Advisers shouldn’t view higher fees on client reviews as overcharging as long as they are delivering the appropriate level of value according to fintech provider and former adviser Plutosoft business development lead Vincent Holland.
Speaking on a webinar hosted by XY Adviser, Holland pointed to the ethical principle around value for money.
“If your service is providing a lot of value for the client then there is scope to charge more because you’re going to have more satisfied clients.”
Holland was a financial adviser and lawyer for Forty Seven Group before becoming a business development lead for Plutosoft.
As an adviser, he discovered the review process was working well when he could start to tell straight away he was providing a high-quality service based on the interactions from the client.
“It’s not about overcharging, but you need to charge for the value that you’re adding. If you are adding value clients will be willing to pay for it. High quality advice is not cheap. But then again, I don’t think any professional advice is cheap.”
Numbers game
Holland said offering an equal number of reviews to different clients depends on the type of market being targeted.
“I am aware of firms who will have quarterly reviews or just once a year. It depends on types of clients you’re servicing.”
For some client demographics, Holland said, an annual review is perfectly fine and most clients often don’t want to see their adviser more than once a year.
“Some clients are more high touch and expect more contact points. I don’t think there’s a right or wrong there. What you want to focus on is your pricing structure and making sure if you are doing multiple reviews per year that the charging is right for the time and cost that you’re putting into it.”
Showing value
Business Health founder Terry Bell described the client review process as the most important of all interactions an adviser has with their clients.
“It’s frustrating, because the progress to plan meeting is perhaps the only time during the year that the adviser is in complete control,” he said in 2020 regarding findings of the Future Ready report.
“It’s the perfect time to demonstrate the value they’re providing. Our client survey results tell us that the better (as defined by the client) the review experience, the higher the level of overall client satisfaction.”
In the firm’s most recent Future Ready report it found 44 per cent of businesses with a defined review process hold them annually, 39 per cent hold them bi-annually and 15 per cent hold quarterly reviews.
Some 80 per cent of reviews last between one to two hours.
