The New Rules of Retirement by Robert C. Carlson

Author:Robert C. Carlson
Language: eng
Format: epub
ISBN: 9781119183495
Publisher: Wiley
Published: 2016-05-02T00:00:00+00:00

The different scenarios indicate there is a lot of variability in the amount that will be available to the man's children. It also shows that the financial effects of a low probability event, needing LTC for three to five years, will greatly reduce the estate. That's before considering the scenario that concerns most people, which is a very long need for LTC.

As I said earlier in this chapter, LTC has a low probability but a high potential cost.

The man might decide to essentially self-insure and still try to leave substantial assets for his children by investing more aggressively to earn higher returns. But the investment returns are not guaranteed. The investment strategies could generate low returns or even losses, as well as high returns. That approach introduces another layer of volatility and uncertainty to an already volatile and uncertain situation. Suppose the investment strategies don't work, and the man also needs LTC? Tomlinson estimated that not buying LTCI is more risky than aggressive investing on its own. He estimated that not buying LTCI is six times more risky.

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