How IRCs can fill the void in your retirement planning conversations with clients

As an advisor, there’s a good chance that you see some very familiar patterns during your clients’ retirements. The first few years are often filled with the novelty of not working after a long career, with time spent travelling, indulging in hobbies, and celebrating family milestones.

Then, there can often be something of a gap as these events become fewer and further between and they start to get older. This can translate into a lull in your retirement conversations with clients – they’ve fulfilled many milestones already, so there’s now not much to discuss.

This represents the perfect opportunity to introduce the concept of an Integrated Retirement Community (IRC), bridging the gap between retirement planning and potentially unavoidable care. Retirement living can be a natural progression in your financial planning conversations

In its thematic review, the FCA made it clear that retirement planning needs to shift from simply what happens when a client finishes work, into a more dynamic approach which accounts for changing circumstances over time.

This is where IRCs can plug the gap in conversation, acting as the missing piece between traditional conversations at the opposite ends of early retirement and later-life care.

Instead of jumping from talking about active retirement into care contingency planning, you can instead talk to your clients about living well and independently in an IRC.

And this is a conversation you can have as early on as you like with your clients, even if they think they’re currently too young. In fact, the sooner you do introduce the concept of an IRC, the better.

An early and upfront conversation about IRCs can shift mindsets, benefitting clients’ lifestyles and wellbeing.

Many people bring an attitude of “I’m staying in my family home forever” into their financial planning meetings, often simply because they don’t understand the options available, what opportunities they represent and issues they avoid.

Talking to them early on about the model of an IRC can help them to understand what the potential benefits could be for them. You can also bust some myths, such as that an IRC is a care home or a last resort, instead positioning it as a cost-effective choice for an active and independent retirement, overcoming many of the issues that arise through staying in their current property. This opens up the idea of an IRC and its possibilities for them, and you can build on these conversations over time with your client.

Essentially, it’s not about throwing in the concept cold and suggesting they think about it right now. Rather, it’s about taking a holistic approach to offering a whole range of retirement options for your clients to consider and educating them on the pros and cons of each.

As their advisor, it’s not your role to recommend a specific move or force a decision. But it is your role to put all the retirement options on the table upfront. When talking about IRCs, focus on wellbeing, independence, care options within IRCs, and the tax and IHT benefits of the deferred fee.

Introducing IRCs early in retirement can help your clients feel less anxious about ageing and feel that their retirement can offer fulfilment and independence even as they move into later life.

It can also give them time to discuss options and preferences with their families, explaining the financial aspects of how their inheritance need not be impacted – and could actually benefit.

IRCs are an important part of your wider retirement conversations and will be perfectly placed early on, as you discuss potential living options beyond the family home.

Get in touch

Riverstone Living offers an elevated retirement living experience, with wellbeing and fulfilment at its heart.

To find out more, please visit https://www.riverstoneliving.com/advisors, or email bruce.ely-johnston@riverstoneliving.com.

Please note

This article is for general information only and does not constitute advice. All information is correct at the time of writing and is subject to change in the future. The Financial Conduct Authority does not regulate estate planning or tax planning.