As you begin the Long-Term Care (LTC) Planning process with a client, there will be a variety of factors and variables to consider when designing their plan, including options for (1) funding duration, (2) cost certainty,  (3) providing protection from rising healthcare costs, (4) the benefit duration, and (5) ensuring residual plan value if LTC is not needed.  In today's marketplace, it can be challenging to find a solution that balances all five of those design features, but you'll be rewarded by doing your due diligence to identify suitable LTC planning solutions for your clients.  As an example.....

Steve & Sally Saver.....Successful Business Owners

Consider the case of a couple where "Steve" is 60 years old and "Sally" is 57, and they've spent the last thirty-plus years running the business Steve's father originally started.  Steve and Sally have seen firsthand the erosion of 75 years of hard-earned savings due to Long-Term Care expenses, as Steve's father had Alzheimer's for the last 8 years of his life.  His father's illness took a physical and emotional toll on Steve's mother, and it had a significant impact on her ability to maintain her lifestyle in retirement.....Especially once she began paying for Alzheimer's care in a nursing home setting, which routinely exceeded $10,000 per month.

The couple wants to include a Long-Term Care component in their financial plan, but they insist it includes five distinct features.  

1)  Limited Pay Option:  The plan must be fully funded before Steve retires.

2)  Premium Guarantee:  To know EXACTLY what it will cost to fund the plan.

3)  Lifetime Benefits:  The plan must provide benefits for as long as care is needed.

4)  Inflation Protection:  The plan benefits should increase as healthcare costs rise.

5)  Residual Value:  Every dollar of their plan should return to their estate or be used to pay for care.

With today's product designs evolving across traditional LTC, hybrid life/LTC, annuity-based solutions, and employer-sponsored options, it's more important than ever for advisors to work with specialists who can align clients with the right tool, not just the one tool they happen to offer.  So, while the couple had a good relationship with Advisor A, affiliated with a well-known firm, he included Long-Term Care Planning as part of the couple's semi-annual review.  However, after researching his firm's "approved" solutions, the advisor told the couple there was no carrier that fit their parameters and asked them to re-evaluate their Long-Term Care planning needs.....Perhaps they would be more "realistic" with their expectations, so he could find a Long-Term Care solution to meet the couple's lowered expectations.  The review continued, and the Long-Term Care topic was tabled for a later date. 

Sally and Steve discussed the situation on their drive home, and neither wanted to "re-evaluate" their LTC Planning parameters – They wanted a second opinion.

The Dangers of Not Having The Correct Tools.....

The next day, Sally contacted Advisor B, who was referred to her by a friend who had recently implemented LTC Planning.   Advisor B also works with a well-known firm; however, Advisor B collaborates with INERTIA to better meet their clients' LTC Planning needs.   Advisor B passed along all of the pertinent information gathered from Sally, and (unsurprisingly) we met Steve & Sally's plan design expectations, and a meeting was set with Steve & Sally to discuss the solutions we identified.  Once the options were explained, the decision was pretty simple, and we began implementing the couple's LTC Planning.

While things worked out well for Steve, Sally, and Advisor B, the same could not be said for Advisor A, as Steve couldn't understand why Advisor A and his well-known firm could not or would not have access to the exact planning solutions Advisor B was able to offer.   After explaining the reasons, Steve was concerned that other aspects of their financial plan might need to be reviewed.  So they did!!   Within a month, Steve and Sally had moved their entire portfolio, totalling more than $5,000,000, to Advisor B.

When clients have non-negotiables about their planning, do you have access to the appropriate solutions, or are you willing to collaborate with a specialist who does??

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