How much should you pay for financial advice?

According to a new website that looks at the fees charged by financial advisors, you can realistically expect to pay around £150 – £175 an hour for advice on how to invest your money. My experience is that the fees are significantly higher than that. You will notice that very few financial advisors are prepared to quote their fees on their website.

Since regulations introduced in 2012 came into force, financial advisors are no longer allowed to receive commission from companies they recommend. This is an attempt to ensure better advice for their clients. As a result the financial market is now looking for a different model of remuneration.

Unbiased.co.uk says that most financial advisors are now asking for “project fees” rather than basing the work on an hourly basis. The company say that advisors typically charge £500 for a financial review and around £350 to set up and advise on, say, an £11,000 investment ISA.

Are financial advisors worth their fees?

One of the biggest problems with using advisors is not the initial fees they charge. It is the ongoing fees for maintaining the service year on year. These are often far greater than the set up fees themselves.

Fees of 1% a year are quite commonly demanded and will rapidly erode the returns you were hoping for on your hard earned savings. In particular I dislike the idea that the fee is based on how much money I have managed to stash away for my retirement.

When my plumber comes round to fix my boiler he doesn’t charge based on my annual income or the value of my house. He charges a set fee based on the time the job takes and the bill stops there.

I can see no reason why a financial advisor should be paid a higher amount of money simply because I have had the prudence to build up a significant cash pile and pension. I am prepared to pay for his time based on a reasonable hourly rate (and you will have to decide whether £150 -£170 an hour is reasonable) but I for one am not prepared to pay fees based on a percentage of my wealth.

At least when my Corgi qualified plumber rocks up I know that he will deliver a quality service – when it comes to IFAs I am yet to be convinced that many of them are worth the fees that they claim could ever be described as “reasonable”.

Related Posts

6 Comments

  • At £100 to double-you’re not really competing with large scale seasoned professionals.

    Once you go down the doubling numbers you begin to compete in effect with institutions and or Goverment policy etc(as that kind of continual doubling becomes an Intrest to the other 7 billion people and stated Goverment)

    As a result-after a handful of these ‘doubling’ moves…the ability and time and competing positions from other investors and said governments etc just make the ability a compounded hardness.

    Hopefully as we become more sophisticated we can enjoy these posts but realise they are like any other headline….attention seeking!

    • I’m afraid that none of that is even remotely true, Gerry. Remember, DYWTAM was written by not one, but two, multi-millionaires using these very techniques. I suspect that you’ve been ripped off in the past by the many “get rich quick schemes” that are out there. That’s a real shame. Having done all of the fourteen levels myself, (and I watch others do the same every week), I feel highly qualified to disagree with every single one of your comments. If you’re not rich now then you have to change your thinking if you want to make serious money. Here’s the thing; “If you keep doing what you’ve always done – you’ll keep getting what you’ve always got”. Stop and think about that for a minute. I don’t know if you live in a two million pound house but if you don’t, here you are telling someone who does that this won’t work. Really? The DYWTAM Programme is a genuine no-nonsense guide on how to become a millionaire – and absolutely anyone can do it.

  • Barry, is it only 10 issues of Double your way to a Million? A friend of mine who is interested wants to know, thanks.

  • hi barry i am interested in your horse racing course and your recommendation of using isiris,i understand kevin booth has resigned from isiris do you still recommend we use this company still thank you,and also i notice on your websitethat it is still dated 2017 .

    • Good question. I have not used the Isiris service recently. I had a brilliant 11 year run but eventually I got closed down by all the bookmakers. I guess that’s a real sign of success but it was fun to do and I actually miss it. I did not know that Kevin had actually retired but I understand that the results this year have been extremely good. Maybe regular readers who still use Isiris can update me on that one and let me know how they are doing.

Comments are closed.

Scroll to Top