LegacyCare Pro News - March Edition

Our whole Industry has a PR problem when it comes to Long-Term Care planning. That's because we allow clients to pick policies by premium tolerance, we do not compare plans correctly, track performance or even keep up with claims.

Advisors have fallen into the trap of blaming products, only to paint themselves into a corner where their product recommendations won't live up to their clients' expectations nor will it protect their clients' Portfolios from excessive future supplementing. That's because we never tied the policies to the Portfolio.

Moving forward, we need to look at this part of your client's Retirement Planning from much different angles and keep the comparison separate. I understand that the biggest hurdle is denial. After Covid, I would think that better access to Home Health Care would be something that clients want to protect. In order to make it an easier path to this level of care, then it means you must build a bigger firewall. The problem is that most Advisors aren't asking the right questions or don't have the time to put something together that shows how to enhance the plans over time. That's where our LegacyCare Pro system and software comes in.

It's not Rocket Science. Most clients would do more planning ahead if they could see a little more into the future. One of the easiest ways to approach the subject is asking, "Can I borrow the kid's inheritance for the next 30 years and use it to take better care of you, if you need care for an extended period of time?". Then, follow up with, "Do you want to give it back to them ONE time, TWO times or THREE times what we set aside for your Long-Term Care plan?"

What if your clients say they're not worried about leaving anything to their children? Ask them to they want to pay for everything "discounted" or "dollar-for-dollar"? Also, ask them if they want their children to make their healthcare decisions based on how it affects their inheritance. Don't give up or use as an excuse to put in a partial plan. There may be something you're missing. Make sure both spouses understand the consequences.

The problem is that we are not showing the steps to move money over to their Long-Term Care and Legacy buckets to pay premiums as they slow down. Advisors are either showing how to move money out of the Portfolio or they're leaving it up to Cash Flow. Thus, missing an opportunity to "discount" any future dollars spent on care. This goes for taxes too.

If you want to keep more inside their Portfolio (for longevity) and take better care of your clients as they age, then we have to get plans started while clients are healthier, protect the Death Benefits (for Legacy or longevity) and stop having Legacy planning conversations at age 70+. They don't have to fully fund the plans, they just need to get them started and get insurability out of the way. You can do this as long as you can prove your intent and the money is still inside their Portfolio to pay premiums.

Let's look at a comparison of 4 plan designs...55 year old couple.

1) How many clients can take $201,000 out of their Portfolio at age 55?

2) Can those with modest means still build a better Long-Term Care & Legacy plan over time? You bet! We just have to get ahead of health issues with lesser benefits for Long-Term Care Insurance and Life Insurance, then wait for future funding.

3) Long-Term Care Insurance has a DEATH BENEFIT if you compare against Lump Sum Asset-based Long-Term Care or use the same funding for any other combination of products. Option B.

4) You need to start creating a CARE FUND or positioning products to create a CARE FUND in the future. As time goes on, clients mentally start thinking about needing care and what they'll leave to their heirs. Make it easier to fund these two concerns by using their younger self to prepare for their later years.

5) Pay attention to Monthly Benefits, amount available from Account Value and the Death Benefits before and after claims. Which plan would you want?

6) If the Death Benefit is protected and equal to the Death Benefit for the Asset-based Long-Term Care, then any additional money spent in order to keep LTCI benefits stronger is a moot point. (We see this daily with existing LTCI policies with clients who have the money to pay the premiums but don't see the cost of the care. We left many of these plans incomplete by not adding Life Insurance.)

7) Do you have a Fiduciary Standard if you don't compare plans this way or keep a running comparison for the next 30 years? Is guessing compliant?

Now, let's look at adding $100,000 to their CARE FUND at age 70...

1) Does it help the Asset-based Long-Term Care as much as it helps the other 3 plans? Pay attention what this additional funding did to the Monthly Benefits in Plan C & Plan D.

2) Can you talk about Legacy planning now? No. Too late. The $100,000 needs to stay in the account to hedge against future Long-Term Care expenses. The Long-Term Care Benefits in Option A plus amount available from Account Value don't add up to the base Monthly Benefits for the other 3 plans.

3) Does the Death Benefit cover the "out of pocket", even if they see the full supplementing go out the door? Look at bottom row. The protected Death Benefit covers "out of pocket" of a 3 year Home Health Care event.

Now, let's look at adding $100,000 to their CARE FUND at age 70...what if they get PREFERRED rates back in their 50s?

1) What if we showed DOUBLING their commitment as a Death Benefit? If we were to put in $150,000 @ age 70 could we take that Death Benefit to $750,000? Can you test it quickly?

2) Does a higher and protected Death Benefit give their children a better "permission slip" to spend the money for the care they really desire. These Home Health projections are 150% of the cost of Nursing Home Care.

3) The stronger LTCI benefits allows this additional funding to go to Legacy planning vs. sitting in an account waiting for a future claim.

4) Wouldn't it be an easier sale to pay a sibling to take care of Mom if it protected more for them and their siblings? Plus, it gives the sibling more help from professionals. Caregiver burnout leads to Mom or Dad having to go to facility care sooner rather than delaying this move.

Realities of Home Health Care & Caregiving

For those Advisors who say, "My clients won't spend this much per month for Home Health Care." Sadly, you're correct. Your clients or their families won't spend that much because nobody likes paying for the most expensive level of care...even, your High Net Worth Clients. That most likely means that their care will fall on the closest child or even a elderly sibling who will be unpaid for their services. We have to do a better job of protecting the caregiver if they sacrifice their time, money and their well-being to take care of their loved one...your clients!

How to get started and see how LegacyCare Pro can help you.

If you have made it this far, then I know you can see the value of presenting plans over reactionary product drops that have been plaguing our Industry for years. No plan is perfect. No Advisor can see everything. Not everything you present will be executed by your clients. That's why we are looking to help you educate your clients on better ways of getting their Long-Term Care & Legacy plans started sooner, showing how to add more funding along the way in order to protect their future ability to age in place as well as leave more to their heirs. Also, we want to give you a "proof of purchase" that tells a better story when your clients need care or their children come to close their accounts.

That being said, please take the time to DM us for our Long-Term Care & Legacy Planning Analysis form. This will allow you to ask the right questions, trigger things that mean the most to your clients and give them access to a higher quality of care. Give us your city and I'll send you summaries for Middle-Class and High Net Worth to show you how these plans will look in your backyard. ~ Barclay

If you want to have a one-on-one to walk through these pieces or want to learn more about our system, then here's my calendar link click here