This is the second deadly money mistake; consumers are fearful or do not even think about negotiating or even evaluating financial adviser fees and commissions. You must talk about financial advice fees to get a better deal or you may end up paying too much for very little.
Direct to Consumer – No Advice = Full Commission
Many people may not be aware:
Financial Adviser and Broker Fee Disclosure
When you seek financial advice on pensions and investments, your financial adviser must disclose their fees and charging structure to you before you agree to proceed as well as having fully competent and qualified financial advisers. No wonder most banks, insurers and investment managers ‘dumped’ their financial planning arms when these rules started on 1st January 2013. That said, you must be careful and force your financial adviser or mortgage broker to disclose all their fees so that you can make a fair comparison on even negotiate your adviser fees.
Not all financial advisers charge the same and you should not be ‘hoodwinked’ when an adviser gets out of their executive car, in a smart suit with polished shoes, a nice brief case and a laptop or tablet with the latest cash flow modelling app. You are making mistake 2 if you do not ask them to disclose their fees and then discuss the added value that they bring to your position. In addition, not all financial advisers charge the same:
See our Fees Shop Our Fees
Example 1: 3% upfront + 1% pa ongoing versus our own fees for a £100,000 pension transfer. |
Adviser Charge 3% upfront plus 1% pa ongoing |
Our Fixed Fee + Risk Fee and then ongoing Gold Review Service |
Upfront Charge |
£3,000 one off charge |
£1,911 one off charge |
Ongoing Advice Charge |
£1,000 pa ongoing |
£435 pa |
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Example 2: 3% upfront + 1% pa ongoing versus our own fees for a £200,000 pension transfer. |
Adviser Charge 3% upfront plus 1% pa ongoing |
Our Fixed Fee + Risk Fee and then ongoing Gold Review Service |
Upfront Charge |
£6,000 one off charge |
£2,661 one off charge |
Ongoing Advice Charge |
£2,000 pa ongoing |
£435 pa ongoing |
As you can see, there is much to be gained from asking for full disclosure of fees upfront. Do not let your financial adviser ‘fudge’ over the subject. They want your business, and you can negotiate or even walk away.
Value for Money – Ask your financial adviser what you get for your ongoing 1% pa yearly fee:
By way of example, this is what we offer our 1 X Policy Gold Review Service clients at £435 pa:
Do not make Money Mistake 2 – always find out exactly what fee you are being charged and what you get for your initial and ongoing fee.