This evaluation of the pilot Financial Consumer Rights Council: Dignity and Debt Financial Difficulty and Getting Older initiative found financial counselling has a number of benefits.
The Financial Consumer Rights Council (FCRC): Dignity and Debt Financial Difficulty and Getting Older initiative was designed to address the effectiveness of one-on-one financial counselling sessions with Older Persons. These sessions included the provision of consumer advocacy and information about financial hardship protections to those entering aged care, education to the aged-care health workforce on the role of financial counselling and examination of uptake of financial counselling by Older Persons the general.
The Centre for Applied Social Research evaluated this pilot study, looking at the effectiveness and challenges of the utilisation of financial counsellors in supporting Older Persons with financial literacy, and assessed the training of the aged-care healthcare workforce on financial counselling referral pathways.
The need for safe, secure and stable support platforms to assess and manage any financial hardship and debt issues of this Older Person population emerged as crucial, and provision of quality advice and support from financial counselling that is accessible to the Older Person population will thus be a key element in maintaining wellbeing, quality of life and positive ageing for this population.
The evaluation found that considerable structural changes have occurred within the aged care landscape in recent (5) years which have impacted on the financial literacy of the Older Person population to manage their finances. These changes in summary have included:
- Increased use of credit cards and finance loans by the Older Person population resulting in increased levels of personal debt, and the transference of existing high levels of debt (such as mortgages, credit card debt) into retirement age
- Reduced levels of home ownership and increasing housing instability (21% of the Older Person population are not home owners) resulting in financial stress and instability
- Requirement of IT literacy for electronic online banking, budgeting and payments, access to MyGov online portals for MyAgedCare, Medicare, Centrelink etc, to manage of Consumer Directed Care (CDC) homecare packagescouns, to manage budgeting and service provider payment platforms and to obtain service provider information for decision-making related to service usage (which the Older Person population often do not have)
- Transition of the aged care landscape onto consumer-directed marketised platforms based on individualised funding models
- Complexity of the Aged Care Assessment Service (ACAS) assessment process and Income and Assets financial assessment required to obtain access to community-based and aged care residential facility services, in addition to ensuing personal income costs in having to subsidise the purchasing of these aged care services once obtained
- Associated stigma and shame within the Older Person population in seeking financial help
This newly emerged marketised landscape of aged care and the impacts of financialisation are bringing unique challenges to the expanding Older Person demographic in Australia.
In light of these changes, the importance of access to financial counselling for Older Persons as a mechanism to obtain financial wellbeing emerged as paramount.
The role of financial counsellors in supporting Older Persons in financial literacy was found to be expansive and included strategies in managing financial hardship and personal debt (an increasing phenomena in the aged care space), assisting with management of their consumer directed care packages (related to the purchasing of required support services), assisting with the completion of entitlement and benefit application forms, helping with navigation of online platforms associated with their financial management and provision of skills and education in seeking to reduce exposure to elder abuse and financial scams.
The report recommended the need for increased levels of population-based debt prevention interventions in addition to crisis-response financial counselling strategies. A number of long-term strategies for the reduction of financial difficulty, debt resolution and prevention of further debt for Older Persons were also proposed.
Government responsibility to ensure mechanisms for financial wellbeing of our Older Persons population and prevention of social disruption from wide-scale hardship will rely on strong and accessible frameworks that are well resourced.
Financial counselling should be viewed as a key component of this framework and mechanisms such as training in referral pathways for workforce, industry upskilling and ensuring wide-scale promotion of financial counselling in the aged care space are critical.
The findings of this evaluation contribute to evidence that financial counselling can work and produce formal and positive outcomes. However, a significant number of potential risks need to be overcome to establish a flourishing, fairly distributed and well recognised and respected financial counselling service in the aged care space.
What is clear is that financial counselling will offer something tangible to Older Persons in hardship in the future and that evidence suggests that the expansion of the financial counselling role will greatly benefit Older Persons in a variety of social ways.