AVOIDING A CRISIS
Henry Montag, CFP, CLTC | June 2nd, 2009As a result of many peoples failure to plan for many common life occurrences i.e. retirement , a long term illness or death many of these already unpleasant situations can turn into a full blown crisis.
We all know well in advance that wed like to retire somewhere around our 60s to 70s but the unfortunate truth is that unless we plan for this contingency far in advance we wont be able to retire in the manner wed like to. Fact is that 95% of those reaching age 65 economically wont be able to retire and that was even before our most recent economic downturn. That number will now of course increase significantly with not only the loss of a significant portion of ones stock and bond portfolio but with the harsh reduction in our residential or commercial real estate holdings as well .
In so far as death is concerned you can make certain that your family has sufficient assets to do those things that are important to you whether you are here to see them through or not. I’m speaking of such things as completing a college education ,paying off a mortgage, having sufficient family income to keep your family living in the manner in which you accustomed them to or having enough liquidity to avoid a forced liquidation of assets to pay for ones estate taxes to enable you to leave your kids/grand kids an inheritance, or to complete a charitable bequest .
If the assets are Not sufficient one has the option to purchase a life Insurance contract to make certain that your wishes and obligations are met.
In so far as a long term illness is concerned the situation can be far more complicated. While we cant stave off a medical emergency, nor the emotional hurt that comes with seeing a loved one in a debilitating situation, we shouldn’t have to also deal with the financial and legal aspects of such an occurrence at the same time.
With a little forethought and planning we can take care of the legal issues such as a power of attny and a health care proxy today while we are healthy and able. We should also encourage those involved to participate in a Family meeting where several important decisions can be made while everyone is sitting around a cup of coffee and a discussion of where and whom and when various decisions should be made.
Where might a parent best be suited to live, with whom should they live and when should such a decision be made . Who will be the participants involved to provide such care. Who will provide make the financial legal and medical decisions? Having such a conversation today will alleviate many hostile and bitter feelings that may arise if we have unrealistic expectations about the future.
While long term care Insurance provides the Guaranteed Dollars necessary to pay for ones care it also accomplishes another very significant aspect as well and that’s the services of a Care Coordinator. Someone that will provide the mundane but much needed research to provide the Family as well as the individual that needs the care with the necessary resources and information to make receiving that care as painless and comfortable as possible.
Insurance may provide the much needed dollars but the concept of the Family meeting can provide the ingredients necessary to avoid the all to often Family Crisis that often results in a panicked call to an Attorneys office where not very much can be done to alleviate the overall unbearable situation that’s sure to exist.
Plan to plan ahead now.
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Tags: care coordinator, henry montag, insurance, long term care, retirement, retirement contigency, stock and bond portfolio
About the Author: Henry Montag is an Independent Certified Financial Planner as well as a CLTC. He’s been in practice since 1976 with offices on Long Island, New York. He is a contributing writer for The Moneypaper, a national financial publication, been my sourced by Investors business Daily, Long Island Business News, Newsday, Wall St Journal, The Moneypaper,Investment News, Senior Lifestyles and has held insurance and securities licenses for over thirty years.
