Small changes that deliver big results

24 Aug 2021

Karen Hoffensetz, Manager of Financial Services at Lutheran Care, knows that providing effective financial counselling requires more than number crunching and drawing up budgets.

“Quite often, when we first start working with a client who is experiencing financial difficulty, the most important thing is to listen,” she says.

“When you really listen and are prepared to move at the client’s pace, you can start to understand what is happening for the client. Often when you’re going through a client’s budget, there can be surprises and you need to be empathetic, patient and non-judgmental.”

Karen says the goal of the Financial Services team at Lutheran Care, which includes financial counsellors, financial literacy workers, low-income support and emergency relief workers, is to empower clients to be in control of their own financial situation.

“Ultimately we want help build up our clients’ skills and support them to make their own decisions,” she says. “We’re not here to make decisions for them, but instead to give options and support.

“When I first started as a financial counsellor, a wise, long-retired financial counsellor gave me advice I’ve never forgotten,” Karen says. “They told me, ‘The first time you see a client, it doesn’t exactly matter what you do for them, it’s how they feel when they leave,’ and that’s very true.

“For some of the clients we work with, they’ve had no-one they can talk to about anything. Sometimes you don’t even end up talking about the financial side of things.”

Lutheran Care’s financial counselling service is one part of the organisation’s work to ‘serve the needs and fight for the rights of those who have fallen through the cracks of the system’.

The financial services team provides a range of free, independent and confidential services including one-on-one support for individual clients that spans budgeting basics, understanding legal rights and the credit reporting system, right through to advocacy.

Many clients come to Lutheran Care after being referred by banks, utility companies or referral services such as the National Debt Helpline.

With many clients reaching out to Lutheran Care as a last resort, the organisation’s financial counsellors also play a valuable role in helping to connect people with a range of supports including monetary assistance, health services and personal counselling.

Wyatt’s support of Lutheran Care’s financial counselling service directly assists people experiencing homelessness in the south of Adelaide and supports general financial counselling in the Northern suburbs, Adelaide Hills and Barossa Valley.

“The value of Wyatt’s support is immeasurable,” Karen says. “We’ve got more financial counsellors on the ground and we’re able to help more clients because of the support they give us.”

“With Wyatt’s help, we are also able to help clients secure grants for essential items such as new tyres for their car so that they’re able to go to work, or clothes for job interviews, or furniture if people are coming from a domestic violence situation and have nothing to set up a new home.”

Karen says that Covid has brought new clients to Lutheran Care’s financial services including “people who are newly unemployed and international students, as well as a significant increase in clients who are at risk of homelessness.”

The growth of ‘pay later’ services like Afterpay and Zip Pay are also having detrimental impacts.

“Even though these companies sell their services like a lay-by service, it’s completely different,” Karen explains.

“It’s not like taking out a lay-by at Target where if you don’t pay it off, you don’t get the item. With these services, you get the item upfront, so it’s another form of credit that they’re giving you.

“Even if you’re paying it off over the four instalments and doing the right thing, it still shows on your credit report because it’s a form of credit. If you can’t pay it, that’s when it goes into default and all the interest charges appear.”

These services are particularly catching out people aged 18-35, Karen says.

“It’s so quick and easy when people are walking around the shopping centres and buying one thing here on Afterpay and another thing at a different store on Zip Pay and then they go home and two weeks later they’re having to pay that money back instead of paying the electricity bill or buying food.”

Though the operational challenges brought by Covid have been significant, Karen’s team has adapted to become even more flexible and accessible.

“We ended up doing a lot of phone calls and Zoom calls when we were all in hard lockdown,” Karen says.

“What’s been interesting is that we’re still doing many of these things because it’s made our service more accessible for people who are unable to meet face-to-face because of transport issues or mental health issues that make it difficult for them to leave the house.

“The silver lining is that we’ve found other ways to deliver our services and still achieve great outcomes.

“People’s lives are changed by financial counselling,” Karen continues. “What we do on a day-to-day basis might seem small in the scheme of things, but it can have a substantial positive impact on the futures of our clients.”


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