Take 5: Advising on long-term care
As people live longer, more people will need long-term care. Planning for it requires a specialist touch. Here are five top tips on getting involved
Long term care planning may be a niche area, but demand looks set to grow; fees are projected to hit £38bn a year by 2025. Consider how you could get involved with MM’s guide to advising on long term care.
1. Get long term care qualifications. The FSA requires anybody advising on long term care to have an appropriate qualification. This means meeting the minimum standards for providing financial advice plus taking an appropriate long term care examination. Options include the CII Certificate in Long Term Care Insurance and the IFS Certificate in Long Term Care Insurance.
2. Know the long term care benefits in your area. Maximum funding contributions for eligible individuals vary by local authority. Knowing what they are, along with the range of care home fees in your area, will help to identify possible shortfalls. As revealed in MM’s long-term care report, this occurs in almost every case, as detailed in Table 1.
3. Research existing long-term care products. And consider the alternatives. Only two providers offer immediate needs annuities – Friends Life and Partnership – with no players remaining in the pre-insured LTC market. Other vehicles can be used instead of, or alongside, immediate needs annuities such as equity release, pension income and investments. Often it is a combination, rather than a single product, that meets a long term care funding need.
4. Consider your client bank. Many clients in their 50s and 60s will have parents at or reaching an age where long-term care becomes relevant. The vast majority of self-funders do not get financial advice; simply asking existing clients if they have family members in this situation could open up a whole new business stream. Running seminars in care homes can also generate leads.
5. Make links with local businesses. People need practical as well as financial advice when accessing long term care. Linking to them helps provide a rounded service for clients as well as potentially generating referrals. Organisations include practical advice services, charities and solicitors dealing with power of attorney.