NAB sees need for specialist rural planners
By Michael Bailey
FARMERS are ill-served by a financial planning industry still based around the pay-as-you-earn mentality, according to the head of a new team of specialist agribusiness planners.
Chris Fry, a long-term NationalAustralia Financial Planning adviser who will run its Agribusiness Wealth Planning team from Melbourne, says feedback from the team will help create products more tailored to rural needs.
“For example if a farmer goes into town for some income protection insurance, he’s asked to fill out a form stating his monthly income. There’s no recognition of a farm’s lumpy and variable earnings,” Fry said.
He added that the typical income assessment model, looking back on a worker’s previous year’s income, was useless for farmers.
“You need to account for the possibility that a farmer might have been through a development phase, spending a lot on leasing paddocks or irrigation projects, which take a couple of years to start generating income.”
Fry said rural communities were “crying out” for planners who understood how farm businesses worked. He has banking experience in dairy, sheep, cropping, rice, horticulture and aquaculture projects, and has set himself the challenge of hiring a dozen or more advisers with similar farm backgrounds over the next six months.
Fry said one-third of Australian farmers already banked with NAB, and the new team would aim to cement the extension of that relationship into financial advice.
The team will work with NAB’s existing Agribusiness Banking division, whose general manager Mike Carroll said: “Farmers’ businesses are usually tied up in the family property. That means decisions such as retirement affect several generations, so succession planning and investing are big issues.
“Particularly with the drought, more and more farm families are relying on off-farm income, including investments, and that also has an impact on retirement plans.”
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