Changing Landscape of Retirement #6 – Sheena Stow-Smith – Transcript

Episode details

SUMMARY KEYWORDS

centrelink, age pension, clients, people, advisors, complexities, system, superannuation, talking, type, government, paid, issued, retirees, bit, financial planners, staff, debt, aged care facility, advice

SPEAKERS

Sheena Stow-Smith, Fraser Jack

 

Fraser Jack 

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Fraser Jack 

Welcome back to the Expert Advisor podcast. I’m Fraser Jack and we are talking all things around the changing landscape of retirement. In particular today, I really wanted to focus on the concept of the Social Security system around around retirement obviously the pension and things to do with with aged care and assets and income testing, etc, etc. So who better to chat to then Sheena Stowe Smith, welcome.

 

Sheena Stow-Smith 

Thank you. Thank you very much for having me.

 

Fraser Jack 

Now, do you want to give the listeners a quick overview of you and why I want to talk to you about the the the central?

 

Sheena Stow-Smith 

Oh, that’s people would say that I know a little bit about CenturyLink. I think my background and I think eagerness if that’s the right word, I don’t know many people use that to describe them essentially call the Social Security system. I don’t think anybody describes

 

Fraser Jack 

the Social Security system and dealing with Centrelink as eagerness I think he might be the only one in the country. Oh, well, let’s

 

Sheena Stow-Smith 

get some passion into it. I think. What’s a real ism I think into it. I think it came from I was an advisor myself. So I sat in front of many clients that struggled with their age pension and their understanding of, you know, what they were receiving, why they’re receiving it, plus other benefits and things like that. So what they’re eligible for, you know, started way back when something like 16 years ago, I think as a receptionist and worked my way before we go

 

Fraser Jack 

there. I just want to also mention that you spend all of your days talking to people and dealing with Centrelink.

 

Sheena Stow-Smith 

Yes. Yeah. And a lot of times

 

Fraser Jack 

you do and you run a business called advice link, which essentially talks to on behalf of clients and financial planners around around

 

Sheena Stow-Smith 

all things handling all things centrally. Yeah. So there’s a lot of time on the phone to advisors about their clients and their Centrelink benefits. There’s a lot of time on the phone to Centrelink. And there’s a lot of research online and do you think there’s online systems all to do with the lovely centerlink So I think if I’m not excited about it, that becomes a real battle.

 

Fraser Jack 

A lot of time on the phone I’m I’m my mind jumps to a lot of the time on hold as well.

 

Sheena Stow-Smith 

Yeah, I love the music. I I can dance along and sing along and lucky most people aren’t here to see that

 

Fraser Jack 

whole music soundtrack down pat, by now I’d imagine.

 

Sheena Stow-Smith 

Yeah. And I think all that kind of came around because, you know, obviously speaking to clients that their Centrelink struggles, but also my my net impact they had, they had their own struggles with Centrelink, and being a financial planner, saying some plan is do these really, really well. Others, you know, trying to be not being a core focus of their business for obvious reasons. And then others just understanding that there’s time on the phone and hair like that music that they didn’t want to tackle it. So, you know, my nan and pop came to me with their own problems and obviously some some knowledge behind what Centrelink benefits they should be receiving, how it all worked, which is kind of gave me the confidence and the ability to work with them on that my my Nan’s a smart woman, she’s she was a teacher, which is you know, and she always worked even through having all her kids. And she was down essentially kind of regular basis telling them of all these US bank balances, term deposits and everything else that they had hidden in drawers and sucks and beams on the roof, all that kind of stuff, but she struggled and there was a clear overpayment for them and not because she was robbing a system and not because she was you know, trying to get more she was trying to tell them but you know, there was a miscommunication and complexity which she just couldn’t break through. And when my pop went into aged care that highlighted We needed to get on top of that for them as well, to get that right for your assessment. So, yeah, it’s definitely able to jump in and help. And

 

Fraser Jack 

this is a story that probably every family in Australia has, at this point. They’re it’s such a pain point, isn’t it? They the Aged Care space for for planners and for family members. And you know, and the people involved as well. There’s so many different areas of stress, which we’ll get into that later. But it’s such a common story, you know, I guess, is that why you decided to transition from advice to the new business?

 

Sheena Stow-Smith 

Yeah, definitely. I think we’re blessed that my Annie was able to help in such critical time from a medical side of things that that with her background, but that the burden of what comes with those people, I call them almost the sandwich generation, when you’re helping your elderly, parents or grandparents and you’re also working full time usually, and, and standing your own family and life. And that burden is, is real. And with such a complex system, and process, and we talked already about time on hold or time, in offices, I just, I saw pain points for clients. And all I wanted to do was just help as many as I could. But it became hard just as a financial planner, because you were doing so much from a compliance point of view. So the clear choice for me when advice thing kind of kicked off was no, this is this is the focus and and this has real merit, I think in what it what it can achieve for advisors and their clients.

 

Fraser Jack 

Yeah, so certainly your you know, the concept of full time versus part time, you know, you were doing this dabbling in a bit of part time when the need arise. But then now, it’s obviously a full time thing for you, and you become an expert in what’s how to how to get the best out of the system, I guess you could say,

 

Sheena Stow-Smith 

Yeah, definitely. So Well, yeah, I’m probably a little bit shy when I say the expert, but there’s, there’s so much learnings that I’m still having, and I do this full time every day, I’m so comfortable and confident with working with the system that our net that are now to every single day. And so, you know, talking to staff members in advising that previously worked at CenturyLink, as well just, you know, growing what we can do for these clients, but breaking through those complexities, and then coming up with new situations every single day, which we learn and grow from as well to be able to get a better outcome for clients as well. So yeah,

 

Fraser Jack 

you mentioned start now this is a really interesting point, because with any, say government agency, or, or authority, whatever it might be, they’re just humans working in this business, right. They’re just it’s a part of the government, it’s a department. But there are a whole lot of people coming in and out of the system all the time. And like any system, I guess, if they’re copying it, if it’s difficult for, for clients on one end, it’s probably difficult for the staff on the other end, and imagine that it’s fairly high turnover.

 

Sheena Stow-Smith 

Yeah, I can’t remember the exact numbers. But there’s, like I think about 10 years ago used to walk in and almost deal with someone on a regular basis, at essentially coffers. But staff numbers, astronomical and even just more recently, with the COVID conditions, the amount of temporary staff that they are the pulled from different government departments being Medicare HMO, things like that. And the lack of training that these beautiful people who work there, received, but in such a complex area, was heartbreaking, the I think my time on hold became a lot less, there was a lot of phone support thrown in there. And that was great for someone who understood those complexities, but I was talking to someone who didn’t understand the systems in front of them, and didn’t understand the complexities in which they were employed to work in. And it’s not to say that, you know, have any solutions around that type of government policy on how they can really work and improve that. But I do empathize a lot with that system. But I do see it as a real pain point for our clients. And I think it’s a real need for professionals and trusted advisors to really get in there and help them if you’re not going to help them with the administration side of things, at least help them understand what they’re trying to achieve, and maybe what they need to be communicating with centerlink. On and about. So you

 

Fraser Jack 

probably spend a bit of your time actually saying to centerlink stuff, I actually know you can do that. This is how you do it.

 

Sheena Stow-Smith 

Exactly. Actually, that was really scary. But you could pick up on that, even to the point of going now there’s a secondary system, or can I speak to Queensland office because they actually have the right system that can plug in and that’s working like it is that amazing the complexities in which these lovely people, as I said, again, working with that, I treat them with kindness with the hope and the outcome that they can provide some support to what we’re trying to achieve for our clients and our advisors.

 

Fraser Jack 

Yeah, it’s, I mean, it’s it’s just kind of scary, isn’t it that you can get lost in a system? It’s, that’s, that’s designed in there to help people, and is not helping people in a way where, and I guess, I guess it’s quite confrontational in many ways. And in some of the staff, they could even be coming in from, you know, a negative aspect because it’s being confrontational, or they’re working with somebody who might be trying to rock the system over here. And then they’re trying to work with somebody who’s in a positive mindset or trying to help the system and they don’t quite know. So they get pre judged on those sorts of things to your DVC. That,

 

Sheena Stow-Smith 

yeah, definitely, I’m like, if you think about who Centrelink you’re trying to help, it’s not just our retirees. It’s not even just the disabled, or disability support pension, claims that they’re trying to really assist. They’re dealing with a vast range of our society. So we’ve no break. I think we as financial planners, you could break up what you do into accumulators pre retirees, retirees, essentially, I’m going to break it down a little bit further. And I kind of say you’ve got your families, starting off families, and maybe some of them are jumping online and doing what they need to do. But there’s a lot of complexities in that as well, especially if you’re single parents, that kind of thing. You’ve got disability and illness. So there’s a lot of complexity around the people caring for those taking those people in or trying to sort out what exactly is going on. You’ve got financial crisis, as well. So those people that are really struggling, and, you know, we’ve all heard of job seeker, and the astronomical amount of benefits being claimed and paid out, and changes that are happening in that area. So we saw the queues in COVID, I think we’re gonna see some, some more claims in that. And I think in that range of society, you’re going to be dealing with a range of education levels, understandings, and also maybe attitudes to what what they expect when they walk into Centrelink. So those staff are basically guarded, they’re armored up, before you even speak to someone and like, I know myself when they put me on hold or transfer me to another department, I, I think I have an inner sigh of like, what is going to happen here? How am I going to be on hold? Is the phone going to drop out? Because you can’t ask them? Can you take down my number and call me back if it drops out? And it does drop out? Like some of the biggest complaints of maybe not last year, but the year prior? were around phone dropouts or hold times. So I’m you know, your client is already on edge. Because of these wait times or the dropouts that they’ve experienced all the transfers before they speak to someone or deal with someone then they’re dealing with someone who’s armored up guarded, really ready to tackle the worst of their situation? And yeah, it’s not a gig, I’d rather be on my side of the phone, then their side of the phone. So yeah, definitely have. That’s my perfect system. But it’s, it’s trying.

 

Fraser Jack 

No, exactly right. And I do you do feel for these people who are put in a situation where the system might be difficult, and then they just human beings with lives two lives and, you know, families to feed, you know, being with not quite enough training and and, and the people around you, right? They’re sitting in a room full of armor that people say they’re going to walk in, they’re going to be armored up to start with. And you know, I don’t know, I don’t know what the answer to that one is. But it’s certainly worth keeping in mind. If you’re ever have a conversation with the handling person. Start with a bit of honey rather than

 

Sheena Stow-Smith 

the smile that comes from my reception days, you know, you pick up the phone, if I’m smiling, even if I don’t feel like smiling, it’s going to come through and hopefully you get a little bit of reciprocation.

 

Fraser Jack 

Exactly right. Some good learnings and good good things to take through with you. So when So yeah, that’s really interesting that the staff the knowledge and the attitude, and obviously, the turnover is is big in that space. So finding the right staff finding the right system, which I guess is where you come into it. You mentioned some of the pains around complexity, we keep saying the complexity word, the fact that there is a lot of complexity. And, you know, that creates complaints and, and a little bit of fear even in a lot of ways.

 

Sheena Stow-Smith 

Yeah, I think so. I think um, like, just even walking into Centrelink. I don’t think some people just don’t want to do it. Some people don’t want to claim for Centrelink at all. I actually think that comes out of where it was born from, like the whole age pension in general was, you know, don’t quote me on my numbers. There’s something like the 19 1905. It started in New South Wales, as something that provided support to people in poverty to poor people. So that is misconception number one that I think is always going to be attached to social securities and services in those types of areas, I think means tested was added in so instead have just a set amount being paid out to people who are in poverty or below a certain line of income. And more means testing and complexities came in. And there’s that terrible word again around. Well, if we’re going to pay a full pension, what’s it going to cost us? And I think that’s what it comes down to, from a government cost point of view, what’s it going to cost the government taxpayers. I think prior to superannuation, there was something like six working people to support one retiree. And that was, you know, a little bit more manageable, but that’s projected to basically half with all their baby boomers going into retirement. So I think what the government has tried to do with the introduction of superannuation came the introduction of means testing, means testing means that instead of just cutting you off, the government supported age pension, it kind of introduced a way of tapering it down. So based on your income based on your assets, we tapered it down. Inside that it’s all you know, what assets are included? Is it your superannuation? Is it your home? Do we count them? You know, where were you allowed to give your money away? Those those added? I’ve got no other word but complexities. I think those are the rules that came through, just added to what can what can you do to plan your retirement? How much do you have? How much are you going to have? And what can you fall back on if everything went bad, and I think the retirement systems started to build to a system, which wasn’t just an age pension for poor people, it started to become a little bit, you know, more focused on building superannuation, names, testing then came into the age pension. And then obviously, people started to focus on being self funded retirees, and then there was a little bit more focus around trying to save for that, and hopefully, in this current economic condition, and and we can kind of still continue with all three of those areas to really support the system that’s in place, I think, even back in the 70s, not Whitlam, I think, tried to abolish the means testing system. I think that kind of got thrown out, though, as superannuation came in as well. So hoping that people would name this a little bit less as well. So and you know, people just that I think there’s a, if you compare it to maybe a Dutch system as well, where people in these types of countries in Europe, they work, they contribute to the government or the retirement fund, if you like, in that in those kind of countries. I think Dutch has something like 18% of salary. And then there’s this guarantee, or there’s this expectancy, that they’re going to have a lifetime income from the government, and it’s managed by the government, which provides them some support in their retirement in our system allows for a little bit more flexibility though, we, you know, our superannuation system, which allows access to funding, and then a fallback position, being the age pension, and hopefully we don’t all need to rely on on the age pension, but we want to be able to know what’s what’s there, and what’s available to us if we’ve been been in the society and, and

 

Fraser Jack 

I think it’s kind of like the the system where the government manages the money for you, and you just hope he, you have to put a lot of trust in, in, in the government. And obviously, people have varying levels of trust in governments. So it’s probably probably, you know, puts a little bit more trust in the system to have our superannuation system in place. And so I’m probably point to people’s engagement with their superannuation a bit more as well. We talked about attitudes, and you sort of mentioned on the concept of the poor. Yeah, sorry, the the attitude of Centrelink, or social security being for the poor when it first started, and then people that were, you know, retired and maybe entering aged care now, that’s probably their attitude towards how that was, wasn’t was in place. But we’ve also got the attitude of sort of the entitlement attitude around I look at paper taxes, I’m looking for money, and then and then we’ve also got the attitude around things like, you know, I want to take advantage of the system, I want to, you know, be doing everything I can without putting any pressure on the system, because it’s my, you know, it’s gonna be my, my kids and grandkids that are paying that back.

 

Sheena Stow-Smith 

And my mom’s a prime example of that as well. Like, I’m not that, you know, my mom’s a teacher, you know, in her in her career, and she’s retired now and, and when she retired, she was very unclear about what she was entitled to when, you know, straight away she know what can I get that soundstage in her retirement planning. She sat down and the age pension was very much a possibility for her but her situation changed where it’s not anymore, which is, you know, a great position for her to be in but telling her, me you’re not entitled to anything But you can get the Commonwealth seniors health card, which I think is a really important point. And some, a lot of our over age pension age people are actually missing out on. So, one to keep in mind, but I think her entitlement mentality was What do you mean? I can’t get it up, you know, she lives in at one g on you know, Lake Macquarie and she sees all her friends with maybe a boat or, or they step up, they get the age pension, why don’t I and, you know, it’s your mom, you’re a saver. you’ve accumulated this, this wealth, and I’m, you know, I’m, she’s my hero, like, I’m so proud of what my mom is able to achieve. From very, you know, simple beginnings if you like, and, and that’s fantastic. But you’re a self funded retiree, you’re not entitled to this. But wait, so I spend more on these hot like, you know, she gets a holiday, she gets lots of lovely things, actually, that’s probably her biggest fear, you know, point of agony at the moment with COVID. But she’s able to spend money as she wishes, because she saved for it. And but this lack of age pension is was a big realization for her. And I think like many So, yeah, it’s this comparison.

 

Fraser Jack 

You gotta love the benchmarking conversations where people start comparing themselves to other people. But it’s interesting, isn’t it, that we’re just the word entitled, Minar? Or entitled, it’s sort of, it’s kind of maybe, maybe we need to work on the languages as planners and financial advisors might need to work on the language and talk about, like, you just said there How lucky she is to be able to not need this, rather than not being entitled.

 

Sheena Stow-Smith 

Yeah, I tell my mom all the time. Like, if that’s your biggest problem, right now, Mom, you are sitting pretty. So you know, she’s an avid photographer, she, she loves to travel, you know, she’s got a beautiful now husband, and, you know, we’re just I’m just really proud about what she’s been able to achieve, because she has this savings mentality as well, because she’s, you know, moved on from a generation where I work, I pay taxes, I struggle through my life to be able to afford these expenses. But now I’m, you know, now people are with superannuation, I think, a big introduction of that. And this seeking financial advice, as well, and thinking about strategies, has empowered you to really change this reliance or entitlement on this system, which actually think we’ll be around for a really long time. At some point, I thought, you know, 10 years ago, when I first started off in the industry, I thought, I’m never gonna get the age pension, this is not going to be a thing. But I think the government can afford to have this around for a really long time. But I think it’s great. It’s people like my mum, the rate, like they’re the reasons why we can keep having this around, and really benefiting and lifting people that, you know, that need to lower financial status that really need it. And also providing support in other areas like so you Come on, we’ll send us health care card is a classic example where it’s not just about paying you an age pension to supplement your income. But what medical support can we give you what, you know, when you get a bit older, if you want to stay in your home Mum, in which she adamantly does, you know, what other support can we get you and now afford as a government, for you to stay in your home for you to be able to get your Lawns Mowed, or if you need a lift or something along those lines, what other support can we now fund for your retirement for your at home care, given that you are now a saver? So I think that’s a really hopeful position for the government to kind of move into and that extends to lots of things like, you know, hospitals, and just you know, disabilities and illnesses and, and tragedies and floods and lots of things that kind of go on that are unexpected.

 

Fraser Jack 

Yeah, exactly. I don’t even know the numbers Exactly. But I think once the people that have been getting superannuation guarantee paid for them for their entire career, once that happened, it’s obviously going to create that a little bit of easing up in that middle section, you mentioned that that middle zone where people have had a job for most of their life and being paid their superannuation guarantee and actually have a bit of savings that you mentioned, your mom is a saver. Now this is a this is a really interesting part of the conversation. Because when people are Savers, that a habit for a long period of time, it becomes ingrained in them to be careful and save money. How do they then become spenders and then just just turn that around? Say No, I’m here to spend the money that I’ve saved now.

 

Sheena Stow-Smith 

Yeah, I think it’s um, and if you from a financial planning point of view as well, when we’re talking about trying to maximize benefits for clients, it’s some people actually sit on that real tipping point, like, you know, you just want the pensioners card or you know, or just want to maximize how much you can actually receive and that’s not been brought in the system. It’s by working within it and achieving people’s retirement goals. And, you know, when you’re an advisor, I think you’re always sitting in front of these clients and you’re not talking about dollars, you really talking about dreams and aspirations and, you know, they want to help their children out? And how can they do that to best provide them with this longevity where they want to have this lifestyle, you’re not talking to them about, let’s go spend your money because this is what it does for you. You’re talking to them about how they feel about their relationship with money, what does money mean to them? And how does it? How does it get them in a position where they’re, they are comfortable in spending. So it’s often about holidays and experiences and family and, you know, passions. And, you know, for my mom, like I said, it’s what stops her from being on the phone to me, my sister, my brother every day, and it’s photography. So, yes, you know, trying to get her in that comfort level that this amount of money in these, you know, in this type of quantities, that’s great, you know, go for it, because you’ve got this type of position. And then I think for a lot of people as well, that fallback, worst position, knowing that the age pension within these within if I get to this position, you know, you talk about asset estimate and income tests. I’ve got an age pension of this. This is like my core, this is my baseline. And I think that really does help people have a better relationship with spending once they are transitioning from that working saving lifestyle to I get to spend now, so I get to leave.

 

Fraser Jack 

Yep, exactly. And you mentioned the word transition is it’s definitely a transition. That let’s talk about the you mentioned the testing the you know, the the income and assets testing. Is that is that great where it is now? Does it still need refining?

 

Sheena Stow-Smith 

I think it needs simplifying. I think, you know, the whole concept of getting rid of it altogether is it’s it for me, it doesn’t sit? Well, Eva, like, you know, to just think that people could be living in huge houses or giving away so much money to their children just so they can have a large pension, because they were savers. And they’re just passing that wealth on. I don’t think that sits? Well, in my opinion. And this is very much an opinion we’ve made but i think i think it does need refining a little bit. And there was talks about whether the home at over a certain amount needs to be kept and whether they need to consider home values in different states, because we all know that’s a little bit different. It’s going to add to those rules and complexities. So that’s the conundrum I think of it is should we be doing that? And then on the other hand, you want it to be a little bit more simpler in its application? Yeah, I don’t know whether I’ve got a definitive answer.

 

Fraser Jack 

It’s complex, isn’t it? Like there there is to make it slightly better, you need to add more complexity. But yet, we want to try and simplify it. So it you know, I guess if you’re if you’re one of the decision makers and rule makers and legislation writers, it’ll be a tricky situation.

 

Sheena Stow-Smith 

Yeah. And I think what I have seen, which I like coming through, but again, it’s probably adding to the complexities like, so back in the day, you know, annuities were 100%, asset test exempt and, and income exempt as well. So they’ve kind of introduced that back in again, where, you know, annuities have a portion of the asset, exempt an income and things like that. And I really like that idea, because I think that’s part of the our retirement system, and inconsistent that we’re really missing is this, setting people up with that guaranteed fallback position. And so I mean, it does add to the complexities, but I like that we’re trying to talk to people about setting themselves up. And then guaranteeing I don’t know, as an advisor, you’re going to probably be listening to me going annuities, they’re not very sexy, they’re not we’re excited. And then not because I don’t think our clients in retirement to change that relationship with money and how they spend, they need a little bit of that excitement and that engagement and that sexiness in markets and investments, but they also need a lot of security around, where’s my next paycheck coming from? Because that’s what it needs to be for them. They need to see regular income guarantees. And I know we don’t talk like that as financial planners, but that’s what your clients need for that peace of mind for some of these things to kind of change. And unfortunately, I think it just adds some of the rules and means testing complexity in in what we do. Yes, certainly

 

Fraser Jack 

does it add to the time factor and into the fear, doesn’t it because sometimes the we only have so much money in it. Probably going to run out some time and then and then then what so you know, you’re absolutely right there. So a lot of work going on with it, you know, with testing, I guess you could say but but tell us about the Aged Care part of this testing, and how you work with plants and in aged care space communities can

 

Sheena Stow-Smith 

I say we’ve aged care. The core element of what advice and offers to advisors is definitely around that. interlink getting your income and assets recorded correctly to the benefits that you’re entitled to with Centrelink, correct. and prevents overpayment, underpayment, debt situations, all those kind of things. That is also a core element of when you’re moving into an aged care facility. So regardless of what beautiful strategies as an advisor, you can come up to unless come up with for a client that’s moving into that situation, unless you’re getting that Centrelink component, right, from their benefits right down to their needs tested fees for the aged care facility, your strategy is almost worthless. And we implement so much as an advisor for our clients, we will go out and put the annuity paperwork in place, we’ll put the new allocator pension paperwork in place and follow it up, we’ll troubleshoot any problems that can come up with it that we send a lot of clients on their own lovely way to deal with an abundance of paperwork. What advice think tries to do is just gather the information from a Fact Finder or from their strategy paper or something along those lines from the advisor, a few extra statements. And it usually kind of gets us most of the way they’re from a central point of view, we can, we can complete the paperwork for aged care facilities, as well as updating or claiming benefits for Centrelink for those clients on behalf of those clients. Really, hopefully bettering that situation for the for the power of attorney, or whoever’s in the middle there. And we talked about this before, but that sandwich generation really often gets stuck. As this person assisting an elderly or frail person moving into an aged care facility, it’s often the worst time for more paperwork. Yeah. And as you mentioned, it’s one of the foundations isn’t it’s the building blocks upon and then everything else is built on Otherwise, the numbers of the room? That’s right, yeah. And they’re really racist of recorder. But if you, but if these people are moving nuns wrong, and putting those forms when the numbers are wrong, they can be, you know, a much bigger upfront cost than what might be required depend on what the strategy is available to those clients as well.

 

Fraser Jack 

Yeah. You mentioned the concept of getting the numbers right, and, you know, going through and doing the income and assets, etc, etc. Is there a fear that people have have of giving those numbers to centrally?

 

Sheena Stow-Smith 

I have seen that and sometimes I try to make sure that advisors are really talking about the current situation, there is issues that sometimes crop up in the line of work that we do, do where we see. And do you know that they’ve been overpaid for X amount of years, or they haven’t updated this situation since they claimed the age pension? I definitely think one is fear that people are worried about talking to these people with armor about this current situation and what it’s one of those like, you know, I don’t understand it, the list is too long, I’m going to park it over here. And if there’s no deadline on that, like your tax return, I’m basically never going to really look at that again. So that’s kind of what happens with a lot of people on benefits. I also think that there’s a misconception about how much do they know about me they should know this. So essentially, I don’t know a lot of what you tell other government agencies. I sometimes even dad at myself, I’m going to show you don’t know really see you sure you can’t find this out. But I I work with people as well that have worked in Centrelink. You know, I trust some of them when they unknowledgeable on the phone as well. We don’t know this, we can’t all we can’t rely on maybe what they’re being fed as well. So Robo debt was a very clear example of when they relied on information that they thought they knew. And that was a catastrophe. That was traumatizing.

 

Fraser Jack 

Yeah, I want to get rabida in a second, because because I think it’s important part of what retirees are going through that fear of, you know, being money being taken back. But you mentioned that the other government agencies, so the tax department, for example, and tax returns, and that being fed to Centrelink.

 

Sheena Stow-Smith 

Now the only information that I know that has been fed to Centrelink is single touch payroll systems. So that’s that system where your employer, your employer, tells, you know, as to what they’re paying you as earnings, and that’s the only system that is feeding through so not your tax returns, not your rental income, your investment income, not your notice, notices of assessment or your none of that type of stuff. It seems literally like you know, not your bank account balances in your data. It’s literally just single touch payroll that I know was being reported.

 

Fraser Jack 

That’s interesting. So if you don’t tell them then you don’t they don’t know. And that could come back later to bite you.

 

Sheena Stow-Smith 

I really hope that they start to communicate at least on ID requirements. That mean at this point, it’s the only time we actually ask our clients to go into essentially office. And it seems really, really logical that they should be held to kind of match up driver’s license numbers and just seem like far fetched it to me, but I think they are actually working on some separate systems in the background. But if financial planners and you know, police agencies can figure this out, I’m sure they can do

 

Fraser Jack 

more systems. That’s what we need. Now, let’s go over the robo debt thing, because that’s obviously created a lot of pain for all different parts of the Social Security, but obviously, with with retirees as well, you know, being being sent letters to say, I’ve overpaid you, you need to pay us back. Have you seen much of that?

 

Sheena Stow-Smith 

Yeah. And I also know that the current debt system is way behind. So they’ve been issued debts for the COVID period, they did start to reissue debts, I think it was around November. And I haven’t seen I know of clients on our system that have been overpaid. We’ve informed them, because we’ve made this update on your behalf. This is a good thing with structure over payment. This is what I think they’re going to ask that like from you at some point in time. So that real, giving them that real knowledge and power, or power and knowledge, sorry, but I think what we’re going to see more of is more debt letters being released, more surprises, more shocks, and less understanding of where it came from, why it’s come about, especially if it was made from an update a year ago. I’m gonna have to remind these advisors and clients, we told you about this, we told you this was going to happen. And we can always fight these things with Centrelink. But if we understand them, and we think that’s fair, it’s it’s much better situation to be in than being overpaid. I think we’ve Robo debt, I think there was a little bit of unfairness with how far back they were looking at the information that they were using to create these debt letters, with the current lack of debt that they were issuing, and this backlog and mishap, it’s going to be almost the same type of thing, where they’re going to say, back in 2019, they’re going to yubikey, issuing measly letters in five years time, clients don’t understand they don’t tell you why or where it came about, or how it was calculated, they just issue it. And it’s scary. one letter I did hear about was a single mother who was issued a letter and just as she was separating from her husband with very little assets. And she’s issued a letter, which said that she was a she owed the system $20,000 or something, which was quite scary for her a quick call. Actually, my honor, we sent that in error, we had you down as a non resident, because I’m a resident, our than you don’t know worth any money. It’s that type of Tell me why I have a debt. And I can go or this is wrong straight away, rather than waiting on hold, getting my arm around getting your then we look, we look at heads when we kind of collide. So I just, it’s tough. It’s a tough system. And I think the new Robo debt, like I call it 2.0, where they are using the single touch payroll system to talk to people about this is what you’ve been paid. And that’s changed recently, too. It used to be what you earned in a certain period. And now it’s what you have been paid in a certain period. But you’ve got to confirm it. So, you know, I know if there’s numbers in front of me, and I just I just click Yeah, okay, okay. Okay, I go for it. But you know, that’s also going to create a little bit of, you know, debt, I think situations and people now realizing, Oh, is that correct? Maybe it’s good. Maybe they had been overpaid. But it’s gonna be creating a little bit of a debt situation as well. So how long has this kind of thing going on? Yeah,

 

Fraser Jack 

it’s interesting. People don’t often read the detail in online forms, do they know the terms and conditions that we all just get used to clicking I agree without reading them

 

Sheena Stow-Smith 

actually read one app, having their terms and conditions that you’d give away your firstborn son, and they just want to see if anyone picked it up. It sounded like really rumpled skin type stuff to me. And I don’t think anyone picked it up ever and they released his information and I think I heard it at all or something like that. And I’m just thinking yeah, better probably remain I don’t know what some of those I promise with this Centrelink work people I’m doing the right

 

Fraser Jack  

guy threw him into the quite happily give away their firstborn son to a nap provider and it wouldn’t take him

 

 

during homeschooling their problems. Exactly

 

Fraser Jack 

what you believe, you know, the main the main pain people have with contacting St. Lincoln in the fears that they have, what would we see the main complaints been

 

Sheena Stow-Smith 

time, you know, lack of knowledge at the other ends. And, you know, that really is some of the problems I think we may get, just like the situation as well if I get rejected for a claim. And there was something like 1.1 9 million claims for job seeker last year. And that’s probably before the thick of some of the the issues we’ve done. The current conditions they use, what’s the number something like, you know, 200,000? rejected. They don’t, they wouldn’t know why they’re rejected, they just get a rejection letter. Sometimes it says, because you didn’t respond to information that we requested, which I think is a lot of the cases, they clients don’t know, what they’re asking and why and how to provide it. Oh, you know, I heard a lot of stuff getting lost in the mail as well. So I think not understanding the time it takes the lack of communication is the biggest, biggest issue.

 

Fraser Jack 

Yeah, it’s incredible. And I don’t know how you spend all of your day putting out these fires, but, you know, my head goes off to you for doing it. And how do you work with planets.

 

Sheena Stow-Smith 

So at the moment, acid is offering us to really take as much information that we know that they’re collecting, we know advise that the trusted professional in this relationship, and we love that they can build up their service offerings, we know that they’ve got a huge amount of compliance burdens in front of them, we offer them a service that they can add to their clients. It’s not advice, if it’s the administration service, we offer them something which they can really profit on, and they can really grow their business through. And I think, you know, if you just talk to half of the clients about this interlink experiences, they’re really willing to pay for this type of service. They’re really willing to refer clients in this type of service. And I think it also lends to a cross generational pace. We’re not just talking about retirees when we’re talking about, you know, families, like I said that the illnesses, the disabled, the Aged Care side of things, so it really lends itself across different clients and clients in practices. And so how we work with advisors is really just looking at the client based identifying who’s ideal for this, and how do we get this in place? And do we offer it to existing clients? Do we put a campaign out there for growing their business with this type of offering? We help them we’ve had a charge for this service, we work with this staff on, you know, what kind of information are we after, as advice thing to get to centerlink to make this really efficient? So we’re after a really efficient process? And the outcome? Is this getting the clients on the right benefit. And it might be less, so it’s saving them debt, it might be more, which is fantastic, but getting them on the right benefit or getting them the right age care phase. So implementing those strategies in that sense, like spacing, which advisors have worked really hard to do. So we do the administration, everything from claims to updates, or provide review reports. But we also help with that business planning point as well. Okay, fantastic.

 

Fraser Jack 

So obviously, if people have, you know, specific needs, obviously, which they will live from time, but really also around that young family space, sorting that out, really around, they’re retiring, I’m about to retire and pre retiree space, getting those foundations. Right, and then also that foundation structure ready for the Aged Care conversations. Yeah, and I think the main three,

 

Sheena Stow-Smith 

yeah, and I think like a lot of what you just said, then as well, as, you know, giving that advisor the real knowledge behind what they’re doing as well, like, I know, when I was studying to be an advisor way back, and you touch on Centrelink, and you touched on the complexities and that means testing, but you don’t, I don’t think you really dive into some of those fringe benefits where you start add a lot more value to clients as well. So giving them a real you know, the cheat sheets that the the changes the power pieces, I think that that really helped them feel confident, very in very quickly, in front of clients or talk about this.

 

Fraser Jack 

Yeah, that’s really interesting. That gives them a bit of empowerment to have a conversation. But also I see it as the the not paying their staff to sit on hold to me.

 

Sheena Stow-Smith 

Yeah, I think if you ask your staff what what do they want to give up the most if you’re offering this type of service? I’ll go Yeah, my Centrelink. I don’t want to be on hold. I don’t like them. I don’t like the music. Dakshina does, too.

 

Fraser Jack 

So tell us about the the future of this. This, you know, the social security environment? How do you think how do you see it sort of panning out from here?

 

Sheena Stow-Smith 

Um, look, I think how much the government’s currently spending on like the age pension amount at the moment compared to other, if you like, oacd countries, it’s, it’s something like two and a half percent at the moment where most of these kind of countries are spending about 5%. So I actually think we’ve got this is going to be around for a while. And if you do actually add in what the government spends on tax concessions around superannuation, we get kind of closer to that mark. So maybe that’s a bit one sided, but I really do think that this is not a system that’s going away. And you asked me about my opinion, if what we should do means testing and complexities? I don’t know. And I actually don’t think those complexities are going to go away the grandfathering is always going to remain the, the issues around am I a homeowner or not a home owner? And, you know, because all those types of things, especially for retirees are consistently changing. So I think the future of age pensions, Centrelink benefits, like I said, My mum saved or life, I think that’s gonna open us up to what else is out there. Now what can we spend more money on? As a government in this type of area? I think it’s going to continue to grow. And I’m excited because I think advice Link is in a position for advisors to support you in that so we can focus on where where is it growing? Where is where are the changes happening? What are what does this mean for your client, like, let’s turn this into a have a senior squad, which goes out and tells me what their pension is card gives them and the free cup of coffee always surprises me, at McDonald’s? Am I allowed to say that? It always surprises me because I really like that. But anyway. But they what it means to them is it’s huge that they have got regional clients that tell me about, you know, they’re going to national parks and things like that. So I think I’ve seen this space for advisors is really talking to you know, how people feel about money, what they’re saving their money on, and then what they actually need to spend their money on. And that’s, that’s really where I see CenturyLink in this space kind of going I think advice thing is going to be there to help advisors along the way.

 

Fraser Jack 

Yeah, and even before that, the more we know about this, obviously, the better we look in front of our clients, because we can we can say stuff. What about training for planners in the space?

 

Sheena Stow-Smith 

Funny, you mentioned that, I think at the moment is we’re really excited, we’re opening up our services and developing a training plan, because I speak to a lot of advisors about specifics around their clients. So we are developing an educational and training plan that helps practices mainly I’m taking my business for myself, but actually helps practices if they want to do it yourself model in this service. We were going to give you the tools, we’re going to give you the education, you know the scripts there how to charge for this then, and what does this look like? What does this do for your business value as well as your clients, which I’m obviously very passionate about. Otherwise, they don’t spend time on hold, essentially. So how to grow your business service, how to do this yourself how to train your staff to do this with you. And maybe it’s not even an advisor space, maybe this is an advice this, this service is something which sits outside of that. But it’s something where you can very much grow revenue for your business, train your staff to do for you, whether it’s your associate advisor who’s coming up the ranks, or some other type of admin support, and do these in house. If you don’t want to, though, advice think as an administration service is always going to be there as well. So we’re really excited about these next step in next phase of advice. And because you are really excited

 

Fraser Jack 

to look,

 

Sheena Stow-Smith 

maybe it means a little bit less time on hold and dancing around.

 

Fraser Jack 

Like I love to help you think so. So like I know a lot of pens that are using you and rave about the services if somebody wants to continue the conversation or get hold of you what’s the best way

 

Sheena Stow-Smith 

and shoot me an email, give me a mobile phone call or if you like the traditional way, but you know, anything and everything. I’m open to any type of communication. Our website has subscriptions. So if you just want to soft contact if you like and any news that I’ve got LinkedIn, reach out, give me a call. I’m very scary and got very scary dance moves. But other than that I’m really excited to talk about CenturyLink

 

Fraser Jack 

no such thing advice link services that’s the.com is at the address.

 

Sheena Stow-Smith 

I think services.com.au

 

Fraser Jack 

and tastic. Okay, have a thank you so much for coming and sharing. I really appreciate it and you know, I wish you all the best and I hope people reach out.

 

Sheena Stow-Smith 

Fantastic. Thank you so much for having me, Fraser.

 

Fraser Jack 

Well, there you have it another episode of the Expert Advisor podcast. I’m Fraser Jack, and I’m joined by Emily Blanche. Good Emily.

 

 

Hey,

 

 

Fraser. How are you?

 

Fraser Jack 

I’m a wonderful thank you for asking and of course our best part of the week where we get to shout out to some x y members.

 

 

Yes,

 

 

let’s do it. So a jewel a shout out today to x y advisors, Chris Carlin and john Kashi up to legends who jumped on at an x y plus web event recently to talk about how they are engaging and delivering advice to millennial clients. Awesome session. Great discussion. Both john and Chris were really open with how they’re charging the fees they’re charging, how they’re walking new millennial clients through their onboarding and discovery process to becoming a client. JOHN shed some hilarious analogies and Chris was really opening why he wants to work with nurses and teachers in Particular and really help millennials and those that aren’t super high net worth. So great conversation. Thank you guys for sharing really appreciate it. And that’s my shout out for today.

 

Fraser Jack 

Wonderful. Thank you legends. The tour is good to hear them great people doing great things, especially in the x y plus area. So people want to get access to the web events, check out x y plus