Senior Clients Need More Income? This Hidden Treasure May Be the Solution

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By Michael Freedman

In 2011, a man arrived at the Tulsa Convention Center in Oklahoma with five carved cups to see how much they might be worth. Whether they'd been hidden away in his grandmother's attic for decades or on proud display for decades, no one knows. But that Saturday morning, he was quite surprised to learn that the set, made from rhinoceros horn, was valued at more than $1 million, the highest evaluation in the history of PBS's "Antiques Roadshow." If only we could all be so lucky!

As an advisor, your goal is to help every one of your clients achieve their financial goals. While that rarely (if ever) includes sifting through old attic treasures, you have a handful of strategies and a variety of assets to help your clients grow their nest eggs to support a long, happy, and (hopefully) well-funded retirement. But with traditional retirement now lasting as many as 20 to 30 years, that's not an easy task. Especially as baby boomers enter a highly publicized retirement crisis.

Medical costs are skyrocketing. Long-term care expenses have the potential to quickly crush anyone on a fixed income. And the market has been unpredictable (to put it mildly). So when assets are dwindling-and there are no carved rhino cups in the attic-what can you do to help your senior clients make ends meet?

The good news is that many of your clients are holding a valuable asset that you may not even realize exists. For your clients 65 and older, that asset may have a surprisingly high market value - a value that is four to ten times more than you or your clients may realize. Even better, your clients may be able to sell that asset today with little to no risk through a highly regulated transaction.

What is this hidden treasure? Life insurance.

Whether your client has a Term or non-variable Universal Life policy, if he or she is 65 or older, it's likely that policy is either unwanted or unneeded-or most likely it's simply unaffordable. To keep up with rising costs of insurance and compensate for increasing life spans, five major insurance companies raised their premiums last year-some by as much as 100%-primarily on policies held by seniors. That means seniors are overpaying for policies that don't even fit their current needs. As a result, a shocking 9 out of 10 policyholders are forced to let their policies lapse (a move that is great for the insurance companies and detestable for the consumer) or surrender the policy, giving them only about $10K on a typical $500K policy.

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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

This article was provided by our partner Tom Lydon of

The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

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