Six practitioners answer some commonly asked questions about aged care advice.
What would you say to increased revenue and career satisfaction? You would think planners would jump at the chance in this environment of uncertainty.
But when it comes to aged care advice, myths and misconceptions abound, says Aged Care Steps (ACS) director, Assyat David. ACS is a provider of aged care support to advice professionals.
To help address some of these misconceptions, ACS recently interviewed six ACS Aged Care Accredited™ planners about their reflections on starting out in aged care advice, including how they structured their service offering, what they charged and what were their mistakes. Here’s what they had to say.
Q1. Why did you decide to offer aged care advice?
Kate Phillips: My father-in-law had an incident that required him to go to an aged care facility. Once you have experienced aged care advice personally, you realise how complicated it is, which planted the seed in me to offer aged care advice.
Dianne Chalk: We were getting phone calls from current and new clients about aged care. People are just desperate for help.
Geoff Whiddon: People don’t talk about aged care. So much of aged care advice is a conversation in a hospital carpark. As such, we encourage our clients to think about aged care as part of the review process, so the decision isn’t taken out of their hands when the time comes.
Q2. How do you start the aged care conversation?
Geoff Whiddon: We talk about future expenses as part of retirement planning. Aged care – in some form or another – is something that everyone needs to consider, including how to fund it.
Kate Phillips: It’s about education. Clients need someone to clearly explain how it all works, especially at the time when decisions need to be made, which is time critical and emotional.
Drew Potts: A lot of clients were starting the aged care conversation with us. For example, someone is unable to come home from hospital, and suddenly, there’s all this complex paperwork to complete and so many decisions to make.
Q3. How did you market your aged care service?
John Walker: It’s about creating a network that includes aged care providers, seniors’ groups and other businesses that provide services to your market, like accountants and lawyers.
Sarah Hall: Social media gets the word out quickly and cheaply. I also approached retirement villages and facilities about marketing in their monthly newsletters, and I advertised in seniors’ magazines and newspapers.
Q4. Has aged care advice grown your business?
Sarah Hall: For us, aged care advice is just building and building. We’re getting between two and five calls a week. So, in terms of revenue, it’s become quite a big focus for us.
Dianne Chalk: We’re getting a lot more business, purely from aged care work. It may start out quite transactional, but a couple of years later, those same clients are ringing back.
Drew Potts: I wish we had recognised the value sooner. It probably took around 18 months for us to get the commercial aspects right, but the growth is there.
Kate Phillips: There’s a steady stream of new people coming through the door. It’s about capturing that opportunity to work with the family on a more ongoing basis. That’s where the profitability can be great.
Q5. What does your business model look like?
Sarah Hall: Our premium aged care service includes everything – from going out and visiting facilities, filling in forms, family meetings and preparing a strategy discussion paper. Or we can just charge an hourly rate. It’s about letting the client decide what they want from us, which is generally everything.
Geoff Whiddon: Our ‘Essentials’ service is a simple cashflow summary for people who know what they want to do. Our ‘Advantage’ package may include up to five different strategies and the implications of each. Our ‘Platinum’ package incorporates advice and further assistance with completing forms, negotiating with facilities and related follow-up advice.
Q6. How do you charge for aged care advice?
Geoff Whiddon: Our strategic advice is up to $3,000, which depends on the number of strategies that are available. Our Platinum service is $5,720.
Sarah Hall: I’ve worked out an hourly rate that includes all my costs. I sit down with the client and discuss what they need. The lowest I’ve charged is $3,000 plus GST, all the way up to $5,000 plus GST – and beyond.
Dianne Chalk: Initially, we simply gave aged care advice away! Then we spoke to others in the aged care space. We now charge at least $2,750 for an individual and $3,300 for a couple.
Q7. What would you do differently if you were just starting your aged care advice business?
Dianne Chalk: I’d charge more upfront. You’ve got to value what you do, because you absolutely make a difference.
Drew Potts: I would recognise the value much sooner and not give so much away. It wasn’t that the clients wanted the advice for free – we just gave our knowledge away.
Geoff Whiddon: I would focus solely on aged care and get rid of every other part of my business. I’d offer a service where I am an expert in all fields of aged care.
Q8. Can you share a client story that illustrates the value of aged care advice?
John Walker: My client had thought it was best to pay the Daily Accommodation Payment, rather than the lump sum. We were able to identify some issues with the source of some of the income in their family trust, which reduced the level of assessable assets significantly. We had new tax returns done, and our client’s annual income was reassessed at nil.
We advised the family to cash in shares and an account-based pension and use these funds to pay off the Refundable Accommodation Deposit, which is non-assessable for the Age Pension. The aged care costs fell dramatically, plus the client now receives the full Age Pension. So, we were able to improve the family’s overall cashflow by $48,000 a year.
Aged care: Something to think about
The emergence of aged care advice as a significant business income stream is no real surprise, says Assyat. The complexity of the sector, combined with the emotional burden, make it logical for consumers to seek out expert help. And with the population ageing, consumer demand will continue to grow.
“Whether planners address aged care proactively with existing clients as part of their retirement planning service, or prefer instead a more transactional approach to supporting new clients in crisis, the business case for providing aged care advice is compelling,” says Assyat.
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Participants
Dianne Chalk CFP®, Principal, Hillross Fairy Meadow
Sarah Hall AFP®, Principal Adviser, TBA Aged Care Financial Advisers
Kate Phillips AFP®, Principal Financial Adviser, Tend Financial Planning
Drew Potts CFP®, Managing Partner and Senior Financial Adviser, Potts Duhring Financial Advisors
John Walker CFP®, Financial Planner, RI Advice
Geoff Whiddon CFP®, Director and Senior Financial Adviser, Dome Financial Group
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