16 March 2016

Financial Planning - is it worth the Fees?

A glimpse at the fees charged by Standard Life's Financial Planning affiliate 1825 is an eye-opener. The example provided - I suppose it would illustrate a middle-class family, comfortable but by no means wealthy - is already a warning as the fee appears to be quite high. What hourly rate is the basis for the implied hourly charge? Would the client learn much more than he would be reading any of the available DIY investment books?
Many people are not really able to look after their finances. Most often this is due to spendthrift habits, but many are also not too keen to get into the nitty-gritty of investment.
But why would you use a Financial 'Planner'? In my opinion the selection of a Financial Adviser is a much more critical decision to make. Paying a Planner and then paying fees for an Adviser would lead to exorbitant expense.
Looking at the annual maintenance fees charged by 1825 and adding the fees charged by the typical Investment Adviser is just paying over the odds.
One should not forget that any investment vehicle (fund) the Adviser selects for you will also charge various fees.