Every decision we make is composed of both conscious and unconscious bias, however, just like you wouldn’t seek a general practitioner (GP) for a complex heart issue or cognitive decline, you shouldn’t rely on non-specialists – or, worse, no advice at all for important financial decisions. Why then do we witness each day clients who accept at face value the ‘advice’ they receive without objective questioning?
- How confident are you that you have received the correct information after waiting on hold for 90 minutes to talk to an overworked, underpaid and under trained Centrelink employee?
- Do I truly believe that if the billboard on the motorway advertises $1,000,000 of life insurance for $1 per week, my family will make a successful claim if I die?
- If a Super fund’s sole focus according to their advertising during Married at First Sight is to ‘save fees for members’, should I not question what corners are being cut on potentially your largest asset?
- Are you truly confident that your assets will make it to the right people and be protected from failed marriages and businesses via an Australia Post DIY Will? Lets not forget you are buying the Will from a Post Office, along with your stamps, express post envelopes and the most recent NRL finals coin collection.
We find it very odd that while most people understand the premium price associated with a superior product when it comes to the manufacturer of their car, the purveyor of their holiday or vintage of their wine, when it comes to financial services cheap/free is what stands out to us all.
Taking charge through the uncertainty
Without professional support, it is difficult to make clear and informed decisions, and the example below highlights the potentially devastating impact of even one poor financial decision which can be just as critical as your Doctor missing something serious during a health check-up.
The means-tested fee in aged care is exactly the type of specialised subject where knowledge matters most. The fee is calculated based on your income and assets, and it can vary significantly depending on individual circumstances.
It is a common misconception that Centrelink employees understand social security legislation, and in the aged-care system, we often find that there’s a ‘Bermuda Triangle of miscommunication’ between Centrelink, aged-care facilities and individuals because the two former service providers tend to robotically follow instructions from each other, much of which might be relying on incorrectly applied information or processes. If you speak to one and then the other, it might feel like you’re getting a second opinion, but you’re actually not, rather the left hand (Centrelink) is unsure what the right hand (aged care facility) is doing.
A true second opinion can be found in 2 ways:
- Gain a personal understanding of complex social security legislation and apply to your own, unique situation.
- Engage a professional who works within this environment
I was recently approached by a client who was overwhelmed with not only the emotional challenges of helping a partner transition into aged care, but also the complexity of aged care fees. She had visited Centrelink and provided the correct information and felt confident the fees were correct, but felt a second opinion would help ease her mind. The truth was, the fees were not correct and with my help, they received the below refund from Centrelink in addition to $37,000 in annual aged pension which they were unaware they were entitled. The client was already ahead by more than $62,000 in the first year and $37,000 every year thereafter.
As the new rate of means tested care fee is lower than the fee previously advised, you are due a refund of $25324 based on information received during the period since the last fee advice letter, if you have paid your fees as previously advised. The service provider will adjust the fees and refund any fees that have been overpaid.
If you find yourself in this position, listen to your gut as there is far more to be gained than lost by seeking a second opinion.
