5 Tips For More Effective

Long-Term Care Planning

 

Most Americans see themselves living a long life.   They plan throughout their working years to create a secure retirement so they can do the things they enjoy most. Yet, as 10,000 “Boomers” turn 65 every day, too many ignore the impact Healthcare In Retirement and Long-Term Care may have on their finances, family, and future.  If you’re proactive and want to begin the planning process with clients, here five tips for more effective Long-Term Care Planning:

 

1)  Determine everyone who should be participating...

Most financial, retirement and risk management planning is done as an individual or couple, however, your clients may want to approach Long-Term Care Planning differently.  Quite simply, when the need for Long-Term Care arrives, it will likely affect many generations within a family.   Since it seems as though American families tend to communicate less effectively than ever; a Long-Term Care plan should be well understood by the entire family.  To some extent parents, children and even grandchildren may want to participate in the discussions. If there are clear expectations of those involved, it’s possible to avoid miscommunication, conflict and resentment in the future.

  

2)  Recognize LTC Planning is a process...

Long-Term Care Planning cannot be accomplished by simply buying a product.   It is a process that should include coordination of insurance, financial, legal and tax advisors; and it should also address generic topics, such as healthcare in retirement, family dynamics and even gender-specific issues.  

 

For instance, a couple in their sixties will have very different needs than a single female in her fifties.   Or, the affluent will have different planning goals than those with more modest means.  In any event, the planning process should be driven by the clients' personal situation, and a cookie-cutter approach is generally ineffective.

 

3)  Define the need and quantify the risks...

Long-Term Care Planning should be customized to meet the needs of the individual or client, and while it's easy to quote "average" statistics most of your clients don't consider themselves "average".   This means it's important to define what type of care might be desired, the duration that care might be needed and quantify the various risks associated with needing that care.  The best way to achieve all of this is by completing a HALO Assessment with your clients.

 

4)  Make LTC a component of comprehensive planning...

In the past, Long-Term Care Planning meant buying traditional insurance products; usually with “use or lose it” benefits and little cost certainty.  However, with the evolution of financial planning, a Long-Term Care plan should be positioned as a component of a comprehensive plan.  That means you will need to understand and consider all of today’s Long-Term Cre planning solutions.  While Long-Term Care Insurance (LTCi) was once the obvious solution, it's just one of many solutions to consider, it can be expensive and quite often it’s not a complimentary component to a comprehensive financial plan.  

 

In 2018, more than $4 Billion dollars of existing insurance, annuities, investments or savings was repositioned into Asset-based Long-Term Care plans; often with little or no out-of-pocket cost.   For many Americans, this has become the most effective way to create a Long-Term Care component in their comprehensive planning.

 

5)  Work with a LTC Planning specialist...

There’s one primary reason your clients will see an Oncologist to treat cancer or a Cardiologist to treat a heart attack instead of their primary care physician - Specialization!!   Taking this analogy a step further, a patient has no business treating cancer or a heart attack on their own, any more than the primary care physician should attempt to do so.  Regardless of comfort level on the topic, we encourage you to work with a Long-Term Care Planning specialist, because the plan will likely be better if you do.  

 

 

Please don't hesitate to contact us with questions as you help clients navigate the Long-Term Care planning process.

 

 

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