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Do you get the feeling that some people won't be happy until you charge £5 an hour and have to go bust because of compliance costs?
Maybe we need to compare it with what accountants charge?
Book keeper time is about £20 per hour, junior about £25, senior maybe £50 per hour for tax advice, and partner for the really hairy stuff about £125. (No, I'm not in London, and yes, I have spent 10x this for seriously specialised advice during acquisitions.)
Where do IFAs come on this spectrum?I am not a financial adviser and neither do I play one on television. I might occasionally give bad advice but at least it's free.
Like all religions, the Faith of the Invisible Pink Unicorns is based upon both logic and faith. We have faith that they are pink; we logically know that they are invisible because we can't see them.0 -
£160 an hour
£332,000 a year
reasonable?
If only it worked like that.
Back in the 90s, I once quoted someone £2k per day for helping them with a rather specialised part of a military contract tender and estimated it would take five days for my side of things. Let's just say that I didn't earn £460k that year!
They didn't win the tender but I did get paid. What was someone saying about being paid for results? Glad I went for the cash on that one!I am not a financial adviser and neither do I play one on television. I might occasionally give bad advice but at least it's free.
Like all religions, the Faith of the Invisible Pink Unicorns is based upon both logic and faith. We have faith that they are pink; we logically know that they are invisible because we can't see them.0 -
Higher than that for the chargeable work, and obviously lower than that for the (seemingly endless quantity of) non-chargeable work. However, that's only the case where the client chooses to opt for an hourly fee. The usual way we proceed is to quote a fixed fee for a piece of work, which means the potential client knows exactly what they're going to be charged and what they're going to get out of it.gadgetmind wrote: »Maybe we need to compare it with what accountants charge?
Book keeper time is about £20 per hour, junior about £25, senior maybe £50 per hour for tax advice, and partner for the really hairy stuff about £125. (No, I'm not in London, and yes, I have spent 10x this for seriously specialised advice during acquisitions.)
Where do IFAs come on this spectrum?I am a Chartered Financial Planner
Anything I say on the forum is for discussion purposes only and should not be construed as personal financial advice. It is vitally important to do your own research before acting on information gathered from any users on this forum.0 -
Don't forget to deduct:£160 an hour
£332,000 a year
reasonable?
1) Premises rental, lighting, heating, phones etc
2) Business rates
3) Insurance indemnity costs
4) Down time not spent with clients
5) Employing clerical and compliance staff
6) Accountancy costs
7) Bank charges
I'm sure the list is a lot longer.
Don't assume that they're seeing 7 clients a day for 5 days a week for 52 weeks of the year.
Plus expenses. Plus a range of free houses. Plus £10m advance payment for the memoirs when voted out as an incompetent.Get real, the Prime Minister only takes £142,500 per annum.0 -
gadgetmind wrote: »If only it worked like that.
OK, I`ll shorten the sentence
£160 an hour
reasonable?
How these people have got the brass neck to even attempt to charge that amount with no guarantee of success is beyond me.
A fool and his money are soon parted seems apt for the mugs who actually pay it.0 -
If your sole aim is to get a generally reasonable capital return over an indeterminate number of years, and you have no great interest in the investing process, I would agree.
A portfolio that looks zany on paper can actually work well over the long term as long as it's well diversified. I don't recall who it was (Bernstein? Graham?) gave an example of such a portfolio and observed that the main problem with it was that it was so uncorrelated with the headline figures of the FTSE and S&P that very few would have the stomach for it.
I think it's this "why is this going down when the BBC say everything is going up?" factor that's behind many being steering into portfolios with a strong home bias. There is a thread of truth in the usual argument of reducing currency risk, but many FTSE companies have heavy non-sterling exposure, so I'm not totally convinced.I am not a financial adviser and neither do I play one on television. I might occasionally give bad advice but at least it's free.
Like all religions, the Faith of the Invisible Pink Unicorns is based upon both logic and faith. We have faith that they are pink; we logically know that they are invisible because we can't see them.0 -
I will happily guarantee success with my charges. Largely because I specifically DON'T state that I will outperform all the benchmarks all the time.OK, I`ll shorten the sentence
£160 an hour
reasonable?
How these people have got the brass neck to even attempt to charge that amount with no guarantee of success is beyond me.
A fool and his money are soon parted seems apt for the mugs who actually pay it.
Success is defined as achieving the stated goals. In this case, the usual goals are:- assessing the current financial situation and helping the client to identify their main goals
- identifying any areas of weakness, inefficiency or shortfall in their affairs
- proposing and explaining new tax structures and investment/savings strategies
- finding out any ethical or academic preferences for their investments (actively managed asset allocation, passive investment vehicle is more than possible if the client wants that)
- checking the level of financial protection in place
- ensuring that any available allowances are being fully utilised if this fits in line with the client's goals
- taking account of long term and short term cash flows
- introducing the client to third party providers of investment management, pension provision, legal advice, annual accounting advice, etc
A lot of work goes into what I do, so yes, I have the "brass neck" to charge a fee for what I do.
* largely because "better" is often extremely difficult to quantify. One client I saw while in training some years ago was complaining about the performance of his advised portfolio against his equity portfolio. He had specifically asked for a low risk portfolio and was comparing its performance against his high risk portfolio. I imagine his tune changed quite a bit when the markets were going steeply down rather than up!I am a Chartered Financial Planner
Anything I say on the forum is for discussion purposes only and should not be construed as personal financial advice. It is vitally important to do your own research before acting on information gathered from any users on this forum.0 -
I will happily guarantee success with my charges. Largely because I specifically DON'T state that I will outperform all the benchmarks all the time.
Success is defined as achieving the stated goals. In this case, the usual goals are:- assessing the current financial situation and helping the client to identify their main goals
- identifying any areas of weakness, inefficiency or shortfall in their affairs
- proposing and explaining new tax structures and investment/savings strategies
- finding out any ethical or academic preferences for their investments (actively managed asset allocation, passive investment vehicle is more than possible if the client wants that)
- checking the level of financial protection in place
- ensuring that any available allowances are being fully utilised if this fits in line with the client's goals
- taking account of long term and short term cash flows
- introducing the client to third party providers of investment management, pension provision, legal advice, annual accounting advice, etc
A lot of work goes into what I do, so yes, I have the "brass neck" to charge a fee for what I do.
The bold bit is Greek to me. Further, your mission statement is not exactly the sort of intelectual property that warrants a significant fee.0 -
If you can do all of those things, all power to you. Don't pay the fee and don't engage the adviser.The bold bit is Greek to me. Further, your mission statement is not exactly the sort of intelectual property that warrants a significant fee.
The vast vast majority of people cannot do all of these things, and pay for the expertise and time of someone who can.
I could learn how to strip down my car engine and rebuild it better. But I have neither the time nor the inclination to do so. So, I pay someone else who already has that knowledge and experience to do it for me.I am an Independent Financial AdviserYou should note that this site doesn't check my status as an Independent Financial Adviser, so you need to take my word for it. This signature is here as I follow MSE's Adviser Code of Conduct. Any posts on here are for information and discussion purposes only and shouldn't be seen as financial advice.0 -
I could learn how to strip down my car engine and rebuild it better. But I have neither the time nor the inclination to do so. So, I pay someone else who already has that knowledge and experience to do it for me.
That's a shame. I've tinkered superchargers onto cars in the past, and done significant diagnostics and tweaks to engine management systems. There is a certain pleasure to working with your hands, particularly when the brain is also involved.
Specialisation is for insects, and bright people (humans are bright, we just are!) can do anything they turn their minds to.
The full quote is, ""A human being should be able to change a diaper, plan an invasion, butcher a hog, conn a ship, design a building, write a sonnet, balance accounts, build a wall, set a bone, comfort the dying, take orders, give orders, cooperate, act alone, solve equations, analyze a new problem, pitch manure, program a computer, cook a tasty meal, fight efficiently, die gallantly. Specialization is for insects." Robert Heinlein
I regularly work this into talks I give to university students as part of (hopefully!) convincing them to work on their weakest subjects, which are usually maths, English, or (more often) both,I am not a financial adviser and neither do I play one on television. I might occasionally give bad advice but at least it's free.
Like all religions, the Faith of the Invisible Pink Unicorns is based upon both logic and faith. We have faith that they are pink; we logically know that they are invisible because we can't see them.0
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