Advisors are making a major mistake if health care isn’t a critical part of a client’s financial plan.

“If you don’t have health, why talk about money?” was Carolyn McClanahan’s urgent message for financial advisers at SourceMedia’s Disrupt | Advice conference in New York.

“If you’re just an investment manager, you will be out of business soon,” says McClanahan, a doctor who switched careers and is now director of planning for Life Planning Partners in Jacksonville, Florida. “Every client is going to face health care costs. If you’re going to leave that discussion off the table, that’s a big value-add that advisors are missing. It will keep clients happy and keep them coming back.”

Understandably, clients may be uncomfortable talking about their health and health history with a financial advisor and not a doctor.

McClanahan, a Financial Planning contributing writer, suggests introducing the topic to clients by saying, “Part of financial planning is to make certain you aren’t going to outlive your money. We can’t predict exactly how long you are going to live, so we do an educated guess based on a number of factors. A significant factor is lifestyle. Tell me what you do to take care of your health.”

REVIEW THE RECORDS
After an open-ended question, says McClanahan, advisors should fill in details about the client’s health, such as their height and weight, use of tobacco, alcohol and drugs, family history, medications they use, and past medical problems.

“If you don’t have health, why talk about money?” said Carolyn McClanahan at SourceMedia’s Disrupt | Advice conference in New York City.
“If you don’t have health, why talk about money?” said Carolyn McClanahan at SourceMedia’s Disrupt | Advice conference in New York City.

Advisors should also help clients review their medical records along with a medical professional, McClanahan says.

“It’s important to know if the records are correct,” she notes. “If they’re not, clients can end up paying much more than they should when insurers check the records in the Medical Information Bureau,” a repository of information compiled on individuals who have applied for various types of insurance.

EMPOWER THE CLIENT
Advisors also need to help clients develop an empowered mindset when it comes to dealing with health issues and with medical professionals, McClanahan says.

Most doctors only allow patients to speak about their condition for less than a minute, she points out.

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"Tell me what you do to take care of your health."

Clients should prepare for their appointments by writing out their symptoms and a list of their current medication regimen. They should also include, if appropriate, information about their diet.

“If clients have complicated issues, they should ask for a longer appointment,” McClanahan urges. “They should write down the questions they want answered during their visit and make certain the doctor provides answers in laymen’s terms, not medical jargon. And before a visit is over, make sure they know what is going to happen next and why, and ask what they can do to improve the situation.”

EMPATHY AND TRUST NEEDED
Once these initial steps are in place, advisors can then provide clients with guidance for long-term care, family support, life insurance and advance directive planning.

As for retirement, McClanahan isn't thrilled with the concept. "Healthy clients should keep working," she says.

Along the way, advisors need to remain empathetic, non-judgmental and to remember that the health care planning process doesn’t happen overnight, McClanahan cautions.

“Health care planning requires trust, which can take a few years,” she says. “But once you have it, you can do a deep dive and be very helpful.”


Charles Paikert

Charles Paikert

Charles Paikert is a senior editor at Financial Planning. Follow him on Twitter at @paikert.