Essentially, the act of creating a strong financial plan means that you are helping take care of yourself and those you love. Unfortunately, it also means having conversations that no one enjoys: how to be best prepared in case of illness, sudden death or the loss of a loved one.
I personally understand the fears and concerns that my clients have as we discuss healthcare plans, long-term care insurance and end of life financial planning.
I understand these worries because I have experienced them.
My grandmother, Mollie, was my main squeeze and I absolutely adored her. At the age of 91, her kidneys stopped functioning and she needed dialysis. Six months after starting dialysis, she looked at me and said, “This is not the way I want to live my life.” As hard as it was for me, I understood her wishes. We spoke to her doctor, who confirmed her mental wellbeing and allowed her to choose the end of her dialysis.
I will always be thankful for the time we shared listening to Jewish music in her home as the healthcare professionals administered hospice. It was such a sad time, but also beautiful because her wishes were granted.
Years later, my family is dealing with another health crisis.
My 84-year-old father has dementia and is now living in a memory care community. This transition occurred after watching my mom’s health decline, while trying to take care of my father in their home. Although we had part-time health care help coming to the house, it was simply too much for my mother to handle. As a family, we made a decision to move my parents into an assisted-living facility.
My mom lives on the third floor in an independent-living apartment and is still able to drive to meet her friends to play Mahjong. She doesn’t consider this home, and it was the first time that she and my Dad hadn’t shared a bed in 60 years, but she understands that it’s best for the family.
My brothers and I experienced how stressful these decisions can be. It’s one of the many reasons I care so much about the families I work with, because I have experienced their concern. I dedicate myself to helping clients understand all of their options and creating a solid financial plan to best protect their wealth.
I want to share some of the pertinent topics that you should be discussing with your financial planner when it comes to your healthcare plans and overall financial well-being.
Is your wealth at risk due to an inadequate healthcare planning?
Individuals and families save their entire life in order to be financially prepared for retirement, but may make this one tragic mistake. A lack of appropriate long-term health care planning can end up costing you wealth and peace of mind. Many people don’t prepare for unexpected health crises, or the end of life care costs that may arise.
Personally, I understand there is nothing more stressful than the balance of providing the best health care possible for a loved one in need, and the ability to pay for it. It’s important to work closely with a financial planner to ensure your financial plan will cover and protect your assets from health care expenses and end of life planning.
Accumulation & Distribution Planning
I encourage you to work closely with your financial advisor to ensure your retirement funds will cover all your healthcare costs and still allow you to live on a comfortable budget. Regular check-ins will allow you to adjust your investments over time to account for unexpected expenses and life changes.
Throughout our lives, we have been focused on the accumulation of wealth. As we near retirement, it’s critical to examine how to best distribute wealth to cover future health care costs, living expenses and understanding how to prepare for the optimal distribution of those funds. There is a great distinction between accumulation and distribution planning. This can be incredibly confusing and overwhelming because of numerous moving parts including asset allocation, income taxes and required minimum distributions.
Long-term Care Insurance
Long-term Care (LTC) insurance can help cover the costs of in-home healthcare for scheduled or daily visits, a nursing home or assisted living facility. Long-term Care insurance should be considered if you have assets to protect, and you are able to afford the associated costs. Like many investments, its beneficial to buy early, as premiums increase as you age.
Statistically, the numbers show that we will all need long-term care protection. The question is how you would want to address it? Self-insure or transfer the risk to an insurance company. It is that simple.
Insurance companies have created products that can fit into many financial plans. There are also ways to secure long-term care with the intention of protecting your estate for your family. Work closely with your financial planner to identify and assess the risks to give you and your family peace of mind.
Financial End of Life
Upon my departure, how do I preserve and protect my financial wealth?
This is one of the most commonly asked questions from my clients.
No one wants to spend time thinking about what will happen at the end of our life, but its important to make plans for end of life care. Many people don’t realize how expensive end of life care is until they are mourning the loss of a loved one and trying to make the arrangements. By planning ahead financially, you can spare your grieving loved ones the expensive burden of funeral arrangements and burial/cremation. Many of these expenses can be prepaid and set in place long before they’re needed. Be sure your family knows your intentions and where your documents are safely secured, ie. a safe deposit box, a letter of instruction and your digital/banking passwords. Although these can be difficult conversations, it’s important to make sure loved ones know how to access all your important information for managing your wishes & your estate.
Smart financial planning can ensure all these factors are considered when developing a comprehensive retirement investment estate plan. Please feel free to contact me today to discuss your concerns or questions.