Healthcare Cost Planning Is A Huge, Neglected Input
Goldman Sachs calls it the Financial Vortex (link), the need to balance current cash needs, with competing priorities resulting in financial stress. The article points out that 45% look to financial advisors viewed as a top source of education & advice. I find this [almost] funny, since very few understand:
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ACA APTC
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Medicare IRMAA
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How to select plans within either of them
My attempt to awake the crowd is not news to y’all, here is the link to the article. There is a reason I have called it Jae’s Corner: the fact that you don’t begin with healthcare cost planning, given your specific health situation, FIRST, is just weird.
The fact that the wealth management industry (whatever that is defined to be), waves at it, and says “You don’t know what you don’t know” is an unacceptable defense. It has always been.
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If you face ongoing expensive healthcare costs, you value health insurance more than Mr. Perfect. The ACA is great to Mr. Sickalot.
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Mr. Sickalot may have a disease which changes his life expectancy, compared to the averages. If this is the case, then all other components (portfolio, Social Security, et al) would logically be adjusted. For bondeleros/bond jockeys, the weighted average life of the household portfolio should be adjusted according to life expectancy and the cost structure required to maintain yourselves. THEN, you put the elements of the remainder of financial elements into place. We are doing this exactly backwards, and when you do arithmetic in the wrong order, guess what? Errors are likely, and if it ‘works out,’ then you need to understand that was the result of randomness, not skill/fate. Insert the most important business book I can name, Fooled By Randomness.
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Instead, our world glosses over these facts, under the ideas “get a niche and stay there” or “you don’t know what you don’t know.” Instead, my view? Not fully qualified, it’s your job to know, isn’t it?