When Long-Term Care Planning is Optional,

Perhaps The Advisor Becomes Optional Too?

Throughout the advisory community, there is a pervasive misconception that Long-Term Care (LTC) planning and funding LTC are synonymous and that LTC Planning in a client's comprehensive financial planning is somehow optional.  First, that perspective leads to procrastination, neglect of necessary client engagement, and a financial future filled with uncertainty since most of your clients will need LTC, which Medicare, a Medicare Supplement, or health insurance does not cover.  

Second, is that in a few short years, when 1 in 5 Americans will be over 65, planning for and paying for LTC must become an advisory priority as there are only four ways to pay for or receive that care:  Either from Friends and Family, government assistance through Medicaid, Self-Funding, or insurance-based risk mitigation. 

Finally, when less than 20% of those Americans¹ have anything resembling a plan for LTC, it becomes difficult to take many in the advisory community seriously when they advocate the necessity of their core competency while failing to address planning for stages of life that will so profoundly impact clients and their loved ones.  

It's time for many across the advisory community to step up, demonstrate the value of their advisory services, and prioritize LTC Planning for the other 80% of Americans (your clients) by taking the following steps…..

Leveraging Expertise and Knowledge:   Specialized knowledge in a chosen field of financial planning positions the advisor as a valuable resource for clients, and that should extend to include LTC.  However, providing informed recommendations tailored to each client's situation can be challenging, especially if you're not keeping up with the latest trends, products, and regulations.  Advisors must be prepared to demystify complex insurance products, government programs, and the financial implications across the care continuum to ensure clients are empowered to make well-informed decisions.

Providing Customized Planning:   Those who have built successful practices understand that while client scenarios may be similar, every client has unique financial circumstances, health conditions, and personal preferences.  So, it's logical and crucial that LTC Planning should be customized and aligned with the client's comprehensive financial goals and personal needs.  By assessing risk, identifying gaps in current plans, and recommending appropriate funding options – including insurance products, savings or investment strategies, Medicare, Medicaid, or VA benefits – provide tailored approaches that most clients can't realize independently.

Ensuring Financial Protection & Risk Management:   LTC can be incredibly expensive, and without proper planning, it will deplete a client's savings and assets, so advisors should strive to safeguard clients' financial futures and reduce the impact when care is needed.  LTC Planning can be integrated into broader financial strategies to protect assets, identify potential insurance solutions, establish a legal framework, leverage the tax code, or maximize various financial tools to ensure viable self-funding.   

Adopting a Holistic & Comprehensive Approach:   A holistic financial plan must consider all aspects of a client's financial life, and providing a comprehensive approach ensures LTC is a vital component of the retirement, estate, tax, or risk management planning for which you're responsible.  Someone within the client's advisory network must ensure that all elements of their financial plan work together to reduce the risk of both expected and unexpected future events.  This peace of mind reduces anxiety and stress for clients and their loved ones to avoid chaos, crisis, and resentment when health challenges occur.

Serving As An Educational Resource:   Regardless of the advisory relationship, the advisor is truly an educator who provides valuable resources and acts as a conduit for clients understanding the importance of numerous topics.  A natural extension of that logic is the proactive inclusion of data-driven, reality-based LTC Planning, empowering clients to make informed decisions about their futures.

There is a Long-Term Care crisis looming that will have a direct impact on most Americans, not to mention the physical, emotional, and financial impact on their family or loved one.  It's impossible to know who will need Long-Term Care, to what extent, and for how long…..That reality creates the imperative for advisors to integrate Long-Term Care planning into their core services, and it must be addressed somewhere in EVERY client's financial, retirement, estate, or risk management plan.  For the countless advisors who treat Long-Term Care Planning as optional, they may discover their clients one day feel the same way about their advisory services…..

¹  Surveys by OneAmerica/Hanover Research (March 2022) and the Nationwide Retirement Institute/LIMRA (May 2023)

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