I, and most other business owners I know, surround ourselves with a team to help us with everything.
We can’t make a decision without running it past our business coach. Can’t do a set in the gym without filming it for our PT. And the most common question in all my WhatsApp groups is “does anyone know an expert in…?”
Yet when it comes to getting help with the money we’ve worked so hard to make, there’s intense scepticism.
“They’ll just tell you to put your money in expensive funds and charge you for it – I can buy index funds for free.”
I’ve said much the same thing myself. But recently I’ve started to see the absurdity of happily paying for help with almost everything else, then dismissing financial advice altogether.
What job are you hiring for?
If the measure of a financial advisor is their ability to make genius investments that beat the market, you’re likely to be disappointed. They will, most of the time, be putting you into funds you could have bought on your own without paying an advisor.
But is “identify market-beating investments” really the job you’re hiring for? If you put that aside, I’d say there’s still a valuable role that:
- Gets you set up in the right way, with a solid plan
- Helps you with cashflow modelling around inflection points, like school fees or giving up work
- Stops you from doing anything too stupid
- Gives you permission to focus on other things, knowing that this part of your life is under control
It’s a blend of advisor, coach and accountability partner – and when I think of it like that, it’s something I’d love someone to take on for me.
My objection is to how it’s paid for.
The old version of the complaint – that advisors get paid by fund managers to push expensive products – was largely addressed in the UK at the end of 2012, when commission was banned on new advised retail investments. Advisors now have to charge clients directly for that advice.
The problem is that a percentage fee creates a conflict of its own.
Fees create the wrong incentives
The average ongoing fee charged by UK advisors is 0.83% of assets, according to NextWealth’s 2026 benchmarking research. So on assets of £1m, that rate would mean paying £8,300 per year.
£8,300 isn’t necessarily a bad deal if it keeps you on track, frees up headspace for other parts of your life, and stops you from doing anything daft. But I think calculating that fee as a percentage can cause two major problems.
The first problem is that the percentage is based on the amount of assets the advisor advises on. So if the client sees an incredible opportunity to reinvest into their business – or wants to diversify into an asset like property that’s outside the advisor’s remit – moving that money reduces the advisor’s future fees.
An advisor can sincerely want the best for you and still find it easier to recommend the option that preserves their income. I find it hard to believe that the structure doesn’t shape their view of the world enough to make a difference.
The second problem is that the structure can produce such a large fee that an advisor might feel pressure to justify it with work that’s unnecessary – or even counter-productive.
Take a client with £5 million invested. At that same 0.83%, they’d be paying £41,500 per year.
Once you’ve set everything up, long periods can pass without your investments needing much changing. But both the advisor and the client might feel that an email saying “all good, nothing to change this year” doesn’t justify a £41,500 invoice.
That creates a temptation to go looking for complex structures and writing 100-page reports to demonstrate how much work is being done. At best, it could introduce unnecessary complexity that’s unlikely to move the needle. At worst, it could reduce returns and make the client feel less confident and in control.
A better way
A fixed fee doesn’t remove every bad incentive, but it removes the direct financial penalty for an advisor recommending that you move money elsewhere.
I think of it like the relationship I have with my accountant. He charges a fixed annual fee. For that, I meet him a couple of times a year, we make sure we’re on track and not missing anything obvious, and the rest of the time I have permission not to think about tax and compliance at all. When a bigger piece of work comes up – like a restructure or a sale – we agree a separate fee for that job, and then go back to normal.
What he doesn’t do is charge me a percentage of the tax I pay or save. If he did, I’d start wondering whether every idea he suggested was for my benefit or his.
So that’s the arrangement I’ll be exploring for financial advice: an agreed annual fee for a clear scope of work, with bigger jobs priced separately.
The advisor would get paid the same whether I kept money in my portfolio or put it into my business. And the fee would be agreed around the help I needed, without automatically growing with the value of my investments.
There’s still the risk with any retainer that once the fee is banked, there’s a temptation to do the minimum. That’s a problem I already manage with other professionals I pay – by staying engaged and making sure I’m getting value. A review that ends up concluding “nothing needs changing” is far from lazy or disappointing if I understand why, and it gives me the confidence to keep executing the plan.
Which brings me back to that WhatsApp group. I happily pay a business coach for their time and judgement, and I’ve come to see how strange it is that I’ve written off the same kind of support with something as important as finances. Even my ego can accept that this is something worth getting help with.