Funding formal care is just one part of comprehensive LTC planning. (LHP Photo/Allison Bell)

Reality check: 80 percent of long term care is administered by unpaid caregivers, according to the National Clearing House for Long Term Care Information.

That makes unpaid caregiving a crucial topic of conversation to have with all of your clients, regardless of their age. Yet many people procrastinate when it comes to making important decisions about caring for their loved ones either short or long term. Families are often blindsided by the realities of caregiving when they are forced to leave jobs, relationships and sometimes even move across states. Simultaneously, many watch as their income and savings dwindle.

It doesn’t have to be this way. The best advisors I know ask the right questions to better understand the hats their clients wear and prepare them for the caregiving realities that lay ahead.

Here are three pieces of advice I give to the advisors so that they can get their clients primed.

1. Name names.

Start the ball rolling by asking your clients to name loved ones who might require their care.

A spouse will often top the list, but parents and in-laws are close behind. Inquire if siblings and other family members fit into the equation to offer assistance.

When my father required constant care for several years prior to his passing, my six siblings and I knew that our mother would be the primary provider. When it was her turn to require care, the answer wasn’t as simple.

No matter the age of your clients, get them talking with their own families about the expectations so that they can prepare in advance should their services be required.

If your client is already providing some form of care for a loved one, follow up with them regularly to see if their situation has changed and keep a sharp eye on their own financial goals and progress to lighten their burden.

2. Free isn’t really free.

The “free” caregiving services that families give are estimated to total $375 billion a year!

That figure appeared in Evercare Survey of the Economic Downturn and Its Impact on Family Caregiving in 2009.

Informal caregiving comes at a high price to clients and their families. Understand how it impacts your clients’ finances now and how it might in the future.

Consider out-of-pocket costs for caregivers which average $5,531 annually, according to Valuing the Invaluable: The Economic Value of Family Caregiving, which appeared in 2011.

In addition to diminished wages and Social Security benefits, caregivers face lower retirement savings.

A recent survey by my company revealed that three quarters of family members serving as primary caregivers reported a reduction in their personal savings; 80 percent of those have decreased their retirement contributions; and 48 percent of respondents have lost a job or missed career opportunities due to their caregiving obligations.

Leverage your financial expertise so that your clients are prepared to face a decline in their income or savings when they are needed to serve as a caregiver.

  • Will your clients be like the 74 percent of caregivers who are juggling work and caregiving?
  • Does their work afford them scheduling flexibility or part time status?
  • Can one member of a working couple leave their job to care for a parent in need?
  • Is a college savings account in jeopardy or should family income be reduced?

These are just a few questions to work through with your clients so they are spending and saving their money wisely in the event they need to provide care for a loved one.

Don’t neglect clients who are or have already cared for a loved one. The average length of caregiving is just over four years, according to a survey conducted by AARP and the National Caregiver Alliance.

Where are your clients positioned in terms of their careers and retirement after their role as a caregiver has ended? Work with them to get them back on track and earn their trust for life.

3. “Help me help you.” 

Caregiving impacts your clients in more ways than one and the best way to help them is to listen to their needs. Balancing work and family takes an emotional and physical toll that is well documented. From marital strain and relocation, to lifestyle changes and emotional stress, all are part and parcel to the caregiving puzzle.

Keep an open conversation with your clients about their family role to ensure that you haven’t missed a beat when it comes to preparing them appropriately. Arm them by keeping materials handy and team up with other experts in your area such as geriatric nurses, elder care attorneys and long-term care insurance (LTCI)  wholesalers who can help you and your clients piece together the right caregiving strategy for their needs.

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