The advisory community plays a critical role in helping clients navigate the complexities of their financial lives, so it's difficult to understand the paradox that exists when 2023 surveys by Nationwide and OneAmerica indicate less than 20% of Americans have any formal Long-Term Care (LTC) Planning.  Furthermore, with the ongoing demographic shift known as "The Silver Tsunami," addressing LTC needs is more pressing than ever.  Across the financial services spectrum, it's time to identify the intersection of specific advisory roles and client LTC Planning needs, as this will enhance the value of advisory relationships and help guide consumers toward a more secure future ….

Demographic Trends and Aging Population:   In 2030, every Baby Boomer will be over the age of 65, and this phenomenon is known as the "Silver Tsunami."   This demographic shift makes it imperative for the advisory community to address the growing need for LTC planning and ensure clients and their loved ones are prepared for future care requirements.  As this generation continues to shape the United States economy, there will likely be a significant increase in demand for LTC services as increases in life expectancy mean more people will require care as they age.  Educating clients about the importance of LTC planning as The Silver Tsunami approaches will empower them to make informed decisions and ensure they are prepared for challenges ahead, making this a catch-all for the advisory intersection with LTC Planning.

Financial Protection and Asset Preservation:   LTC costs can be expensive, and for the unprepared, as Medicare, Medigap, and most health insurance plans generally do not cover long-term care expenses, there's a significant coverage gap, and those costs can quickly deplete a client's assets.  Engaging in LTC planning helps mitigate these high costs by providing strategies to protect assets and ensure wealth preservation for future generations.  Someone in an advisory capacity must play that crucial role, safeguarding clients' financial legacies and helping them manage the financial risks associated with LTC.  Understanding this reality highlights the need to consider insurance-based LTC Planning or other financial solutions to cover potential care costs and mitigate risk.  Insurance and risk management professionals, Medicare specialists, financial advisors, etc., should all see how their role intersects with LTC Planning.

Client and Family Well-being:   While LTC Planning benefits clients directly, it also relieves the future financial, emotional, and physical burden on their families, and proper planning will ensure access to high-quality care options to provide peace of mind for all parties.  Engaging in proactive LTC Planning helps families make informed decisions, reduces stress, avoids resentment, and fosters a supportive environment, and this is often the purview of a trust officer or the estate planning/elder law attorney.

Comprehensive Financial Planning:   LTC represents a crucial component of a comprehensive financial plan, and LTC must be addressed somewhere in the client's retirement, estate, and risk management planning.  Integrating LTC into a client's planning is a holistic approach that helps them manage the risk of future LTC needs, maximizes the tax code, and improves overall financial security.....This also represents the convergence point where the CPA, CFP, or financial planner finds LTC Planning a responsibility or fiduciary duty.

Employer-Sponsored Benefits:  LTC coverage in an employer-sponsored plan can help companies attract and retain employees by demonstrating a commitment to their well-being.  Group LTC insurance plans can provide employees with cost-effective coverage options that might be more affordable than individual plans.  Employer-sponsored benefits increase awareness of the importance of LTC planning, encouraging employees to consider future care needs and take appropriate action.  Whether it's a small group with three employees or a corporation with 30,000, LTC is becoming a priority for benefits specialists nationwide.

Compliance Mandate and "Know Your Client" Rules:  Consumers must document or affirm their investment experience, risk tolerance, and financial ability/situation to comply with industry regulations and compliance standards.  Before it's too late, the advisory community must extend those standards to include future LTC needs and recognize that without proper planning, 100% of a client's assets are ALREADY allocated to healthcare and LTC expenses excluded by Medicare or other insurance.  Quite simply, those who carry a license or have initials after their name should see this as a concerning inflection point with LTC Planning.

The advisory community plays a vital role in helping clients prepare for potential challenges, and every member of that community should determine where their role intersects with addressing their LTC needs.  By engaging individuals and companies to incorporate LTC in their planning or plans, more Americans can have financial security, improved family well-being, and enhanced overall value proposition with the advisory community.  

Long-Term Care Planning is now a strategic business consideration, and it's time for you to determine its convergence with your advisory role.

20240805