If you’ve never received financial advice before, it’s understandable if you feel concerned about how much it might cost you. Like any other professional service – such as working with an accountant or a lawyer – the amount you pay your financial adviser will depend on how complex your needs are and how much time they spend with you.
While there is no set cost for financial advice, it may help to look at the average prices financial advice clients pay and what they get in return.
In 2019, the Financial Planning Association of Australia found that its members charged their advice clients an average of $2,671 to prepare a Statement of Advice and $3,757 per year for ongoing advice.1
Keep in mind that this is an average and the cost may vary significantly depending on the adviser’s level of experience, your requirements, and the time and effort needed to set up and maintain your financial plan.
Another variable is the type of advice you receive. One-off advice about a particular issue (for example, setting up a pension account) will cost less than an ongoing, comprehensive advice relationship that looks after all your financial requirements – such as your super, investments and estate planning.
The best way to get an accurate idea about how much your advice will cost you is to speak to the adviser directly. They can provide you with a Financial Services Guide that outlines all their costs, so you can decide upfront if you’re comfortable with what they’re charging.
Some of the fees you pay to your financial adviser may be tax-deductible if they relate to an investment that provides you with assessable income. Your financial adviser or accountant can explain to you which fees may be tax-deductible, and which ones aren’t.
1Financial Planning Association of Australia, CoreData FPA Member Research, 2019