Aging Options

A “Long-Term-Care Plan” is an Essential Part of Retirement Preparation

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Do you have a “long-term-care plan”? Before you answer, let’s define what that means, and why we ask the question.

We ran across this idea in a recent article on the financial website MarketWatch (you can click here to read it). The article, written by California-based financial planner Robert Klein, phrases the issue pretty bluntly: the piece is titled, “Make sure you have a long-term-care plan in place before it’s too late.” With that dire warning, let’s dive into Klein’s article. As you’ll discover, there are things we definitely agree with, and one big concept with which we take issue.

First, in Klein’s view, what he calls a long-term-care plan is not the same as long term care insurance. Instead, his idea of a long-term-care plan is basically a financial strategy you put in place now to deal with the cognitive and physical decline most of us will experience eventually. He puts it this way: when we’re younger, it’s hard to grasp the notion that one day we’ll have difficulty managing our finances. “The reality,” Klein writes, “is that although we may be able to delay the onset with a healthy and active lifestyle, one of the first things we lose as we age is the ability to make complex decisions. Given this fact of life, we all need to create a long-term-care plan while we’re fully coherent and have all of our faculties.”

The core of the plan, says Klein, are “specific action steps” for your family or other caregivers to implement so that you and your assets will be protected, and your wishes honored, as you age and begin to experience the type of physical and mental decline that this article assumes is inevitable. Klein calls this “financial caretaking.” As he states, “Simplification of your financial life, including investments, is key to the success of your plan.” This allows you to begin to transition to “a plan with less-complicated investments long before your cognitive abilities and your ability to manage them begin to decline.”

As he gets into the thrust of the article, Klein focuses on planning for sustainable income, an idea he says is foundational to your long-term-care plan. Sustainable income is the income you can count on as you age, and which is independent of the performance of the stock market. This is income, says Klein, which “requires no management.” It can include Social Security, pensions and fixed-income annuities. With these tools in place, the theory goes, you will have a simple, steady source of income on which you can rely, one that will not only provide you with financial security but which will also greatly simplify your care if and when your loved ones have to step in.

(One tool Klein doesn’t mention is a reverse mortgage. As we’ve discussed many times on the radio and with clients, this can be a powerful financial instrument when used wisely, helping augment that steady and reliable income stream you’ll need as you age. Contact us at AgingOptions and we can help you determine whether a reverse mortgage is right for you.)

There are several points with which we here at AgingOptions would agree with the MarketWatch article. For one thing, planning for your retirement future is essential – and we would echo the advice, the earlier the better (more about that in a minute). For another thing, we would generally agree that for most retirees a simple income plan is preferable to a complicated one. We have lost count of the number of bereaved and bewildered spouses who contact us after their husband or wife has passed away, completely uninformed about the complex and often risky financial decisions that were made by their deceased loved one. Make sure your investment strategy as you age is not built on a complex and precarious foundation. As the saying goes, there’s a big difference between “plans” and “schemes.”

The biggest area with which we would disagree with Robert Klein is that his version of a long-term-care plan seems to focus solely on finances. At AgingOptions, as our clients, seminar attendees and radio listeners know, we use a strategy we call LifePlanning, which would more or less be a “long-term-care plan” on steroids.  With a LifePlan in place, your finances are indeed carefully planned out, both for you and for those who may one day have to step in and manage your affairs when you’re no longer able to.  What makes a LifePlan so valuable is that it also encompasses the other vital aspects of what we would consider a true long-term-care plan: your legal affairs, your housing choices, your medical insurance needs and communication with your family. Our assertion, based on years of experience, is that a LifePlan is the type of long-term-care plan you really need.

To learn more, why not take a few hours and attend a free LifePlanning Seminar soon? You’ll get a host of questions answered, and we assure you it will be time well spent. Click on the Upcoming Events tab and register online, or call us. We’ll be happy to assist you as you create a plan that truly provides the kind of long term assurance you’ve been seeking.

(originally reported at

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