Huge variations in adviser fees
The consumer champion asked the IFAs to give quotes for different services. An IFA in the north-west quoted nearly £2,000 more to arrange a protection policy for a 30 year old female than an adviser in Scotland quoted to do the same job. The average fee Which? were quoted by IFAs in this case was only £596.
Although the average fee quoted to transfer a £10,680 investment into a stocks and share Isa was £356, one adviser in the south-east quoted £2,500. Two IFAs in the south-west and the east of England quoted £106.
Currently there is no approved list of ‘typical’ charges for IFAs’ fees, meaning people will find it difficult to know whether an IFA’s fees are reasonable.
Which? wants IFAs to be forced to publish a rate guide on their website, so that people can make an informed decision about which IFA to choose and what is a reasonable amount to pay.
Commenting, Which? chief executive, Peter Vicary-Smith, said: “Financial advisers should be much more transparent in their pricing, providing details of all their charges upfront. At present it’s very difficult for customers to know how much they’re going to be charged, and what is reasonable.
“IFAs should clearly display their fees online and if they don’t the regulator should step in to make this happen.”