Are You Prepared to Handle Your Parents’ Estate?

Contributed by: Sandra Adams, CFP®

Clients are increasingly facing the grueling task of handling their parents' financial affairs after their deaths. If their parents worked with professional advisors over their lifetimes, it's very likely that the task of handling the financial affairs and settling the estate can be a relatively straightforward process. However, many clients come to me asking for help with situations in which their parents didn't have things in order and don't know where to start.

What kinds of things are they finding?

Accounts at multiple institutions, sometimes cash accounts, sometimes investment accounts and/or direct stock accounts. We call this "diversification by location" — it did nothing to diversify the actual investment portfolio; it only spread the assets to different providers and custodians, making it that much more difficult for the executor after death to get a handle on the assets.

Accounts with registrations and beneficiaries that haven't been updated. Perhaps Dad passed away ten years ago and your parents had a joint account. Now, Mom has passed away and as you go to settle her estate, you find that there are accounts with both names still on them (Joint accounts that now have two deceased persons on them) or accounts in your Mom's name that still have your Dad listed as the beneficiary. This is not impossible to unravel but can certainly take some time (and paperwork) to get sorted out!

Physical stock and bond certificates. Huh!?! Yes, there are still clients, mostly older, holding physical stock and bond certificates. In many cases, the actual shares had been deposited in an account at a broker-dealer or with a stock transfer agent in a dividend reinvestment program in the past. The trick here is now trying to determine whether the stock certificate is representative of actual shares, if the shares are held elsewhere, or if they were sold at some time in the past and no longer exist. If there are no notes or records that are attached to the certificate, and you cannot track the stock in any of the other investment account holdings, you now need to become somewhat of a detective.

Stock certificates for companies that no longer exist. The same goes for stock certificates showing up for companies that you no longer recognize. Likely, these companies have changed names, merged, or been bought out by other companies. Again, it takes some detective work to find out what happened to the company and whether the "new" company is still something your parent's estate may hold or if it's something that was sold throughout the years.

Collectibles. Signed baseballs. Gold and silver coins. Jewelry. Novelty Collectibles. Rare guns. China. Any and all of these items and so many more are things that clients find in their parents' homes when they're cleaning them out to sell. The difficult part here is that many family members no longer want to keep these things as family heirlooms to pass on from generation to generation. So, there's a need to sell them and pass on the cash. Given that, as the executor, finding the right people and places to provide an accurate value for these types of items can sometimes be a challenge.

Parents' Home. This can often be a challenging situation. Many issues often surround the issue of the home — financial, emotional, and otherwise. If there was no kind of deed (Quit Claim Deed or Lady Bird Deed) in place to provide who the home was to go to or it was not named in a Trust, ownership is likely directed by the Will and the probate court system. One of the biggest processes is going through the home to make sure to find any important documents and valuable family heirlooms. Once those items are removed, there's a process of determining what other items should be kept to be given to family members, what should be donated, what should be recycled, and what should be thrown out. There's another category for families interested — what can be sold in an estate sale — if you feel that there are items of value and are willing to go through the process. The good news is that there are companies willing to be hired to help you do all of that — and they're well worth their price in gold! And once that's done, there's still the process of selling the house, which can be a process of its own.

Are you overwhelmed yet with what you could be facing? We haven't even talked about all of the paperwork there could be. For every account held at every provider, broker-dealer, bank, and insurance company, there's a different set of paperwork that likely requires either a copy or an original death certificate and other documentation. This can include documentation proving your authority to sign and the capacity in which you're serving to represent your parents' estate. And if you're still working (not retired, when this could be your full-time job for the next several months), it could even be more challenging to find the time to get all of this done without the help of professional assistance.

So, what can you do to prevent being in this situation if you're not already there?

Have difficult conversations with your parents about their current financial and legal affairs. Let them know that it would be helpful to understand how their estate is set up and how their financial affairs are structured to ensure that things will be simple and easy to handle as they age. (You can always tell a story about a friend who had to handle things for their parents and struggled because they weren't in order, and you don't want your family to struggle in the same way).

Bring in the help of professionals if and when needed. An estate planning attorney to update documents. A financial advisor to help simplify, organize and put a comprehensive financial and aging plan in place. And both are excellent resources when it comes time to handle your parents' estate —both can provide guidance with steps, help with paperwork, and provide resources as you go through the process.

If you or someone you know is expecting to need to handle their parents' estate in the near future and wants assistance in getting things in order proactively, guiding them to work with professional advisors can be your best advice.

Sandra Adams, CFP®, is a Partner and CERTIFIED FINANCIAL PLANNER™ professional at Center for Financial Planning, Inc.® and holds a CeFT™ designation. She specializes in Elder Care Financial Planning and serves as a trusted source for national publications, including The Wall Street Journal, Research Magazine, and Journal of Financial Planning.

Any opinions are those of Sandy Adams, CFP® and not necessarily those of Raymond James. Securities offered through Raymond James Financial Services, Inc., member FINRA/SIPC. Investment advisory services offered through Center for Financial Planning, Inc. ® Center for Financial Planning, Inc. ® is not a registered broker/dealer and is independent of Raymond James Financial Services.

Caregivers Try to Balance it All

Contributed by: Sandra Adams, CFP®

The month of September is host to a slew of recognition for caregivers: World Alzheimer’s Day, National Daughter’s Day, Intergeneration Month, and Self-Care Awareness Month.

According to the National Institute on Aging, there are an estimated 11 million unpaid family caregivers in the United States for patients with dementia, including the most prominent form of the disease, which is Alzheimer’s disease. More than one in four Alzheimer’s and dementia caregivers are “sandwich generation” caregivers —they are caring for someone with dementia AND caring for a child or grandchild at the same time. And according to the Alzheimer’s Association, over two-thirds of caregivers are women with nearly 50% looking after at least one parent or parent-in-law. The need for self-care for these family caregivers – often women and often working – is real.

We would all love to believe that, given the opportunity, we would embrace serving as a caregiver for our loved ones — that we would treat the opportunity as “a gift.” In the book Working Daughter: A Guide to Caring for Your Aging Parents While Making a Living, by Liz O’Donnell, the author says:,

Caregiving didn’t feel like a gift to me. It felt like a burden—a burden I didn’t want and one that I wasn’t prepared to handle. I had no warning, no training, and no support. I didn’t realize how many other people I knew were also caring for sick and/or elderly parents. No one in my circle of friends or coworkers was talking about it. As a working mother, I had so many people and resources to draw on for help and advice about everything from how to get a child to sleep to how to balance parenting and career. As a working daughter, I felt alone. And among the few people I knew who were family caregivers, no one was complaining about it. Just me. They must all agree it’s a gift, I thought to myself. I am a horrible, selfish person for thinking it’s a burden.

The reality is that what Liz expresses is not unique. According to a 2017 CNBC report, of the millions of family caregivers out there, almost 60% (58% to be exact), classified the burden of caregiving to be high or moderate. For those caregivers also working and/or raising young families, the percentage is likely to be higher. That feeling of “burden” is likely to lead to stress and feelings of guilt (guilt for feeling the job is a burden and guilt that you are not doing your best at any of your jobs).

Caregivers, for the most part, keep their feelings isolated. They don’t want others to see that they don’t appreciate the opportunity they have to spend this time caring for their loved ones. As a result, they suffer in silence and don’t reach out for help — for themselves or for the resources they need. They may miss out on resources available in the community to provide relief (adult day programs, volunteer programs through local senior programs, Area Agency on Aging programs, Meal Programs, transportation programs, caregiver support programs, etc.). If the caregiver is afraid to admit they need help, they may never know of the programs available to provide relief and assistance.

In addition to bringing awareness to caregiver-specific emotional and psychological struggles, September is the perfect time to bring attention to the financial planning issues that surround caregivers and how these can be addressed.

According to AARP, family caregivers spend an average of 24.4 hours caring for their loved ones in addition to their other responsibilities. For working caregivers, especially women, this means making accommodations to their work to meet the demands of their caregiving roles:

• Requesting a less demanding job 

• Taking unpaid leave 

• Giving up working entirely 

• Taking early retirement

As a result of work accommodations, the result of future wages, according to the AARP Policy Institute (2018) is $324,044 in future wages for women and $283,716 in future wages for men. In addition to wages, health insurance, retirement savings, pension benefits, and Social Security benefits are lost to those who cut back or stop work due to caregiving duties. For those who were on an advanced career track, losing upward momentum by having to slow down or stop work can have a significant impact on future advancement AND wages. And for women, who are typically already behind men in earnings, slowing down or stopping work due to a caregiving role can put them even farther behind their male counterparts. Compound that with the fact that women will potentially live longer, and live longer alone (be widowed), and they’re in a “no win” situation.

Action steps for working women who are also caregivers:

•  Plan ahead as much as possible before the caregiving duties begin. Make sure those you will be caring for have a solid financial and care plan and that as many resources as possible are put in place in advance. 

• Work with your employer to see what arrangements can be made for flexible schedules, paid leave, etc., in order to keep you employed while being able to accommodate your caregiving duties with the least disruption to all areas of your life.

• Make sure you utilize all of your resources, including other family members, caregiver support, and self-care.

• Work with your own financial adviser to plan for the possibility of caregiver duties and consider what different scenarios might look like for your own plan. Look out for your own financial security, as well as for your loved one’s caregiving needs.

Caregivers have a big challenge. They try to do it all and do it all flawlessly — which might not be possible. Create a balanced life where everyone is safe and futures are secure. Planning ahead as much as possible is key to making this happen. Don’t try to do it alone!

Sandra Adams, CFP®, is a Partner and CERTIFIED FINANCIAL PLANNER™ professional at Center for Financial Planning, Inc.® and holds a CeFT™ designation. She specializes in Elder Care Financial Planning and serves as a trusted source for national publications, including The Wall Street Journal, Research Magazine, and Journal of Financial Planning.

Securities are offered through Raymond James Financial Services, Inc. Member FINRA/SIPC. Investment advisory services offered through Center for Financial Planning, Inc. Center for Financial Planning, Inc., is not a registered broker/dealer and is independent of Raymond James Financial Services.

Raymond James and its advisors do not offer tax or legal advice. You should discuss any tax or legal matters with the appropriate professional. Any opinions are those of Sandra D. Adams, and not necessarily those of Raymond James.

Certified Financial Planner Board of Standards Inc. owns the certification marks CFP®, CERTIFIED FINANCIAL PLANNER™, CFP® (with plaque design), and CFP® (with flame design) in the U.S., which it awards to individuals who successfully complete the CFP Board’s initial and ongoing certification requirements.

What is Retirees’ Biggest Fear?

Contributed by: Sandra Adams, CFP®

I recently attended a conference on aging where the presenter discussed the biggest fears of clients approaching and entering retirement. The question was posed to the audience, “What do you think the biggest fear of clients entering retirement is according to recent research?” As I thought about the possible answers given my interactions with clients, so many possibilities came to mind. The fear of running out of money, a detrimental stock market causing the loss of significant assets, or the loss of a spouse without being able to fulfill retirement goals. Then the speaker said very bluntly, “Alzheimer’s disease.” Wow!

It makes a lot of sense. The most current Alzheimer’s Association Facts and Figures report that 1 in 3 seniors pass away from Alzheimer’s or other dementia (more than breast cancer and prostate cancer combined). More than 6 million Americans are currently living with Alzheimer’s disease; that number has increased 145% over the last decade and 16% during the COVID-19 pandemic. In 2021, the cost to the nation of Alzheimer’s and other dementias was over $355 billion (that number is projected to be $1.1 trillion by 2050 if no cure is found).

Even more impactful to our clients and families, over 11 million Americans provide unpaid care for people with Alzheimer’s or other dementia; this includes an estimated 15.3 billion hours valued at nearly $257 billion. It’s no surprise that retirees’ biggest fear is Alzheimer’s, whether it’s getting the disease or becoming a caregiver to a spouse who gets the disease and having retirement derailed by an illness that currently has no cure.

Thinking about this from a financial planning and retirement planning perspective, there are likely two significant and very different issues. First and foremost is FOMO, or the Fear Of Missing Out. Alzheimer’s and related dementias most certainly steal many opportunities from clients’ to live out their ideal retirement; to enjoy the happy, HEALTHY next phase of life they always planned for. The fear of missing out on that if an Alzheimer’s dementia were received for one or both of a spousal couple is real, especially if that diagnosis comes early in retirement.

Second, and most significant, is the financial impact of an Alzheimer’s diagnosis on the overall retirement plan. In 2019, the Alzheimer’s Association reported that the average lifetime cost for caring for a person with dementia was $357,297. For most clients without a Long Term Care plan or Long Term Care insurance, these costs could certainly be detrimental to their overall retirement plan.

Planning in advance of a diagnosis is always recommended. So, what are some specific action items that might be recommended?

• Consider Long Term Care before retirement (the longer you wait, the more expensive solutions can be, and the more likely you can become uninsurable).

• Seek the advice of a team consisting of a financial advisor, estate planning/elder law attorney, and a qualified tax professional to formulate the best possible future long-term care funding strategy. This is often the best defense against the attack of a disease that can significantly impact your plan in the future.

• Plan to have a family discussion about your long-term care plan to ensure your family is aware of your wishes and their potential roles in your plan. Have a facilitator guide the meeting if you feel that might make the meeting run smoother. 

“Thinking will not overcome fear, but action will.” W. Clement Stone

Planning ahead and preparing is your best defense against your fears. If you have not yet started planning for your aging future or your potential long-term care needs in retirement, there is no time like the present. Reach out to your financial advisor to develop a team of professionals and start planning today!

Sandra Adams, CFP®, is a Partner and CERTIFIED FINANCIAL PLANNER™ professional at Center for Financial Planning, Inc.® and holds a CeFT™ designation. She specializes in Elder Care Financial Planning and serves as a trusted source for national publications, including The Wall Street Journal, Research Magazine, and Journal of Financial Planning.

Investing involves risk and you may incur a profit or loss regardless of strategy selected, including diversification and asset allocation. Raymond James is not affiliated with Sandra D. Adams, CFP®. The cost and availability of Long Term Care insurance depend on factors such as age, health, and the type and amount of insurance purchased. These policies have exclusions and/or limitations. As with most financial decisions, there are expenses associated with the purchase of Long Term Care insurance. Guarantees are based on the claims paying ability of the insurance company.

Securities offered through Raymond James Financial Services, Inc., member FINRA/SIPC. Investment advisory services are offered through Center for Financial Planning, Inc. Center for Financial Planning, Inc. is not a registered broker/dealer and is independent of Raymond James Financial Services.

Planning for End of Life Care with Hospice

Contributed by: Sandra Adams, CFP®

I watched recently as a good friend of mine struggled to arrange care for her mother at the end of her life. Her mother struggled with dementia, and after a fall, her health took a severe turn for the worse. It suddenly became clear that she was not going to recover. My friend wanted a quality and pain-free remainder of life for her mother, so she decided to call in Hospice care. Hospice care is a service for people with serious illnesses who choose not to get (or continue) treatment to cure or control their illness. Hospice care focuses on the care, comfort, and quality of life of a person with a serious illness approaching the end of life. It often also includes emotional and spiritual support for both the patient and their loved ones.

Many people hear about Hospice, but if you have never had experience with it, you may have some questions. You might be wondering:

When are you eligible for Hospice Care? Anyone with a serious illness who physicians think have less than six months to live usually qualifies for Hospice Care. For Medicare to pay for Hospice Care, patients must stop aggressive medical treatment intended to cure or control their illness.

When is the right time to start Hospice Care? This is a decision you make with your doctor about your illness and how it is progressing. Still, it is good to remember that the earlier you start Hospice services, the longer they may have to provide meaningful care, and the longer you may have to spend quality time with your loved ones.

Where does Hospice Care take place? It can take place in several settings, including your home, assisted living, nursing home, or hospital.

What services does Hospice provide? Depending on the needs of the patient and family and the patient's end-of-life wishes, Hospice can provide a wide range of services. Services can include emotional and spiritual support for the patient and the family, and relief of symptoms and pain (pain management, therapy services, and many more) personalized to the patient and family.

Before I worked for The Center, I worked for a Hospice. I regularly saw the value of the services provided both for the patients and the families when the end of life was certain. Several of my family members have also used Hospice services, and I don't know how our family would have dealt with the end of their lives without the empathy and compassion of the nurses, doctors, and social workers. If you or someone you know is facing the end of life and prefers to face it with pain management and a quality of life focus, search for a Hospice near you at www.mihospice.org if you are in Michigan or www.nationalhospicelocator.com if you are in other states. If you have other aging planning questions or issues that we can help with, don't hesitate to contact me at Sandy.Adams@CenterFinPlan.com

Sandra Adams, CFP®, is a Partner and CERTIFIED FINANCIAL PLANNER™ professional at Center for Financial Planning, Inc.® and holds a CeFT™ designation. She specializes in Elder Care Financial Planning and serves as a trusted source for national publications, including The Wall Street Journal, Research Magazine, and Journal of Financial Planning.

The foregoing information has been obtained from sources considered to be reliable, but we do not guarantee that it is accurate or complete, it is not a statement of all available data necessary for making an investment decision, and it does not constitute a recommendation. Any opinions are those of the author and not necessarily those of Raymond James.

Survival Tips for Caregivers

Contributed by: Sandra Adams, CFP®

It’s no surprise that our population is aging at a rapid pace. Currently, more than 46 million older adults, age 65 and above, live in the U.S.; and this number is expected to grow to more than 90 million by 2050! In any given year, there are more than 50 million people providing care in the U.S., many of whom claim they did not have a choice in taking on their caregiving responsibilities.

I had the privilege of attending the annual Alzheimer’s Association-Michigan Chapter/Wayne State University Institute of Gerontology – A Meaningful Life with Alzheimer’s Conference recently. Much of the conference focused on how to make sure that caregivers are being taken care of, so they can then provide the best care to others. Many caregivers are so focused on those they are caring for that they’ll skip their own doctor appointments (54%) or miss work (65%), which puts them in potential medical and financial harm, as well as risk for caregiver burnout for the sake of focusing on the person they are caring for.

Action Steps to Help Caregivers Survive Burnout:

1. Acknowledge that you matter — take time for yourself!

2. Make a plan for your mind, body, and soul — take time to rest your mind, exercise your body, and feed your soul!

3. Don’t sweat the small stuff — don’t worry about things you cannot control!

4. Stay socially active — take time to do things with family and friends that are not in a caregiving capacity.

5. Find someone to talk to about your frustrations — whether it’s a friend, a caregiver support group, or a therapist.

As a caregiver, you can be overwhelmed with so many responsibilities. You may have a family of your own and care for older adult parents, or you may be caring for a spouse while holding down a job or other responsibilities. Whatever your caregiving role, it is never easy. It is important to remember that you are not in it alone; there are others to rely on and delegate to, whether in health care, financial, legal, or other roles. And it is most important to take care of yourself. It takes a happy, healthy caregiver to take care of others in the best way possible. If you or anyone you know is serving as a caregiver and are in need of support, please reach out. We are always happy to help.

Sandra Adams, CFP®, is a Partner and CERTIFIED FINANCIAL PLANNER™ professional at Center for Financial Planning, Inc.® and holds a CeFT™ designation. She specializes in Elder Care Financial Planning and serves as a trusted source for national publications, including The Wall Street Journal, Research Magazine, and Journal of Financial Planning.

How to Reduce the Risks of Dementia and Diminished Capacity to Your Retirement Plan

Contributed by: Sandra Adams, CFP®

Senility is what they used to call it and it only happened to the very elderly like our great grandparents.  Surely, not us. We are healthy, educated, and financially well off, so we don’t need to talk about senility or plan for it. THINK AGAIN!

Senility is now known as Alzheimer’s, a disease that accounts for 60-80% of dementia. The statistics are alarming! According to the Alzheimer’s Association, more than 1 in 9 people over age 65 have Alzheimer’s disease. The chances of an Alzheimer’s diagnosis doubles every five years after age 65 (beginning at approximately 5.3% at age 65 and going from there).   If the disease runs in your family, a head injury, hypertension, diabetes, stress, excess weight, depression, and many other conditions increase your risk of diagnosis.

Risks of Not Planning

I don’t need to tell you that losing your memory is a scary proposition. The fact that you could live for years (if you are otherwise healthy) without knowing who you are, where you are, who any of your loved ones are, and not recall your short nor most of your long-term past is frightening.  Even more disturbing is that you also forget how to care for yourself, and your body begins to forget how to function.  Family may be able to assist you at first, but as time goes on professional care is usually needed.  A few thousand per month for at-home caregivers is not out of the question.  As more care is required, the few thousand dollars per month can quickly become five thousand to ten or twelve thousand dollars a month, depending on the level of care needed and where you live. The impact on your financials, if you haven’t planned, can be detrimental.

In addition to the care risks, there are capacity risks.  Those who develop Alzheimer’s or related dementia go through a period (sometimes before their diagnosis or possibly early in their diagnosis) when their capacity is considered “diminished.”  They are not yet considered fully incapable of making their own decisions. In other words, the right to make decisions has not yet been taken from them, but their ability to make decisions is compromised.  In this stage of the game, we are generally watching for behavioral changes in clients:

• Missing Appointments

• Getting confused about instructions/having difficulty following instructions

• Making more frequent calls to the office to ask the same questions

• Trouble handling paperwork

• Difficulty recalling decisions or actions

• Changes to mood or personality

• Poor judgment

• Memory Loss (generally)

• Difficulty with basic financial concepts

Concerns that are more significant can be financial fraud and exploitation. Clients with diminished capacity are incredibly vulnerable to others who try to take advantage of their inability to understand what is or is not real. Unfortunately, 1 in 10 seniors over age 65 are victims of financial exploitation, according to the Government Accountability Office, with losses totaling over $3 billion annually. While most of this exploitation is at the hands of strangers, sometimes family, friends, and caregivers exploit the vulnerable.

Proactive Solutions

Now that I have completely frightened you about dementia and diminished capacity, let’s take a step back and look at what we can and should be doing to plan and protect your plan proactively against these risks.

From a personal health perspective, the Alzheimer’s Association suggests:

• Combined physical and mental exercise

• Continuous Learning

• Social Engagement

• Get good sleep

• Eat a healthy diet (Mediterranean Diet recommended)

From a financial planning perspective, it makes sense to put together a proactive aging strategy as part of your retirement planning to address the potential risks of dementia/Alzheimer’s/diminished capacity on your comprehensive financial plan.  What should this aging strategy address?

•  Legal Documents

• Care

• Finances

• Legacy

Dementia and diminished capacity are scary.  We don’t want to think about a time when we might not remember our names, remember our loved ones, or even recognize our reflections in the mirror. Dementia and diminished capacity can wreak havoc on our families and our financial security if we don’t plan. Take steps today to put together an aging strategy so that you and your loved ones are prepared. Preparation is the best defense!  If you or anyone you know need assistance with this topic, please let us know.  We are always happy to help!

Sandra Adams, CFP®, is a Partner and CERTIFIED FINANCIAL PLANNER™ professional at Center for Financial Planning, Inc.® and holds a CeFT™ designation. She specializes in Elder Care Financial Planning and serves as a trusted source for national publications, including The Wall Street Journal, Research Magazine, and Journal of Financial Planning.

Planning Opportunities for LGBTQ+ Elders

Contributed by: Lauren Adams, CFA®, CFP®

For over 35 years, our independent wealth management firm Center for Financial Planning, Inc. has partnered with Raymond James Financial Services to achieve our mission of “Improving lives through financial planning done right.” In addition to providing our clients with custodial services for their investment accounts, Raymond James also offers a wide range of resources to The Center from everything from equity research reports to educational opportunities to stay on top of the ever-changing financial planning landscape.

One wonderful resource example is the Raymond James Pride Financial Advisors Network, a network of advisors serving the Lesbian, Gay, Bisexual, Transgender, and Queer (LGBTQ+) community that was founded in 2020, and its “Inaugural Business of Pride Symposium,” held in June 2021. At the Symposium, I had the opportunity to attend a session titled, “The LGBT+ Aging Crisis – Planning Opportunities for our LGBT+ Elders,” presented by Dan Steward, National Program Director for the Human Rights Campaign Aging Project, and Sherrill Wayland, Director of National Education Initiatives for SAGE.

In the presentation, Steward and Wayland discussed practical ways for financial planners to address and better serve members of the LGBTQ+ community:

• Recognize the distinct needs of this growing and diverse community: It is estimated that there are over 2.7 million older adults that self-identify as members of the LGBTQ+ community. Citing the work of leading researcher Professor Karen Fredriksen-Goldsen, the presenters explained that within this group, however, there is a wide range of generational experiences: from the oldest “Invisible Generation” that grew up when public discussion of LGBTQ+ issues was unheard of, to “The Silent Generation” that grew up when issues were being discussed but faced heavy discrimination, to the younger “Pride Generation” where many have been out for decades. Recognizing that there are nuances within the community, but also understanding the overarching themes of discrimination and resiliency, is an important component of developing the cultural competency required to best serve these clients.

• Plan, Plan, Plan: I’ve seen firsthand how the benefits of pairing comprehensive financial planning with a thoughtfully constructed, well-diversified investment portfolio that fits the clients’ needs and objectives can be liberating and even life-changing for so many. Working with a financial planner early on can help members of the community develop good financial health and financial security that will position them well later in life. Thoughtful estate planning (including considering if wills, Durable Powers of Attorney for Healthcare and Financial Matters, and living trusts are right for the situation) become all the more critical given that members of the LGBTQ+ community still face legal discrimination in many areas. Proper insurance planning can help manage risks and protect assets, including the potential need for long-term care coverage, over a client’s lifetime.

• Be aware of the elevated risk of financial exploitation and barriers to seeking help: According to SAGE, a significant portion of the elder LGBTQ+ community does not wish to live alone, has shrinking support networks, and may be inclined to seek companionship online. These factors can conspire to put these clients at higher risk of financial exploitation (including online “sweetheart scams”) and elder abuse. At the same time, coming from a place of resilience and self-sufficiency after facing discrimination throughout their lives, LGBTQ+ elders may be reluctant to seek help. They may fear being outed if they need assistance, that they won’t be believed by authorities, the loss of financial support from the abusive person, or the prospect of living alone. Financial planners – who may be some of the most trusted people in the client’s life – must be aware of these concerns and be ready to help encourage reaching out to authorities or seeking assistance if needed.

• Know your resources: In the effort to assist, planners must know what resources are available and be cognizant of the added layer of being able to identify inclusive service providers. Steward and Wayland identified several resources that financial planners serving this community should be aware of:

  • The Long-Term Care Equality Index – The first national benchmarking system for residential long-term care communities. The index was launched in June 2021 and 184 communities participated. It was created by a partnership between the Human Rights Campaign Foundation and SAGE to promote equitable and inclusive care for LGBTQ+ older adults.

  • National Resource Center on LGBT Aging – This project is funded by the U.S. Administration for Community Living and serves as a resource center to improve the quality of services and support offered to LGBTQ+ older adults. It offers a host of resources ranging from caregiver support to Social Security, Medicare, and Medicaid guides to resource directories on the national and state level.

  • SAGE – SAGECare provides LGBTQ+ cultural competency training on aging issues to service providers. Their “Find a Provider” tool can be used to locate service providers that have participated in their cultural competency training programs.

 By keeping these considerations and resources in mind, financial professionals can ensure all clients –regardless of sexual orientation or gender identity – can benefit from the power of financial planning and act as true advocates for the aging LGBTQ+ community.

Lauren Adams, CFA®, CFP®, is a CERTIFIED FINANCIAL PLANNER™ professional and Director of Operations at Center for Financial Planning, Inc.® She works with clients and their families to achieve their financial planning goals and also leads the client service, marketing, finance, and human resources departments.

The Importance of Naming Your Future Advocates

Contributed by: Sandra Adams, CFP®

Estate planning and topics like “incapacity” or “end of life” are topics that most clients dread and often put off taking care of. Not only are these unpleasant topics to think about, but there are often difficult decisions to make in the process.

Aside from making decisions about what to leave people once you are gone and who to leave things to, some of the most critical decisions that need to be made have to do with who you name to make decisions on your behalf – most importantly during your lifetime when you might not be able to make them for yourself. This would come into play with your:

• Patient Advocate/Health Care Durable Power of Attorney

• General/Financial Durable Power of Attorney

• Trust – listing of your Successor Trustee

For each of these, it is important to choose someone that you trust. Someone that could take over handling responsibilities and making decisions for you if you could no longer handle those for yourself, either on a temporary or permanent basis. It is important to note that the advocates for each of these roles DO NOT have to be the same person. You may decide to name a different Health Care/Patient advocate than the person you name for your General/Financial and Successor Trustee. For instance, your daughter that is a nurse may be the perfect person to name as your Patient Advocate. Likewise, your daughter that is the accountant is the perfect person to name as the General/Financial and Successor Trustee because numbers are in her blood. It is also important to remember that you should name at least one or two backup advocates, just in case your first choice is for some reason not available when the time comes. Another tip – it is not a great idea to name multiple people to serve at the same time that cannot make decisions independently. For instance, don’t name your three children to act as your Patient Advocate together – BAD IDEA – even siblings that get along likely won’t all agree when the pressure is on!

What happens when you are single and have no children or family (and maybe no close friends younger than you) to name as your advocate? Surprisingly, this comes up quite often and this makes it hard to find an appropriate advocate. Try naming professional advocates. Here are some possibilities:

• Often, attorneys are willing to serve as General/Financial Powers of Attorney

• Health Care Professionals like Geriatric Care Managers that will serve as Patient Advocates. There is likely to be an hourly cost for their services, but these folks are well qualified and will serve and the proper fiduciaries when the time comes.

• For successor trustees, attorneys or Financial Institution/Broker-Dealer Trust Departments can be named as success trustees or co-successor trustees (also for a cost) to make sure the trust document is followed and the client is protected.

These advocate decisions, especially those that apply to possible lifetime incapacity, are some of the most important estate planning decisions you will make. As much as you don’t want to make them, it is important that you do. We encourage you to consult with your financial planner and estate planning attorney on these and other important estate planning decisions. Don’t put off today making these important decisions that could impact your financial plan!

Sandra Adams, CFP®, is a Partner and CERTIFIED FINANCIAL PLANNER™ professional at Center for Financial Planning, Inc.® and holds a CeFT™ designation. She specializes in Elder Care Financial Planning and serves as a trusted source for national publications, including The Wall Street Journal, Research Magazine, and Journal of Financial Planning.

7 Ways The Planning Doesn't Stop When You Retire

Contributed by: Sandra Adams, CFP®

Most materials related to retirement planning are focused on “preparing for retirement” to help clients set goals and retire successfully. Does that mean when goals are met, the planning is done? In my work, there is often a feeling that once clients cross the retirement “finish line” it should be smooth sailing from a planning standpoint. Unfortunately, nothing could be further from the truth. For many clients, post-retirement is likely when they’ll need the assistance of a planner the most!

Here are 7 planning post-retirement issues that might require the ongoing assistance of a financial advisor:

1. Retirement Income Planning 

An advisor can help you put together a year-by-year plan including income, resources, pensions, deferred compensation, Social Security, and investments.  The goal is to structure a tax-efficient strategy that is most beneficial to you.

2. Investments 

Once you are retired, a couple of things happen to make it even more important to keep an active eye on your investments: (1) You will probably begin withdrawing from investments and will likely need to manage the ongoing liquidity of at least a portion of your investment accounts and (2) You have an ongoing shorter time horizon and less tolerance for risk.

3. Social Security

It is likely that in pre-retirement planning you may have talked in generalities about what you might do with your Social Security and which strategy you might implement when you reached Social Security benefit age. However, once you reach retirement, the rubber hits the road and you need to navigate all of the available options and determine the best strategy for your situation – not necessarily something you want to do on your own without guidance.  

4. Health Insurance and Medicare

It’s a challenge for clients retiring before age 65 who have employers that don’t offer retiree healthcare. There’s often a significant expense surrounding retirement healthcare pre-Medicare.

For those under their employer healthcare, switching to Medicare is no small task – there are complications involved in “getting it right” by ensuring that clients are fully covered from an insurance standpoint once they get to retirement.  

5. Life Insurance and Long-Term Care Insurance

Life and long-term care insurances are items we hope to have in place pre-retirement. Especially since the cost and the ability to become insured becomes incredibly difficult the older one gets. However, maintaining these policies, understanding them, and having assistance once it comes time to draw on the benefits is quite another story.  

6. Estate and Multigenerational Planning

It makes sense for clients to manage their estate planning even after retirement and until the end of their lives. It’s the best way to ensure that their wealth is passed on to the next generation in the most efficient way possible. This is partly why we manage retirement income so close (account titling, beneficiaries, and estate documents). We also encourage families to document assets and have family conversations about their values and intentions for how they wish their wealth to be passed on. Many planners can help to structure and facilitate these kinds of conversations.

7. Planning for Aging

For many clients just entering retirement, one of their greatest challenges is how to help their now elderly parents manage the aging process. Like how to navigate the health care system? How to get the best care? How to determine the best place to live as they age? How best to pay for their care, especially if parents haven’t saved well enough for their retirement? How to avoid digging into your own retirement pockets to pay for your parents’ care? How to find the best resources in the community? And what questions to ask (since this is likely foreign territory for most)? 

Since humans are living longer lives, there will likely be an increased need and/or desire to plan. In an emergency, it could be difficult to make a decision uninformed. A planner can help you create a contingency plan for potential future health changes.

While it seems like the majority of materials, time, and energy of the financial planning world focuses on planning to reach retirement, there is so much still to do post-retirement. Perhaps as much OR MORE as there is pre-retirement. Having the help of a planner in post-retirement is likely something you might not realize you needed, but something you’ll certainly be glad you had.

Sandra Adams, CFP®, is a Partner and CERTIFIED FINANCIAL PLANNER™ professional at Center for Financial Planning, Inc.® and holds a CeFT™ designation. She specializes in Elder Care Financial Planning and serves as a trusted source for national publications, including The Wall Street Journal, Research Magazine, and Journal of Financial Planning.

Planning for Retirement when Unexpected Events Occur

Contributed by: Sandra Adams, CFP®

This year, more than ever, I have found myself meeting with clients in the prime of their retirement planning years who have experienced some unexpected life events – events that might not normally be part of the retirement planning process.

What am I speaking of? I have had young pre-retirees experience terminal illnesses or become caregivers for spouses or family members, experience the loss of a spouse, experience divorce after a very long marriage but before retirement, and most recently, I have had some lose their long-time jobs with recent layoffs at companies like General Motors.

Losing a job is just one of many unexpected, pre-retirement events that can potentially throw savings goals and plans off course. Some may add that a very negative or extended stock market decline can also hinder retirement and, in most cases, is unexpected. As the old saying goes, you should always “expect the unexpected”.

What can you or should you do now to make sure that you can keep your retirement strategy on track, even if one of these unexpected events comes creeping into your life?

1. Plan Early and Update Often. Although many folks don’t like to think about it, start digging into how much you much income you will need in retirement. If your income projection is significantly less than you are bringing home now, what will change in retirement to make you need less income? Will you have significantly less debt? Will the activities you plan to do in retirement cost significantly less? Be realistic. Take stock on a regular basis of where you are towards your savings goals versus your needs, so that you stay on track and are able to update your strategy if you are not moving toward those goals.

2. Save, Save, and Then Save a Little More. When times are good, and while you can, stretch yourself to meet your savings goals. There is a delicate balance between spending to enjoy your life now and setting aside funds for your retirement. It makes sense to set significant retirement savings goals (especially if you didn’t start as early as you wanted to). And making it a habit to save more – even one percent each year – will help you reach or exceed your retirement savings goals. Other ways to get ahead can include allocating a portion of your annual raise or any bonus you might receive to retirement savings. Aim to save, save, and save a little more to put yourself in a position to absorb the unexpected.

3. Take Control of What You Can Control. While you cannot control what happens to the markets, your job (for the most part), or your health (other than eating right and exercising), there are things you can control. You can control your savings rate: You can be disciplined about saving, save regularly and continue to save more over time. You can save in the right places: You can attempt to max out your savings within your employer retirement savings plans on a tax-deferred basis, you can have a liquid cash emergency reserve fund of at least 3-6 months of expenses “in case” something unexpected comes up, and you can have an after-tax investment account and/or ROTH IRA (if your income tax bracket allows) in case a life event causes an earlier-than-expected retirement or a temporary unemployment situation. You can keep debt under control and plan to have as much debt paid off as possible going into retirement. Reducing fixed costs during retirement allows you to use your cash flow for wants versus needs, and provides you with greater flexibility if an unexpected event occurs.

4. Put Protections and Guardrails in Place. Planners like to call this “risk management”. We are talking about protection for contingencies, so they don’t sink your retirement ship. Having a reserve or emergency savings account is a good first step. But what else might you put in place? It’s important to have the right insurances – disability insurance, life insurance, and long-term care insurance. Continuing education and networking are also important protections – WHAT? Keep up your credentials and training, so that if your current job is phased out, you are prepared to quickly jump back on the horse and become re-employed. Many folks become complacent, and if something unexpected happens with their company or their role, are completely unprepared to seek new employment. Unfortunately, the U.S. Government Accountability Office estimates that older workers wait more than 40 weeks to become re-employed, so being prepared can make all of the difference.

5. Seek Good Advice. This is not a time to DIY. Way too many things can go wrong when it comes to a potential early retirement transition. Seeking the advice of a trained professional can help you find the best course of action. In most cases, assessing your specific situation and making the best possible decisions, especially when it comes to things like pensions, Social Security, and which accounts to tap for retirement income, can make a huge difference.

“The more things change, the more things stay the same” – Jean-Baptiste Alphonse Karr

When we do an initial financial plan for a client, we like to say that something will very likely change when the client walks out the door, and we will need to adjust the plan. Life happens. A financial plan must be fluid and flexible. And so must you, as someone who is planning for retirement. Unexpected events that happen just as you are reaching for the golden doorknob to retirement can be frustrating. But if you have expected the unexpected, planned for the contingencies, and have some spending flexibility built into your plan, you will be on your way to a long and successful retirement.

Sandra Adams, CFP®, CeFT™, is a Partner and CERTIFIED FINANCIAL PLANNER™ professional at Center for Financial Planning, Inc.® She specializes in Elder Care Financial Planning and serves as a trusted source for national publications, including The Wall Street Journal, Research Magazine, and Journal of Financial Planning.

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Opinions expressed in the attached article are those of Sandra D. Adams and are not necessarily those of Raymond James. All opinions are as of this date and are subject to change without notice. Any information is not a complete summary or statement of all available data necessary for making an investment decision and does not constitute a recommendation. 401(k) plans are long-term retirement savings vehicles. Withdrawal of pre-tax contributions and/or earnings will be subject to ordinary income tax, and if taken prior to age 59 ½, may be subject to a 10% federal tax penalty. Roth 401(k) plans are long-term retirement savings vehicles. Like Traditional IRAs, contributions limits apply to Roth IRAs. In addition, with a Roth IRA, your allowable contribution may be reduced or eliminated if your annual income exceeds certain limits. Contributions to a Roth IRA are never tax deductible, but if certain conditions are met, distributions will be completely income tax free. Prior to making an investment decision, please consult with your financial advisor about your individual situation.

Certified Financial Planner Board of Standards Inc. (CFP Board) owns the certification marks CFP®, CERTIFIED FINANCIAL PLANNER™, CFP® (with plaque design), and CFP® (with flame design) in the U.S., which it authorizes use of by individuals who successfully complete CFP Board's initial and ongoing certification requirements.