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3 Tips on Successfully Planning for Your Client’s Longevity

  • By Ironstone
  • |
  • October 18, 2016

Elderly Couple Smiling

Here’s a real dilemma for a wealthy 87 year old woman whose situation is secure but is causing family conflict.  She needs full-time care, long term.

  • Her financial advisor, together with the bank trustee managing her assets, used calculation tools to figure out how to make her assets last for her lifetime.  Somehow they failed to anticipate the actual cost of caring for an elder with physical conditions and illnesses that require 24/7 care.  This is a woman with advanced cardiac disease who had open-heart surgery.
  • Her daughter, who is a professional, left her self-employment to care for her mother full time. The caregiving daughter wants some compensation from mom’s millions. She indeed deserves it.
  • The life expectancy the trustee and advisor chose as a basis for determining how long her assets would need to last was 100 years of age.  Given her medical issues, no doctor treating her would agree with that estimate.
  • While cash is being drawn down monthly for her essential expenses for care at her daughter’s home, no one calculated the cost to her daughter who is losing a six-figure income by providing the needed care.  Being with her daughter is the mother’s preference and her daughter is taking excellent care of her.
  • The brother, who is eager to get his “share” of an inheritance, is hovering around the trustee demanding to know how much is being spent to care for mom and why the caregiving sister should get compensation to make up for her income loss, even partially. He resents his sister for asking for compensation for caregiving.

What could you, as an advisor, do to prevent or mitigate family conflict like this when planning for an aging client’s future? 

Advisors, here are 3 critical tips for elderly longevity plans:

1)  When using tools to calculate life expectancy, you must take into consideration your client’s medical condition. Get real data from your client or from involved family. Update your information and calculations as age takes its toll. Health generally declines in old age.

2) Take into consideration that about 70% of people today will need long-term care at some point. In the client’s case described above, the minimum cost of care for her is $12,000 a month. That does not include bookkeeping, a driver, or medication management. That figure covers a full-time, 24/7 non-medical home care worker only.

3) Assume that if your client has adult children willing to provide care, a wealthy client can and should compensate the caregiving adult child. What is “fair” should be based on market rates for service provided and the cost of what the adult child has to give up, such as quitting a job.

Calculation models may be inadequate to build in these details. The smart advisor will use good sense and knowledge of every client’s needs and preferences to adjust planned drawdowns to meet those needs.

Carolyn Rosenblatt is an R.N., B.S.N., Attorney and Mediator, with over 10 years in nursing and 27 years in legal practice. She has extensive experience working with both healthcare and legal issues of elders. She retired from litigation to become a consultant and mediator at, serving as an advisor to families with aging loved ones.

In the course of advising families about the problems of getting older, Carolyn and her husband, Dr. Mikol Davis, Ed.D, became aware of the information gap in the financial services field. From their observations and concerns about this information gap, Aging Investor was formed.

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Author Bio

Ironstone is a learning and development consultancy with business acumen that translates across many industries. Our focus is on practice management strategies in order to enhance and improve both business and personal life. We support professionals who want major and comprehensive improvements that look at all aspects not just an isolated area for change. Ironstone has identified 4 key performance areas known as the Fundamental 4™, which are required to design, develop, and sustain a successful business.