Analysis in a new report by Air, the market-leading later life lending platform, shows that advisers building their later life lending advice capability can add up to £760,000 to their firm’s value from just 25 cases per year. Air calculates the set-up costs for referring cases to a specialist later life lending adviser are typically around £4,500 compared with £21,740 for an in-house service.
The new report from Air co-authored with Tony Wickenden of Technical Connection and Phillip Wickenden of Ad Lucem sets out the case for building later life lending capability to enable advisers to deliver better client outcomes and stronger commercial performance.
In its report Air presents a roadmap on how to address growing client demand for later life lending and provides analysis on whether to refer later life lending clients to specialist advisers or to set up their own in-house advice capability.
The report The home belongs in the plan – Why later life lending is essential for client centred advice available to download at: https://homeintheplan.airlaterlife.co.uk/ estimates that referral will breakeven after around three to six cases while in-house services will take eight completions to breakeven.
The report stresses that expanding into later life lending does not need a new division just a structured investment of time and modest capital to put the right qualifications, templates, and governance in place.
The report calculates that keeping later life lending advice in-house will deliver maximum long-term value as firms earn advice fees and full commission but referral can be the more pragmatic path. Starting with referral enables firms to gather MI and client stories safely, before deciding whether it makes sense to move the advice in-house. Customer outcome benefits come from both models and compliance implications require careful consideration.
Will Hale, CEO of Key Equity Release and Air, said: “Later life lending has moved from a niche consideration to a mainstream planning conversation, and the commercial case for building the capability has never been clearer. But the firms that will see those returns are the ones that start from the right place: genuine client need, transparent explanation of costs and trade-offs, and robust documented understanding before any decision is made.
When that foundation is in place, advisers aren’t just unlocking a revenue line, they’re deepening relationships across generations in a way that compounds in firm value over time.
At Air, our goal is to equip advisers with the insight and tools they need to establish productive referral relationships where appropriate and to deliver confident, client centred advice in a fast-moving environment.”
Damon O’Connell, Director, Key Partnerships said: “The preferred starting point for many advisers wishing to enhance customer lending choice in line with their Consumer Duty obligations is to establish a strong referral relationship with a later life lending specialist.
For some advice firms who see a clear market opportunity and strategic rationale to broaden their lending proposition beyond its core business, then developing an in-house proposition can be the right route – but it should be approached with careful consideration.
At Key Partnerships, we work with many advisers that choose a hybrid approach: writing some business in-house while continuing to refer specific cases. This is often for lower-value, more complex, or time-intensive cases that can place a strain on internal resources and distract from the core business lines that drive the majority of a firm’s revenue.
Tony Wickenden, Founder and Managing Director of Technical Connection, said: “The commercial opportunity here is real, but it only works if the client outcomes are right first. The firms that will benefit most are those that build a repeatable, disciplined process – clear alternatives, plain-English cost explanation, documented understanding – because that’s what protects the client, protects the adviser, and makes the revenue sustainable.”
Air is running a series of webinars, which include targeted sessions for IFAs, residential mortgage and wealth advisers as well as later life lending specialists, and advisers can sign up at https://airlaterlife.co.uk/events?category=Air%20Whitepaper
Air’s services include training on setting up referral pathways and business development as well as support on qualifications. More information on Air is available from the website:
Air’s services include training on setting up referral pathways and business development as well as support on qualifications. More information on Air is available from the website here.
