Only five of the 50 largest financial advice firms in the country disclose fees on their websites, according to research by Candid Financial Advice.
Of the firms reviewed - based on FTAdviser’s Top 100 Survey last year - and excluding networks, only Brewin Dolphin, Hargreaves Lansdown, Investec Wealth & Investment, Sanderson House and Vestra Wealth detail their charges online.
Justin Modray, founder of Candid Financial Advice, commented that while the commission ban forces firms to tell clients how much they charge, it seems the vast majority will only do so when consumers meet with an adviser.
“This makes shopping around for a fair deal very tiresome and in my experience too many clients feel compelled to use an adviser after meeting them, even if their fees are high.”
He added that while exact fees can sometimes only be established after a chat to gauge the work involved, when advisers fail to give any indication of potential costs on their websites it suggests their fees and probably high.
“I would encourage the FCA to compel advisers to clearly publish both their fee range and example fees for typical scenarios on their websites.
“Without this consumers usually have little option but to get sucked into an adviser’s sales process simply to find out what the advice might cost, which deters shopping around and seeking a fair deal.”
The research highlighted that the largest adviser in the UK, St James’s Place Wealth Management, does not detail advice charges on its website. It stated that the only clue is in the small print for the funds its sales force is restricted to using, which suggests many have a 5 per cent initial charge.
Andrew Humphries, marketing and communications director at St. James’s Place, said they agree that it is essential that investors have access to the total cost of investing before they decide whether or not to proceed, but added that all client business is face to face advice and is introduced through personal referrals.
“Many other well-known adviser firms also fail to disclose financial planning and advice charges on their websites, including Succession, UBS, Punter Southall Financial Management, Ashcourt Rowan and Tilney Bestinvest,” commented Mr Modray.
Jason Hollands, managing director for business development and communications at Tilney Bestinvest, responded by telling FTAdviser that the fees for financial planning work will depend on the nature and complexity of the work involved.
He added it is the inherent nature of financial planning, that it is bespoke, not generic.
“Our approach is to meet with a potential clients, with no fees levied for the consultation, assess their needs and the scope of the work, and present them with a clear and transparent proposal and costings, before undertaking further work.”
He also pointed out that fees for investment services - whether advised, managed or execution-only - are provided on Tilney Bestinvest’s wesbite and questioned whether Candid really disclosed its advisory fees, after only being able to see a table of fees related to size of investment assets.