Like many IFAs, my view has been that the transition to fees for our
services will be extremely difficult.
Yet with profit margins falling and a recent spate of time wasters, I have
had to consider how best to grasp the nettle of charging for the work on
which we embark for prospective clients in the wake of their initial
After much thought and discussion with industry colleagues, I decided to
keep the initial consultation free but charge a fee of £100 for the
preparation of our report and recommendations.
At our discretion, that £100 will be refundable from any commission
subsequently generated by business transacted through us (subject, of
course, to a minimum amount).
We now present ourselves as a company remunerated by a mixture of fees and
commission – unless, of course, pure fees are the preferred option.
So far, I have been pleasantly surprised at how many prospective clients
have agreed this to be an entirely reasonable proposition – and at how
indifferent I have been to those not prepared to pay such a nominal and
potentially refundable sum (mainly stakeholder enquirers), if only as a
gesture of serious intent.
One new client, having eventually signed up for most of what we'd
recommended (and he was by no means an easy fish to land), said he would
not have paid any fee and that had I raised the issue he would have simply
have gone elsewhere.
I would like to think that almost all other IFAs he might have approached
would have operated a policy similar to ours. Hopefully, before too long,
this will be the case.
As someone recently asked at a presentation I attended, how do you know
clients won't pay fees unless you ask them? Good point.
As it turns out (so far), most of the genuine ones will and cutting out
the timewasters at the outset will do nothing but help your business. Try
WDS Independent Financial Advisers, Bristol