Business Innovators Radio - Interview with Kerry Morris, CFP® Founder of HonorShield Discussing Aging Insurance

Episode Date: November 5, 2023

Kerry Morris, Author of When Retirement Goes Bad, Life Sucks, Certified Financial Educator, and CERTIFIED FINANCIAL PLANNER™ professional.Kerry Morris has been serving families for the past twenty-five years as a financial planner and advisor. He has recently launched HonorShield, LLC., as a way to challenge the current thinking and behavior of consumers and financial advisors preparing for the potential high cost of aging.He has spent several of his twenty-five-year career advising hundreds of families experiencing the nightmare of paying for care. The question, always, was “how to make the money last”?Morris has watched too many families, too many men and women not be fully prepared for retirement. The financial industry has put this cost-of-care issue on total “ignore” mode, often shoving it onto a small but valiant band of “insurance specialists” around the country. Only about 1 in 100 Americans embrace this model. That is a problem for American families and our country.Morris found a better way, a win-win solution that more Americans could feel good about embracing. It’s a whole new way to approach and solve this problem: the LCAP—the Longevity Care Allocation Plan. Every person, every family deserves to know how an LCAP works. Kerry Morris has made it his life’s goal to ensure that those he helps can hold their head high and know that no matter what curve balls retirement throws at them, they will be prepared.“One of the most important things I’ve learned in my 25 years in the business is that a great life is supported by three areas, Health, Relationships, and Money. My job is to make sure that a family’s money is working effectively to accomplish that job.”Learn More:http://www.honorshield.com/Influential Entrepreneurs with Mike Saundershttps://businessinnovatorsradio.com/influential-entrepreneurs-with-mike-saunders/Source: https://businessinnovatorsradio.com/interview-with-kerry-morris-cfp-founder-of-honorshield-discussing-aging-insurance

Welcome to influential entrepreneurs, bringing you interviews with elite business leaders and experts, sharing tips and strategies for elevating your business to the next level. Here's your host, Mike Saunders. Hello, and welcome to this episode of Influential Entrepreneurs. This is Mike Saunders, the authority positioning coach. Today we have back with us Carrie Morris, who's the founder of Honor Shield, and we'll be talking about aging insurance. Carrie, welcome back to the program. Thanks, Mike. Aging insurance.

That sounds like a fun topic. It sounds like a thing, right? I mean, I've heard of aging and I've heard of insurance. I've not heard of aging insurance. So get us started with what actually is aging insurance. Yeah. And of course, you know, we're kind of, it's not a technically official thing, right? So we're using insurance as a term to kind of like say, hey,

let's define those two words, like you said, what is aging insurance the way we're using it? And let's start with the definition of the word insurance. So a short one that I pulled up is a thing providing protection against a possible eventuality, right? So is aging a possible eventuality? Yes. Yeah, every day. Yeah. Let's hope so, right?

Yeah. Yeah. So aging insurance, the things that come with a possible. population that's living longer and longer and longer, right? So this isn't 1933 when the average life expectancy was barely old enough to even start your Social Security, right? I mean, you know, when they, when they passed the Social Security Act to 1933, they never expected to pay out all this money to people up in their 70s and 80s, okay? You know. Yeah, those actuarial tables have morphed over the decades, huh? Yeah, and turned upside down. And so

what comes with a population that's living longer and longer are the health scenarios of that aging process, right? And so, you know, we're in a, we live in a world where every 65 seconds, there's a dementia diagnosis on, on Alzheimer's diagnosis, actually, on average, you know? Wow. Yeah, so. That's pretty staggering. Every 65 seconds, there's an Alzheimer's diagnosis. According to the Alzheimer's Association.

Yeah, when you average it out. Wow. You know, so it's a big, big deal. And that's why my second book is called Financial Survival for Families in the Grip of Dementia. And so aging insurance is just a term that we kind of use to talk about, hey, you know, is there a way that to provide protection against the financial side of this aging process? Because it's something that, you know, people have been aware of for a while. but unfortunately a lot of folks are living in the 2000s. And all they think of is, well, you know, traditional long-term care insurance or you've got advisors saying, oh, well, you've got enough money, you know, but those advisors don't necessarily know really what those impending risk are and the impact those can have on their

portfolio. It's kind of like that's a really good point. it makes me think of like that bucket of water and the holes in it. You know, I've got my bucket. I've got my water in there. But if there's more and more holes being put in there, then that is our money seeping out. And that's money that could go toward retirement. And what could be some of those factors, that health care and the aging, the aspect of paying for impending aging, because you can't get away from that.

Yeah, I mean, it's like, you know, there's nothing that has come in some, that affidding. family. So I'm a guy, right. I've looked at a lot of nest eggs. I've helped build a lot of income streams. And there's nothing that comes at a family financially, not even college, right? You know, paying for college is we call it the toll booth on the way to retirement. And, but not even that is, is to the tune of 40, 50, 60, 80,000 dollars a year with an unknown end date. And that's the biggest thing is that it's such an unknown. And everybody thinks they can kind of guess how they're going to age. They kind of rationalize in different ways, right?

But as a guy who part of my career was spent doing elder care planning, I sat in my conference room with over 700 families who were at that point of having to pay for care. I talk about this in my first book when retirement goes bad life sucks. And it's about the hidden defect in the portfolio that our portfolio. aren't designed to, aren't designed to handle this. So you have the mindset of a 401k generation. All they've ever known, the boomers, is putting money in the plan. The company puts money in the plan. That's all they've ever known.

But they don't realize when they retire that the mathematics actually changes. When you start pulling money out of an account that goes up and down, it behaves quite different than an account that goes up and down with no money coming out of it. So now you bring in care costs into the. that and it acts like market losses upon that and can start turning things south really, really fast and become unrecoverable before you know it. That's a big point because I know like what you just said where if there's volatility up and down, but no hits with the balance is going down as far as from some of these big

expenses, you can weather volatility. But if it's volatility and huge expenses coming out, boy, that's a triple whammy. Yeah, and so that's a fancy word for that's called Sequence of Return Risk. I talk about it at a book. At Onershill, we talk about that in our presentations. I believe almost every presentation we do include some facet of helping folks realize that. It's what I noticed sitting in my conference room watching these people's, you know, trying to plan in the midst of crisis, you know. And so you and I have talked before in other episodes about solutions and things.

But that's what, you know, we use aging insurance as a general term to just mean that, hey, there's a way to transfer that risk. So that word insurance is talking about transferring some of that risk. Well, we can put kind of a stop gap on it by using some of the tools out there. And that's what we do at ownership. Yep. So let's talk about a few of those tools because I know that any time that you throw big numbers out, like look at all. all these big costs of, you know, aging and long-term care, things like that. The solution sounds great, but it also feels, seems like sometimes it's expensive.

So talk a little bit about the tools and kind of, is it expensive and hard to obtain those tools? Yeah. So that paradigm is still out there. And that's what, you know, it's like the 2000s and the 1990s kind of want their idea, want their products back because we're starting to see. less of it now. It seems like we're getting away from it. But for a long time, all anybody ever thought about was what we call traditional long-term care insurance. And that was, you know, it was a really

great deal at one point. Then it actuarially, it got into trouble. It did get expensive. And it was definitely got more hard to get because carriers misjudged how many people were going to keep their policy, how expenses were going to soar. So, you know, let's let's take a second and acknowledge the fact that even the insurance companies got overwhelmed by these expenses when it comes to traditional long-term care insurance, you know, and they're big insurance companies, much less the average consumer. So what's really awesome today, and it's been around for years, people just don't know about it when we say, okay, is it super expensive and is it very hard to get?

Well, the cool part is that it's not too expensive if you do it the right way. it actually becomes, remember back to the portfolio, becomes an allocation of the portfolio. So there's actually solutions today. You know, you think about ma and pa tucking away some money, right? Like, hey, honey, this is going to take care of us when we get old, right? Well, now you can tuck that money away, but then get a multiple of it guaranteed to help you pay for care one day. So that's transferring some of that risk so that if you do need care, which there's a seven and ten chance, you know, and we are. and that's a broad statistic,

but that's kind of the current percentage of people over 65 that are being cared for in one way or the other today. But if you do need that, at least you've got something that you can turn on that's going to kick out several thousand dollars a month, and that's going to keep that portfolio from having to have those big, huge withdrawals that acts like market losses on it,

in addition to your income and all that. Right? So expensive, well, you be the judge, but if you can allocate some money you already have and just get that multiple, then it's not like that same paradigm as like, oh, I got to write a check for this every month, right? And then on the very, is it very hard to get? See, that's another thing that is kind of a holdover from the traditional long term care insurance days is that now we have, again, there's a variety of health, that, you know, when we say very hard to get, it's really alluding to can we qualify for it health-wise.

And so, you know, we can go into that a little bit deeper. But the question is, is that there are solutions that will cover a wide range of health. You don't have to be super, super perfectly healthy to get it. Yeah, I think that's a huge piece because, you know, so many times people are hearing, you know, people like yourself talking like, oh, that sounds great. and I hear you, but it's got to be expensive. Oh, it's got to be hard to get. And it kind of makes me think, okay, so you're saying that it's readily available. It's not too expensive, but isn't it just for set aside for the wealthy and the healthy?

Because I know over the decades, I've heard of investment type opportunities and you hear about this. And it's like, oh, but it's only if you have nine gazillion dollars to invest. And you're like, oh, well, great. Well, is this solution just for the wealthy and the healthy? and it's so restrictive that you have to have spectacular perfect health or lots and lots of money. Yeah, great question. And so the answer is let's define what wealthy even means these days. You know, like you heard of the millionaire next door, right?

Yeah. Yeah, so is a family who's worked their whole life and saved up a million dollars, is that wealthy? You know, I would say that that's what we call the mass of fluid. right there's you know 800 whether that nest egg's 800 or a million or whether it's two million all the way you know and the truth is is that solution-wise there are solutions all the way down to smaller nest eggs as well and of course just for the sake of the the listeners education and to check the box if somebody you know doesn't have much money or they're already impoverished that's what the Medicaid program is there for that's why we all paid into that program

program for years, that's to help the impoverished folks, you know. But other than that, there's such a wide range of options. I mean, all the way down to short-term home health care that does carry a little premium to it, all the way up to. And so anywhere, you know, there's a set of solutions for, say, a nest egg below 500,000. There's a set of solutions for nest eggs above 500 million, two million. And the thing is, is higher net worth people understand leverage. So you remember earlier when I mention, okay, you can do an allocation and say instead of putting it in a bonds or instead of putting it in small cap or large cap, you think, you think about that pie chart you've seen over the years. You simply can allocate some dollars over to one of these solutions with the insurance

care is designed to give you a multiple. You know, there's there's one of them out there that, you know, it goes up to 869. It's, it's a quadrupler. It's got some health questions. So it's got a few health questions, but they're just knockout questions, what we would call it. So no guarantees. I'm in the business, right? So let me make a big disclaimer. This podcast is for educational purposes. I'm not making any promises, but just trying to get the word out there that there's a range of wealth and a range of health that fit these various solutions. That's what we train our advisors at Honorshild to do. That's why Honorship was created was to help unpack and look at a situation for a family and then be able to fit the right solution to them at the point of health and wealth that they are. Sometimes that varies by spouse even, Mike.

Yeah. You know, it makes me think of, like, what if someone goes, oh, I've always dreamt of owning my own home, but I could never qualify for a mortgage because I've had some credit hits in the past. And that's only for people with huge credit scores and huge down payments. And if that's the mentality that you took, you'll never get into a house. But if you realize that, oh, there's some programs for people with damage credit, people with low down payment. And let's get you in. And then we can always improve it down the road when things change.

And I'd like your explanation there because it's exactly that. There's programs out there for people that are super wealthy and not so much. Yeah, perfectly said, perfectly said. People just don't know what they don't know, you know. And what we're trying to do is like back to. the beginning of our podcast of our interview, you know, it's like we don't know how we're going to age. And so if there's a viable way to get some protection in place, to kind of just cover ourselves on the top side, you know, so that it can't get too out of control. We've got

some kind of benefit there. It doesn't have to be perfect. It's not designed to pay for every dollar. You know, it's designed to prevent us from, say, a husband wiping out his wife on his way out, that kind of thing. You know, it's like we've seen that happen. Capping some of the, the, capping some of the high expenses. Yeah, you know, if you were a crash scene investigator and you'd seen all these crashes like I have, you would be a big seatbelt promoter. You know, you would be trying to promote all the, all the auto safety methods you can. that you could, you know. And that's, that's all it is. I mean, it's just us, we're just trying to sound the alarm like, hey, this is a problem. It's not going to go away in America. And you don't

have to just go into that alone with, with no protection. And so I would encourage people not to let their assumptions keep them from, you know, letting a professional like us show them their options, you know, then they go from there, get educated. You know, I like how you landed the plane on that, show the options, get educated, work with the professional, not someone that just thinks they might know, you know, get with someone like yourself that knows all the options and just see how it sets with you. And if, and I love that seatbelt analogy. It's not like the seatbelt is going to prevent an accident or mean there's zero damage. It's just going to limit how much damage that there was. So I think that's a, this kind of thing makes so much sense because if those

numbers are true, the 70% number of people that will need this kind of care, let's go ahead and just make sure that it's not going to get out of hand and ruin a strong retirement strategy that you might have in place. That was really a clear summary there. And my last comment, Mike, is just let's come away from the money for a second and just share with the listeners real quick the fact that this is really about the whole family. It's about relationships. It's about stress levels and it's about decision making. And I've seen the process of decision making when families are going through the aging process, you know, be dramatically impacted or hurt by the, by having or not having repaired in this area. Yeah, 100%.

Well, Kerry, as always, you just have such a clear, concise way of explaining these topics that are really confusing to people. so thank you so much for coming back on. What's the best way someone can reach out and connect with you? Yeah, I think honorshield.com. It's one word, honor shield.com is the best place to go, Mike. And thanks for having me on today. Great to talk with you again. Thank you, Carrie.

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