How much should I pay for independent financial advice?
An IFA can help you save for retirement, protect your family and achieve your goals. We reveal how much you can expect to pay for their advice.
To get independent financial advice from a fully qualified adviser with access to products from across the market, you need to pay for it.
Rules that had previously allowed IFAs to earn an income from commission were scrapped at the end of 2012 due to fears that payments from providers skewed the advice IFAs offered.
So how much does an IFA's advice now cost?
As with every service, fees will vary between providers and some parts of the country will invariably be cheaper than others. Nonetheless, research from unbiased.co.uk revealing average costs provides a useful starting point, and can help you establish whether the quotes you're receiving are reasonable.
It found the typical IFA will now charge £175 an hour for their service. However many will quote a fixed price for a job such as investing an inheritance or setting up
Costs for common advice needs:
- Initial financial review and report - £500
- Advice on a £200 monthly pension contribution - £500
- Advice and setting up of a £10,000 investment Isa - £300
- Advice and investment strategy for a 50-year old investing a £50,000 inheritance seeking medium growth - £1,500.
- Advice on converting a £100,000 pension into a lump sum and income - £1,350
- Advice on setting up an income drawdown scheme on a £300,000 pension - £3,000
Cost will in many cases determine whether or not consumers seek advice, but in searching for a good IFA Karen Barrett, chief executive of unbiased.co.uk said people shouldn't focus too much on the price: "A focus on cost alone is not necessarily helpful for consumers looking for the best adviser for their needs. As with any professional adviser, costs are only relevant in terms of the services provided and we urge consumers to bear that in mind when shopping around for an adviser."Source: www.moneywise.co.uk
Category: Personal Finance