FAQ: Financial Questions

Contrary to the stereotype of just plopping people into liquid nitrogen, cryonics as practiced by Alcor is a highly complex procedure involving many people, expensive medical supplies, chemicals, and substantial long-term costs. The initial cryopreservation process itself costs Alcor tens of thousands of dollars. Remaining funds are allocated to the Patient Care Trust to fund long-term care. Alcor also budgets more conservatively for long-term care than other organizations, resulting in higher minimum funding requirements. For more information, read The Cost of Cryonics and the page about the Patient Care Trust.

Despite the high cost of cryonics, the belief that cryonics is only for the rich is a myth. The cost of cryonics is similar to other complex medical procedures in wide use today, and like these procedures, cryonics is affordable by nearly everyone through insurance. The key, however, is having life insurance or other financial arrangements in place in advance of need. Most people could not afford heart surgery if suddenly faced with having to pay the full cost in cash. Cryonics is no different. The large sums required at the time of these procedures can be made affordable if appropriate steps are taken while one is still healthy.

Alcor is still a small organization, and cryopreservations are very costly. Alcor cannot afford to carry six-figure accounts receivable. Life insurance is a more secure (for Alcor) and convenient (for members) form of funding that Alcor can closely monitor.

While the technical magnitude of the problem of treating cryonics patients is enormous by today’s standards, the future costs in terms of human effort and resource expenditure will probably be modest. Nanotechnology will be developed (and is being developed) to build better computers and waste-free industrial processes. Cell and tissue repair technology will be developed for medicine and agriculture. A day will come when configuring existing programmable cell repair devices for the specific problems of cryonics patients will probably require only moderate effort. The efforts required to ensure today’s patients reach that day will be greater by far, and they represent the true challenge of cryonics.

Alcor’s Patient Care Trust uses the power of long-term compounded investment earnings with the intent of achieving growth eventually sufficient to revive all of Alcor’s patients. (From 1950-2009 the S&P 500 had an inflation adjusted return of 7%). The Patient Care Trust assets are reported regularly on the Alcor website.

In addition, the costs of information-based technology are predicted to drop dramatically (see The Law of Accelerating Returns). Restoring cryopreserved humans is an information-intensive task, and will benefit from such decline in costs.

Either trend would be sufficient by itself. Both trends taken together provide greater confidence that the costs of reviving the patients in cryopreservation can be met.

For decades, Alcor members have wanted to keep their assets after they were cryopreserved so that when they woke up in the future they would not only be alive but even have some money to help them better enjoy their future life. However, since retaining assets when you’re legally dead raises several novel issues, most lawyers and financial planners would either refuse to do it or would charge high fees to become acquainted with the legal issues involved and to develop a strategy that seemed likely to succeed.

There are now two available options to address this problem:

1. The Alcor Model Revocable Asset Preservation Trust is a model trust that members can take to their estate planner, financial planner, or attorney which could be used as a starting point for their own personalized Asset Preservation Trust. The Alcor Model Revocable Asset Preservation Trust provides clear answers to the legal concerns that lawyers and estate planners might have about how to handle the various issues that arise in dealing with preserving your assets and returning them to you when you are revived. The Trust requires a minimum of $500,000.

2. The Multi-Investor Future Income Trust (MIFIT) is a vehicle for smaller investments, with a minimum of $25,000. This vehicle pools these smaller investments into a larger fund.

The Board overseeing the Patient Care Trust (PCT) is chosen by the Alcor Board of Directors. The PCT Board exists for the purpose of controlling and approving all expenditures of PCT funds, which are for the long-term care and revival of Alcor patients. The five PCT Board members are chosen for five year staggered terms, and serve without pay. Alcor chooses PCT Board members to fulfill two of the most important objectives of Alcor’s Mission Statement: keeping current patients in biostasis, and then restoring them and reintegrating them into society. Three of five PCT Board members are required to have family members currently in cryopreservation, adding personal motives for secure care and revival when possible.

Individual Trusts created by individual members often use Alcor appointed “Trust Advisors” who can be called on to make important Trust-related decisions after the member has been cryopreserved. Trust Advisors are obligated to carry out the wishes and serve the interests of the member, not Alcor, but an Alcor-appointed Trust Advisor raises the concern that Alcor’s financial interests might be given undue weight in a Trust Advisor’s decision making process. The Alcor Model Revocable Asset Preservation Trust includes a paragraph discussing the financial incentive to revive you:

To provide an incentive to revive you sooner rather than later, the Model Trust lets you pick a percentage of the Trust Assets to be given to Alcor upon successful revival. Giving more to Alcor provides a greater incentive to revive you sooner (and also provides more funds with which to carry out that revival), but also a greater incentive to try risky techniques that might not be fully proven. Giving less to Alcor creates less financial incentive to rush into a premature attempt to revive you, but also provides less incentive to revive you in the timeliest fashion. It is difficult to say exactly how large this incentive should be, or even whether there should be an incentive, but the Model Trust lets you decide how big an incentive you want to provide for a successful revival.

Opinions about how big to make the financial incentive for revival, or even the advisability of such an incentive, vary considerably. Widely varying opinions are common in the cryonics community. Some individual members have Asset Preservation Trusts that provide a simple fixed annual percentage (anywhere from 1% to 5% annually) to Alcor with no other incentive, while others provide substantial sums upon their revival and little or nothing prior to that. The latter provides substantial financial incentive for early revival.

Besides the financial incentive provided by individual members’ Asset Preservation Trusts, the Alcor PCT can discharge its responsibilities to its patients by reviving them and reintegrating them into the community. This reduces the financial costs of reviving patients, and might even provide a financial incentive to revive patients. Just as computer technology keeps falling in price, many technology forecasters expect future advances in information-intensive technologies, including molecular manufacturing, and nanomedicine, to fall exponentially in price until reviving patients is actually less expensive than keeping them cryopreserved.

Financial incentives, however, are often not the most significant forces driving human behavior. As advancing preservation technology and advancing medical repair technology converge, the revival of recent patients who were cryopreserved with minimum damage will greatly increase the credibility of cryonics and the security of cryonics organizations. This benefits leaders and members of cryonics organizations by increasing the security and revival prospects of their cryopreserved friends and family. It will also increase their own survival prospects if and when they need cryopreservation themselves. Finally, from a very human and purely emotional perspective, the urge to say “We told you so!” will likely be irresistible.

Even after cryonics patients begin to be revived, there will still be injuries that cannot be repaired in real time and require cryopreservation to buy time or wait for even more advanced technology (e.g. severe brain trauma, extended periods of clinical death at warm temperature, or malfunctioning medical technology).

After the first few successful revivals, the whole world will view our patients as just that: patients. Once that change takes place, unnecessary delay in reviving them will be viewed in the same way we view any other delay in medical treatment. As a society, such delays are viewed as unacceptable socially, legally, ethically, morally, and politically. Undue delay could result in unrest, lawsuits, or even criminal liability for unlawful imprisonment. Alcor, as a prime mover in creating this societal change, is going to be the last organization to delay treating the patients under its care.

Claims that cryonics organizations might keep their patients cryopreserved forever for their own financial gain comes from the same lack of understanding from which the myth arose that cryonics may be consumer fraud.

Yes. Perhaps most explicitly, the Patient Care Trust states “When the Trust Board determines that the amount of annual investment income generated by the Trust (not counting new contributions) in any year is at least Thirty Percent (30%) more than the reimbursed Patient Care expenses in the same year, the Trust Board may place any earned income above the Thirty Percent (30%) margin into a separate research account within the Trust and use such income to begin funding and/or investing in research in procedures to repair and revive the Patients, when and if such research proposals are offered by Alcor or by others.”

Neither Alcor’s management nor board can spend PCT funds unless approved by the Patient Care Trust Board, as described in the Patient Care Trust document. Alcor’s Finance Director sends the expenses monthly to the PCT and they approve them before reimbursing Alcor. Alcor itself does not have signing authority on the PCT accounts. The PCT expenses are detailed on the last page of the issued financial statements since 2010.