Title: Why Most Planners Fail at Long-Term Care -and How to Fix It

Danielle Miura, CFP?, MSFP, E

Let’s be honest.

99% of financial planners don’t fully prepare their clients for long-term care.

Here’s how long-term care planning typically goes:

Have a conversation with clients about their long-term care wishes.

Based on the client’s wishes, planners input numbers into financial planning software, hoping the results will provide answers.

Then, they advise clients about what steps to take to save for long-term care or what financial products to buy.

Occasionally, they’ll refer clients to long-term care experts.

But here’s the issue: relying solely on calculating averages and crunching numbers isn't a comprehensive plan for long-term care.

This approach often falls short, leaving clients underprepared.

Plus, these numbers or averages are likely to be incorrect.

Honestly, I get it.

When I took the CFP? educational classes, they didn’t explore the complexities of in-home aging, planning for conditions like dementia, or caregiving for aging parents.

Please don’t get me wrong; I don’t blame the CFP? Board for this.

I’ve learned from leading elder care professionals, listened to countless caregivers, and spent years researching this field.

Unfortunately, many planners simply don’t have the time to fully explore these areas or develop the soft skills necessary for these emotional and difficult conversations.

But today, you're in luck.

In three easy steps, I will teach you how to avoid being one of the 99% of financial planners.

1. Have Conversations Early and Often

Long-term care and dying shouldn’t be discussed when people turn 60, 70, or - hopefully not - 80

I start conversations with clients about disability and long-term care as young as 30.

Early discussions help clients prepare instead of react.

If you want to eliminate the taboo of death and aging in your firm, start talking about it.

These conversations don’t have to be difficult. Think of them as planting seeds that will grow over time as your clients age.

Here’s a simple set of questions to guide these discussions:

●????? Who could you rely on for physical or financial help if you had a sudden health scare?

●????? Who is most important to you? If they were hospitalized, how would you support them?

●????? If a severe illness or injury prevented you from working for an extended time, how would that impact your lifestyle and ability to support your family?

●????? What does long-term care look like in your family? What financial or caregiving pressures have you seen?

●????? How might chronic illness or hereditary conditions affect your future care needs?

●????? Are you familiar with the different long-term care types and associated costs?

●????? Have you shared your caregiving preferences and financial plans with your family? How prepared are they?

●????? Do you know what Medicaid or Medicare covers for long-term care?

●????? Have you researched or toured care communities in your desired retirement location? Are they aligned with your budget and preferences?

These conversations will evolve as your clients age, but starting early allows them to plan rather than react in a crisis.

2. Customized Care Planning

We all agree that every client is unique, so why not craft a personalized care plan that reflects their specific needs instead of relying on generic averages?

First, start by having clients tour local nursing homes or care communities.

These tours allow clients to visualize their potential future living arrangements and gather brochures to estimate the costs of care.

Even if they prefer to age at home, having a Plan B option can provide peace of mind and more accurate cost projections.

Once you’ve gathered these estimates, combine them with tools like Genworth’s cost averages and the client’s family health history to estimate the length of care that may be needed.

But this is just the beginning.

A comprehensive plan should also account for additional care expenses not covered by community living or unexpected costs tied to in-home care.

For example, include a budget for home modifications, medical supplies (like gloves, wipes, and diapers), food delivery services, or transportation.

These smaller expenses can accumulate quickly, potentially overwhelming clients if not planned for in advance.

Second, consider setting aside funds to compensate family members or friends who may step in as caregivers.

This can be done through a formal care agreement or informally with gift cards, meal payments, or transportation costs coverage.

Structuring these payments ensures caregivers are fairly compensated while preventing financial strain on the family.

Third, be sure to factor in the client’s family health history.

For instance, a family history of conditions like dementia or Parkinson’s may mean a longer and earlier need for care.

Meanwhile, clients with a history of diabetes or autoimmune diseases could face long-term disability sooner than expected.

Although clients may not inherit their parents' health conditions, planning for these possibilities is vital.

Tailoring the care plan to these health risks provides a more realistic picture of potential future needs.

Lastly, always prepare for the worst-case scenario.

No matter how well we plan or how advanced our predictive tools are, there’s always a chance the long-term care plan could fail.

When reviewing a plan, ask yourself: Will my clients be financially secure if

●????? They need intensive or memory care?

●????? Their spouse passes away before them?

●????? They require long-term care for a decade rather than a few years?

Building flexibility into the plan through "what-if" scenarios ensures your clients are prepared for anything life may throw their way.

Need help creating a customized plan? Speak with a long-term care expert.

3. Build a Team of Experts

If only we could inject everything we need to know about long-term care into our brains—but for most of us, that’s not realistic.

Fortunately, you don’t need to know every detail about long-term care planning. However, it would help if you had a strong network of experts you can rely on.

Start by building a team that includes estate or elder care attorneys, geriatric care managers, and long-term care insurance experts.

These professionals can provide the specialized knowledge and insights your clients need.

To take it a step further, consider expanding your network to include local nonprofits and area agencies on aging and caregiving resources.

These organizations can provide additional invaluable support and services when your clients face long-term care decisions.

With this network of experts ready, you can offer your clients a comprehensive, well-rounded approach to long-term care without having to master every area yourself.

By following these three steps, you’ll stand apart from the 99% of financial planners who fail to prepare their clients for long-term care.

Your clients will appreciate the thoughtful, proactive approach, and you’ll feel confident knowing that you’ve helped them prepare for the future in ways that generic numbers alone never could.

What steps have you taken to better prepare your clients for long-term care?

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