When a successful couple came to New York investment advisor Neal Solomon for a retirement plan, he was happy to work with them, but with one important caveat: The husband was an avid gambler who had to agree to abide by Solomon’s creative solution for protecting their retirement assets from one risky losing streak too many.

“We set up a creative gambling account. I said to them: ‘If it goes up, great. If it goes down, tough. If you ever ask me to take money out of your retirement account to gamble, I’m quitting on the spot,” said Solomon, who founded his firm, WealthPro LLC in Gloversville, N.Y., more than two decades ago.

“It’s been years, and the husband has honored our agreement, which is why they’ve had a successful retirement,” added Solomon, who said some clients who go it alone are not so lucky.

“If I see a retiree start making irregular withdrawals from their retirement accounts, I ask them about it directly. But not all investors are willing to answer,” he said.

Senior debt is up some, and bankruptcies are on the rise. So it’s never been more important to ensure that seniors’ retirement isn’t going to be compromised by poor decision-making and unexpected expenses. In the past decade, retiree debt has risen 50%, and bankruptcies have jumped from 2% to 12%.

Tom Burmeister, vice president of financial planning at Advicent, provider of the NaviPlan financial planning software, said rising senior bankruptcies and retirement costs are an “eye-opener” the company continues to track and update for.

There are many reasons seniors run out of money in retirement, but “rising health-care costs are a huge piece” of the equation, Burmeister said.

To help retirees and advisors assess health-care costs in retirement, NaviPlan is about to roll out a new feature on its platform allowing advisors to realistically assess clients’ actual health-care and medical expenses in retirement.

“Based on health-care data, demographic information and the answers to a few questions about clients, we can now project full retirement health-care expenses and make informed decisions regarding which Medicare supplement [policy] to buy,” Burmeister said.

“The assumption by too many people is that they are completely covered by Medicare, which isn’t true,” he added. Seniors still need to purchase a Medicare supplement policy, which can range from $200 to more than $1,000 per month per retiree, depending on where they live. Some estimates put out-of-pocket health-care costs in retirement at around $250,000—an expense that not all advisors figure into planning.

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