- Basic Financial Planning Can Help Protect Assets And Guide Decisions -

NAPLES, Fla., Jan. 24 /PRNewswire/ -- Concern that the high cost of health care might drain financial assets is felt even by Florida's wealthiest residents, according to survey findings released today by The PNC Financial Services Group (NYSE: PNC).

Nearly one in three (29 percent) of the wealthy Floridians surveyed by PNC strongly or somewhat agreed that "health care costs will ultimately consume a major portion of my financial assets," yet nearly two-thirds (61 percent) do not have a comprehensive financial plan, which can help protect family assets from the big potential bite of medical costs.

"Regardless of their level of wealth, people everywhere are worried that medical expenses and long-term care costs pose a major threat to their financial security today and for their family in the future," said Jennifer Immel, an estate planner for PNC's wealth management unit in Florida. "Without proper financial planning that takes health care into consideration, many people end up leaving a bankrupt legacy to the next generation."

Results of the nationwide survey, included a sampling of more than 200 wealthy South Floridians, were released this week by PNC, which has wealth management offices in Naples and Vero Beach, as the second in a series of reports. Highlights of the health care findings in Florida include:

- Financial Concerns: Nearly half of respondents (47 percent) reported that "providing for my health and wellness" is their No. 1 financial concern. Affording health care for their families is also a top financial concern for nearly four in 10 Floridians surveyed (37 percent).

- Future of Medicare: Four in 10 respondents (43 percent) perceive the potential insolvency of the Medicare system as a threat or huge threat to their family's wealth. Among those with children, more than one-third (35 percent) thinks their children will not benefit from Medicare in the future.

- Potential need for long-term care costs and expensive medical treatment also were viewed as a "threat or huge threat" to the family wealth of more than one-third of respondents (35 percent). One in five (22 percent) of those with living parents worry about their parents' lack of long-term care insurance.

Healthy, Wealthy and Unwise?

The serious concerns expressed by survey respondents about the costs of long-term care, medical expenses for family members and the potential for Medicare insolvency have not translated into related financial planning for many wealthy Floridians. PNC's survey found that asset protection preparations lag for many wealthy households. Florida survey results included:

- Nearly two-thirds (61 percent) do not have a comprehensive, written financial plan.

- While 88 percent of respondents have a will, nearly one-third (30 percent) have no health care proxy, which specifies an individual to implement a living will and make health care decisions when its statement of preferences do not apply.

- Nearly six in 10 (57 percent) respondents have established a trust to transfer wealth to heirs, but only 31 percent have named a professional trustee.

- Seven out of 10 (70 percent) have not purchased long-term care insurance for themselves or a spouse. Among those respondents, nearly half (45 percent) felt it was unwise to spend money on a premium they may never use, 24 percent said it was cost-prohibitive and 21 percent said they never thought about it.

"Floridians know all too well the consequences of not specifying end-of- life decisions can be devastating -- emotionally, financially and legally," said PNC's Immel. "Advance directives-living wills and health care proxies- are legal documents that should be completed as part of the process of completing a will."

She added: "A truly comprehensive financial plan should take everything into account, including health care, but that is often not the case. Many people focus their planning on lifestyle issues and financial growth strategies but want to avoid the fact that we will all get older and need some level of medical care in the future. The implications can be severe."

Immel said a Health Savings Account offers a tax-advantaged way to set aside money for health care costs. From an asset protection perspective, there are numerous options, ranging from an estate plan, life insurance, irrevocable life insurance trust and Delaware Asset Protection Trusts, for example. A grantor trust, meanwhile, would help pass assets to future generations with the safety net understanding that the grantor could retain control of the trust.

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