Financial advice costs explained

The amount a financial adviser will charge will vary dependent on the work you want them to do. The charges vary based on the complexity of the service, ranging from investment advice to specialised pension consultations. Here’s a few different ways you may be charged:

• Percentage of your investment value
  Ongoing advice, is where your adviser looks after your assets and keeps an eye on them regularly, making any changes that may be needed along the way to help you achieve your financial goals. This is done most commonly by taking a percentage of the value of your assets so as the value of your investment portfolio changes so does the amount of advice charge paid.
• Hourly charges
  For some advice, your adviser will charge you an hourly rate dependent on how long it takes them to do a piece of work for you. Whether it be fund research, finding lost pensions, speaking to providers, all of this takes time. They’ll always let you know if this is what they’re doing and will give you a rough idea as to how much this may cost.
• Fixed charges
  This is where you and your adviser will agree upfront an amount for a specific piece of work to be done. This might be the setting up of a product, or generally any ‘one time’ sort of work
• Platform fees
  Platform fees are a charge by the online services that the financial adviser uses to build and manage your investment portfolio, these are usually taken directly from the fund itself. These aren’t necessarily a charge that is obvious and is usually taken directly from the fund itself.

Sadly, no advice is free. Some firms will offer a complimentary consultation to understand your needs and advice requirements before proceeding to paid financial advice. It provides you with the opportunity to consider whether the adviser is the right person for you, as it's likely you'll be in contact with them for potentially the rest of your life. You can, however, get free guidance on next steps by Pension Wise.