WHEN I WAS IN COLLEGE, A buddy and I decided to take a road trip during our summer break to see a few games at Wrigley Field. With barely enough money to get back to Tallahassee where we attended Florida State University, we decided to stay with my mom's parents in their home on Chicago's North side because it was free. I loved the idea because my grandfather was fun, and my grandmother always fed me well.
Grandpa was a gregarious, kind hearted man who seemed to know everyone in the city of Chicago. After emigrating from Croatia as a child, he lived his entire life in the Windy City working exclusively for the Chicago Transit Authority (CTA) from high school to mandatory retirement. A member of the Greatest Generation, he fought in the Pacific during the war for the U.S. Navy. While he told us funny stories about those years, he walked out after just a few minutes of "Saving Private Ryan" because of less pleasant memories.
The most important job he did, however, was raising my mother and my uncle. Nothing seemed to matter more to Grandpa than family. And he was a ball of energy. At the age of 74, he took my friend and me golfing and proceeded to walk two fairly fit 19 year olds into the ground. He was vital and energetic his whole life. Well, almost his whole life.
A few years ago he had a cardiac episode so severe the entire family rushed in from around the country to be by his side. Although the doctors thought his time had come, he recovered enough to go home, living several more years and defying the odds again. He maintained his sense of humor and made friends quickly at the home he and Grandma moved into, but it was odd to see him need care when he was always the one doing the caring. He passed away about a year ago.
As longevity continues to increase, there are many implications imbedded in my grandparents' story. My grandparents have been very well cared for almost accidentally. I phrase it that way because while it was no accident that they had accumulated some funds, saved and lived within their modest means, they never had a formal "plan" for the future. Their pension income has been a big help. But long-term-care insurance was never really an option for them because, by the time the industry had a decent offering, they had aged and were afflicted with various ailments that would halt an underwriter as much as they slowed down my grandfather.
Most readers can tell similar stories about members of their family. "Everybody has a story," Grandpa would say. When elderly clients come to us already beginning a process of increasing frailty, I believe it is important to get to know their stories and their values as much as their finances in order to be effective at helping them age with dignity. With the first Baby Boomers turning 60, more and more financial services firms are clamoring to position themselves as the advisors of choice for their generation. They will help make retirement cool. In addition, more and more is being written about planning techniques applicable to retirees. Thanks to the Boomers, we see changes to software to address distribution as well as accumulation, the focus of most packages just a couple of years ago.
But not all clients will spend their retirement reliving their youth playing in a rock band. Instead, an increasing number of newer retirees are spending their time and money taking care of their parents. I believe some of the most effective and meaningful planning in the coming decades will not be done by firms focused on fancy spreadsheets, the latest tax saving trusts, or gifting strategies and the like. Those will be important, but instead, the resources the best planning firms will marshal for clients are those that will help people age and decline with dignity.
The service providers planners will need to know and work well with in the 21st century are likely to include health care personnel, counselors, and geriatric care managers. Developing skills as a screener will be necessary. Getting to know professionals in your area will be important, but not enough.
Like most families in similar situations, my mother and her brother worried about money as their parents needed more care. However, most often their concerns were about health and safety issues. The angst is exacerbated by their parents failing faculties. In our firm, we are seeing an increasing number of young retirees who are faced with similar anxieties and challenges. Suddenly, they are caring for their parents. We were fortunate to have my uncle living in the Chicago area who was able to find a place to move his parents that could give good care and was located just a few miles from his home. For many the experience is a long-distance situation, more like that of my mother who lives near me in Florida.
Our ability to find skilled professionals wherever they may be needed will not only help the aging, but younger retirees as well. Robert Powell recently wrote a fine piece for CBS MarketWatch on the subject of long distance care. Powell cites three primary tasks: assess the need, keep documents in order and visit often.
To assess the need he discusses the growing field of geriatric care management. In our firm, we have found that it can be very helpful for the family to better understand what type of road an elderly person may be headed down. A geriatric care manager can perform an assessment and provide continuing monitoring as a person ages. Typical costs for a professional geriatric care manager might be a few hundred dollars for an assessment and $60 to $90 an hour for ongoing care, according to Powell. You can find information at The National Association of Professional Geriatric Care Managers Website, www.caremanager.org.
Even if you employ a properly licensed and credentialed geriatric care manager, it is highly beneficial for the family to know the people who interact with their older family member. These types of informal support networks help paint a broader picture of how someone is faring than information from an occasional visitor.
Usually when one reads about important documents, a list emerges of the usual suspects such as wills, living wills, durable powers of attorney and health-care proxies. However, families should also assemble the contact numbers for the doctors, lawyers, neighbors, etc. and distribute the list widely. This increases the chances that whenever and wherever something happens, there will be someone around who will have an idea of who to contact. In today's world it is advisable to make sure that any and all necessary privacy releases are signed and filed with appropriate parties.
Theoretically, the early days of retirement are the most active-- a time to see the world and enjoy the fruits of one's labor. Increasingly, retirees will find themselves traveling to visit aging family instead and attending to their affairs. While this may be the right thing to do, it is often very difficult in a wide variety of ways.
My mother usually didn't feel she visited her parents enough. And when she did--not having seen them in a while--their condition often seemed much worse to her than my uncle described. He would have a different perspective because he saw them regularly. The disparity in time together sometimes caused some anguish for both mom and my uncle.
I don't think financial planners can solve these problems. There are no spreadsheets or Monte Carlo simulations to address these issues. Yet, I believe that firms that can help clients find the help their families need will be supporting their clients in a way that has far more meaning than a well managed portfolio ever could.
Dan Moisand, CFP, is a principal of Spraker , Fitzgerald, Tamayo & Moisand, LLC, in Melbourne, Fla. He is president of the Financial Planning Association, and a two-time winner of the Journal of Financial Planning's national Call for Papers Competition. He has been listed as one of the best advisors in the country in several top magazines.