Jayson Forrest is the managing editor of Money & Life Magazine.
Aged care advice is a burgeoning area that provides a new income stream for planning practices and a way of differentiating an advice offering, but there are challenges involved.
Each year, an estimated 110,000 Australians reach the age of 65 – and age where most people are thinking about retirement. It’s also an age where many people are thinking about downsizing, including exploring aged care options as they get older.
According to the co-founder and director of Aged Care Steps, Louise Biti, the provision of aged care advice to clients and their family members, presents an additional opportunity for financial planners to provide an additional value-added service for their clients.
“Aged care advice is much more than just aged care accomodation and RADs (refundable accomodation deposits); it’s about engaging directly with your clients and their immediate family about other issues, such as home care, funding strategies, accessing Government assistance, and providing emotional support,” Biti says. “Aged care opens up a whole new area of advice opportunities for planners.”
With the Government on average paying $67,000 for every single person in aged care, Jacqui Hayes CFP® – a planner at Strategic Financial Planning – believes the burgeoning area of aged care advice will only become more important as Australia’s population rapidly ages.
However, Hayes concedes that aged care advice doesn’t come without its challenges. Having worked with aged care clients and their families, she highlights the following three issues as being particularly challenging for any practitioner business providing aged care advice.
1. Attracting new business
While planners can seek referrals from aged care facilities, Hayes concedes this does require a lot of hard work. Instead, she prefers to work directly with her own client base.
“The core client base of most practices is ageing. These clients are potentially great aged care clients or have parents needing advice. In fact, your new aged care business could be right in front of you,” Hayes says.
Importantly, Hayes adds that it’s crucial to include a client’s family in any aged care discussions, which she says is also a great way of engaging with the next generation of clients.
2. Identify what clients value
Hayes says when it comes to aged care, it’s important for planners to remember that when they first meet with a client or the client’s family, the meeting is typically full of emotion.
“There is guilt and fear from the children because they can no longer look after mum or dad. And there is also panic and urgency by the children to help their parents.”
Hayes believes it’s essential that planners are empathetic to the emotions surrounding aged care, while also showing clients how their expertise can help them through this emotional rollercoaster.
“Clients value having access to a source of truth; they value the removal of emotion from the advice process; they are seeking simplicity amongst confusion and complexity; they want peace-of-mind and the reassurance they are working with a professional who has the best interests of their loved one at top-of-mind,” Hayes says.
“These are all qualities that financial planners bring to the table when providing aged care advice. By anticipating what clients are looking for in the aged care advice process, planners are better able to prepare and serve the needs of their clients.”
3. Identify what to charge
Hayes is adamant that planners don’t give away their expertise of intellectual property without properly charging for it.
“When it comes to aged care advice, clients usually want answers yesterday, so charge for it,” she says. “With aged care advice, you can charge a premium for fast reports.”
For help with a Permanent Residential Aged Care – Request for a Combined Assets and Income Assessment form (SA457), Hayes typically charges clients an average of $350, while for an aged care SOA this is about $3,500.
“These are just average amounts that I work on,” Hayes says. “Depending on the work involved and its complexity, a planner can charge more. This makes aged care advice a good income stream for a business and a great way to differentiate your service offering from other practices.”
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