Lattes and Long Term Care Insurance

A painless way to help parents who can't or won't purchase long-term care insurance. It's called the Latte LTC Savings Act.

If three adult siblings give up one latte daily, at a savings of $12 collectively, they will save $84 weekly. In one month, they will save $336 collectively. In one year, they will save $4032. That will buy LTC insurance for one parent for two years. 

That's only one latte daily. What if they gave up three lattes a week and covered both parents. Run the numbers for yourself. 

I don't sell insurance. I'm not a financial adviser. I'm not an economist. But this isn't rocket science . It's common sense that kids may have to make a small sacrifice to make sure they and their parents are not bankrupted by long term care costs. 

I speak to groups about conversations that matter between generations. People don't plan for lots of reasons, but their children can protect themselves by doing this for their parents. Everyone wins.

The Freak Accident

Freak accidents always catch us off guard. We can’t even picture the weird things that can happen.  The ones we can imagine, we try not to think about.

That's why my heart races when I watch the Blue Angels screaming across the sky at less than 1000 feet above me. Or the acrobat who does a triple flip at the top of the tent with no safety net below. Or the magician, bound hands and feet, in a tank of water who tries to escape before he drowns. (Yes, I know it's magic, and he knows what he's doing, but sometimes, he drowns.)

That's what happened yesterday with the crash of a vintage fighter plane at the annual air show in Reno.

A World War II-era P-51 Mustang, flown by a veteran Hollywood stunt pilot plunged  into the edge of  the VIP grandstands, killing three people, and injuring more than 50 spectators . The pilot Jimmy Leeward, who was interviewed last year before the races ,was asked why he liked to race fighter planes. "They're more fun. More speed, more challenge. Speed, speed and more speed," Leeward said.

The FAA and air race organizers spend months preparing for air races as  they develop a plan involving pilot qualification, training and testing  along with a layout for the course. The FAA inspects pilots' practice  runs and brief pilots on the route maneuvers and emergency procedures. The pilot knew what he was doing. Preliminary reports indicate a mechanical problem.

Jimmy died doing what he loved. Spectators died because they were there. The injured who survive will always remember the freak accident. My heart will always race in anticipation of it.

Stop Blaming Mother

A mother is a terrible thing to waste. To all adult children who point to their mother as the focal point of their life’s misfortunes, it's really time to grow up.

Millions of adult children, some of them already grandparents themselves, still spend time and money on the therapist's couch, ruminating about everything their mother did or didn’t do, does or doesn’t do. These adults don’t see themselves as the imperfect human their own mother is.

If Mom is still alive, they dread spending time with her or remove themselves from her life altogether. If she’s already gone, they may feel relieved that they don’t have to put up with her anymore.

I think that mother blaming should have, like meat, produce and dairy products, an expiration date.The mother who didn’t measure up to demands or expectations earlier will not be able to do it now. She’s caught in her own circle of pain for things she may or may not know she did, or if she knows, she may not know how to forgive herself.

It's time to get real.Unless Mom beat you mercilessly, ignored your every emotional need, or wasn't there when you were in pain, she was one of the ordinary variety of mothers who didn't know any better. She didn't deliberately set out to hurt you. She didn't plan how to make your life miserable. She probably tried her best...and didn't know she failed until you turned on her.

If she's still alive, consider how you may regret all that blame when she's gone.  If you're lucky, you've learned some things about being a parent and why it's not the easy job you think she should have mastered better. Tell her you’ve learned some things, grown a lot, and want to reconnect. The thing about a mother’s heart is that it’s infinitely elastic when it comes to love. It’s the 40/70 rule. If you’re 40 and your Mom is 70, it’s time to mend two broken hearts. 

Pay Attention to Warning Signs

Yesterday, three young visitors to Yosemite National Park climbed over a metal guardrail, ignoring the warning signs. One slipped, another tried to help him, the third tried to help them both. Horrified witnesses watched helplessly as the trio plunged over the 317 foot thunderous waterfall into the churning waters below.

Tragedies like this happen every day, in different scenarios and circumstances. What links them is the
aftermath of the tragedy. Their death impacts the people who love them and must now deal with their loss.

Most young people don't think about warning signs. They're certain  they can outrace the train coming around the bend; they can climb over the guard rail to get a better picture or ski the black diamond trail. Each time they ignore the danger sign and live adds to their bravado. They're still confident of their invincibility and don't yet understand the role of luck in their life.

Things could so easily be otherwise as it is for many people, young and old. A warning sign is there for a reason. Whether medical, physical, emotional or financial, a warning sign could save your life. And yes, you'll still need a little bit of luck.

Real Men Face Their Mortality

If you doubt that death can be a funny subject for cartoons, check out the fabulous collection in the New Yorker magazine. One of my favorites shows two guys dressed as angels,gazing down from a cloud and smiling, while one of them says" It looks like my will is still in probate and I've been up here for 11 years."

This is an amusing cartoon but in reality, it's not funny. Because your widow will be dealing with the heartache of losing you, and the last thing she should have to cope with is the headache and expense of probate.

?My what?"you ask. ?I'm not planning on dying any time soon.?

Great. I hope you don't, because the best way to protect your wife against widowhood is for you not to die. But eventually, you will, just like the rest of us. We just don't know when that will happen. Could be in ten or twenty years; it could be tomorrow.

It's tough to think about, but according to the U.S. Census figures, the average age a woman is widowed is 56 years old. Your widow might be on either end of that mean average.

If your wife has relied on you to handle the finances during your marriage, the impact of having to learn all about them during a time of loss is tremendous and a huge emotional burden. If you're not sharing financial information with her, it's fair to assume that you don't consider her to be an equal partner in your marriage.

Uncle Sam considers her an equal partner, especially if you live in a community property state. By legal and financial definition, your wife takes on half of the financial responsibility in your household. If you die, your widow will have to pay off your creditors, even if she doesn't know about them.

If you don't have a will, a revocable living trust and durable powers of attorney for medical and financial decisions in case you are incapacitated, you're showing your wife a side of you that isn't heroic or manly. You're practicing avoidance behavior, thinking that if you don't pay attention to something negative, it won't happen. Bad things happen to good people all the time, things they couldn't have foreseen when they left the house that morning.

Your wife, whom you say you love, may never tell you how worried she is about being widowed. She may have tried, but somehow you manage to turn her off by accusing her of nagging or being morbid.

So, she's stuck. She can't write your will, or create a living trust without your input. She can't take your medical exam for an insurance policy. If you're in denial about your mortality, you're placing the woman you love at risk.

The woman you married may still be at your side. But she may not trust you as much or be as comfortable with you as she used to be. She's not seeing you the same way because you're not addressing her need to feel secure and protected in case she is widowed. That wonderful woman, without whom you might be lost, is not going to suddenly be able to take charge of the finances if she hasn't been involved before.

You have the chance to do something truly heroic. Bite the bullet. Face your mortality. If you really love her, respond to her fears about being widowed. Set things up so she is provided for, even if you're not going to be part of her life. Start talking about the things you'd like to cover in your estate plan. Include her in gathering the information you'll need to start the estate planning process. Create a revocable living trust.

Don't do these this by downloading forms from the internet. See a lawyer who specializes in estate planning. That way, you're sure things will be done right.

Get long- term care insurance so she doesn't spend her own golden years taking care of you. Share the financial records with her. If she doesn't understand them, explain things to her. Make sure she knows your broker, lawyer and accountant. Urge her to meet with them whenever you do. The questions she asks are not dumb questions. They're simply questions that haven't been explained properly.

If you really meant those wedding vows of love, honor and cherish, here's your chance to walk the talk. Life without you will be hard enough for the woman you love. Don't add to her grief and loss by leaving her with a financial burden she may not know how to handle.

Real men face their mortality. That's what makes them heroes.

When Children Feel Entitled

For ten years, Mary helped to raise her grandchildren while her daughter Meg and son-in-law Bob were building a business. In addition to seed money and two additional loans totaling nearly $1 million dollars, Mary’s husband Sam, a business consultant, helped the young couple set up a retail business. 

Mary’s relationship with her daughter Meg had been stormy since Meg’s teenage years. Mary hoped that by helping out with her grandchildren, whom she adored, she could draw closer to her daughter and free up Meg's time to work with her husband in the business. 

Meg and Bob continually postponed seeking their own sources of credit. Last year, they asked Mary and Sam for another loan. Their request came at a time when Sam was still recovering from the 2008 crash of their retirement portfolio.Sam asked Bob if he could see the business details in the hope that he could find ways to help the children without selling off any more of his assets. 

Bob refused, angry at Sam's request and claiming that his wife's parents were meddling. They tried to get a bank loan, but were refused. Within a few weeks, Meg told her mother that she could no longer be with her grandchildren, saying that she didn’t want her children influenced by people who lacked the compassion and generosity to help their children continue their business. 

Mary and Sam, who saw their grandchildren daily for 10 years, haven’t seen them for eight months. Their daugthter intercepts letters, emails and texts. She refuses to seek counseling with or without her parents, blaming them for their business failure. 

Mary and Sam are  heartbroken, but still concerned about helping their grandchildren. They've set up trusts for their grandchildren .

Their daughter Meg may be trying to prove a point. God only knows what it is.

Some Financial Advisors Ahead of the Curve

Over the years, I’ve met dozens of financial advisors in the San Francisco Bay Area. Most are just fine. They crunch the numbers and work the charts, and when markets do well, they can do no wrong. The true test of their relationship with their clients comes when times are bad -  When fear is high, loss is painful and trust is compromised.

Some financial advisors understand these pendulum swings in mood and confidence and use the undulations to think outside the box. I like to think of these firms who understand the soft side of financial planning as the harbingers of how business will be done in the future.

For example, Paul King, president of King Wealth Planning in Cupertino CA has been presenting community programs to educate and empower people , and especially women, about how to lead an enlightened financial life.  The cost of these programs comes right off King’s bottom line. But the good will it generates can’t be measured in dollars. It is measured in trust.

Can the firm point to a direct correlation between what the programs cost them and what they receive in return? Not yet, but I’m hoping the coming years will repay the firm with a cornucopia of business because of what they were willing to provide at the front end.

Another creative soft side approach is that followed by Lasecke Weil LLC Wealth Advisory Group, headed by Tracy Lasecke and Curt Weil. They know that baby boomers and their parents often find it difficult to begin the crucial conversations they need to have about planning. They also believe that training their own team in how to be more sensitive to intergenerational issues makes it easier for the planning process itself to begin. It's more about hearts than charts.

Learn more about the soft side of financial planning: 

http://www.financialconversationswithheart.com

http://www.kingwealth.com.

http://www.laseckeweil.com

Financial Advisors and the F Word

Oh, it's not what you're thinking. The F word I'm thinking about is fiduciary, meaning that your financial advisor is required to put your best interests as the client first, no matter what.

That might seems obvious, but according to a survey by Bloomberg Business, the majority of Americans mistakenly believe that insurance agents, stockbrokers and people calling themselves financial advisors are fiduciaries.www.tinyurl.com/2777xyl

The survey showed that thirty-four percent of investors believe that financial advice is the primary service offered by stockbrokers, even though their main job is to buy and sell stocks. The 'advice' is free; the broker's payback is the commission on the trade he/she makes for you.

Ninety-three percent of respondents said brokers should be required to disclose conflicts of interests in advance, such as cash payments or vacation trips they would receive from a mutual-fund company in exchange for selling its product. Should be required? Do investors ever think about or ask if a conflict of interest exists?

Sixty percent of respondents said they thought insurance agents had to uphold a fiduciary duty. Alas, not true. They are required to explain the policy they are selling, not point out the hidden costs. Who can blame agents for wanting to sell an annuity when the up front commission rate is 18%?

The SEC (Securities and Exchange Commission) may take up the full disclosure issue this year for everyone selling financial products or advice. On the other hand, they may not. They've been planning to do that for many years. Just never got around to it.