Citywire printed articles sponsored by:
View the article online at http://citywire.co.uk/new-model-adviser/article/a657977
Allianz GI: only 7% of consumers will pay £100 for advice
by Michelle Abrego on Feb 11, 2013 at 10:57
There is a huge mismatch between the amount advisers are planning to charge in the retail distribution review (RDR) world and how much clients are willing to pay, according to fund group Allianz Global Investors.
A survey by the provider found that 86% of advisers planned to charge between £100 and £200 an hour for advice, but that only 7% of clients surveyed would be willing to pay this much.
One in four clients would be prepared to pay up to £50 per hour for advice, but only 7% of adviser would be prepared to work for this rate.
Allianz GI surveyed 200 adults aged between 50 and 70 year old and 166 financial advisers.
A further 21% of consumers would be willing to pay between £50 and £100 an hour but again just 7% of advisers would be willing to work for this rate.
The survey also found that 32% of consumers surveyed would not be prepared to pay for advice at all.
Nick Smith (pictured), Allianz GI head of retail sales, said the survey results were concerning.
‘In the run up to the RDR there was a lot of speculation about an ‘advice gap’ - in other words, a discrepancy between what investors are willing to pay for advice, and what advisers are willing to work for. As the dust starts to settle, our research points to a really significant mismatch in expectations.’
News sponsored by:
Today's top headlines
iShares: Time to shatter the ETF myths
As result of industry changes - the retail distribution review - and a growing focus on cost-efficient solutions, we anticipate the number of investors using ETFs will rise significantly over the coming years.
But as with any newer product, especially in the financial world, various misconceptions about ETFs have perpetuated over the years and iShares is committed to addressing and ultimately dispelling these.
More about this article:
More from us
- Allianz GI to launch first UK infrastructure debt fund
- Lords take aim at FSA over RDR advice gap
- Where bulls and bears will roam: top tips on investing in 2013
- Why Barclays thinks IFAs will survive the RDR …for now