How does Way Forward works with financial counsellors?

By David Berry, CEO Way Forward

Way Forward launched its service in 2018 to assist people in long term financial difficulty who have debts across multiple creditors. 

Two years ago, we announced at the national Financial Counselling Australia conference that we were opening our doors to referrals from financial counsellors.

Since then, we have regularly on-referred clients to financial counsellors, particularly, people who are experiencing a more complex situation or the needs of the person is best supported by a financial counsellor. 

Compared to financial counselling, Way Forward has a specific focus, which means our service is suitable for only certain situations. This means we require the clients we support to have regular income, debts across multiple creditors and employment. More on this is included below. 

This means Way Forward supports financial counselling programs, with each offering a unique service to people in financial hardship. We look to financial counselling services to assist people who have complex needs and draw on their expertise in a range of areas. 

CEO of WayForward David Berry is afraid there is a looming monster of household debt being concealed by stimulus and deferrals.(ABC News: Geoff Thompson)

Photo credit: (ABC News: Geoff Thompson)

For financial counsellors, Way Forward is another tool in their financial counselling toolbox, providing a free option that is not available elsewhere. 

Who can we help? 

It is essential that we match the person seeking support to the right type of service. When we work with someone, we look at all their debts in assessing their situation and determine how much they can repay. We focus on helping clients with their unsecured debt but will consider their secured debts in any plan. 

The people Way Forward are most equipped to assist are: 

  • Struggling with multiple creditors 
  • Have a regular income and are not heavily reliant on Centrelink benefits 
  • Want to pay their debts back in an affordable way 
  • Do have surplus funds available after paying for living expenses 

The issues that Way Forward cannot assist with are: 

  • Statute barred debts 
  • Full debt waiver 
  • Family violence 
  • Bankruptcy 
  • Financial Abuse 
  • Gambling 

People who require wrap around services and support, such as those struggling with drug, alcohol or gambling addiction are best supported first by specialist services with the right expertise. We have a range of referral options listed on our website. 

How can Way Forward help? 

We develop an arrangement with our clients that address all of their debts across multiple lenders. We then work with those lenders to come up with a repayment plan and assist the client through managing the payment process to all their creditors. As our arrangements typically go for 2-5 years, we assist our clients by: 

  • Confirming a workable budget which includes a buffer. 
  • Negotiating a realistic payment plan with creditors/lenders. 
  • The client makes one payment to us that we then distribute to all creditors. 
  • There is no cost for clients to use Way Forward. 

Whilst clients may need to look at reducing their discretionary spending, it is important that people can live their lives while paying off a debt. We advise our clients that allowing for a regular buffer in their budget will assist for unexpected expenses that are likely to occur over the term of their arrangement. 

Should they not want to allow for a buffer we encourage them to put that amount in a separate account and make lump sum payments to reduce their debt throughout the term of the arrangement. 

If someone has secured debt (e.g., a mortgage) we will provide options for where and how they could get support. We are also happy to connect clients to other organisations that may be better placed to assist them. 

Our arrangements are flexible and allow for both changes to payment amounts and additional lump sum payments. First, the client needs to let us know their desired change and we test the feasibility of the change to the payment with the client to determine the impact.  If it is suitable, we can facilitate the change. Arrangements are negotiated over a term aligned to the client’s circumstances. 

How can Financial Counsellors refer to us? 

There are three ways that financial counsellors can refer their clients to Way Forward: 

  1. Working side by side with the financial counsellor. The financial counsellor does a full case assessment and works alongside the client: Way Forward supports by managing the creditors. 
  2. Handover to Way forward. The financial counsellor does an initial assessment and budget and hands over the client and their budget to Way Forward. 
  3. Keep you in the loop. The financial counsellor refers a client to Way Forward. Way Forward does a full case assessment to determine whether they meet our criteria, we will review the client’s budget, send out letter of authority and keep the financial counsellor in the loop. 

Sending a completed budget is a great way to help us quickly identify options for the client (moneysmart.gov.au), keeping in mind that everyone needs a savings buffer. We buffer $50 a week for unexpected expenses so please add this into the budget.