What we do and how we charge

When it comes to financial planning, the most common questions people have are ‘what is financial planning?’ and ‘what does financial planning cost?’. So, here we’ll explain what we do as financial planners and how we charge fixed fees for the financial planning we provide.

You’ve probably heard the terms financial advice and financial planning, assuming they are the same? Financial planning and financial advice are terms used interchangeably, but there are distinct differences between financial advice and financial planning.

In short, financial planning is an ongoing process to help you achieve your goals in life, and a financial plan is your guide through life’s journey. So, let’s delve into more detail about what we do, the different fee structures and why we charge fixed fees for our financial planning.

What do financial planners do?

First things first, financial planners embark on a journey of discovery about you. And what might surprise you is that money might not always come up straight away. They’ll listen to what’s on your mind, your worries or concerns, and your plans for the future.

A financial plan is then built, mapping out your financial future, and testing if you can afford the life you want. The planner will talk you through all the steps needed to achieve your goals. And, they will always be in your corner to give you guidance and reassurance along the way. As well as providing tangible financial benefits, there is also a host of emotional benefits to gain from working with a financial planner.

Financial planners offer advice on pensions, retirement income, investments and savings, inheritance planning, insurance and protection and this is all incorporated into your bespoke plan. Taking into account your needs and priorities first and foremost, looking at all the ‘What if…’ scenarios, a holistic financial plan leaves no stone unturned.

The financial planning process

Financial planning typically follows a six-step process, which includes:

1. Establishing your vision and goals
2. Building a picture of your complete financial situation
3. Assessing whether you have enough to do the things you want to do
4. Creating the plan to align your finances with your life goals
5. Putting the plan into action
6. Reviewing your plans at least annually

For a full breakdown of the six steps in our financial planning process, you can view our previous article on the topic here.

The beauty of financial planning is that it considers every aspect of your finances. It offers a step-by-step guide, helping organise your finances to get you to where you want to be in life.

Typically, the areas covered in a financial plan are:

  • Retirement planning

When planning for the retirement you want, you’ll need to find out how much you need to live your desired lifestyle. Using cashflow modelling, you can see whether your plans are feasible, what options you have available at retirement and how to take your retirement income in a way that ensures you have enough for the rest of your life.

  • Inheritance planning

Planning to protect your wealth also involves maximising the legacy you leave behind. It’s often a difficult topic to discuss, especially with the ones you love most, but preparing your family for a transfer of wealth is a conversation better started sooner rather than later.

  • Tax planning

If you’re a business owner, high earner or expecting to receive a lump sum, you’ll probably have complex tax considerations to face. To make your money mean more, it’s wise to develop a tax planning strategy early.

  • Contingency planning

Understandably, the pandemic prompted 5.8m UK adults to consider life insurance, but still, only 37% (19.5m) has bought or thought about life insurance to date.

It’s never nice to think about the worst thing happening, but it’s crucial you do. So, we plan for the unexpected.

“By failing to prepare, you are preparing to fail” – Benjamin Franklin

Financial planning fees

As with most things in life, financial planning has a cost. If you have ever worked with a financial planner or adviser before, then they might have charged a percentage fee based on the amount you invest.

However, we work differently. We deliver fixed fee financial planning. Instead of charging a percentage of your investments, we charge fixed, flat fees.

We think fixed fee financial planning is fair because the fee you pay is based on the complexity of your situation and the time it takes to formulate your plan, not how much you invest.

Initial service fee

Each financial planning firm is different, but to give you an idea our initial fees can range between £2,000 – £12,000, but typically we charge between £4,000 – £8,000. Because we work on a holistic basis, and each person’s circumstances and requirements can differ, the cost can vary. But once we’ve got a clearer understanding of your financial picture, you will receive a personal proposal explaining the fixed fees for your financial planning service.

Ongoing service fee

Once you’ve received your initial plan, the work doesn’t stop there; they take time to implement and you may need ongoing support to ensure you stay on track to reach your goals.

Most financial planning firms charge an annual fee, which may be payable monthly or quarterly. If the firm charges on a percentage basis, this would be based on the amount of money invested. However, again, our fixed fees depend on the complexity of your financial planning.

Our ongoing financial planning fixed fees can range between £125 – £833 per month, but typically we charge between £333 – £666 per month.

Finding a financial planner

If you are looking for a financial planner, it can be a difficult decision to make. We understand that entrusting your finances to someone else is not a decision to be taken lightly. You want to find a planner that shares your values and who you can trust. For this, we advise you to look around and search until you find someone that’s a good fit for you.

To help you on this quest, we’ve put together a list of questions to ask a financial planner and the ideal answer you’ll want to hear.

If you have any questions or want to discuss your financial plan, please feel free to get in touch with us and speak to one of our financial planners.