Straight Talk With Jack: More Do's and Don'ts of analyzing your client's future long-term-care costs!



By Jack P Paul Actuary, LLC



Let me pick up from where my last blog left off.  As I mentioned last time, there are many different approaches to, and pitfalls in analyzing the potential long-term-care costs of clients in their 60's and 70's. Before I get to a comprehensive approach to this topic (but look for one in the next blog - as well as a special offer!), here are some guidelines to consider.



Do: Educate your client about long-term-care.  Make sure your client understands the limited help Medicare provides.  Discuss the problems/limitations in qualifying for Medicaid.  Explain that the level of care in those institutions that accept Medicaid will probably not be at the same level as those that are private pay.  If you don’t have a good knowledge of these issues, by all means use the services of an expert – such as a lawyer who specializes in elder care.


Do: For clients who are couples, analyze both members of the couple.  Besides spousal discounts that can be significant for long-term-care insurance, make sure your clients have an appreciation of what life will be like for the member that doesn’t need care.  Have the couple plan for the case that both members need long-term-care.  What if both members are stricken with Alzheimer’s?  Will their house be put up for sale?   Is there someone to manage their lives?  Will there be conflicts among family members?   For stepfamilies, what additional problems may arise?

Get input from both members of the couple.  They should come to agreement on the necessary issues.  Again, employ an expert if you need to.



Do: Make sure your client’s estate plan is in order.  If not, get them to contact professionals to get it in order.  This includes any medical directives that may be appropriate.



Finally and obviously -



Don't: Ignore your client’s possible range of future long-term care costs.  These costs can run, just for a single person, anywhere from zero to well over a million dollars.  It is very common to focus on the client’s asset portfolio and investment strategies.  A major long-term-care event can “blow up” a financial plan.



Don't: Avoid using help from experts in analyzing long-term-care and its costs.  There is no need to become an expert in long-term-care yourself. 





Next Time: The biggest DO: A comprehensive approach to analyzing your client's long-term care costs! Also, a special offer from Jack P Paul Actuary, LLC!!



About Jack Paul: Jack is President of Jack P Paul Actuary, LLC. He specializes in applying state of the art actuarial techniques to meet the needs of the financial services industry. He has developed a product, PDRP Plus, which calculates probability distributions of future health, long-term care and prescription drug costs for singles/couples near or at retirement. These distributions help financial planners and their clients understand and better plan for these costs, as they are customized to each client's mortality and morbidity profiles. PDRP Plus then, if desired, combines these probability distributions with the client's asset portfolio, and spending, investment, insurance, tax and estate strategies to compute the probability that the client will meet his/her goals, including the all-important goal of not outliving his/her assets.



Jack is a Fellow of the Society of Actuaries, a member of the American Academy of Actuaries, and holds three designations from the American College - Chartered Financial Consultant (ChFC), Chartered Life Underwriter (CLU) and Chartered Advisor for Senior Living (CASL). Jack has over 30 years of experience in the insurance and financial services industries. He is located in Ardmore, Pennsylvania.





Thanks for reading - please e-mail or call me if you have any comments/questions.

Jack@Jackpaulcasl.com

(610)- 649- 2358



Check out my website - www.jackpaulcasl.com



Copyright 2012 by Jack P Paul Actuary, LLC