Why Advisors Are Using Yesterday’s Playbook for Today’s Risk

You have spent your careers doing this right — thoughtful, thorough, and precise. Asset allocation, retirement planning, mitigating risk, solving for the complexities that keep your clients up at night. Yet with long-term care planning, the conversation has been built on a framework that hasn’t kept pace with the last 25 years of change — a bit like flip phones in a smartphone world.

And that’s the issue. Not a lack of awareness — but a lens that hasn’t kept up with the reality it’s trying to describe.

THIS ISN’T A LINE ITEM — IT’S AN OPEN TAB

Care today looks something like this:

  • $10K–$15K/month for typical assisted living in a metro area
  • $25K+ per month if you want something… nicer
  • $900+/day if you want to stay home with 24-hour care

There’s no timeline. Not 6 months. Not 2 years.

Just… we’ll see. It’s not the monthly number that gets you. It’s the open-ended tab.

The data is unambiguous: 70% of people who reach age 65 will develop a severe long-term care need before they die.1 The longer your clients live, the more certain this becomes.

This isn’t a fringe risk. It’s a planning certainty.

THE LENS PROBLEM

As an advisor, you aren’t lacking information — you’re just solving with the wrong framework. A 2026 problem being addressed with a 2005 approach built on older products, older pricing, and older client experiences. All valid then. Not aligned now.

Most LTC conversations still collapse into: “Do we buy insurance… or not?” Which is a little like asking: “Do we wear a seatbelt… or just drive carefully?” It misses the point entirely.

Because this isn’t about a product. It’s about what happens when liquidity matters more than wishful thinking, when taxes matter more than projections, and when the plan isn’t a plan anymore — it’s decisions made under pressure.

We’ve been helping advisors reopen these exact conversations — with clients who said “we’ll handle it ourselves” years ago, and are now a lot closer to needing to. The pattern is remarkably consistent. So is the relief when there’s actually a plan in place.

“WE’LL INSURE OURSELVES”

Said early. Said confidently. And yes — some high-net-worth clients can.

But here’s what that often looks like:

  • Selling assets you didn’t plan to sell
  • Paying taxes you didn’t want to pay
  • Explaining to family why the plan changed

While navigating… care.

Self-insuring sounds strategic. Until you actually have to do it. Care didn’t just inch up — it shifted tiers entirely. Think elevator, not escalator. And we’re living longer, more often with extended periods of dependency. The timeline is open. The tab keeps running.

Your client assumed their spouse would take care of them. That spouse is now in their 90s. Or the plan was the adult children nearby. Those children have careers, families, and lives of their own. It’s a reasonable hope. It’s an unrealistic plan.

SOLUTIONS

They’re not cheap. Neither is long-term care.

Today’s plans are guaranteed — premiums, growth, death benefit. That guarantee is the “moat” around your portfolio and income stream.

Your premium yields highly leveraged money. Think 8–10x in LTC benefits over 20 years — or a death benefit that essentially returns your premium. You can have your cake and eat it too.

At the highest level, the comparison isn’t “insurance vs. investments.” It’s certainty vs. exposure. All tax-free.

And the structures that deliver this have more flexibility than most advisors realize — which is a conversation worth having.

NOW COMPARE THAT TO SELF-FUNDING

To replicate this on your own, you’d need to set aside ~$1MM+ per person, earmarked specifically for care, hope markets cooperate at the exact moment care is needed, liquidate assets in a potential down market, and fund care entirely with after-tax dollars.

And even then — timing risk, longevity risk, and sequence-of-returns risk are all yours. Simultaneously.

SELF-FUNDING

These solutions eliminate those variables:

  • Leverage: Turning ~$100K into a $1MM+ LTC pool
  • Tax efficiency: LTC benefits — real dollars — come out income tax-free via cash payments
  • Liquidity protection: Preserves the rest of the portfolio
  • Defined outcome: Known benefit regardless of market conditions

And if care is never needed — this isn’t a sunk cost.
There’s a guaranteed death benefit and access to value if surrendered. The dollars are still working either way.

WHEN SOMEONE SAYS “SELF-FUND,” WHAT THEY’RE REALLY SAYING IS: TAKE ON ALL THE RISK YOURSELF AND HOPE THE TIMING WORKS.

What these products do is transfer that risk — and lock in a highly efficient pool of tax-advantaged dollars for one of the most financially disruptive events in retirement.

No sunk costs. No open exposure. Just a plan.

One note: qualifying matters. These plans require a health profile underwriters will consider — a thorough medical review upfront is essential. Skip it and you’re setting up for denials and false hope. And for clients who want flexibility over paperwork — cash plans don’t demand receipts or agencies. They need your routing number.

THE RISKS NO ONE NAMES

Lifestyle Risk. You don’t just spend differently — you live differently.

Legacy Risk. That “for the kids” bucket? It becomes “for care.”

Sequence Risk. Markets don’t care that you need liquidity this year.

Having assets is one thing. Having the right assets — in the right place, at the right time, with the right tax treatment — is something else entirely. The difference between “We’re fine” and “Why are we selling this now?”

THE PART THAT GETS HUMAN

One spouse hesitates • The other reassures • The kids weigh in

Everyone means well. No one is aligned.

Money doesn’t remove friction. It raises the stakes. The better question isn’t “Should we buy LTC insurance?” — it’s “How do we deal with this without disrupting everything else?

THE BOTTOM LINE

Most people think they’ve accounted for long-term care. They haven’t. They’ve just decided not to deal with it yet. Most people aren’t self-insuring. They’re just uninsured — with confidence.

A NOTE ON WHO CALLS US

If you work with clients in their 50s and 60s with meaningful assets — this conversation is already on the table. Most advisors just don’t have a specialist to hand it to.

Here’s the counterintuitive truth: a client with $2–$5M is often the worst candidate for self-funding. The higher the resources, the more nuanced the planning — and the more there is to protect. This isn’t a conversation about affordability. It’s a conversation about structure.

This is exactly the conversation we were built for. Let’s solve for it.

WHERE THIS GOES FROM HERE

If this resonates, you’re likely already having versions of this conversation with clients. If a few specific names came to mind while reading — that’s usually where this gap shows up first.

Where it tends to stall is in the transition from idea to execution. That’s the gap we focus on.

If a client came to mind while reading this, that’s not a coincidence – it’s a starting point. A 20-minute call is usually enough to know if there’s a fit. No prep needed. Just a conversation.

info@karploshak.com or call us directly: 516-801-1419

ABOUT THE AUTHORS

Natalie Karp, MBA, CLTC and Rona Loshak, MBA, CLTC are Founding Partners of Karp Loshak LTC Insurance Solutions Brokerage Inc. With decades of combined experience, Karp Loshak specializes exclusively in long-term care planning — because they believe it deserves that kind of focus.

1 U.S. Department of Health & Human Services, What Is the Lifetime Risk of Needing and Receiving Long-Term Services and Supports? Office of the Assistant Secretary for Planning and Evaluation (ASPE).