Mini Case Study: Diminished Capacity

Recently, our team began working with a retiree in Pleasanton, CA to set up his financial plan and accompanying investment strategy, with the primary goal of making sure he has enough to fund his long term care needs.

The retiree's daughter reached out to us on his behalf, as he is experiencing diminished capacity. While she knew her Dad had retirement funds and other savings, she wanted to make sure it would be enough.

By the time his family came to us, they had already done a great job addressing needs in advance of his diminished capacity:

• They helped him move to an assisted living facility due to his evolving care needs.

• His daughter had:

  • Became his Power of Attorney for health and finance.

  • Became the Trustee of her father’s trust.

  • Assisted him with the sale of his home.

  • Coordinated a plan for his health and other needs at the care facility.

This is where we stepped in, and what we're doing now:

• We are building a financial plan to provide for his future needs, using the sale proceeds of the home in addition to his retirement savings. Our plan addressed:

  • Increases in costs of care that outpace inflation.

  • A cash flow plan to optimize his tax strategy based on how his ongoing needs are addressed, and when it is more tax-efficient to use retirement plan funds or after-tax savings for those needs.

• In partnership with our sister firm Summit Tax Planning, we:

  • Created a plan for his 2025 taxes.

  • Initiated a review of prior years' preparation. Through this, we found a 1099 for a Required Minimum Distribution was missed in a prior year. This will be addressed by our Summit Tax team.

Our planning work will give peace of mind to the family, so they know they've taken the necessary financial steps to care for their loved one during what has been a very challenging time.

If you or your family are trying to solve for a need in retirement and looking for fiduciary advice and investment management services, please send me an email (ryan@swrpteam.com) or book a time on my calendar to discuss how we can help.

This material is purely intended to be general and educational in nature, and should not be construed as specifically-tailored investment, financial planning, tax, legal, or other professional advice. Information and data contained herein is as-of the date of publication, and may be subject to change in the future without notice. Any investment performance referenced is purely past performance, which is no guarantee of any future performance. Nothing contained herein should be construed as an offer to sell, a solicitation of an offer to buy, or a recommendation of any security or other financial product or investment strategy. All investment, tax, and financial planning strategies involve risk that you should be prepared to bear. You are highly encouraged to consult with professionals of your choosing before taking any action based on this material.