The “Daily Plan-It?”
Keating Law, PLC
Volume 12, Issue 8 4/22/2010 © 2010 Keating Law, PLC, Phone: 586-498-8400. All rights reserved.
Interesting Long-Term Care Trend: Boomers Are Insuring Their Parents
Financial advisors have long touted to clients the benefits of buying long-term care insurance. While the recession has possibly motivated clients to listen to these benefits more than ever, they aren’t new.
What is new is who clients are buying long-term care insurance for — their parents.
Keeping Mom & Dad Out of Poverty
According to a recent article at OnWallStreet.com, financial advisors are seeing middle-aged clients asking about buying long-term care insurance for their less well-off parents. Often this is to protect not only their parents’ estate, but their own future as well.
Many have just had a relative go through being in a nursing home, and they see the devastation and the stress it causes. They’re concerned their parents don’t have a lot of means, and thus want to buy insurance.
Sometimes several siblings will split the cost, though the burden of care typically falls on only one sibling.
What If Insurance Isn’t an Option?
However, some clients may not be able to afford providing long-term care insurance for a parent. Or, perhaps the parent is already incapacitated and it’s too late to buy insurance. If that’s the case, these clients’ parents could be eligible for Medicaid.
Refer these clients to an estate planning and/or elder law attorney who can provide information on Medicaid eligibility and asset protection strategies.
It’s a good idea for advisors to find out if long-term care insurance or Medicaid is in the mix for their middle-aged clients’ parents. Find out what assets the parents own, what their source of income is and whether they are likely to become incapacitated.
Advisors can use this conversation to emphasize the importance of baby boomers insuring themselves for their own future care.
Our Families Are No Longer Like The Waltons
Years ago the objection most seniors had to buying long-term care insurance was either, “I won’t need it,” or, “My kids will take care of me.”
Remember how The Waltons showed us three generations of a family living together? The grandparents helped quite a bit. Their kindness was returned when they became incapacitated and their children became caregivers. That’s just how it was.
But today’s families rarely reach that ideal. Children who nursed their elderly parents are saying, “I don’t ever want to put this kind of burden on my kids."
That’s why they’re increasingly buying long-term care insurance for their parents or exploring how to help Mom and Dad receive Medicaid benefits. As an advisor, you can help them accomplish this.
As always, I hope this article has helped you and your clients. If you have a specific case or concern, please contact our office.
Thomas H. Keating has actively practiced law for 25 years, focusing on business and estate planning, with emphasis on the automotive and construction industries. Mr. Keating belongs to the State Bar of Michigan, the American Bar Association Section on Real Property, Probate and Trust Law, the State Bar of Michigan Section on Probate and Estate Planning, NAIFA, and the Michigan Forum of Estate Planning Attorneys. He is the founder of the Financial and Estate Planning Keeping Current Series as well as the East Side Business and Financial Forum and is a member of the Financial and Estate Planning Council of Detroit. Mr. Keating is a member of WealthCounsel, a national forum of estate and business planning professionals, multiple chambers of commerce, and industry associations, and is a frequent speaker at estate planning forums around Michigan. Mr. Keating is co-author of Strictly Business, book written for those facing business and succession planning challenges.