It’s easy to put off your investment review, but with our handy framework you can quickly understand the portfolio performance and service value you are getting.
Most of us have switched banks many times in our lives. Some of us will even do it every six months to chase the latest deal. But far fewer of us ever switch wealth manager, whether it be a financial advisor, private bank or investment manager.
‘It takes too long.’ ‘It’s a hassle.’ ‘I’ve known my advisor for years.’ You might have any of these reasons for staying put, but if your wealth manager isn’t the right fit for you and your portfolio is underperforming, not taking action could prove costly.
If you don’t think changing is right for you, ask yourself how you really feel about your current wealth manager:
Our business has been developed to help you navigate the industry and streamline the search and compare process. There’s no need for hours of research, as the hard work has been done for you. With over 30 wealth manager partners in the UK, our service is fast, free, and completely independent. Within minutes, we can match you with up to three firms and encourage them to compete for your business, ensuring transparent communication, realistic planning and optimal performance.
Confusing, hidden, mysterious, expensive … these are all words that could describe investors’ feelings towards wealth management fees. The City watchdog launched a crackdown in 2012, which improved transparency, but there is still a way to go.
Headline fees quoted by independent financial advisors, wealth managers and private banks may not include everything you pay. Things such as transaction costs, custody fees and platform fees can come as unpleasant surprises.
There may also be ongoing charges for third party funds in your portfolio, and if your IFA outsources your investments to a discretionary wealth manager, this could add a layer of charges.
New EU regulations slated for 2017 will force wealth managers to break down their charges more clearly. This is good news for consumers, but it will also shine the spotlight on the huge disparities in fees across the marketplace.
Of course, you would expect to pay more for a bespoke service, and active management, than ‘doing it yourself’, but ‘doing it yourself’ can actually be a false economy, and more expensive. That said, you should understand what you are paying for, as some estimates suggest that up to 70% of an investor’s real return can be swallowed up by charges.*
Let’s look at an example. Imagine client A pays their wealth manager an annual fee of 2.5% on an investment portfolio worth £1m, while client B pays 1%. Over 10 years, client A will shell out £364,335 for their advisor’s management fee alone, while client B will pay £155,752**. What seems like a minor difference in fees can really add up over the long term. Ask your advisor what their Total Expense Ratio (TER) is – anything above 1.7% is on the high side.
Users of findaWEALTHMANAGER.com can save an average of £15,000 every year in fees, based on a £2m portfolio1. You worked hard to build your wealth, and your wealth should work hard for you. What’s standing between you and financial freedom?
If you’re ready to make a change and want to see how much you can save, try our smart online tool to find your ideal wealth manager HERE.
1Estimated average saving for FWM clients with £2m invested through a retail fund, or an IFA.