The expenses associated with the continuation of care for your loved will not simply go away at your passing. They will simply be transferred to someone else. Recognizing this, many caregivers choose to plan for funding these expenses prior to their death.
In a previous post we posited that a caregiver will likely need to use investment strategies that have the potential to continue to grow and outpace inflation well into their retirement. They will likely need to at least consider risk management strategies and products that will mitigate the erosion of their assets in the event of a death, disability, or long-term care need.
Here are some action items in this regard:
- Review your investment mix to ensure that its’ structure is consistent with the growth needs of a two-generation planning scenario. Stocks should be properly diversified both across and within asset classes. Additionally, a portfolio that is invested predominantly in fixed income or bonds statistically will lack the horsepower to meet the multi-decade distribution need.
- Consider utilizing non-traditional investment products to manage or transfer longevity risk. Properly structured, annuities can provide a guaranteed stream of income through the lifetime of the second generation.
- Finally, consider using a financial planner or investment advisor that is familiar of the dynamics of multi-generational distribution planning.
In a future post we will discuss considering risk management strategies and products that will mitigate the erosion of their assets in the event of a death, disability, or long-term care need.
The opinions voiced in this material are for general information only and are not intended to provide specific advice or recommendations for any individual.
Securities and Advisory services offered through LPL Financial, A Registered Investment Advisor, Member FINRA/SIPC. For informational purposes only. Integrated Financial Group and LPL Financial do not provide legal advice or services.