The gambling Mecca of Las Vegas and the concept of building and maintaining a nest egg generally don’t seem like a natural fit, but all irony aside, the city was a great venue for the annual Retirement Symposium sponsored by Financial Advisor and Private Wealth magazines.
The weather was gorgeous during the three-day event at the end of April, and the Las Vegas Strip outside the conference site at Caesars Palace was lively as always. Things were also busy inside the conference hall, as 30 sponsors displayed their wares and more than 500 attendees took in nearly 20 sessions covering a gamut of retirement-related topics ranging from tax-efficient withdrawal strategies and income-producing alternatives to bonds to matters related to annuities, Medicare and Social Security.
And, of course, the appearance of Nick Murray as keynote speaker during one of the luncheons was a popular draw. During his talk, he called out the financial services industry for how it responded to the 2008-2009 crisis. Specifically, he said the nadir of equities in early 2009 should have been an obvious signal to buy stocks that were at generational lows and sometimes sporting copious yields.
But instead of scooping up the incredible value that was equities during that time, many investors sold stocks at exactly the wrong time and instead were herded (or herded themselves) into bonds and the growing ranks of alternative investments, including private equity and long/short funds in various asset classes.
“I didn’t know [at the time] how anybody didn’t know that the best-performing asset class over the next five years” would be equities, Murray said.
But now many investors fear equities are fairly valued—or overvalued—after the five-year run-up. As for bonds, the yields generally stink and conventional wisdom holds that prices will tumble when interest rates inevitably rise. What to do for income, then?
At a panel session devoted to income-producing alternatives to bonds, speakers weighed the pros and cons of three different options: closed-end funds, business development companies and non-traded real estate investment trusts. These different asset classes have their own quirks that won’t appeal to all investors, but they all potentially offer yields greater than Treasurys and many other fixed-income securities.
While retirement planning, retirement income and retirement-related strategies were the collective theme of the show, some of the sessions and discussion tackled other matters such as investing and practice management. Deena Katz, a founding partner of Evensky & Katz Wealth Management and an associate professor at Texas Tech University’s personal financial planning department, teamed up with author and wealth management consultant Hannah Shaw Grove to discuss how women view finances and the relationship they want to have with their primary financial advisor.
“The women I work with want to talk about their money in different ways,” Katz said. “Women measure success in different ways, and it isn’t necessarily about how much money they’ve accumulated. The money they’ve made is a vehicle to accomplish other things in life, and it’s not the end-all and be-all. So when we talk with them, we need to be respectful and mindful of that. It’s not about ‘how much money we can make you’ or a conversation about the hot stock of the past 10 minutes. It’s about ‘How can we use this money for good?’ And it makes the conversation so much different.”