Craig Hall of NICRI has some information for YOURLifeChoices member Shaun, who would like to know how much a visit to a financial planner will cost.
I have read about the new legislation surrounding financial planners. I have always been reluctant to visit one before but now think it is something I may consider. How much should I expect to pay?
A. Provided by Craig Hall, NICRI
The financial planning industry is presently undergoing reforms with the aim to ‘improve the trust and confidence of Australian retail investors in the financial planning sector’. These reforms are designed to tackle conflicts of interest and raise the standards of the industry.
What this means is that financial planners will not be able to receive a percentage payment directly from the fund which you have invested in (a commission), but instead will charge a fee for service. This means that as an investor you will know up front what fees you will be charged as opposed to a commission structure where the fee that is paid is determined by the value of your investment.
The question of how much you can expect to pay in future is still an unknown as it will depend on various factors such as the type of advice you require, the complexity of your situation and the time and research that is required to formulate the plan. This also applies to the ongoing service you may wish to receive from your planner. On top of this it will depend on the adviser you use and the demographic of the area. Currently plans start from around $700, but this also depends on the complexity of the scenario.
You can expect to see pricing under the new regime from 1 July 2013 so it will pay to shop around. Fee details should be available in their Financial Services Guide (FSG) which they can provide or may be found on their website. It will be a requirement that any ongoing service arrangements/packages will be listed and supplied to you in advance so that you are aware of all the services that should be provided and decide if you wish to continue with the arrangement.
If you require further information on financial matters that may concern senior Australians please contact NICRI toll free on 1800 020110, email [email protected] or write to PO Box 1339, Fyshwick ACT 2609. NICRI information leaflets are also available on its websites www.nicri.org.au © and www.moneymap.nicri.org.au.