:24
become a millionaire. You know, who

43:25
wants to be a millionaire? That's

43:27
basically it. And I and I show

43:28
millennials how simple it is in America

43:31
to become a millionaire today. I believe

43:33
most every American could do it if they

43:35
if they really wanted to. They have to

43:37
be disciplined. You know, you're not

43:38
going to do it in Dogecoin, okay? And I

43:40
hate to sell you. AMC and GME are

43:42
probably not going to do it for you. But

43:43
I can show people how to become a

43:44
millionaire the right way. And it's

43:46
about making more money. It's about

43:48
spending less money and investing into

43:49
appreciating assets. So, that's going to

43:51
be the theme of that book. It's going to

43:52
be for millennials on how to become

43:54
wealthy in America today.

43:56
Next year, we're looking for that.

43:59
We'll see. I mean, I I put a goal to be

44:01
have it done this summer and I I have I

44:03
I have I've got about 27 pages done. So,

44:05
I mean, I got a lot of work to go.

44:06
I No, I understand. Great story about

44:08
Tom. The last time I I saw him, I'm I

44:10
used to be this huge coffee drinker. So,

44:12
we met for breakfast. We're both

44:13
traveling. I said, "Hey, man. I'm in

44:14
town. Let's let's get together." And so,

44:16
we sat down and Tom, he you know, he

44:19
he's a professional traveler. I mean,

44:20
the the dude just he knows what he's

44:23
doing. So, he pulls out these tea bags

44:24
and I'm like, "What are you doing?" He's

44:26
like, "No, this is my kind of tea. I

44:27
love this tea." And I I bring it with

44:28
me. Since that time, and you don't know

44:30
this, I I didn't tell you this before we

44:32
we got on the podcast, I now drink tea.

44:36
And I I credit Tom Hegna with that

44:37
because I'm like, well, let me try that

44:39
because, you know, coffee kind of eats

44:41
your stomach up a little bit. And ever

44:42
since then, and that was years ago, um

44:45
I'm like this tea fanatic. Um which

44:48
makes sense if you're from the South,

44:49
but I'm talking about warm tea. But

44:51
that's that, you know, Tom Hagner has

44:52
not only given me nuggets of wisdom

44:54
through his life, he gave me, you know,

44:55
the the habit of uh the daily warm tea.

44:59
I don't know what's this. What was the

45:01
what was

45:01
it? Cinnamon tea. It's a Bigalow

45:04
cinnamon tea. I love it. It's called

45:05
cinnamon stick. I take it everywhere I

45:07
go. I'm It's not because I'm cheap and I

45:09
don't want to pay, you know, 30 cents

45:10
for a tea bag. That's not it. It's my

45:12
favorite tea. I bring it on the

45:13
airplane. I bring it to my hotels. I

45:14
bring it everywhere because that's my

45:16
tea. And then I drink iced tea the rest

45:18
of the day. But in the morning, I drink

45:20
the hot tea.

45:21
So, anybody listening out here from

45:23
Bigalow, um you might want to send that

45:26
case of of tea to Tom Hegna. Go to tom

45:29
hegna.com.

45:31
Um

45:33
what do you think of these markets?

45:35
We're getting closing up a little bit

45:36
here, but I got a couple more questions

45:37
for you. You know, we've both seen it

45:40
all. We both have been through market

45:42
cycles. You know, I started, you know, a

45:44
long time ago, three decades ago. You've

45:46
been in a long time. What do you think

45:47
of these markets here? And what do you

45:49
tell the retirees?

45:51
Um, you know, I I know you're saying put

45:54
I agree with you. Put that retirement

45:56
income floor in place, but what are you

45:58
saying about markets here with your

46:01
experience viewing?

46:02
Well, I mean, there's just so much funny

46:04
money that's been printed that's worked

46:05
its way in the market. So, the market is

46:07
is significantly overvalued where it

46:10
should be. I would tell people I'm not

46:12
anti-stock market at all. I have, you

46:14
know, I have a lot I have chunk of money

46:16
in the market as well. But I have

46:18
learned this. I am better sticking with

46:21
quality stocks. Amazon, Apple, Facebook,

46:24
Google, you know, um, you know, maybe

46:27
even Boeing or something, but but stick

46:28
with the top rated stocks. I think

46:31
you're going to be better than if you're

46:32
going after all this, you know, AMC and

46:34
GME and Dogecoin and all that stuff. And

46:37
if you want to speculate, and all that

46:39
stuff is speculating. I'm not against

46:40
speculating, but speculating should be

46:42
somewhere between 1 and 3% of your

46:44
portfolio. Not 50%, not 30%, 1 to 3%. I

46:47
put 1% of my portfolio in Bitcoin. I'm

46:49
very comfortable with that. Uh because

46:51
if I lose 1%, it's not going to affect

46:52
my life, but if it goes to a million

46:54
dollars of Bitcoin, it'll sure help me.

46:55
So So that's why I I I do that. But um

46:58
just I'd be very cautious about this

47:00
market. I mean, because when it goes,

47:02
it's going to go. And as we saw last

47:04
time, everything went down. Stocks went

47:06
down, bonds went down, gold went down,

47:08
Bitcoin went everything went down.

47:10
There's no safe haven except for fixed

47:12
annuities. Basically, there was not much

47:14
of a safe haven. I mean, when everything

47:16
goes down, it goes down and it can be

47:18
ugly. And you don't want to lose money

47:20
right before or right after retirement

47:22
because that's the riskiest time of your

47:23
investing life.

47:24
And I tell people all the time, having

47:27
come from that um side of the ledger

47:29
where I work with Dean Witter and Morgan

47:30
Stanley Payne Weber and UBS um at the

47:33
time of this taping over 85% of all

47:36
trades are non-human, algorithmic,

47:38
blackbox, high velocity. So, it's a

47:40
different market. It's an institutional

47:42
market. It's a 24/7 365 market.

47:45
Unfortunately, you know, us peons don't

47:47
get to do the 247 365. So, you know, I

47:50
would be I would be very careful. I

47:52
think that's sage advice. Um, two last

47:55
questions. The first one is is about

47:58
blockchain and and blockchain for the

48:00
people out there is the technology and

48:02
the underlying foundation of the

48:04
bitcoins and the cryptos and all that

48:06
stuff. But blockchain is blockchain

48:07
technology is more than just

48:09
cryptocurrency. Do you see blockchain

48:12
affecting the annuity and life insurance

48:14
industry in a positive way? Yes or no?

48:17
I I think so because it allows um

48:20
transactions to happen with transparency

48:23
yet anonymous, which is which is really

48:26
weird that that everybody can see what's

48:28
going on and there's a number or code of

48:30
what's going on, but you can't see who

48:32
just did that. And so I think um you

48:35
know every almost every industry has

48:37
been using blockchain to help their

48:40
supply chains to help their inventory.

48:43
Uh maybe annuity issuers can become more

48:45
efficient maybe they can uh mitigate

48:47
some risks that we don't even talk about

48:49
day-to-day that are actuarial type

48:51
risks. So I do think that over time it

48:54
it it will be a positive. One last

48:56
thing. Um I mean closing comment from

48:59
you just about uh retirement and what we

49:03
covered here. Just sage wisdom from Tom

49:06
Hegna.

49:07
Well, retirement people think it's about

49:09
real estate or it's about the stock

49:11
market or it's about how much money is

49:12
my 401k. That's not what it's about.

49:14
It's about how much guaranteed lifetime

49:16
income do you have and have you taken

49:18
the appropriate risks off the table.

49:20
Have you mitigated long-term care risk?

49:21
Have you mitigated inflation risk? Have

49:23
you mitigated sequence of returns risk?

49:25
market risk, uh, inflation, deflation,

49:27
what about taxes? And, and most people

49:29
who do it themselves, they have blind

49:31
spots. Oh, yeah. I had a good quarter.

49:33
Oh, man. I made 30% last year and

49:35
market, okay, yeah, what happens when

49:36
the market crashes 50%. And then you

49:38
determine that you need long-term care

49:40
and, oh, by the way, they just doubled

49:41
your taxes and now inflation's at 5%.

49:44
what then what you know and so I just

49:46
think too many people have blind spots

49:47
which is why they need to stand the

49:49
annuity man to help them out and and

49:51
show them what the blind spots are and

49:53
then they can choose which ones they

49:54
want to protect against.

49:56
Ladies and gentlemen, that rockstar you

49:58
just heard is named Tom Hegna. Go to his

50:00
site tom hegna.com.

50:03
We will have him on again. I want to dig

50:04
into the mortality credits um you know

50:07
topic as well. But I really appreciate

50:09
you being here, Tom. And uh I appreciate

50:12
everybody that's watching on the Fun

50:14
with Annuities YouTube channel and all

50:15
listening on all the major podcast

50:18
platforms. We will see you next week on

50:21
Fun with Annuities.

50:27
[Music]