With the new Care Bill progressing through parliament, trade body Symponia have suggested that independence is not the most important sole factor when it comes to long term care advice.
As a firm which specialises in providing care fees planning advice to the elderly, we believe that independence really does matter.
Ensuring that elderly and often vulnerable individuals receive independent rather than restricted financial advice about their options for paying care fees is vital.
It is vital because independent financial advice means options other than a financial product should be fully considered and explained.
With restricted financial advice, there is a real danger than the advice will focus on the use of a financial product; in the case of care fees planning, either an immediate care annuity or an investment portfolio designed to generate income.
Independent financial advice on care fees planning means that the adviser will fully consider keeping assets in cash, renting a property, utilising local authority and state support, or a multitude of other, non-product options for the solution.
It is possible to get good advice from a restricted financial adviser, just as it is possible to get sub-par advice from an independent financial adviser.
The use of an independent financial adviser, particularly when it comes to a specialist subject like care fees planning, does however reduce the probability that an inappropriate product will be the result of the advice process.
With the immediate care annuity currently limited to only a couple of providers, the independent approach becomes less relevant from a product perspective, particularly when restricted advisers tend to consider both providers as part of their advice process.
Where independent financial advice does come into play with care fees planning is ensuring that all of the options are fully considered, and the motivation for the adviser to recommend a product is reduced as a fee is paid for genuinely impartial advice, rather than advice which sets up the restricted adviser to flog a product for which they are then paid.
