Could coronavirus change the way advisers charge clients?

Models under scrutiny

clock • 6 min read

Dramatic market dips resulting from the global pandemic have seen some advice firms' revenue streams take massive hits, putting pressure on the assets under management (AUM) model. And, like in any time of crisis, advisers are questioning whether their approach is best and some are exploring different possibilities. Claire Tyrrell spoke to several advisers about their charging structures and their view on fixed fees versus percentage-based models.

Capital Asset Management IFA and chief executive Alan Smith has operated his Chartered firm on a fixed fee basis for the past five and a half years after changing from a percentage of AUM model. Smith recently spoke to some advisers who were looking to make the same shift in light of current market conditions: "I think [change] was happening anyway. On one hand firms' revenue is really under pressure right now, and secondly they're stuck at home - I'm hoping people will have more time on their hands to reflect on their current business model." He points to the fact that many advisers ...

To continue reading this article...

Join Professional Adviser

  • Unlimited access to real-time news, industry insights and market intelligence.
  • Stay ahead of the curve with spotlights on emerging trends and technologies
  • Receive breaking news stories straight to your inbox in the daily newsletters.
  • Make smart business decisions with the latest developments in regulation, investing retirement and protection.
  • Members-only access to the editor’s weekly Friday commentary
  • 
 Be the first to hear about our events and awards programmes.

Join

 

Already a Professional Adviser member?

Login

More on Your profession

Advice/guidance review may trigger regulatory framework overhaul

Advice/guidance review may trigger regulatory framework overhaul

The advice/guidance boundary review is centred on four key consumer harms

Sahar Nazir
clock 22 September 2023 • 1 min read
Firms told they are 'too focused' on numbers rather than services

Firms told they are 'too focused' on numbers rather than services

Industry experts gathered to discuss challenges posed by Consumer Duty

Sahar Nazir
clock 22 September 2023 • 2 min read
FE Fundinfo buys French firm to boost distribution channel

FE Fundinfo buys French firm to boost distribution channel

The firm acquires Adjuto to ‘further strengthen its reliable status’

Sahar Nazir
clock 20 September 2023 • 1 min read