My financial planner charges 1% — is that fair?

General advice only · AFSL 222640 · Global Mutual Funds Pty Ltd

The direct answer

Convert the percentage into dollars first. 1% of $300,000 is $3,000 a year; 1% of $1.5 million is $15,000 a year — for broadly similar work. A fee is fair when the service you actually receive (reviews, strategy changes, tax and super coordination) justifies the dollar figure. Many advisers now offer flat fees; ask for both options and compare.

What it depends on

The full answer depends on your specific circumstances. Here’s what matters.

The dollar amount, not the percentage

Percentage fees grow as your balance grows, even if the work does not. Your annual Fee Disclosure Statement must show the fees you paid and the services you were entitled to and received — use it to calculate your real cost.

What the fee includes

Some fees cover only an annual review; others include tax coordination, cash-flow planning and ad-hoc advice. Platform, investment management and insurance costs are often charged on top — ask for the all-in cost.

Your consent

Ongoing fee arrangements must be renewed with your written consent annually under current rules. If you did not actively agree, or no longer value the service, you can decline to renew.

The last 10%

What a qualified professional can add

The answer above covers the general position. Here’s where professional judgement — applied to YOUR specific situation — makes the difference.

Explaining the total cost of your advice, platform and investments in one dollar figure
Restructuring the service to match what you actually use (for example, moving to a flat or project fee)
Delivering strategic value — tax, super contribution and structuring decisions — that can outweigh the fee

Questions to ask before you engage one

If you decide to engage a professional, these questions help you evaluate whether they’re right for your situation.

What did I pay in total dollars last year, including platform and investment fees?

Would you offer a flat fee instead of a percentage, and what would it be?

What specific services did I receive last year for the ongoing fee?

Do you receive any other payments linked to my account?

Your next step

Find your latest Fee Disclosure Statement, add up every fee in dollars, and list what you actually received. Then ask your adviser whether a flat-fee arrangement would suit you better.

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