tmmonline.nz  |   landlords.co.nz        About Good Returns  |  Advertise  |  Contact Us  |  Terms & Conditions  |  RSS Feeds

NZ's Financial Adviser News Centre

GR Logo
Last Article Uploaded: Thursday, March 28th, 10:13PM

News

rss
Latest Headlines

Advisers overdue for a pay rise

Financial advisers probably deserve a pay rise but getting clients to pay it is another question entirely, industry commentators say.

Wednesday, December 16th 2015, 6:00AM 2 Comments

by Susan Edmunds

New Zealand financial planning and investment advisers who charge an hourly rate are asking, on average, $250 to $300 an hour from their clients.

Others charge a fee based on a percentage of assets under management (AUM), of between 0.5 per cent and 1 per cent. Many operate a hybrid structure.

Institute of Financial Advisers chief executive Fred Dodds said it was likely that those who charged an hourly rate were making less overall than advisers charging a percentage of AUM.

The $250 an hour rate is similar to the pay for a relatively junior barrister at most law firms and about twice what a locum GP would be paid. Law firms charge out their staff at a higher rate again.

Adviser Murray Weatherston said financial advisers' fees should be higher. “I don’t see a lot of difference between a good financial adviser and partner in a law firm. But the law firms charge a lot more than that.”

He said the biggest problem for advisers was what the clients were willing to pay. “Some people are working for a lot less than that. It’s a question of getting people paying for advice.”

He said very few advisers were operating solely on an hourly rate basis.

Industry consultant David Whyte said advisers might expect to spend eight hours setting up a meaningful plan for a client.

“A couple of grand is not an unreasonable fee for that. With the six-step process there is a bit more time spent on research and recommendations. Relatively speaking it’s a pretty good deal for the consumer to be charged that given the significance of the outcome of a well-constructed plan or recommended risk strategy.”

He said advisers had to become more skilled at communicating the value of advice to consumers.

“If solicitors and accountants can convince people they are providing value with their advice surely adviser should do the same.”

Tags: financial advisers

« Entity licensing benefits no one: WhyteLVR restrictions to be reviewed »

Special Offers

Comments from our readers

On 24 December 2015 at 5:37 am henry Filth said:
It's pretty d*mn difficult to find an adviser who provides actual advice, rather than trying to stuff you into a lowest common denominator "platform".

You find yourself dealing with a salesman, not an independent professional.

It's that blatant sales pitch which makes the comparison with doctors and lawyers laughable.
On 24 December 2015 at 12:09 pm traveller said:
I think Henry F has a point. I get the feeling that people wanting advice are put off by the prospect of a hard sell and this comes from the old view that there is little difference from the attitude towards aggressive life insurance salesmen. Whether this was, and still is, true, I don't know. Doctors and lawyers are also salesmen if you think about it, subtly selling their own expertise but there the comparison ends as they are not see as "product pushers" although in some cases they will be.

Sign In to add your comment

 

print

Printable version  

print

Email to a friend
News Bites
Latest Comments
Subscribe Now

Weekly Wrap

Previous News
Most Commented On
Mortgage Rates Table

Full Rates Table | Compare Rates

Lender Flt 1yr 2yr 3yr
AIA - Back My Build 6.19 - - -
AIA - Go Home Loans 8.74 7.24 6.79 6.65
ANZ 8.64 7.84 7.39 7.25
ANZ Blueprint to Build 7.39 - - -
ANZ Good Energy - - - 1.00
ANZ Special - 7.24 6.79 6.65
ASB Bank 8.64 7.24 6.79 6.65
ASB Better Homes Top Up - - - 1.00
Avanti Finance 9.15 - - -
Basecorp Finance 9.60 - - -
Bluestone 9.24 - - -
Lender Flt 1yr 2yr 3yr
BNZ - Classic - 7.24 6.79 6.65
BNZ - Green Home Loan top-ups - - - 1.00
BNZ - Mortgage One 8.69 - - -
BNZ - Rapid Repay 8.69 - - -
BNZ - Std, FlyBuys 8.69 7.84 7.39 7.25
BNZ - TotalMoney 8.69 - - -
CFML Loans 9.45 - - -
China Construction Bank - 7.09 6.75 6.49
China Construction Bank Special - - - -
Co-operative Bank - First Home Special - 7.04 - -
Co-operative Bank - Owner Occ 8.40 7.24 6.79 6.65
Lender Flt 1yr 2yr 3yr
Co-operative Bank - Standard 8.40 7.74 7.29 7.15
Credit Union Auckland 7.70 - - -
First Credit Union Special - 7.45 7.35 -
First Credit Union Standard 8.50 7.99 7.85 -
Heartland Bank - Online 7.99 6.69 6.45 6.19
Heartland Bank - Reverse Mortgage - - - -
Heretaunga Building Society 8.90 7.60 7.40 -
HSBC Premier 8.59 - - -
HSBC Premier LVR > 80% - - - -
HSBC Special - - - -
ICBC 7.85 7.05 6.75 6.59
Lender Flt 1yr 2yr 3yr
Kainga Ora 8.64 7.79 7.39 7.25
Kainga Ora - First Home Buyer Special - - - -
Kiwibank 8.50 8.25 7.79 7.55
Kiwibank - Offset 8.50 - - -
Kiwibank Special - 7.25 6.79 6.65
Liberty 8.59 8.69 8.79 8.94
Nelson Building Society 9.00 7.75 7.35 -
Pepper Money Advantage 10.49 - - -
Pepper Money Easy 8.69 - - -
Pepper Money Essential 8.29 - - -
Resimac - LVR < 80% 8.84 ▼8.09 ▼7.59 ▼7.29
Lender Flt 1yr 2yr 3yr
Resimac - LVR < 90% 9.84 ▼9.09 ▼8.59 ▼8.29
Resimac - Specialist Clear (Alt Doc) - - 8.99 -
Resimac - Specialist Clear (Full Doc) - - 9.49 -
SBS Bank 8.74 7.84 7.45 7.25
SBS Bank Special - 7.24 6.85 6.65
SBS Construction lending for FHB - - - -
SBS FirstHome Combo 6.19 6.74 - -
SBS FirstHome Combo - - - -
SBS Unwind reverse equity 9.95 - - -
Select Home Loans 9.24 - - -
TSB Bank 9.44 8.04 7.55 7.45
Lender Flt 1yr 2yr 3yr
TSB Special 8.64 7.24 6.75 6.65
Unity 8.64 6.99 6.79 -
Unity First Home Buyer special - - 6.45 -
Wairarapa Building Society 8.60 6.95 6.85 -
Westpac 8.64 7.89 7.49 7.25
Westpac Choices Everyday 8.74 - - -
Westpac Offset 8.64 - - -
Westpac Special - 7.29 6.89 6.65
Median 8.64 7.29 7.32 6.65

Last updated: 28 March 2024 9:42am

About Us  |  Advertise  |  Contact Us  |  Terms & Conditions  |  Privacy Policy  |  RSS Feeds  |  Letters  |  Archive  |  Toolbox  |  Disclaimer
 
Site by Web Developer and eyelovedesign.com