Economics asks what should happen and why, and accounting asks what actually happened, who is responsible, and where it shows up.  The household/consumer balance sheet is even simpler; if it isn’t listed, it isn’t planned for. That’s not philosophy — that’s accounting, compliance, and common sense, and once you accept that rule, everything else follows mechanically:

No line item → no measurement

No measurement → no management

No management → no mitigation

No mitigation → exposed household balance sheet

So, whether you’re a consumer or an advisor, it’s really a simple question: Where is the line item for future Long-Term Care (LTC) expenses?   And, to make matters worse, there is no avoiding an answer…..and no one on the list below is exempt.

1. Consumer or DIY Investors/Planners, you broke it, you buy it!  If you’re managing your own retirement plan and the LTC liability isn’t listed, quantified, or offset, then self-directed doesn’t mean self-protected—ignoring the line item is still ignoring the risk.

2. The Registered Investment Advisor is a fiduciary 100% of the time and, regardless of your “scope of authority,” the omission of an unmodeled personal liability this large is a fiduciary breach.

3. Broker-Dealer / Registered Representatives fall under Reg BI Care Obligation, requiring a reasonable basis for recommendations (including omissions) and consideration of reasonable alternatives. No documentation of the LTC liability or alternatives means no reasonable basis, so the potential exposure is massive.

4. Dually Registered / Hybrid Advisors wear both hats and can’t hide behind “suitability” when acting in a fiduciary capacity on the same client.

5. CFP®s are bound by the CFP Board Practice Standards, and the failure “to identify, analyze, and address a material risk in the financial planning process” is a standards violation. The Board has already disciplined your peers for less…..

6. Insurance-Licensed Advisors (even LTC specialists) might only sell products, but without integrating the liability into the broader plan (tax, investment, estate impact), you are still omitting the balance-sheet treatment, and “just” selling insurance coverage doesn’t shield you from the liability in the rest of the plan.

7. Wealth Manager and Private Wealth Advisors with high-net-worth clients.  You are the ones who lose the most in absolute dollars and legacy erosion buying into the myth that “self-funding is fine for the affluent”…..It’s the weakest defense because even if your clients have the most tools available and the highest expectation of sophistication, you have to isolate and mitigate that line on their balance sheet. 

8. Retirement Income Specialists, RICP or CPFA entire value proposition is sustainable income and risk management in decumulation, yet LTC is the single largest sequence-of-returns destroyer. Omitting it risks turning your work into a fictional masterpiece.

9. Estate Planning Attorneys advise on and execute legal documents, but if those documents fail to model care costs before death, the estate plan fails in practice, and it will be difficult to claim “that’s not my scope” when the liability – if properly identified – predictably erodes the estate.

10. Tax Advisors / CPAs advise on topics like retirement planning, model the Roth conversions, QCDs, or tax brackets while ignoring the massive tax drag from forced liquidations to fund care.  That’s a balance-sheet omission, and you are the one who knows that best….

11.  Robo-Advisors / Digital Platforms deal with garbage in, garbage out, because their algorithms don’t model the LTC inversion, and their “comprehensive” projections are mathematically incomplete by design.

Following the money is the natural progression of the financial planning process, and there must be a starting point for every entry……when there isn’t one, it’s incomplete and by definition it can’t be considered planning.

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