Understanding the Life Resource Planning Process

August 7, 2012 - By the NCPC

As I have pointed out in a previous article, the life resource planning process is a way for you to expand your business by reaching out to existing clients or customers.  Or you can expand your business by acquiring new clients or customers.  Or you can abandon your current business strategy and adopt a new strategy that will help you be more successful.

Life resource planning focuses on helping aging seniors optimize their resources for their final years of life.  In the last article of this series – article #8 – I will discuss how you identify and market to aging seniors.  I will also discuss how life resource planning requires a team of like-minded advisers and specialists to help those seniors optimize their resources and how you go about putting that team together.

In this article I will discuss how a life resource plan for your client or customer is produced – from the initial contact and survey to the final implementation and possible provision of products or services.

Acquiring the Knowledge to Become a Life Resource Planner
Those practitioners who serve the needs of aging seniors in their final years of life have discovered that there is much more to optimizing resources than simply fixing any financial or legal problems.  In order to operate in this area of endeavor you must have a knowledge of

• financial strategies and systems,
• legal needs,
• government support programs,
• government funding opportunities,
• VA benefit rules,
• Medicare rules,
• Medicaid rules,
• tax rules and strategies,
• family and eldercare support systems and the
• various private senior support services available in your community.

The resources we are attempting to optimize include

• existing or potentially new income resources,
• existing or potentially new asset resources,
• individual and community health resources,
• family and community senior support services and
• resources available for shelter such as living with family, finding cheaper housing, moving to a facility or relying on government-sponsored living arrangements.

Because of the complexity and the disconnected nature of the myriad of community senior services, you cannot possibly acquire the expertise to serve the needs of your senior clients or customers by yourself.  You will need to work closely with a variety of experts and advisers who support aging seniors with their final years.  Nevertheless, to do your job properly, you must have a knowledge of how all the systems work and how they fit together.

The National Care Planning Council has put together a comprehensive training program for the knowledge you need.  This includes 12 hours of video or personal face-to-face training along with a large amount of written study materials.  The NCPC will provide a few hours of support for you until you have demonstrated through a testing process that you have completed the 12 hours of training and understand the material in the written text.  After that, ongoing support and coaching is available, not only from the Council, but from other successful life resource planning practitioners.

Identifying Who Needs a Life Resource Plan
Most healthy, active seniors will not do life resource planning.  They have no incentive to do so.  The incentive presents itself when an aging senior is confronted with one or more of the following challenges:

1) there has been a major change in the health or physical capability of the senior or the spouse of the senior;
 
2) the senior or a member of the family on behalf of the senior, such as a child, is confronted with a financial crisis or has come to the realization that assets and income are insufficient for future needs;

3) the senior or the spouse of the senior, for various reasons, has become more dependent on others for support with daily living.

It is your job as a life resource planner to identify those aging seniors needing your planning skills and help them solve their problems by optimizing their available resources for their final years of life.  We will discuss in a future article how you actually find those individuals who need your help.  After you have found them, we provide you with training and with appropriate surveys and questionnaires to help you identify the needs of your potential senior clients or customers so that you can produce a suitable plan for them.

Setting and Sharing Your Fees
We have found that those of you who have not done fee-based planning in the past are often reluctant to charge high enough fees for the services you provide.  This is understandable, since there is a learning curve to gain the confident attitude necessary for the client to have confidence in you as well.  Many practitioners will start out with the fee around $500, but as they gain proficiency and confidence, those fees may increase to around $1,500 or $2,000 or more, depending on the complexity of the plan and the amount of service they need to provide.

Many of the plans that you produce will also require the services of your key partner – the senior geriatric service specialist.  Two previous articles have identified the necessity for working with this specialist.  We recommend that you set aside some of your fee in a retainer account to cover the cost of the geriatric service specialist in providing an initial geriatric service assessment for the senior household.  When she has completed the assessment and recommendations, the family will typically recognize the need for her continued services and will employ her separately with future payments not coming out of the planning fee.

You must also include in your fee, $160 for the preparation of the plan.  As part of our service, the National Care Planning Council will produce the plans for you.  This saves you anywhere from 3 to 4 hours of your or your assistant's time as well as printing and binding costs and frees you up to do the more important tasks of marketing and presenting plans.  It also saves you or your assistant countless hours of learning how to use the planning software and keeping up with numerous updates to that software.

The NCPC planning service consists of inputting, analyzing and printing out the planning recommendations along with colored charts and graphs pertinent to those recommendations.  In addition, these 50 or so pages are inserted into a high-quality binder with high quality tabs along with another 200 pages of other planning and educational materials for your client – about 250 pages in all, with tabs.  The NCPC only charges $160 for this service of inputting data, analyzing, providing recommendations, providing the binder, the tabs and approximately 250 printed pages of black and white and colored inserts, assembling the entire plan and shipping it to you.  One single fee for everything, including shipping.  Minor adjustments you request to the plan are free of charge and are sent to you in PDF format. A sample plan is available on our website.

Steps in Putting Together the Plan
From your marketing efforts or from contacting existing clients or from a referral, you may have received a lead that could be identified as a senior or a senior couple needing a life resource plan.  This lead could already be familiar with the type of planning you provide or you may have to educate this potential client or customer about what you do.  At some point, you will want to encourage this potential client or customer to engage your services as a life resource planner.  In many cases, your client will be a surrogate for the aging senior or seniors.  This is almost always a member of the family, such as a child and your planning presentation may be exclusively given to this family representative or to the family representative and the parents in a meeting together.

One way to generate an interest in your planning process is to have an interested potential client or customer fill out a pre-planning survey to identify the issues that person may not even be aware of.  Once you get the survey back, you will meet with the potential client to go over the results of the survey and if a life resource plan is needed, you will show this person or couple your sample planning materials or results from actual plans you have done.  We have designed such a survey for you and the sample is found on our website.

If your new client or customer agrees to your fee and your plan, you will have that client sign a letter of agreement between you and the client.  We have designed a letter of agreement for you which will disclose the following:

• whether you are licensed for certain types of advice,
• that the fee does not apply to the sale of any services or products,
• that the fee does not apply for any services for which you cannot charge (veterans benefits as an example) and
• that the client agrees not to disclose anything about the plan to anyone else (except for close family members) without your express permission. 

 

A sample letter of agreement is found on our website.

If the survey uncovers the need for your key partner – the geriatric service specialist – you will make an appointment for her with the client.  She will do this assessment at the place where your clients are living or intend to live.  This on-site visit is an important and necessary part of her service.  The National Care Planning Council does not process her input in the planning analysis, but her input and presence at your final presentation are crucial to implementing an effective life resource plan.

If you are dealing with a potential client over a long distance and will not meet personally with that person or the couple, we have designed a modified approach for you to do the survey and the planning.  A geriatric service assessment can also be done over the phone, but it is not as good as one done in the environment where your clients are living.  Face-to-face is always more productive and generally commands higher fees, but long distance planning can work as well.

Once you have a signed letter of agreement, you provide the life resource planning questionnaire to your client or the client's representative to fill it out.  This is a detailed questionnaire and in most of your cases, the questionnaire will never be completed properly.  You will need to schedule time with the senior client (or the family representative) and have the senior client or family representative bring all of the pertinent documents in order to help him or her complete this questionnaire completely and accurately. 

This step is not a waste of your time.  It is through this one-on-one time with your client that you develop the rapport and trust necessary for him or her to follow your recommendations when the plan is complete.  It is also necessary for you to recognize what you want to achieve with your plan.  You also need to recognize that a questionnaire that is not accurate or complete will result in a plan that is not accurate or complete.  Garbage in produces garbage out.  The NCPC will not process a plan for you that is not accurately entered into the PDF eform questionnaire.  And, only the PDF eform version can be submitted – no printed or scanned version.  A sample of this questionnaire is found on our website.  (This is a flattened version in which the eform fill-in-the-blanks has been removed.)

Those practitioners who do fee-based planning and use the approach above have discovered over the years that completing the questionnaire with the client typically will reveal the final recommendations on the plan.  Even though you may know the outcome in advance and you may hint at some of these recommendations, you should never make recommendations prior to the completion of the plan.  This undermines the mystique and the value of your service and cheapens it in the eyes of your client.

Once the questionnaire is completed, you will also complete a planner input form in PDF that notifies us what you want to see in your plan and what you want to achieve for your client.  A sample of this input form is found on our website.

You will email us the computer-generated PDF life planning questionnaire eform along with the planner input form.  We do not accept the questionnaire in any other format nor do we complete the questionnaire for you from documents that you furnish us.  We feed the data from the PDF questionnaire into our software and complete the analysis and the recommendations.  We use your planner input form as part of the analysis and recommendations.  About 30 to 50 pages of black-and-white and colored planning presentation materials are then printed, along with the other 200 pages or so of client educational and planning material.  All of this is inserted into a quality binder with quality tabs and shipped to you.  The turnaround time is about a week.

Presenting and Implementing the Plan
Most of our new life resource planners ask the question, "Why is there so much?"  Meaning, why is there over 250 pages of planning materials inserted into a three ring binder?  Would it not be much better to provide less information and not overwhelm the client?  Besides, the client will never read or even understand all of this material. 

Our purpose is deliberate.  We have learned it over many years of doing this kind of planning.

None of the material we provide is irrelevant, and if the client or the client's children really wanted to read it all – which some actually do – it provides valuable information.  But that is not our primary purpose.  We want the client to believe that we have devoted a great amount of time and effort into producing this plan and that it is unique to our client.  This is basic psychology.  The more valuable it looks to the client, the more satisfied the client is in paying the fee.  And this satisfaction and trust carry over to the recommendations that you make.  The more impressed the client is, the more likely he or she will implement your recommendations.  After having done a few plans, most of our planners are surprised that their clients treat the plan as a valuable possession and actually will use it and read it and share it with other members of the family to proudly show what they have accomplished.

We also came up with a unique approach to making the recommendations.  It is our experience that most fee-based planners make their recommendations on a single page or two in the form of an outline or a checklist.  Our approach is a little different.  We have designed a number of recommendations that may or may not have been uncovered in the questionnaire.  We still make them because we believe these actions should apply to certain clients whether they have done them are not.  This might result in 15 or 20 or even more recommendations.  The recommendations are also incorporated as paragraphs that not only provide a course of action but also include education on why they should take that course of action.  Please understand that we only make recommendations that we believe apply to the client in some way.  We provide on our website an excerpt sample of recommendations taken out of a sample plan.

This recommendation strategy is also basic psychology.  By giving them a number of choices, they can feel like they are making their own decision on which ones they want to implement.  This makes them feel like part of the process and creates more trust in your planning recommendations.  The end result of this strategy is that they will almost always follow your recommendations and feel good about it.  Once they have decided the priority of the recommendations, you will make a checklist for them and follow-up to make sure that everything has been implemented.

The binder is divided into three major sections by tabs.  The first major section includes contact information, the results of the surveys in the questionnaire, and analysis of their insurance and a list of beneficiaries and owners for those possessions where that is important.  The rest of this section contains the recommendations followed by very detailed color charts and graphs.  You can choose to use the charts and graphs to explain concepts to them or you can just show them that they are there and let them feel impressed that you have gone to a lot of extra work.

The second major section is devoted to long term care planning.  If your plan does not involve the geriatric service specialist, this information is generic with instructions on how to put together a long term care plan with the family.  If your geriatric service specialist has done an assessment, the generic material is replaced by her assessment and her recommendations.  This may or may not involve long term care planning.  You insert her material on your end.  We do not do this for you.  When she is involved, she must also be in attendance when you present the plan so that she can present her input as well.  She also plays a key role in uncovering the services of many of the members of your team.  She is an extremely vital partner when you have a plan where she needs to be involved.

The third section of the binder is devoted to what we call the "Life Resource Planning Manual."  This consists of about 170 pages of information pertaining to planning for the final years of life.  This manual was written exclusively for use in a life resource plan.  It is interesting that some of the clients do insist on reading this manual and in every case the feedback is positive that they felt this was a very important part of the planning process to them.

As a new life resource planner, once you have completed the mandatory 12 hours of training, we will go over with you on the phone how to present your first life resource plan.

Following up with Product or Service Sales
If certain products or services are to be recommended to your client by you, you must make this a separate process from the planning activities and presentation.  This is necessary in order to avoid a conflict of interest especially in those instances where you are selling insurance products or investment products to your client as part of the solution to the planning process.  You cannot make any insurance or investment sales a part of the plan, because in these cases you will be violating some sort of federal or state code.  Besides, by taking this approach, you are demonstrating your professionalism and ethical behavior to your clients and they will have that much more respect for you.  If you are not already doing this, you will be surprised at how impressed they are by your upstanding behavior.

You could do the selling right after the same session in which you present the plan as long as you make it clear to your client that you are no longer doing the planning and you are wearing a different hat.  In order to differentiate your wearing a different hat, we recommend that you provide full disclosure as to what you are doing with the product or service recommendations.  This means revealing that fees or commissions are involved, that they do not have to buy these products or services from you and that they have every right to engage someone else for these products or services.  You will also emphasize that the receipt of fees or commissions is not the important issue and the size of your renumeration is irrelevant to making sure your client is satisfied.  You will also mention that no matter who they might use, those same commissions or fees will be involved, and you will be able to get the same products or services for them.  It will probably surprise you that with this approach, virtually none of your clients will go to anyone else for products or services.

Viewing Samples of Life Resource Planning Documents
On our website at www.liferesourceplanning.com, we have provided for you sample PDF files of all the planning documents used in the life resource planning process.  You can either go to the website and find the links their or you can link out of this document to by clicking on those files listed below.

sample case intake form
sample case letter of agreement
sample case planning questionnaire
sample case planner input form
sample case plan
sample case recommendations (excerpts from the sample case plan)