How much do financial advisers charge?
You can generally expect to pay a set of upfront fees, which may cover the advice given and its implementation. From then on a financial planner’s fees are often determined by your situation and how complex it is. The cost can also depend on the plan your financial planner sets out.
At ANZ, your first meeting is obligation and cost free. During that meeting, your financial planner will quote how much your advice will cost based on your needs and the complexity of your situation, and how much it would cost to implement the recommendations if you choose to go ahead with the advice
Ongoing costs of hiring a financial planner
One option is to pay for the services you need only when you require them. This is known as a fee-for-service payment structure and involves paying a fee for the services or advice you need, or for the amount of time you’ll be spending with your financial planner, each time you use them.
Some financial planners may also offer you an ongoing service arrangement with them. Under this arrangement they will charge an ongoing advice fee for an agreed service and period of time.
(ANZ only offers a fee-for-service payment structure, not an ongoing-service agreement. This gives our customers the flexibility to seek financial advice if and when they need it, paying for it as they go, rather than paying an annual fee regardless of what advice is required).
The fee for hiring a financial planner can vary depending on the complexity of your financial situation and the level of service they provide. Once your financial planner has assessed your situation they should clearly lay out the costs and what services they’ll provide in return.
Where an ongoing service arrangement is entered into, depending on your situation and the agreed level of service, a financial planner’s fees may include the cost of face-to-face meetings, financial reviews, statements and reports, access to tools, and educational products, such as seminars or newsletters.
Reviewing your financial planning and costs
Your financial situation might not vary a whole lot from year to year, but if your circumstances change or you reach a new life stage (such as starting a business or approaching retirement), you can ask your financial planner for a revised strategy to suit your changing needs at any time.
You may also have questions about the advice you receive, and understanding the costs associated with it. If you do, your financial planner should be able to answer your questions and provide the clarity you need.
In recent years financial advice has been under scrutiny in Australia, and it’s clear some planners failed to deliver a proper service, which the banking royal commission investigated and made public in 2018 and 2019.
New rules implemented by the government and revisions by financial-planning providers, such as banks and other institutions, have been implemented recently to resolve these concerns. Organisations such as ANZ take these matters seriously and you can expect from any financial advice provider that:
- you’ll only be charged for services received
- the adviser will disclose commissions or arrangements they may have with product suppliers
- advice will be appropriate for your financial situation.
If your financial situation changes and you are concerned about the affordability of financial planning, talk to your planner about what adjustments can be made to meet your current situation. For example, some financial planners charge a fee for implementing the recommendations they make. Instead, you may be able to opt to pay for the strategy your planner puts together and implement it yourself. (Keep in mind that your financial planner is an experienced professional in implementing financial arrangements).