In our last blog post, Lifestyle Changes Bring Increased Risk to Older Clients – Part1, we explored the need to rethink the planning paradigm for older clients and actively shift to assuming a 100-year lifespan. However, a 100-year lifespan does not necessarily equal 100 years of good health. We know that in the last decade of a person’s life, there could be more focus on health issues, medical coordination, and personal care needs. That gap between lifespan and health span creates new risks for advisors, caregivers, and families.

We issued a clear call to action for planners and advisors to rethink post-retirement and lifestyle planning. Changing the planning paradigm to assume a 100-year lifespan and integrating lifestyle planning, especially for the last decades of life, can mitigate the risks for advisors, caregivers and families while markedly improving services to our clients.

Risks increase as we age.

In our practice, it is increasingly common to receive a call from a trust officer, wealth manager or family doctor asking us to assist a client on the verge of a personal care crisis. Consider the following example:

A 75-year-old woman has cared for her 85-year-old husband at home for over a year. There are no children; the only relative is a distant niece living in Vancouver. The husband has cognitive impairment, has been recently diagnosed with a brain tumour, and is having more falls at home. His wife is exhausted, is becoming frailer herself, and is now under a doctor’s care for heart problems. The couple has contracted with a trust company to act as their Attorney for Property. They have appointed each other to act as Attorneys for Personal Care, but no alternates have been appointed.

As the personal care situation deteriorates for each person, the risks to safety and well-being increase. With a decline in physical, mental, and cognitive function, focusing on and planning for wellbeing and health is crucial.

In the example, medical care and coordination become more complex, and there are no family members to assist. Advisors may be asked to take on additional tasks related to planning for or procuring care that is not within their mandate. Financial costs can increase as care requirements climb. Eventually, family members may dispute actions taken, leading to even more risk. How does an advisor manage this increasing risk?

Best practices in managing risks as lifestyles change

An ounce of prevention is worth a pound of cure. The moral of the story is to plan ahead well before a crisis strikes. If a client in their 80s is having episodes of declining health and they are becoming more compromised and frailer, it is time to look at a lifestyle plan now. Do not wait for a crisis.

While every person’s plan is unique to them, the following are examples of components of a basic plan:

Assessment

• Understanding of relevant diseases, and their expected course and prognosis.
• Understanding of current medications and their administration.
• What does the client want in terms of care and lifestyle support?
• What does the client need after being assessed by a professional?
• Is there an emergency plan in case the caregiver is ill?
• Is there a step-by-step plan for varying levels of diminished capacity?

Identify Care Criteria

• Identify the care criteria for the client, as well as the caregiver spouse or partner. Criteria will be unique according to needs.

Identify Gaps in Care or Support

• Review potential gaps in housing, nutrition, health, safety, hygiene, and clothing.
• For example, the client may still drive but is unsafe on the road. Or the client has diminished capacity to the extent they cannot be left alone in the home.

Build a team around the client to address gaps

• Develop options, costs, and preferred alternatives.
• Document a written, integrated plan for the above components. Review regularly as a roadmap for caregivers and Attorneys for Personal Care.

In summary, there is no guarantee that as our clients age, their lifespan will equal their health span. As advisors, we need to embrace a planning paradigm for a 100-year lifespan and incorporate lifestyle planning into that paradigm before a health crisis emerges. Only then can we effectively help manage the risks for the elderly person, their attorneys for personal care and property, advisors, and family members.