November 11, 2021

#267 Kevin Smith – Transcript

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Fraser Jack
Welcome back to the xy advisor Podcast. I’m Fraser Jack and today I’m joined by Kevin Smith. G’day, Kevin!

Kevin Smith
G’day Fraser. How are you?

Fraser Jack
Tremendous. Thank you for asking. Welcome to the show. Now, we managed to catch up in person in South Australia not so long ago, as the borders were available to be opened. And I think I think quinzaine have opened up now. But thank you for coming on. You’ve got a really an interesting business model, which I want to explore. But actually, let’s, let’s just quickly give you a quick overview of that current business model.

Kevin Smith
Yeah, so I’ve run a business called pension services. And what we essentially do is we deal with Centrelink, and aged care matters on behalf of clients. So it sort of sits it does sit outside the advice realm. But it comes from an advice background. But it’s more an admin service, completing paperwork, following up with Centrelink, and just picking the fight when we need to pick the fight with Centrelink, and having some wins. Yeah. Now,

Fraser Jack
we’ll get into how this happened in a second. But obviously, that’s a pretty valuable service for clients. Both, you know, for financial advisors and accountants and other professionals and a lot of people going through the pain I love the way you call yourself on your LinkedIn profile or Centrelink stress remover as your your job title. I think that’s a great way to put it. Let’s get back in time, tell us about your journey. You You started off as an advisor, but tell us how you got into advice in the first place, ah,

Kevin Smith
advice, I think was really a little bit of dumb luck to a certain degree. By initially, I left school I finished university and didn’t really know what I was going to do, moved overseas and worked for some big institutions, State Street and done a lot of settlements for them and done a lot of back end office for them and didn’t enjoy being stuck in an office all day. After while, came back to Australia, landed a job with BT at the time, and done some of their reconciliations, some of their margin lending just before the GFC. And you know, they weren’t worried about, you know, let’s write off $20 million on the reconciliation, nothing’s gonna happen to the market. And that was probably 2006 2005. And then got an opportunity 2007 to join CBI with a graduate program. So done that for a while, within nine months. So you’re an advisor where you go and learn very quickly, how to become an advisor, move to country Victoria for a couple of years. And that was my journey into advice that grew from there. So I was with big institutions for most of my career, or my career. And it worked really well. I probably elbow I did leave the industry. Two years ago from that perspective, I got an opportunity to leave. And I wasn’t really confident, I guess in where advice was sort of going I wasn’t happy with all the changes that were continuously happening. I’ve been through five had been through this had been through that had been through removal of commissions and all the rest of it, which were all good things for clients. But I was finding it was getting harder and harder just to provide good simple advice to clients. And I was also finding that clients were having struggles with simple things. You know, we had a lot of clients that struggled with budgeting, cash flow, we had a lot of clients who struggled and just struggling to deal with Centrelink took the opportunity to leave advice in June 2009. And

Fraser Jack
took up June 2009 1998. Yes,

Kevin Smith
yep, two years ago, yep. And sort of explored what I was going to do. And that’s been sort of that. And I guess from that journey, I went in and done a lot of more financial coaching. So around setting people budgets, holding them accountable to that budget, which was more so probably more important than the actual budget itself was just that accountability in and kicking their butt on sort of a monthly basis. And that was going well, we’ve done a little bit of corporate financial health as well. So we went a couple of businesses and said, Hi, this is what we can do this, we can help your clients and that worked well. And then COVID hit, and everything sort of shut down very quickly.

Fraser Jack
Yeah, so this is a, I just want to explore this part a little bit more. So you you left becoming your private client advisor, I think it probably I pack at that time. Then you decided to start your own business. Tell me about that moment where you decide to go out on your own and have your own business.

Kevin Smith
Yeah, I’d always wanted to run my own business. From my perspective, I’d always wanted that experience. And I’d sort of wasn’t sure how I was going to do it. So what actually happened is I actually put my name into an incubator, through hub, Australia, 24 bit hub, Australia, one of the local universities and they put me through a three month incubator and it was all about how to start how to grow your business. They provided some office space for 12 months. And they put us through this course about just validating your ideas and seeing what works. And I found that really useful. From my perspective, it was a great grounding, and it also taught you look if you can validate Your idea run with it. If it’s working, keep going. If it’s not, you don’t have to be married to it.

Fraser Jack
Yeah, it’s a it’s a it’s a fail fast type concept with a with any particular startup, your trial and error, you try and test and you test a new major and you move agile, you sort of go Okay, great. Well, that part’s not working, what is who’s gonna buy and everything’s around, don’t build too much, right? Just build enough to just define a paying customer.

Kevin Smith
Correct. And that’s, we were getting some traction with the financial coaching. I was working but it wasn’t growing at a great speed. And I guess I came from where I knew I had a certain runway and I was looking at that right my down the barrel and or sort of got six months to go. COVID sort of pulled a few contracts. And what actually does, I’ve actually put up a couple of videos around. Hey, this is what job keeper is. This is what job seeker is when that all sort of came out, put it on YouTube, put on Facebook and said to people, Look, if you haven’t traveled Booker, Lincoln Medora here’s the calendar. Link, bang, away you go. Every within a couple of days, I had 10 appointments, mudhar, I should What am I going to do now? You know that that was the Okay, I’ve got appointments Medora. And everyone’s like, how do I deal with Centrelink can’t do this can’t do that. Mike, come on. It’s not that hard, like it is. But it’s not dealt with Centrelink for clients for the best part of 30 to 40 years, knew not inside out, but had a good enough background to guess with advice and been able to read the legislation. So this is what the rules are, this is where it sits. This is where it isn’t to help those clients. And then I guess that background and the course I’d done through Flinders University, I sort of poke the bear a little bit just to see what was there. And I went to a couple of advisors I knew and said, Hey, do you enjoy dealing with this? No, no, absolutely not. And it was probably a little bit more animated than that there was a few F bombs in there. And then I went to a few accountants and said, Look, do you know what’s going on here? Do you know about this? Do you want to be dealing with this? Absolutely not, we don’t want to touch it. So it’s okay. There’s something there. And then one of the advisors phoned me back next week and said, Hey, I’ve got your first client. Yeah. And that was it. Yep. Go that was

Fraser Jack
the test measure. And you’re absolutely right about those, you know, the Centrelink? You know, there is a it’s a very rules focused business, I started a business, I guess it’s a very rules focus organization. So if you know the rules, then you pretty much you know, you know, the entitlements, and you’re able to work your way around it.

Kevin Smith
Yeah, correct. And that’s what we just do is, you know, if you know, the rules, you can play the game. And it’s like anything, right? Like, it’s, it’s no different to when you’re in a vise, if you know, the rules, you can play the game. And that’s, that’s where we came from. It was just that, well, if we don’t know, we’ll pull the legislation, we’ll read the legislation. And then we’ll start pushing back. And we’ve had some really good wins on that as well, around mistakes around debts around, you know, challenging them when they think they’re right, or they’ve made the wrong decision. And it’s worked really well and can’t talk. So it’s been good.

Fraser Jack
I think one of the keys here is that you’re approaching this from an analytical point of view, you know, you’re not the emotional state that the clients in. Absolutely, yeah. And so you’re able to go well, I can see this fact and their effect on the other fact. And I can also then use my skill as a, you know, that you developed as a planet to be able to then relate to the client on their emotional level. And in you working as that translator, I guess, that maybe people in Centrelink can’t quite get yet.

Kevin Smith
Correct. And it’s, it’s still, I guess, from my perspective as my client, right, so I’m still looking after them, I’ve got their best interests in terms of what the best outcome for them is. And it’s not just another number, whereas I think sometimes it can, if you’re in a call center, it could just be another number, you know, somebody else on the phone, whereas at least I’ve got pushing for them to get the right outcome. And, and that’s good.

Fraser Jack
And so essentially, your financial coaching business just morphed in this very short space of time into this new, you know, this the supply of something that that there was a demand for?

Kevin Smith
Yep, absolutely. To the extent where we have essentially wound it all up. I think the website’s probably still there. But that’s about it. In terms of taking on clients, bits and pieces, we don’t do it anymore. It’s all the demand. And I guess the need for this sort of services that high that we’re finding is just too busy to run two of them at that point in time.

Fraser Jack
Yep, fair enough. And and so tell us about when that was like you mentioned COVID Hit the cinema, how quickly did you then pivot your offering to the to the becoming a new new business?

Kevin Smith
I reckon I’ve registered the name. And it’s funny because I made that mistake, and I don’t know if it’s a mistake, or if it’s, I thought I knew where the marker was enough. I guess I registered in the name I think the first week of May 2020. I’d assumed it was going to be all the oldies. You know that was my assumption that that’s where I figured it would be so I figured it was going to be all the 65 year olds or 66 year olds coming up to age pension to stressed about it. Somebody They also do.

Fraser Jack
And so the name, the name was pension services,

Kevin Smith
correct? Yeah. And so I figured, well, you don’t make sense. You can’t use age pension, you can’t use Centrelink in their pension services sort of works. And that was the initial couple of clients. And then people said, Oh, can you deal with this? Do we can, you know, we can deal with the job seeker claim? Can you claim he helped us with Family Tax? Yes, we can. And so it’s just evolved from there, which, eventually we’ll probably have to rebrand or change or something like that. But that’s not a focus at the moment. It’s just keep doing what we’re doing and do it.

Fraser Jack
Well. You will name certainly not putting people off at the moment, I guess. No, it’s not. Absolutely not. And so your model is to then work with other professionals that refer you clients? Yep.

Kevin Smith
So we work with we work with a lot of advisors, accountants, lawyers, especially estate planning lawyers, there’s auto complexity around that, where here’s what the rules are, you can give the advice to the client, you know, if you need us to help implement it, you know, I had a lawyer recently who came to me and she’s like, I’ve got this age care entry form. I’ve spent six hours on it, and I can’t build a client for that. Give it to us. So we can actually get what the clients record is, and Centrelink made sure it was up to date. And it’s a simple form. It’s not that hard. Oh, well, I spent five hours on a model. That was a waste of time, right? You can’t build for that. So it’s a much simpler solution when you’re doing it day in day out, you know, what you’re looking for, you know, the questions to ask, and you know, when you’re not getting necessarily the right answer as well.

Fraser Jack
Yeah. I’m gonna get into that in a minute. But you mentioned there that you become an authorized personnel. Yes. On their account. Yeah. So

Kevin Smith
we go in as nominee for the clients as correspondents nominee. In most cases, sometimes we use permission to inquire just depending. And then we’ve got the ability to interact on the client’s behalf. So dealing with any questions, Centrelink, you’ve got doing any updates on the client account, completing any applications for the client, we can do all that. And then we can go in and push them in make sure that, hey, it’s moving in the right direction, or it’s moving in the expected direction?

Fraser Jack
Yeah. And you mentioned that it, you know, you can you can push where, you know, it’s wrong, or there’s, I mean, at the end of the day, I think St links, probably like every other organization is full of human beings. And, and they may or may not have been trained properly, and they may not, they may be new, or all sorts of other things. So they don’t always get it right. You must see some things. Oh, absolutely.

Kevin Smith
And, you know, I think when the pandemic hit, I know here in Adelaide, one of the outsourced it. Providers went and hired two or 300 people out north and two or 300 people down south, and essentially put them in a call center and said, answer the phone, give them two weeks training on, here’s how to Google the answer and the internal systems. It didn’t give them any real training and payments. So there was sort of flowing a little bit blind and saying, No, you’re not eligible for this, or no, you’re not eligible for that. So yeah, so there was instances where we’ve found that, you know, debts had been raised that shouldn’t have been raised. I had one recently where they’ve dragged a client’s rent assistance up from three, four years ago and said, Well, that’s a debt, you shouldn’t have been claiming rent assistance, because you’re living on the boat and the company paid it and well, the client gave you all the right forms. He done all the right decorations, you can’t then come back and say, hey, just because the accountants claimed that as well. Yeah, it wasn’t the clients decision. It’s been the counting it decision. And they sort of agreed and turn around said, Well, we can wipe that five grand straight off, which is a good outcome for the client. We’ve had a couple other cases where they’ve said, yes, you’re entitled to this, pay the benefit, come back and said, Oh, actually, we made a mistake. And but we’ll rephrase the debt to light. There’s some parameters around when the DEC be raised and what sort of notification period they should be in all the rest of it. You’ve raised it too late. We think you should be taken off. And away we go. And they have been doing that. So it’s been good.

Fraser Jack
It’s interesting, isn’t it? We talked about the value of advice so often in financial advice, and you know, the value of having somebody that go into bed for you with the Centrelink. I think it’s pretty it’s a pretty big piece of the puzzle.

Kevin Smith
Yeah, it’s massive. I had one of the accountants that initially I spoke to, she said, look, I’ve got a client all she wants when COVID hit is the $750 She wants a $750 payment so she can buy a new shoes and you handbag, as we went through the whole process and I said I think constant title a bit more than 750 bucks let’s I said slightly happy for me just to not pay with it but put in a couple of different times and see how it goes costs age do we need to add so they Centrelink turn around and convincing somebody Centrelink that somebody has a negative taxable income is actually really hard. It doesn’t match the computer you can’t put a negative in they just don’t understand it. So we have no sales no computer says no hurt. So we have to overcome that. We got around that assets client. Look, it’s getting close. It’s getting close. We’re just waiting on a couple of things. And eventually so they turn around and paid the Family Tax Benefit for now. 20 which you hadn’t done a tax return on the Friday, oh my gosh, you can’t do this. She hasn’t done a tax return. We don’t want the money yet. I’m claiming 1819 She’s in financial distress for. So they’ve paid $15,000 on the Friday for Family Tax for 1920. I’ve given them a rocket on a Friday afternoon saying, you screw this up, you need to fix this. So they’ve dropped another 15 and a half $1,000 into her account on the Sunday. And she’s like, she, Kevin, what do I do with this? I said, look, there might cause some of it back, let’s just wait and see what the taxes turn out. I said, just stick it in the offset. But this same client then got knocked back for a job seeker. And we appealed that and somebody hadn’t done the data entry, right. And then within a couple of months, I said, Well, we’ll slowly take this, how quickly you need the money. It’s not urgent, now I’ve got the other money. And then she got a whole HIPAA back pay for the job seeker. So she picked up another 21 $22,000. So in the space of probably nine months, maybe 10 months, she picked up about 50,000, which she was entitled to and and all the rest of it and made a massive difference in her life. and stuff. But that’s pretty rewarding.

Fraser Jack
Yeah, that’s that’s a pretty amazing story. And obviously, you know, there’s there is the fact that there’s obviously a reason why she needs that money in the first place. But when did that client come from you from an advisor? Or for

Kevin Smith
from an accountant? Yep. Yep, from an accountant that just was like, I don’t have time to learn. I don’t know how to do it. Can you just manage it for us?

Fraser Jack
Yeah, don’t take it, that account is referring to plenty more clients? Yes, yeah, we

Kevin Smith
get plenty of there, we get a lot of their complex stuff. So a lot of this stuff where there’s trust involved or companies involved in adds more work to the actual claim. That it probably a lot of clients don’t go through the process because they think it’s too hard. I’ll just leave it, I’ll just spend what I’ve got to say. So that client, that accountant sends a lot more work along those lines. It’s pretty complex clients.

Fraser Jack
And what’s your what’s your business model? Do you charge then for that initial work or just PR work? Or is it how do you then create a business model around charging?

Kevin Smith
So I just took, I tried to figure it out the fairest way to clients, you know, and that was, that’s probably been the hardest thing for me to figure out is where, where’s the fairness? And how do you charge because I don’t get a magic number to Centrelink, unfortunately. So I still have the queues and the team. But some of the people that do some work for me still have the 45 Minute weights on hold and all the rest of it. So we just have to manage that. I guess the biggest thing is we we deal with five or 10 cases at a time to make that a little bit easier. So we just went down the, here’s the flat fee. This is what we’re going to charge. And away we go and see what see what sticks. And it has stuck. We’ve nine times out of 10 when making money on it. Yes, there’s the occasional case where it was out of the water because something’s come out of left field or, you know, there’s been an incorrect decision made or something like that. But we’ve just stuck to hey, here’s the flat fee. It’s fair and equitable. And away, we go from there. And when we look at different pricings, then we start saying, Well, this is a bit more complex. There’s more forms here. We need to charge more for that. And I think in the last 18 months, I’ve had two clients have said no, I don’t want to pay the fee. That’s fine. You know, there’s been no real pushback in terms of how it’s too expensive or anything like that.

Fraser Jack
Yeah, I think I think the fees just related to the level of stress and in that game also than their level of return.

Kevin Smith
Yeah, correct. Yeah, it’s not, it’s not significant. You know, we’re charging sort of simple age pension applications with charging $660, you know, so it’s not huge amounts of money. I speak to a couple advisors locally, they’ve been sending me a fair bit of business. And it’s a look, for us to even touch that it’s 990. There’s a couple others aside, it’s $1,100. Because it’s there’s different costs players, and different things they’ve got to factor into. So if we can do it at a reduced cost and be an outsourced provider to an advisor or an accountant or just be a direct referral arrangement, then that’s great.

Fraser Jack
It makes sense. If you’re spending 45 minutes in a wait time to get hold of a human on the other end of the phone. I’m assuming if you get hold of a good one, then you’re you’re spending the rest of the day on the phone to that person talking through all of the cases.

Kevin Smith
Yeah, pretty much. So it’s, I had somebody a couple of weeks ago up in that he was up in Toowoomba. And it was one of the processing centers. And I was like, Look, I just made this fix this fix. And I’ve got one more. It’s like most that you said that five times down, like yes, I’ve just got one more. And so within an hour and a half, I was able to knock off about 10 cases. And I was like, Well, this is what the situation is. This has been put into complex assessments that shouldn’t be there. Can you pull it back? You say it shouldn’t be there. I’m like, Cool. Let’s not wait three months for it to be rejected. So it does make a massive impact who you get on the phone and that’s sometimes the biggest challenge is some of those people or the other in the phone don’t necessarily know and that’s okay, like it’s not okay, but it is okay. You’ve just got to sort of hang up and, and yeah, we’ll go again and see what happens. I had somebody just recently. Like, it’s not my money, right? Like, it’s my business, but it’s not my money. And I guess this goes back to what you’re talking about around the emotion and sort of, we’ve got this claim in clients earned 78 grand last year, they’re entitled to a pension. Both them are still we’re still working at this point in time. They said, No, no, they’re over the income limit, said, Okay. So the income limits if they’re working about 90,000, and she said, No, they’re still over the limit. She said, You need to start putting new applications. No, I don’t. I said I can. I can do an appeal. I said, I want to let you know, you can’t you’ve got to do in your application. Can you please watch in a pinch? Like you’re getting aggressive on the phone with them? No, no, no, this is just me talking, like not getting aggressive. I’m just telling you wrong. And I’m gonna terminate the call. Sure. There isn’t. She eventually hung up on me. And I’m like, Okay, fine. picked up the phone. Hey, it was somebody in the same call center said, hey, look, I’ve just got off the phone. Somebody, I want to let this appeal. This is what’s going on financial hardship. I need this moved quickly, where he said, I forgot a phone call on the Tuesday. Yep, we’re processing this. I don’t understand why they’re rejected at this clients always been eligible. I said, Yeah, that’s what my numbers said. And that’s what the legislation says they’ve just knocked it out of the park, another will get it processed, and literally turn around and pay the client, essentially, the next day, there was about five grand each and back pay, you know, so if the client been navigating them that themselves, a lot of clients would just give up? You know, and that’s what we find is I’ve tried two or three times to get this, I’m struggling with this. They just send out a letter saying no, there’s no reason. And then they give up. Whereas we try and push and say, Well, why is it? What’s the reason? You know, one of the moments seems to be, I’ve got a couple of clients that were putting carers allowance and care payments, and then all of a sudden, they want to ID mum and dad who might be at 85. And they’re just rejecting it without saying, hey, it’s saying it’s optional. Id actually, it’s mandatory to ID mum and dad now, are they just saying, hey, it’s been rejected? There’s no other further information? And can’t say? Well, I’ll just give up

Fraser Jack
yet. I coming back to this. You mentioned the word struggle, that that level of stress has come completely out of proportion to the logical side of it. When somebody thinks or gets a letter from the government, essentially saying no,

Kevin Smith
yeah, correct. Absolutely. Like the stress levels that the clients having for us just to say, don’t worry about it, we’ve got it, it’s fine. Or we’ve already, you know, an order cases, we’ll get the letter a week before the client gets it, because we’ll get them electronically. And the client will find out and freak out and be like, Hey, this is just come and die. If we’ve already taken care of it. Just rip it up, throw it in the bin. What do you mean, I might remember, we asked you for this two weeks ago, yeah, we’ve already dealt with this just file, but they said this, so it’s already dealt with, don’t worry about it. So it’s, it is valuable from that, from that client side of things, it’s very valuable to them, and will sort of say, you know, look, you can go and do this yourself, you know, you can go and do this yourself, you’re eligible go and do it didn’t go to a nine times out of 10 direction comes back off. No, I don’t want to deal with them. If you can deal with that pay for that. If that pain point can be removed. They’re very quickly, they’re happy to pay for it and where we go, you know, we’ll, in all the cases, we book appointments for our clients, if they’ve got to go and get our did let us know, go and sit them in Centrelink for an hour and a half, two hours waiting for them to be called. When you available, let’s book an appointment in lock the appointment in confirm it with the client there in and out in 20 minutes. That’s a great experience because they’ve had that versus John Street that walks in says, Hey, I’ve got this pension paperwork. It’s there for an hour and a half and just looks at and thinks what do I do? You know? I’ll never forget when I first started advising one of the advisors that I worked with, he said, This is up in no jury said, are you ever going to tap the toilets and said, I said no. Why would I go to the toilet and said I says when you do just can’t check the lights out. I said what do you mean? He said are they’re all blue lights? Why are they blue lights? unsettling? He said so. Okay, so the people that are going into claim conquer and shoot up while they sit in their way to pay for it. It’s like they can’t see their veins if the blue lights are on, you know, like it was one of those things. That’s not the way it should be. Right? That’s not a great experience

Unknown Speaker
of it’s the level of the customer service and we don’t want to help people out clients shooting up on the way and yeah,

Fraser Jack
good, good, good. Right, cool. So for your point of view, from your business point of view, you’re really taking people from that moment of struggle and you know, upset or fear factor and relieving the stress that must feel good from your point of view. It is

Kevin Smith
it absolutely is and the reward and just the release of anxiety they can you know, sometimes it is hard because clients expect it to be done tomorrow. And I’m still dealing with the government organization, right. Like, in the middle of the pandemic, I was finding that pension applications were getting processed in two weeks. To her, it was just bang there. We had people in processing. The last sort of six weeks, it’s Melbourne and Sydney have been locked down. Pension applications have slowed right to the bottom, you know, they’ve been processing the COVID, payments and disaster payments, and all those sorts of things first, and they’ve been prioritizing stuff. So that level of frustrations there with clients, we try and set those expectations that, hey, if you’ve got to trust, it’s going to be three months, at least before somebody picks it up. But it might be six months, you know, because it’s complex assessments, it’s a black hole, we can’t get into them, we can jump up and down as much as we want. But we’re not going to get speak to somebody in complex assessments to deal with any of this. They’ll phone us when they’re ready. And they do. You know, they will phone and say, Hey, about this case, this is what it is. And away we go from there. But the level of satisfaction, satisfaction is really good. And the ability just to remove that stress, you know, we do. We’re finding more and more, we’re getting people coming to us with aged care, entry paperwork. And it’s hugely stressful time because mom and dad, mom and or dad is going into aged care. And I’ve seen the place, we need to organize this, can you do this paperwork for us, and just get it taken away, because they’ve just given us 26 pages. And we don’t know how to do it. We can take a guess. But we’re not sure if we get it wrong. And we’ve had a few where people have got it wrong. People haven’t done it. I had one the other day where the sons pretty busy. He works with AFP. And they’ve obviously had a busy two years. He said, just hanging around his paperwork, I’ve been back and forth. And I think we filled something out wrong at one stage. And they’d ticked a box somewhere that said they had a life interest in their own house, which they didn’t, they just are in the house. And so it led to this sort of 18 months of backwards and forwards with Centrelink. And in the meantime, they just said well, mums gonna pay the $255 A Day dinner, maximum fee for aged care. We’ve jumped in. So it’ll take us a while to fix. And we’ve got to wait for quarterly reviews and this that the other. But they picked up a 43 and a half $1,000 refund on aged care fees. So that makes a big difference to current situation.

Fraser Jack
Well, it’s incredible, great stories out there. They can come out of this. Yeah, absolutely. And you mentioned sort of setting expectations is a big part of this, you know, when you when you first meet with them, you can say to them, the rules are this, but it’s going to take three months at this particular point in time to really sit in that expectation that then again comes back and says okay, well, we know the rules are expert probably going to get back paid. We’re going to be okay with this

Kevin Smith
attract. Yep, absolutely. Yeah, we have to is probably the biggest thing is setting the expectation upfront, because I think well. And this year, we have to correct a few of those expectations. Yeah. And it’s not just around claim time. But one of the big ones we find is the centering can see what’s in my bank account. Yeah, classic cars, I bet they can see what some bank can now they can still privacy. There’s still this there’s still that. But there’s that expectation of will Centrelink know what I have? It’s the government they know everything. No, they don’t. You know, you go from two different extremes. We have some clients. I’ve got one or two that sort of tinfoil hat wearing people that don’t trust anything, can’t disclose anything. And well, we can’t deal with it. If you’re not going to disclose it to us. We’re not part of this throughout No way. And I’ve got others here, the government can see everything that they know, on my taxes that the ATO can see this Centrelink know that they can get the data, but it takes a process that takes time it doesn’t get picked up straightaway. Yep. Because it is really important to set those expectations.

Fraser Jack
And, you know, we’re talking about in a lot of cases, claims that have gone in favor of the client. But of course, that’s not always the case. There’s got to be cases where people are coming to you because they you know, they have raised the debt or there’s a debt to be paid or they don’t want to or they need to they need to fall on their sword Noy?

Kevin Smith
Yeah, absolutely. So there is times when we look at claims, and look, we don’t think it’s going to get up. And generally offset accounts. We’re happy to do a little bit of work and do it pro bono and have a look at it and see if there is something we can do. If there’s not, we’re not going to charge you, you know, I had somebody that’s in New South Wales trying to claim for a pension. And he didn’t tell us the whole truth. I guess it’s probably what happened in background where like, you can get pension, there’s no issue. And what sort of worked out through the course of it and we took it through to compliance in this setting. The other is it had a fairly substantial compensation payment within 18 months that he didn’t disclose to us. And that precluded him for X amount of time because it was a replacement of income and all the rest of it. And it was a tough situation. We had local MP on tours and this that the other might look, this guy’s just received 250,018 months ago, you know, like that’s a lot of money. And he can’t substantiate where it’s gone. He’s still renting. He’s still doing These sorts of things, if he can give me some receipts that we can start working on, and that was sort of settled his argument, he couldn’t fabricate anything, or he couldn’t not fabricate, but he couldn’t produce anything to support it. And we eventually said this kind of, unless you can actually provide us some support and a leg to stand on, we can’t fight this. And we try to be smart. So I guess with a lot of the other work we do, I’m finding, we’re doing a lot of cares, payments, cares, allowance stuff, we’ve sort of built a tool that we can pre assess clients and figure out where they sort of sit just using basic sort of software and spreadsheets and bits and pieces like that. But we can essentially say, yes, you’re going to be eligible for a carers allowance, yes, you’re going to be eligible for a carers payment. And it takes away that whole process of let’s jump in, do a whole heap of work, go to doctors, get this done, get that done, wait six weeks, and then it’s rejected. So we’ve been pretty clever like that, just to figure out what the legislation says, figure out how they score, build a tool to help us to make us more efficient.

Fraser Jack
I love a good spreadsheet tool, how I got to spreadsheets with new creative calculators, and you can you can just say to people Oh, there’s there’s an answer. And people think you’re incredible. Yeah. Now the, there has been a lot of disruption for Centrelink, obviously with COVID and payments and lockdowns, here, there and everywhere and new rules coming in and uncertainty and then not knowing how long that’s going to be for and, and so what’s the strain is it put on tinkling as far as, as you mentioned, trying to get these in the complex assessments done?

Kevin Smith
Oh, it’s been immense, like it’s pushed a lot of their complex stuff out a bit, I think it’s getting better now. But it was putting a lot of pressure on some of those case officers, you know, and if you don’t put them on a pedestal, but they’re sort of this is one of these rare breeds that you speak, because they’ve got to be an accountant to read these financials, nor to cases or they’ve got to have that knowledge. And it’s not just the average person. So what we were finding was happening was the simple ones were going through fairly quickly, anything that went to complex, they were just getting a huge volume. So that was what was pushing it out to sort of three, six months. And then that asked for more information, then it go back into the queue. So that was the frustrating bit for a lot of people. I think it is getting better. But it’s so slow. And still so.

Fraser Jack
Yep. And and do you see your business continued in that pension align? Or do you think you’re getting at so much more with carer payments and Family Tax benefits and stuff,

Kevin Smith
I think will still pick up all sorts of errors. It’s funny, because word of mouth is amazing in terms of your clients. And you know, we’ve had a number of clients where I’ve got one of the moments sitting on my desk, and we’re sort of helping through and it’s like, well, we’ve got married, I’ve got a company, this is what the situation is for two separate houses, they’ve just given me 100 pages worth of documentation to fill out. I don’t know what I’m doing. They can’t doesn’t want to do it, can you at least get it through. And again, setting that expectation of, hey, I can look at your financials pretty quickly, you’re going to have to pay some of this back. Or if not all of it, let’s start hiding it away. I’m not hiding the word, let’s start putting it in the bank and just sitting it there. So that even when the debt does come, you can pay it and away you go. I’m comfortable with most of the stuff to do with Centrelink, with the exception of child support. I think everyone asked me he did that meant that I think it’s a hiding to nothing. And I think it’s a lot more dealing with Centrelink sort of emotional here level, dealing with child support. I think it’s up about there, in terms of people paying people receiving, not knowing how the formulas work. And then, you know, the child support agency, which is run by Services Australia doesn’t have the best reputation, it can be seen as ruthless at times.

Fraser Jack
Yeah. And and people are looking for explanations that you might not be able to give correct. So just look on that amount of information and knowledge, as you said, you know, you’ve been through many years of dealing and looking at it, did you find that was a difficult process to get your head around all that sort of legislation and what the rights and stuff were? Or do you think is actually a little bit easier than we think?

Kevin Smith
I think if you’ve got the time, it’s relatively easy. It’s probably the has been a steep learning curve with a couple little things where someone’s been thrown out. That doesn’t make sense why asking for that, or, you know, it’s just been unexpected. But then you learn from that, you know, I had a client pass away, which is fine, but we’re doing some work for him. And then all of a sudden that cancels that nominee status. And so sort of ground everything to wholeness at all. Look, you can do this get a letter signed by a power of attorney and not power of attorney, executor and away you go. And you go to somebody else. And it’s that same classic thing. Two people tell you two different answers, you know, answer that there’s learnings that we’ve sort of put together and started building out sort of, here’s how the process works. So that we know for next time, hey, if that person does, we’ve got to pull up stumps, you know, we can’t do any more or we need the executor to do the phoning. We can provide all the information, but we can’t get any further than that.

Fraser Jack
Yeah, becomes a new engagement with the executor. Give them the update and what we can handle can’t do and Yeah. Yeah. So then so as your business grows, and lastly about that in a second, but as your businesses is getting more mature, you’re getting more and more of a knowledge bank of what you need to have a know.

Kevin Smith
Yeah, absolutely. Yep. And we’re trying to make it easier on ourselves, I guess from that perspective. So we are on a lot of process stuff. So we use a lot of like Google Sites, recorded videos, this is how we do it, this is what needs to be done. So that you’ve got it there for later, or, Hey, this is what’s happened. This is a complex case, bang, bang, bang, here’s the issues that we faced. So that the hardest thing is I don’t want everything stuck up in my head. You know, I don’t want to be, I don’t want to be that sole practitioner that has got all the knowledge, but it’s also the biggest bottleneck in the business.

Fraser Jack
Yeah, really good call, if you want to look at scaling, which I’ll ask you about a second. But tell me about that. I’m getting that information out of your head in using video.

Kevin Smith
Yeah, so a lot of room and a lot of loom to just get it out. And then just building out processes around it, you know, simple things like if somebody is to walk in, you know, we’re talking to a couple of interns and bits and pieces at the moment. But here’s how you fill out the basic form. Here’s where this number needs to go. Here’s where that and it is fairly straightforward. But if there’s a resource there, it’s not 15 questions, Hey, Kevin, how to do this. Pay Kevin how to do that. Here’s the video, check that resource. If it doesn’t fit in this box, come and ask me. And I think it’s that thing of you get out of that mindset of being a technician and trying to do it all the time and start thinking, well, am I going to be a business owner? And should it be doing the same thing twice? Or three times? Or four times? Or can I find a better way that I should be concentrating on Hey, this is the technical bit where I’m really valuable? Let’s find other people to do. In 12 months time, I can’t in 12 months time, I can’t be sitting on the phone for the amount of hours that we sit on the phone now. You know, I’ve spent Yeah, I think I said to my wife the other day, I’ve spent 570 hours on the phone this year. Right? And I don’t like the phone. The six and a half 1000 phone calls. They’re like it’s not much fun.

Fraser Jack
You should be asking for an office in the Centrelink office, I can work from your office and not just I’ll just work out of your systems, say me phoning in and taking a call center person, right?

Kevin Smith
It would be magic, if that was the engagement, right? If it would be good if we could get some sort of engagement like that, where hey, we’ve got one nominee for as many clients. If we can get a direct client to somebody in processing that can actually move stuff through, then that’s fine. Because we’re not asking stupid questions, you know.

Fraser Jack
And you think I’m just trying this on you think if it was if I was running Centrelink, that would be a great thing. Because we would actually process a lot more and I would need less people.

Kevin Smith
And it’d be more efficient for government and efficiency doesn’t always doesn’t always

Fraser Jack
add up to the old they’re listening. Yeah. Could you tell us about the business itself? How’s it grown over the last sort of 12 or 18 months since it’s really been? Yeah, it’s,

Kevin Smith
it’s growing probably a little bit stupidly. The first three to four months, it was sort of like, yep, couple of clients would come in now. And again, accounts would find me up. Now we’ve sort of been working in been concentrating on hey, let’s concentrate and advisors, accountants, lawyers, even just locally, and I’ve got some we’ve got interstate ones as well. And it’s grown rapidly. You know, I’ve done some cheeky things. So my parents took off in a caravan to Tasmania, probably six months ago. And I turned around said, here’s a holy before I was gonna stick them up on every notice board that you go past, on the way to Tasmania, and they’re done it right. And sure enough, we get phone calls now from Tasmania saying, Hey, I saw your post to worry based our best Natalie was supposed to hop on the ferry terminal going across to kind of think it is Bruny Island. Yeah, brilliant. At literally clients have come in like that. Like it’s it’s incredible. So we’ve just been a little bit not cheeky, but taken advantage of

Fraser Jack
doing this in genius. That’s not cheeky. That’s great. Oh, that’s a great little guerilla marketing campaign. Yeah. So

Kevin Smith
we’ve used that I’ve done it with my in laws as well and got them to do the same thing. And with that, and we ran a bit of Facebook advertising, you know, within, you know, that 18 month period, we’ve got clients in every state. Yes,

Fraser Jack
amazing. And you’re right, the Centrelink rules are the same around the country, mostly. So those are not local lockdowns, but they’re pretty much similar in the country. So it’s not like you have to be limited to South Australia.

Kevin Smith
And I think the thing is, as well, once clients know, they’re happy to use you and I, my theory was when I set this business up, I’ll ever want to see everyone will want to do do it on video and away you go. And I’ve had two clients. They’ve said, Can we do a vehicle? I’m sure most of us probably more the older clients, most of the old clients. Can we just do it on the phone? Right away you go, you know, it’s been phone calls and heads the hours on the phone, but it’s been phone calls, it hasn’t been video locally. We get some people that come into the office and we’ve got Some that just say no. Tell us what you need. We’ll get it to you. And away you go from there.

Fraser Jack
Yeah, no. And of course, being location independent means that you can take on staff from anywhere in the country.

Kevin Smith
Yep. So I’ve got somebody that does some work for me to state, which helps a lot. They will talk for a while, that certainly helps. And that knowledge helps. And again, it’s about building that knowledge database. So when we do bring people I’m not worried about where people sit, I’d rather, you know, speaking to a PDM system, rather than a flute, if you’re looking for CSOs or not that just give them flexibility. Tell them that you work from home town, they can be their songs, the data security’s there, and all those other things, then it’s fine. You don’t need to be in the office, you know, the office is good. But if it’s a deal breaker for somebody that’s opium.

Fraser Jack
Predominantly, if it’s over the phone, then it can be anywhere. And it’s really interesting. So I’m so I’m gonna go on a limb here and say, when you find somebody that’s really good and Centrelink and they want to get out of Centrelink. There’s an opportunity.

Kevin Smith
There’s about 10 opportunity here right now.

Fraser Jack
Yes, yes. Yeah. Hello, somebody. Good, buddy. Nice to meet some good people on Centrelink to be on the other end of that.

Kevin Smith
Yeah. Yeah. But yeah.

Fraser Jack
So tell us about the future, then what does that what’s installed? Have you thought about too far ahead? Are you looking in the next six months? Are you looking out into the into the

Kevin Smith
next 12 months, we’ll probably double again. So I’ll probably be bringing next year, the aim is to put another two staff. But that’s full time part time. We’ll wait and see. But that’s probably where it needs to be just for the level of stuff coming in. And it’s probably expand again, probably hitting some more of the accounting firms, some of the wars. Yep. more targeted, I guess, you know, and so we’ll

Fraser Jack
use, will you be spending your time around business development, sort of talking to two professionals and some of your time in sort of the complex system places? Or is it

Kevin Smith
that that’s what I’m thinking? And that would be ideal? Yeah, I’ve got at the stage now, where a lot of cases, we can generally assess whether a client’s going to be eligible in 1015 minutes on the phone, you know, they can tell us sort of relatively closely what they’ve got. And we can do a quick calculation. So yes, you’re eligible. Okay. Let’s get this done this done this done. And then we’ll interview over the phone. Just taking away that interview just saves 45 minutes of my time, it’s better somebody else be doing that rather than me. It’s good for the client interaction. But I’ve got to be realistic with it over the long term as well.

Fraser Jack
Yeah. And so when advisors work with you, do they just say, Oh, can you bring this client? Or do they go through a situation and then get you to do the work and then come back to the client? So here’s where it’s

Kevin Smith
a bit of both. So I’ve got some advisors. I have fun advisory Malcolm, he validates his clients just sold his business. What’s he going to be eligible for? Can you get anything? Can you get a health care card? So yeah, we can get them health care card. I said, but we could also put him on job seeker is what would it mean? I said, Well, if he’s not working, he’s not age pension age. I said, if he’s happy to go and do some volunteering, then we can put him on job seeker. And you could sort of hear the advisor advisors Oh, that’ll save him 13 grand a year drawing out of his super unallocated pensions, is that okay? So let me speak to the client, and I’ll just send the client to you. They said we don’t want to touch it. We don’t want to do it. But if you’re certain that’s what it is, here’s the phone number away, go. I’ve got other clients, other advisors say, Look, can you just jump in, so we can get access to their, their, my, their online system, in terms of through nominee access, we can get access to it? And they say, Look, can you just jump in and fix this client or do this, you know, we’ll give you most of the information will tell the client that you’re the person implementing it. And if you spend that time just interviewing the client or getting what you need from the client, we’re happy. We’re happy to take the ongoing updates in bits and pieces, but we just don’t want to spend the time doing the client. Yeah, and then we’ll just invoice the advisor and not the client.

Fraser Jack
Yeah, right. Okay, so then you just invoice advisor advisor then makes it part of their ongoing service or whatever might be Yeah, wonderful. Thank you, Kevin for coming on and chatting to us today. If somebody wanted to continue the conversation what would the be the best weapon analogy

Kevin Smith
look, flick me an email. Kevin pension services was probably the easiest one that Comdata you pick up the mobile or the one 300 numbers on the website so one pension services.com that I you and go from there BFS tresses as emails usually pretty good because sometimes I’m stuck on the phone Centrelink.

Fraser Jack
Yeah, yeah, emails, always go door or jump on LinkedIn. While you’re on LinkedIn. You’ve got your, your your, all your details there. So hey, thanks for coming in chatting to us. There’s some amazing stories that you and I have spoken about over time about to some of the some of the outcomes that’s been available for for clients. I think it’s something that and most advisors don’t want to do it. And again, it makes a massive difference in the stress levels of many, many clients over appreciate that

Kevin Smith
beautiful thank you very much.

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