We all need to get better at advising people on long-term care

The UK has an ageing population which brings with it challenges including an increase in disability and dependency amongst older people. It has also caused an inevitable rise in demand for long-term care which has become extremely costly for families as a result.

The options for funding long-term care can be complex and often hard for families and individuals to understand, making the role of advice – whether it be financial advice, advice from a solicitor or a local council – absolutely crucial.

But, as things currently stand, those involved in the advice process are actually at risk of collectively failing these people who are already facing challenging and emotional circumstances.

Financial advice

For a financial adviser, providing advice on long-term care is a specialist area that requires deep technical knowledge. This is clearly recognised by the PFS which has a specific Later Life Specialist accreditation and advisers must have the CII’s CF8 long-term care and ER1 equity release qualifications to receive the later life accreditation. But despite this, very few in our industry hold these qualifications and accreditation. These are clients with complex needs and the potential risk that comes from receiving advice from someone who might not have the right level of knowledge, goes without saying.

Solicitors

It’s also not uncommon for clients to be given advice from a solicitor to put their home or property into their children’s name(s) on the understanding that this will reduce the value of the client’s assets towards long-term care. The problem with this is simple: it’s not correct.

Local authorities and councils

Families may be able to receive support from their local authority towards the cost of elderly care, depending on their financial circumstances. But, unfortunately, in many cases the local council or authority do not have the resources and expertise to properly understand and assess the value of an individual’s assets. The position and approach they take can also vary across councils too which may result in disputes with the families seeking long-term care support.

Good practice tips

Despite how all this sounds, there is some really positive work being done when it comes to advising clients on long-term care. Here are some examples of good practice which can really help families get the funding support they need:

• Let’s start simple. Every client, regardless of whether or not they’re at the point of requiring long-term care, should have a Will and Power of Attorney (PoA) in place. At De Beul Kerr, we include this as part of a client’s suitability letter. It’s also important to request a copy of the Will and PoA from the client’s solicitor.
• You may not agree that a Will and PoA is necessary for every single client but this becomes absolutely vital for clients who may need to use measures such as equity release in order to fund long-term care. Indeed, we would actually label anyone considering equity release as a potentially vulnerable client.
• Provided a client has a solicitor in place, some advisers will take the opportunity to discuss and share relevant information, such as copies of the client’s Will and a PoA by meeting with the solicitor, alongside the client. This type of cooperation can make communication smoother and the whole process more efficient for everyone involved, while also providing important reassurance to the client that all parties are working together in their best interest.

Looking ahead to the bigger picture

We started off this article talking about the difficulties around the affordability and availability of long-term care so even if challenges in the advice process are resolved, there are clearly bigger issues at play. And these issues are only going to impact more and more of us as our population continues to age. This really makes elderly and long-term care a concern for all of us as a society. And so, with that in mind, I’ll end with a bigger question: is it time the UK government considered a rise in National Insurance to help meet the care needs of our elderly population? The answer, from my experience supporting clients in this position, is a resounding yes.

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