Guide · Adviser fees
Financial adviser minimum fees explained
A quoted percentage does not always tell you what you will pay. A minimum annual fee can become the real charge.
What is a minimum fee?
A minimum fee is the lowest cash amount a firm will charge for a piece of advice or an ongoing service, even if the percentage calculation would produce a smaller number.
Why does it matter?
If a service has a £2,000 minimum annual fee, a client with £100,000 would effectively pay 2% before considering other product or investment costs, even if the headline rate is lower.
What should you ask?
Is there an initial minimum?One-off planning may have its own minimum charge.
Is there an ongoing minimum?Check the normal annual cash amount.
Does the minimum change?Ask whether it changes as assets or service level change.
Is ongoing advice necessary?A one-off service may be more suitable for some simpler needs.
Minimum fees also tell you about client fit
A high minimum may signal that the firm's service is designed for larger or more complex clients. Being technically accepted is not always the same as being a natural fit.
Sources & further reading