Australian wealth management clients are significantly less concerned about hidden fees and costs in their advice relationship than their global counterparts according to new research from consultancy Ernst & Young.
Data out of the 2021 EY Global Wealth Research Report reveals that while 83 per cent of Australian advice clients are aware of “trading and products fees”, 29 per cent remained concerned about hidden costs when working with their adviser.
While the domestic figure is high – EY report “there is still some scope to continue to improve transparency and education locally” – a full 42 per cent of global advice clients registered concern about hidden costs.
The EY report is based on a global survey that involved 2,500 wealth management clients in 21 geographies, including Australia.
Among the other findings, EY report that a large portion of advisers underestimate or misunderstand their client’s preferences around ESG and sustainability concerns.
“76 per cent of Australian respondents have personal sustainability goals, yet 41 per cent feel their wealth manager falls short in understanding their values,” EY states, adding that impact investing is expected to grow 14 per cent among Australian respondents by 2024, reaching an average adoption level of 43 per cent – compared to a global average of 35 per cent.
“Demand for purpose-driven investment is rising, with 72 per cent of Australian respondents believing it is important to consider environmental, social and governance (ESG) parameters in their portfolios,” EY states.
When they discover their fund has charged their super fund hidden intra-fund “advice” fees (for the next 40 years,) without informed consent or annual opt-ins, they might issue a class action for fees for no service.