Your IndustrySep 4 2014

Clients paying more attention to charges

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Advisers’ clients are placing a greater emphasis on adviser charges and costs, research by Canada Life revealed, with 44 per cent now focusing on this compared to 36 per cent last year.

Similarly, product charges across investments have increased in importance from 31 per cent in 2013 to 33 per cent in 2014.

However, advisers are finding that clients are less concerned about product choice than last year - the figure is now 27 per cent compared with 32 per cent in 2014.

Transparency of cost has also shot up in clients’ minds from 15 per cent to 21 per cent, whilst time devoted to providing advice has gone from 26 per cent to 31 per cent.

The research, carried out among 244 professional advisers, found that 23 per cent believe their clients are more financially aware post-RDR.

Eighty-two per cent of clients prefer face-to-face contact with their advisers, constituting the adviser service that clients most value.

Nick Harding, propositions and marketing director for wealth management and retirement income at Canada Life said: “The introduction of RDR was a watershed moment and it would inevitably take some time before the changes filtered through into client opinion.

“As a result clients are now placing far more emphasis on charges and costs than a year ago, while valuing adviser time more than ever before, placing face to face contact their top service attribute.

“Advisers know that maintaining an open dialogue with their clients, to ensure clarity surrounding costs and charges are sufficiently addressed is key.

“But it is clear that clients highly value the work of advisers, and are increasingly appreciative of time devoted in providing advice.

“It’s unsurprising, given the innately personal nature of an individual’s finances, that face-to-face contact and a good understanding of personal circumstances are the services most valued by clients.”