Talking to Clients About Long-Term Care: The Million-Dollar Retirement Planning Risk Advisors Can’t Ignore
If you’re like most Advisors, you are good with numbers. You model market returns. You stress-test for inflation. You plan for taxes. But there’s one line item that too often gets ignored, one that can blow up a retirement faster than any bear market ever could. It’s not a stock market crash or a bad investment. It’s not inflation. It’s long-term care.
And the reality is this: for many of your clients, the potential cost of needing care late in life is their largest unfunded liability, often bigger than their mortgage ever was, and in many cases exceeding a million dollars over time.
Long-term care is the silent threat. I’m not talking about a rare “what-if.” Seventy percent of Americans over the age of 65 will need some form of long-term care. That means for the majority of your clients, this isn’t just a possibility. It’s a probability.
And yet, few clients have a plan. Why? Because they can’t visualize the numbers. They don’t see it on their net worth statement. And if you’re not putting it in front of them, they assume it’s not worth worrying about.
The problem: Long-term care risk
- Average annual cost of care (today): $60,000–$120,000, depending on the setting.
- Average length of care: 3 years for men, 4+ years for women.
- Alzheimer’s or dementia care: 8–10 years is not unusual.
Now, factor in inflation. Even at 4% healthcare inflation, that $100,000 annual cost doubles in less than 20 years. A 60-year-old client today could face $200,000 a year or more in care costs by the time they’re in their 80s.
Multiply that out over several years—and add the “two-spouse scenario”—and you’re looking at seven-figure exposure.
This is a different kind of risk; one clients are not familiar with. Market risk can be mitigated with diversification. Sequence risk can be managed with withdrawal strategies. Longevity risk can be addressed with annuities. But long-term care risk is different because it’s not optional. If your client needs help eating, bathing, or dressing, they’re not going to decide to “pass” on care to save money.
Plus, it hits in clusters. One spouse needs care, draining assets, then the other spouse follows. It impacts the entire family. Even wealthy families take a financial and emotional hit. Adult children may cut back work hours, relocate, or become full-time caregivers.
Long-term care needs destroy liquidity. Without a plan, assets are sold at the wrong time, triggering taxes and missed growth opportunities.
Here are some numbers you can take into your next client meeting.
This is a powerful long-term care story.
Example:
- Today’s care cost: $100,000/year.
- Inflation: 4%.
- Care needed at age 85 (25 years from now).
- Duration: 5 years.
At 4% inflation, $100,000 becomes $266,580/year in 25 years. Multiply by 5 years: $1.33 million. And that’s after-tax money, meaning they need to pull much more from taxable accounts to cover it.
Show a client those numbers, and they’ll stop seeing LTC as a niche insurance product. They’ll start seeing it as the biggest unaddressed hole in their plan.
The financial math is eye-opening, but what really moves clients is the emotional side. Remind them that without a plan, the default caregivers are usually the spouse or adult children. That means missed work, stress, burnout, and potential family tension. A funded plan buys more than care. It buys dignity, independence, and choice.
It’s not about the long-term care policy—it’s about the picture they paint in their mind.
An Advisor friend of mine asks clients: “If you ever needed help getting dressed, where would you want to be? Who would you want helping you?”
That’s a tough topic to bring up and that’s one reason why it’s often avoided. It’s emotional and uncomfortable. Another reason is that traditionally, long-term care products were not user-friendly. Premiums would rise, benefits were “use it or lose it” and underwritings was a hassle.
But avoiding the conversation doesn’t remove the risk. It just removes you from the solution. And that’s a dangerous place to be when heirs start asking, “Why didn’t our Advisor warn us?”
The good news is that you no longer have to lead with the old drawbacks. The LTC market has evolved. Hybrid products or life insurance with LTC riders provide guaranteed benefits with no “use it or lose it.” Cash indemnity plans allow clients to spend benefits however they want, with no receipts. And no-underwriting options are now available for many solutions, making them accessible for older clients or those with health conditions. Instead of selling a product, you’re providing a risk-transfer strategy.
Here’s a simple three-step approach you can use to bring up the subject of long-term care planning without losing momentum.
Open with a question “Have you ever been a caregiver for a parent or spouse?”
This taps into personal experience, which drives urgency.
Show the math. Run a 20–30-year projection of care costs with inflation. Use their actual portfolio numbers so it’s personal.
Introduce a strategy. “Would you like to see strategies that transfer some of this risk away from your portfolio and your family?”
If they say no, you’ve done your duty. You raised the issue. If they say yes, you’ve opened the door to meaningful planning.
I consider long-term care a fiduciary imperative. If 70% of your clients face this risk, and you don’t address it, what does that say about your definition of “comprehensive planning”?
Ignoring LTC risk is like ignoring homeowners insurance in a wildfire zone. You might get lucky, but if disaster strikes, the fallout is catastrophic.
Some Advisors will wait until the client brings it up. The best Advisors don’t wait. They lead. They make sure every major risk—market, inflation, longevity, and care—is addressed.
I urge you to give this topic serious thought. Long-term care is the hidden million-dollar risk in most retirement plans. It’s lurking off the spreadsheet, waiting to disrupt the best-laid strategies.
Your role isn’t to sell a product. It’s to make sure your clients see the full picture and have a plan for every likely scenario. That means helping them protect their wealth, their dignity, and their family relationships.
Clients won’t always thank you today for bringing it up. But years from now—when the plan you helped create kicks in, they’ll be grateful you had the courage to have the conversation.
It’s not the market that ruins retirements. It’s life. Plan for life, and the market takes care of itself.
Watch this 4-minute video message from Don Connelly to hear his story as a caregiver and a recommendation he makes that almost sounds too good to be true!
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