Andrew Carnegie sold his steel company in 1901 for $400 million in gold bonds. That can be reckoned at $40 billion today. He had accomplished it by his own efforts. He was the world’s wealthiest senior–age 65 and retired. But he said of that sale: “It was the saddest day of all.”

A clutch of problems appeared. He became despondent because he was out of the blast furnace saddle for the first time. No one needed him anymore. His so-called friends would no longer go to his castle in Scotland (Skibo). He partly coped by giving away almost all of his money to build libraries around the world, but he knew he needed help.

There are hundreds of thousands of Americans who have also become wealthy seniors. They are not Carnegies, but they also face a clutch of problems. Chart 1 lists some of the common ones, as identified by experts in aging, health care, financial services and related fields.

Seniors can be despondent; they may be hypochondriac. Just like Carnegie, they know they need help.

Who can help? Who can be the advisors?

A myriad of candidates appears. But the very experienced brokers/agents in the insurance business are the best. They know how to gain the confidence of those wealthy seniors. They know that the right approach is not product driven; it is driven by the real needs of those wealthy seniors. (Incidentally, wealthy clients are perfectly willing to operate on a fee basis, provided the service is valuable).

To provide services to this wealthy group, advisors need tools suited to this market.

For instance, the advisor should evaluate the senior’s personal health expectancy (an actuarial assessment, like life expectancy). Such evaluations break life expectancy down into 3 parts: the healthy period; the assisted living period; and the skilled care period. Such assessments can be especially good for gaining client confidence–the essential first step–because even if the client has ailments, the healthy period is usually very long. (Example: a 78-year-old nonsmoking female, with type 2 diabetes, shows 6.9 years healthy; 2.8 years assisted living; and 2.9 years skilled care in one of my own computations.)

When clients learn of their own health expectancy, the news often helps overcome despondency. Sometimes confidence is gained, and cruises are booked.

In the process, the advisor can begin helping the senior address his or her ultimate long term care needs, if this has not been done earlier. The renewed optimism facilitates this further planning.

Here are some other tools for working with wealthy seniors:

–The advisor can use, or set up, an index to rate and compare life insurance products: traditional and universal; newly issued vs. in-force; etc. This can help with product selection, when that is needed.

–The advisor can prepare a policy description package for the client. This provides an in-depth analysis of the product or plan for lay readers.

–The advisor can conduct a financial appraisal to use for assessing life settlement needs and potential. Be sure to incorporate the client’s medical condition in the analysis as well as a determination of the asset-value of the life product.

–The advisor should assess the asset-mix. A good approach to use is to base this on a business-cycle analysis. (This is an actuarial approach to long-term strategy; it does not give specific investment advice.)

There are many other specialty subjects of intense interest to wealthy seniors. Some are listed in Chart 2, including the life settlement factor. To be effective in the wealthy senior market, advisors must have detailed knowledge about such subjects.

Andrew Carnegie got out of his despondency by giving away his money.

The insurance industry can help today’s wealthy seniors get out of their own despondency by 1) convincing them that they can expect long periods of health and 2) providing them with services they need. The advisor can’t come up with a Skibo Castle, but can come up with tax-effective ways to give away money, such as gift annuities and charitable remainder trusts.

The only thing that counts is meeting the real needs of the wealthy senior.