Long-term health care reform is like an albatross around America’s neck. The Clinton administration failed in the 1990s to introduce comprehensive health care reform, and recently former-President Barack Obama’s legacy health care bill –the so-called “Obamacare” law—has been under threat, with many demanding repeal.

Americans today, young and old, are doling out huge sums of money for long-term care, while the health care industry continues to flounder hopelessly.  

For example, with long-term care expenses averaging $68 for basic health assistance, $125 for full-time in-home care and up to $253 for nursing facility care—per day—long-term care presents retirees with a significant financial dilemma. And these costs are expected to double within thirty years—the same amount of time most of today’s retirees need to make their nest egg last for the long haul.

That’s why a wealth advisor who knows how to make sound investment decisions is key while planning for retirement, particularly for those beginning their life as a senior.

Ronald Ray, principal at R & R Wealth Management, who has experience in holistic financial planning for retirees, said most of his clients come to him having already earned all the money they are going to earn. They are either close to or already retired, and need to stretch their savings for the rest of their lives.

“Most people don’t realize that they are going to spend a third of their life in retirement,” Ray said, adding that part of his job includes having to deliver the difficult news that people are overspending and will need to change their lifestyle in retirement.

“If you retire at 65, it’s very possible that you are going to live another 30 years,” he said. “If you’ve only saved $100,000, you are going to be living on Social Security for most of that time. You have to make what you have last.”

Retirement requires planning in a few key areas: healthcare, long-term care, life insurance, legacy planning, and income. This includes creating customized solutions to protect what is already in hand by getting the best products and minimizing fees, taxes, and preventing knee-jerk decisions that may lead to costly errors.

Ray explained that long-term care and healthcare present significant challenges because most people fail to consider the possibility of serious health problems until it’s too late to purchase products that will be of help.

“I don’t like to see people make themselves poor in order for the state to pay for long term care. We don’t want people to give money away or tie money up in irrevocable trusts,” Ray said.
“We want them to leverage what they got to get an insurance company or another program to cover those costs,” Ray added, explaining that solutions may include long-term care policies, life insurance policies, or fixed annuities with long-term care riders.

Ray, who believes open communication and complete transparency are imperative to building long-lasting trust, said that his biggest challenge is getting people to accept a fundamental shift in their views about long-term investing. Buying and holding mutual funds is not as effective as an individualized, plan that may include a variety of insurance products and fixed annuities. Annuities, he added, offer a high level of security for risk-averse investors.

Ray explained that many people fall into trap of believing they are diversified for having money in multiple mutual funds for years, but really those investments are all correlated and likely lead back to the same companies.

Ray believes, getting away from that approach to a more customized and conservative approach really helps clients perform better over time.


For more information visit: www.rrwealthmgmt.com

Investment Advisory Services offered through Retirement Wealth Advisors, (RWA) a Registered Investment Advisor. R&R Wealth Management and RWA are not affiliated. Investing involves risk including the potential loss of principal. No investment strategy can guarantee a profit or protect against loss in periods of declining values. Opinions expressed are subject to change without notice and are not intended as investment advice or to predict future performance. Past performance does not guarantee future results. Consult your financial professional before making any investment decision.