September 29, 2021 – Our clients realize that our goal is to leave no stone unturned when it comes to financial planning. Topics related to investments, taxes, insurance, and estate planning are the bedrock of what we do for all clients. Situationally, we address cash management, retirement planning, college planning, executive compensation planning, and employee benefits advice. We have sharpened our focus to include Life Planning and the importance of client behavior in getting things accomplished. Heck, I have joined clients at car dealerships to help negotiate a great deal! This service is comprehensive and represents the meaning of being “holistic.”
But there is a missing piece. It’s not a new product or service but rather a circumstance that has been part of life forever- your health! Why, you ask, would I speak to my financial advisor about my health. Isn’t that what my doctor, dentist, and therapist are for? Of course, they are essential resources helping you be healthy and staying that way. However, do they address the intersection of your health and your money other than asking for your insurance information? Should they? Certainly not, and the reason is that the way health affects your finances is highly complicated, and without training are not able to assess that relationship. They should not be diverted from their primary purpose, keeping you healthy, which is already challenging in the 15 minutes you get in the annual checkup.
So today, I ask two critical questions and will give some perspective on the answers. First, how does your health affect your finances? Second, what resources are available to help you navigate that relationship?
Consider the following:
- Healthcare costs continue to rise at above-average rates and represent one of the most significant expenses for Americans after housing and transportation.
- Choosing the “right” insurance policy can be bewildering for all, especially for the elderly.
- Our insurance system implicitly links medical coverage to employment which significantly complicates using your “human capital.” This obstacle affects critical aspects of your life, such as what you do, who you work for, where you live and when you can retire.
- Your health status, including medical history, is a significant determinant of life expectancy. Very few financial decisions will not be impacted by your health status, including retirement, life insurance, long-term care, your estate wishes, earnings potential, and many others.
- When you define wealth to include quality of life, you can add travel, hobbies, activities, and family time as factors influenced by the health/money relationship.
If the impact is so pervasive, you would think there would be many resources that can provide the guidance needed. Unfortunately, that is not the case. Healthcare planning is not even on the radar of the major broker-dealers and Wealth Managers in the financial services industry. Smaller boutique firms might target medical professionals to service but do not address the complexities mentioned above. Comprehensive financial planners are aware of the importance but have not developed the proper process, procedures, and technology to provide the service effectively. Even those in the medical profession tend not to treat their patients holistically. Does your primary care physician brainstorm with your cardiologist, endocrinologist, surgeon, chiropractor, therapist, eye doctor, or dentist to get a complete health picture and treatment plan? I think not. Unfortunately, you are left to make those determinations while attempting to “quarterback” the care plan with these professionals for yourself or a family member. Oh, did I mention you probably have little or no medical training and are dealing in a system that is an administrative nightmare! It’s no wonder that 4 in 5 Americans say financial concerns add stress to their lives. Proper healthcare planning would go a long way to address the needs of the American people and our society.
As you might be able to sense, this topic is certainly on our radar screen. We are partnering with Caribou, a company that is addressing this healthcare planning void for financial advisors. Their tagline is “We see a world where healthcare doesn’t get in the way of living.” Stay tuned. We will be writing a lot more on this critical topic. Please let me know if you or your family and friends are interested in the subject and would like to be involved in developing a unique service for our clients.