'These conversations have to take place, period,' warns aging specialist
While many reports are warning about the upcoming crisis for the aging demographic and shortage of long-term care, one advisor who specializes in preparing for this stage says advisors can help by doing their own end-of life financial planning so they know how to guide their clients.
“You have to lead by example. I’ve done this myself. I’ve had the conversations and put plans in place. It hasn’t felt great because it makes me realize that I’m on the other side of getting closer to 100, but it’s better than lying in an ICU and not having done a stick of planning,” Neela White, a Toronto senior portfolio manager and aging specialist with Blue Wing Advisory Group with Raymond James Ltd told Wealth Professional.
“Canadians aren’t saving, let alone addressing all the various needs they may face with long-term care. So, I think it’s really incumbent on advisors in our industry to incorporate the whole aging and longevity aspect in their financial planning for retirement. Survey after survey has shown that aging Canadians don’t want to be a burden to their family, but you have to ask somebody: What does that mean? What does it entail?”
White said clients may be reluctant to talk about aging and the assistance they may need, along with the resulting loss of autonomy. But, advisors can help them prepare by asking questions, such as: Who is your support group? Who is going to take care of you if you need care? How will you get help if there’s a shortage of personal service workers, nurses, and long-term care homes? Do you have enough money to afford assistance if you want to remain independent? At today’s rates, she noted that could be $30 an hour for 365 days, but the labour shortage could push those costs higher.
As for their homes, advisors can help by asking clients: What changes can you make to your own home? It could be something as simple as removing throw rugs and lowering lights or something more complicated, such as installing a chairlift or converting a family room into a bedroom and accessible main floor bathroom with a shower. Do you have the money to pay for it? Have you looked into what resources or services your community offers? Have you had open conversations with your family? Do you have the important documents, such as wills and powers of attorney, in place?
“As advisors, we need to be comfortable with dying and death and the conversation that surrounds it,” White said, noting that many advisors and clients aren’t. “I think all of these conversations have to get better and more fulsome to really understand the emotional hurdles behind not planning. Intuitively, we all know we have to do it. So, what’s the reason for procrastinating? And how can we help our clients do the necessary planning to deal with all this?”
White suggested that, once advisors get to know their clients and have developed a relationship, they should initiate this very personal conversation and reverse engineer the questions. It may mean tackling one issue per meeting, so it isn’t too overwhelming. But, starting backwards, they can assume the person may live to 90 or 95 and require from five to seven years of assistance. Right now, she said the waitlist to get into the government-funded long-term care in Ontario, where clients only pay half, is about 30,000 people long. That’s a two to five-year wait list, so advisors need to ask what clients may do for that length of time since they’ll need a Plan B.
It would also help if advisors learn what’s involved in moving through this phase, from planning for long-term care to paying for funerals and burials. She noted that there’s a hierarchy of needs of criterion for how people are placed in long-term care. Funerals and burials can also offer a range of costs, so it would be good if the advisor can begin to have these conversations with their clients, who may not even have discussed any of their wishes with their spouse or family yet.
“What we commonly see is that by the time people are making these decisions, they’re in a crisis situation or it is post-crisis and everyone is reacting in a very emotional way,” said White.
She noted that some advisors may not be comfortable with these discussions. If that’s the case, they can refer clients to aging specialists like her. Or, if clients want to discuss issues such as medically-assisted dying, the advisors should refer them to their doctors for accurate information.
“These kinds of meaty conversations come through a relationship of trust,” said White. “But, it depends on who you want to be to your clients. I want to be the person who has helped them through a difficult time in their life because I have experience doing this. So, for me, this is part of the job and it just has to be done if we truly want to serve our clients.
“There’s no better time than now to start because what the aging demographic is facing is everywhere right now. It’s in the newspapers. It’s in the magazines, and it’s on the news. It’s around us in our clients and families. So, how much more validation do you need that this is something that’s getting bigger and there’s less public money to solve it? We know this planning and these conversations have to take place. Period.”
