How much should I pay for independent financial advice?

To get independent financial advice from a fully qualified adviser with access to products from across the market, you need to pay for it.

Rules that had previously allowed IFAs to earn an income from commission were scrapped at the end of 2012 due to fears that payments from providers skewed the advice IFAs offered.

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So how much does an IFA's advice now cost?

As with every service, fees will vary between providers and some parts of the country will invariably be cheaper than others. Nonetheless, research from revealing average costs provides a useful starting point, and can help you establish whether the quotes you're receiving are reasonable.

It found the typical IFA will now charge £175 an hour for their service. However many will quote a fixed price for a job such as investing an inheritance or setting up a pension.

Costs for common advice needs:

  • Initial financial review and report - £500
  • Advice on a £200 monthly pension contribution - £500
  • Advice and setting up of a £10,000 investment Isa - £300
  • Advice and investment strategy for a 50-year old investing a £50,000 inheritance seeking medium growth -  £1,500.
  • Advice on converting a £100,000 pension into a lump sum and income - £1,350
  • Advice on setting up an income drawdown scheme on a £300,000 pension - £3,000

Cost will in many cases determine whether or not consumers seek advice, but in searching for a good IFA Karen Barrett, chief executive of said people shouldn't focus too much on the price: "A focus on cost alone is not necessarily helpful for consumers looking for the best adviser for their needs.  As with any professional adviser, costs are only relevant in terms of the services provided and we urge consumers to bear that in mind when shopping around for an adviser."

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The accountants Glasgow detailed client support from year-end and management accounting, internal and external auditing, tax advice and planning to due diligence, risk management and investment advice.

Agree. When shopping around for a financial advisor, the most important thing is to find the most professional and competent one. After all, your life savings are at stake. But it's universal truth that the prices for advisory services are going down. Why? Because of technology. Some advisors provide their advice for lower fees, as part of analytical procedures are automated. IFAs are partnering with the automated wealth management services and this is how they are able to service more clients without compromising quality. I found the table "Costs for common advice needs" especially helpful and insightful. Good to know this type of info. Hopefully, the prices will continue to go down, as technology evolves.