What Is a Reasonable Fee for Financial Planning in Australia?
What Is a Reasonable Fee for Financial Planning in Australia?
Financial planning fees in Australia vary depending on the complexity of the advice. On average, a comprehensive financial plan may cost between $4,000 and $7,000, while ongoing advice can range from $4,000 to $7,000 annually.
For specific services like retirement planning, estate planning, or investing, fees may be different. It’s important to remember that these fees are often tax-deductible if they relate to the ongoing management of your investments.
While these costs may seem steep, consider the potential savings and benefits that result from strategic planning. A good financial plan can save you thousands in taxes, optimize your investment portfolio, and secure your retirement—making it worth the initial expense.
Case Studies: The Real Value of Financial Advice
1. Growing Family Looking to Build Wealth
A 35-year-old couple purchased their home six years ago for $350,000. With hard work, they have paid off their mortgage, and the property is now worth $700,000. They approached us to help them upgrade their home, given the growing size of their family.
We devised a comprehensive plan that included using the equity from their current home to purchase strategic investment properties. Additionally, we managed their tax obligations to ensure they have the choice to retire at age 50, with over $150,000 per annum of capital available for the foreseeable future. This type of advice is not just about property—it’s about creating a future that allows flexibility and freedom for their family.
2. Establishing a Special Disability Trust
An 80-year-old father came to us with a unique challenge. He has a disabled son and wanted to ensure that his son would be financially protected long after he’s gone. We established a Special Disability Trust, allowing him to place his home into the trust without affecting his Age Pension entitlements. This way, his son will have a roof over his head and protected assets for life. The complexity of these cases highlights the depth of knowledge required to navigate legal and social frameworks for specialised family circumstances.
3. Permanent Disability Payout
We helped a 35-year-old who is permanently disabled due to mental health issues and can no longer work. After years of fighting with super funds and insurance providers, we secured her insurance payout and set up an income stream that does not affect her Disability Support Pension. This required knowledge of both superannuation and disability law—demonstrating that financial advice goes far beyond investments or taxes.
4. Managing a $10 Million Superannuation Fund
A couple in their 70s came to us with over $10 million in superannuation. New legislation now caps super at $3 million before additional tax is payable on unrealized gains. Unsure how this would impact their future, they sought our advice on how to minimize taxes while still ensuring a solid succession plan that keeps their wealth in the family. Our strategies helped them maintain control over their wealth, avoid unnecessary taxes, and plan for their family's financial legacy.
How Much Does Financial Advice Cost in 2024?
The cost of financial advice in Australia in 2024 is rising due to increasing regulatory requirements and the complexity of individual financial situations. The average cost for a comprehensive financial plan remains between $4,000 and $10,000, but ongoing advice is key to adapting to changing circumstances and regulations. While this might seem high, consider it an investment in your future—a well-executed financial strategy can yield returns that far exceed the initial cost.
Is It Worth Paying for a Financial Plan?
Absolutely. When you consider the potential pitfalls of not having a solid financial plan—paying more in taxes than necessary, poor investment choices, or running out of money in retirement—financial planning becomes an essential service. For example, having a financial planner can make the difference between just getting by in retirement or living comfortably with the lifestyle you’ve always dreamed of.
Skyrocketing Fees and Red Tape: Why Is Financial Advice Becoming Unreachable?
Many Australians are concerned that skyrocketing fees and red tape are pushing financial advice out of reach for the average person. However, the complexity of managing wealth, taxes, and retirement has increased significantly, and professional advice is crucial to navigating these challenges. Newcastle Advisors strives to make advice accessible by offering tailored plans based on each individual’s circumstances, ensuring long-term success for our clients.
Financial Advice—It’s About More Than Just Fees
Yes, financial advice can feel expensive, but when you look at the value it brings in securing your financial future, the cost becomes a worthwhile investment. From growing wealth to protecting assets for loved ones, financial planners offer tailored advice that provides peace of mind. With the right financial advisor, the fees you pay today could mean avoiding costly mistakes and maximizing wealth for the future.
If you're wondering whether financial advice is worth the cost—consider the real-life scenarios above and ask yourself: What price would you put on financial security and the peace of mind that comes with it?