Lighthouse Financial Advisers Townsville | Helping people over 50 retire with confidence
  • Home
  • What We Do
  • Who We Are
  • Podcast
  • Blog
  • FAQ
  • Contact Us

How should a financial adviser get paid?

29/1/2019

 
man and woman discussing how a financial adviser should get paid in townsville
​In the last few years there has been endless debate in my industry about how financial planners should get paid. The two main options are to be paid on a percentage basis or on the flat dollar.
For example, for a client who has $500,000 in retirement savings under a 1% fee structure would pay $5,000 per annum. If this figure grows to $600,000 the fee increases to $6,000, and if it drops to $400,000 the fee would be $4,000.  Alternatively, they could pay the adviser a flat fee of $5,000.

Here’s the kicker; I don’t think it’s important and have met great advisers who charge either way. It comes down purely to the preference of the adviser and the client.

To me, the more important question is; are you getting value for the fees you are paying?

You could pay an adviser $3,000 per year but still be significantly out-of-pocket if they make mistakes, or miss some possible tax savings, or invest your retirement savings inappropriately.

On the other hand, I have seen advisers charge $30,000 per year and thought it was a bargain. Their clients’ situations are highly complex, they are saving their clients so much in tax and the risks of getting it wrong are so high.

At Lighthouse our model is simple. We charge 1%.

My job is to get you from where you are now, to where you need to be to retire. If you consistently listen to my advice and stick to the plan you will get there as quickly and as safely as possible.

If I do a great job and your retirement savings grow over time I get paid more. If I don’t do a great job I get paid less. To me this is the simplest and most transparent way to get us working together.

I’m not being paid 1% to ‘get a good return’. I’m not being paid 1% to ‘beat the market’. I’m not being paid 1% to ‘make sure you’re in the right fund’ every year. I’m being paid 1% to make sure you sleep at night knowing you are doing everything you possibly can to meet your goals.

If you don’t have an adviser do you think it’s possible I could either: save you 1% in tax, help you earn an additional 1% investment return each year, save you 1% in not making mistakes each year, or save you at least 1% in time and worry?

If you’re not sure ask me and I’ll explain how and where I can in an initial meeting. If I can’t add enough value to justify charging a fee, I’ll tell you.

If you do have an adviser and don’t already know the exact answer, don’t be afraid to ask what fees am I paying and what do I get in return?

If you get an answer you’re comfortable with, great. If not, it might be time to dig deeper.

​Written by Dallas Davison.


Comments are closed.

    Author

    Dallas Davison, Michael Hogue and Ali Hogue.

    Archives

    October 2020
    September 2020
    August 2020
    July 2020
    June 2020
    May 2020
    April 2020
    March 2020
    February 2020
    January 2020
    December 2019
    October 2019
    September 2019
    August 2019
    July 2019
    June 2019
    May 2019
    April 2019
    March 2019
    February 2019
    January 2019
    December 2018
    November 2018
    October 2018
    September 2018
    August 2018
    July 2018
    April 2018
    March 2018
    December 2017
    November 2017
    October 2017
    September 2017
    August 2017
    July 2017
    June 2017
    May 2017
    April 2017
    March 2017
    February 2017
    January 2017
    December 2016
    November 2016
    October 2016
    September 2016
    August 2016
    June 2016
    May 2016
    April 2016
    February 2016
    November 2015
    July 2015
    June 2015

    Categories

    All
    Alice Springs
    Book Reviews
    Budget
    Charters Towers
    Cloncurry
    Contract
    Contributions
    Debt Reduction
    Economy
    Events
    Examples
    FAQ
    Fees
    Financial Adviser
    Financial Planning
    Fund Management
    Goal Setting
    History
    Hughenden
    Inflation
    Interesting
    Interest Rates
    Investment
    Julia Creek
    Lifestyle
    Media
    Money
    Money Over 50
    Mount Isa
    Pandemic
    Pension
    Priorities
    Retirement
    Richmond
    Risk
    Sharemarket
    Superannuation
    Tax
    Travel
    Uncertainty
    Wealth
    Winton

    RSS Feed

​HOME
WHAT WE DO
WHO WE ARE
PODCAST
BLOG
CONTACT US

Important Information
Financial Services Guide
Privacy Policy
Lighthouse Financial Advisers Townsville
​
Tel 07 4772 0938
Email mail@lighthouseadvisers.com.au
45 Ingham Road West End Townsville Qld 4810

Lighthouse Financial Advisers Townsville Pty Ltd ABN 26 146 225 505, 45 Ingham Road, West End Queensland 4810 is the holder of an ASIC Australian Financial Services Licence (AFSL) #471826.

Website by Grey and Grey
  • Home
  • What We Do
  • Who We Are
  • Podcast
  • Blog
  • FAQ
  • Contact Us